Name: Pilar mine.

Location: The Pilar operations are located in the state of Goiás, in the central region of Brazil.

Holding and Controlling Company: Brio Gold.

Brief Description: The Pilar property is divided into 14 exploration permits. It has three exploration claims covering an area of about 174.76 km and six mining concessions covering an area of 58.55 km.

The Pilar complex comprises the underground Pilar and Maria Lázara mines, the past-producing Caiamar mine and the Três Buracos deposits.

Brief History: Mining started in the first half of the eighteenth century at the region of Pilar de Goiás. It is believed that metal was extracted by slaves living in Quilombo de Papuã (original name of Pilar de Goiás) prior to an expedition led by João Godói P Silveira in 1741. The area was occupied by ‘garimpeiros’ (artisanal miners) from the 1740s to 1820s, with more than 5 000 people working on the site, half of whom were slaves.

Mineradora Montita (Montita) started exploration in the region in 1972.

Mineración Colorado (Colorado), a subsidiary of Utah Mines Group, signed an agreement with Montita in 1981 and started an exploration programme in the area, which ended in 1982. Colorado was acquired by Mineração Marex, property of the Australian Broken Hill. After several unsuccessful attempts to implement legal proceedings to eradicate activities of the garimpeiros; they left the project area in 1984.

In 1989, Montita signed a joint venture agreement with Mineradora Serra do Sul (Serrasul), owned by Canadian International Nickel Company (INCO), and together they formed the Companhia Nacional de Mineração (CNM). Serrasul withdrew from the project in 1990, owing to a lack of capital funding from CNM and financial turmoil at INCO.

Montita started its exploration campaign in 1995 and drilled about 10 000 m in the area, with only 5 000 m targeted at gold prospects. Montita reached an agreement in 2016 with Yamana to explore the area for three years, following which Yamana bought the project.

Yamana initiated activities from August 2006, focusing on new geological field mapping and, in October 2009, an exploration ramp was initiated to support a feasibility study on Jordino, part of the Pilar deposit. The underground exploration programme at the Pilar deposit was completed in May 2010 and mine development began later that year. Processing plant production began in June 2013 and the first gold was poured in July 2013. Commercial production began in October 2014.

Products: Gold.

Geology/Mineralisation: The Pilar property covers the Guarinos and Pilar greenstone belts and a portion of the Moquém gneissic complex. The Guarinos greenstone belt is represented by a succession of basic rocks, mostly basalt and amphibolite, and by meta- sedimentary layers, related to interflow sedimentary events. Chlorite-quartz-garnet-schist is also present.

The main structure is the Carroça shear zone, a reverse-dextral major shear zone, parallel to the main regional foliation with several kilometres of strike length. The shear zone has a mylonitic fabric and an associated 400-m-wide hydrothermal alteration zone.
The Pilar greenstone belt comprises a thick sequence of ultra- mafic and mafic flows, sedimentary rocks, and felsic volcanic rocks. The ultramafic-mafic sequence occurs predominantly at the central and eastern parts of the belt, while the sedimentary sequence is restricted to the western portion of the belt.

Reserves: Total proven and probable reserves as at December 31, 2016, were estimated at 8.58-million tonnes, grading 1.63 g/t gold.

Resources: Total indicated resources as at December 31, 2016, were estimated at 8.23-million tonnes, grading 2.66 g/t gold.

Total inferred resources as at December 31, 2016, were esti- mated at 14.47-million tonnes, grading 3.50 g/t gold.

Mining Method: The Pilar mine uses custom step room-and- pillar mining method for about 80% of its production. This is supplemented by traditional longhole stopping.

At the Maria Lázara mine, ore is extracted using traditional longhole sublevel open stoping.

Major Infrastructure and Equipment: The Pilar mine includes mine workings and equipment, a 3 500 t/d processing plant, tailings storage and supporting facilities.

Water is sourced from the Vermelho river and electricity from the 11 MW of power available from the Itapaci power station.

Prospects: Development at the Pilar mine and the acquisition of low-profile equipment (fan drill and dozers) to improve the mining method and reduce dilution to better grade and production are being accelerated.

Pilar’s all-in sustaining costs are expected to increase in 2018 as Brio Gold starts development of the lower-cost openpit Três Buracos deposits, which is expected to contribute to production in 2019. Therefore, higher production with lower costs is expected.

Contact: Brio Gold investor relations.

Contact Details:
Brio Gold,
tel +1 416 860 6310,
email info@briogoldinc.com , and
website http://briogoldinc.com.