Project Summary

The Minto Mine is a high grade copper-gold mine that commenced commercial production on October 1, 2007. The mine is located 240km north of Whitehorse, Canada, and is owned 100% by Minto Explorations Ltd., a wholly owned subsidiary of Capstone Mining Corp.

Capstone acquired Minto Explorations and all other project interests, including a partially constructed but dormant construction site, in June 2005. Within two years from acquisition, Capstone re-drilled the mineral resources to mineral reserve standards, completed a bankable feasibility study, arranged project financing, built a new mine and reached commercial production. In the two years since then, the mine has been expanded twice, increasing throughput by more than 100%, and discovered five new deposits.

The Minto Mine is an open pit mining operation with conventional crushing, grinding, and flotation to produce copper concentrates with significant gold and silver credits. Concentrates are exported via the Port of Skagway, Alaska, to smelters in Asia for treatment and sale. In December 2007, the results of an independent pre-feasibility study for the expansion of the Minto copper-gold mine were released. This study increased mineral reserves and laid out a path for significantly increased copper production, which recommendations have now been implemented, enhancing project economics.

 

In addition to the current reserves, significant exploration upside exists on the Minto property. Aggressive exploration programs conducted by Capstone have met with considerable success, with the 2006 and 2007 exploration drill programs resulting in a 140% gain in copper contained in mineral resources. That success continued in 2008-2009, with conversion of a significant portion of the new mineral resources from the inferred to measured and indicated categories. This was topped off in 2009 with the discovery of a new high grade deposit. In total, there have been six new high grade copper gold discoveries in little more than three years of exploration conducted by Capstone, since it took over the project.

In December 2009, a new pre-feasibility study was released, which incorporated the results of some of the exploration successes in 2006-2009 and work continues to further optimize the production scenarios.

 

In August 2010 Capstone announced the results of NI 43-101 compliant mineral resource estimates for four separate undeveloped deposits at 0.5% CCOG the total pounds in resources outside of the main pit now stands at 825 million pounds of copper.

 

And updated pre-feasibility study is currently underway.

http://capstonemining.com/i/pdf/2009-12-15_MintoPhaseIVPFSTechReport_01.pdf

Overview

Technical Report, December 2009

 Project Overview

The Minto Mine is an operating high-grade, open pit copper-gold mine located in the Whitehorse Mining Division, Yukon Territory, Canada, about 240km northwest of Whitehorse. Capstone Mining Corp., through its subsidiary, Minto Explorations Ltd., has a 100% interest in the Minto Mine.

Access to Minto is via the Klondike highway to Minto Landing, where boat, barge or ice-bridge gives access across the Yukon River to the head of an all-weather road that leads to the mine site.

Project highlights include:

• Seven new discoveries in just over three years, including Area 2, Area 118, Ridgetop, Copper Keel, Minto North. Minto East and Wildfire.
• Production in 2008 totaled 53,148 dmt of copper concentrate containing 46.1 million pounds of payable copper at an estimated total cash cost* of $1.15 per pound, net of byproduct credits and treatment and selling costs
• Production in 2009 totaled 59,863 dmt of copper concentrate averaging 40.7% copper; and produced 51.9 million pounds of payable copper at a total cash cost of US$1.12 per pound.
• Ramped up to Phase 3 design capacity of 3,200 tonnes per day (from 1,563 tonnes per day).
• The Phase IV Pre-feasibility Study ("PFS") and technical report released December 2009 included the following highlights:
  • Focused on shallow, open pittable mineral resources for mining.
  • Proposed increased mill throughput to 1.37 million tonnes per year.
  • Production to average 45 million lb/yr copper production over 8 years.
  • Total cash cost average US$1.34/lb of payable copper.
  • Option to add high-grade underground feed to increase production and/or reduce costs.
• Capstone is targeting production of 40-43 million pounds of copper in 2010 at a total cash cost* of US$1.30 to $1.40 per pound of payable copper from its Minto Mine.
• Off-take agreement with attractive terms for the sale of concentrates in place through 2013.
• Connected to grid power in November 2008 resulting in a significant reduction of diesel consumption and costs and green house gas emissions.

* This is a non-GAAP performance measure and readers should refer to notes on non-GAAP performance measures on page 12 of the Company's management discussion and analysis for the three month period ended March 31, 2009 as filed on Sedar for further details.

Operating Results
Key operating statistics⁽²⁾ for the Minto Mine are presented below:

(2) Gold is not assayed on site, resulting in a significant lag in receiving this data.
(3) Adjustments based on final settlements will be made in future periods.
(4) Minto's operating costs are adjusted to exclude mining of ore and waste not related to concentrate produced in the period, these costs are capitalized or inventoried in the financial statements, then expensed when the associated ore is processed.
(5) Some totals will not sum, due to adjustments on final settlements on copper sales during the year. These adjustments are only reflected in the year to date column. 

 

Production

The mine plan for the Minto deposits focuses on accessing and milling the high-grade ore first, with lower grade material sent to stockpiles for blending and processing later in the mine life. In 2009, Minto Explorations commissioned a gravity gold recovery plant in the grinding circuit in order to recover free gold that is present, however no benefit from this optimization has been assumed in the production forecast since the benefits of this has to be demonstrated through production.

In order to assess the possible opportunity for larger scale open pits and their potential impact on future permitting requirements, a preliminary study was conducted where an optimistic copper price and lower operating costs were used to understand these potential pit limits. Although the large scale pits provide the potential for more tonnage through the mill (due to the lower operating costs and higher copper prices assumed), they do so at a reduced copper grades and also would require significant increases in waste dump capacities, as well as tailings storage requirements. It should be noted that this large open pit scenario is preliminary in nature and only serves as a rough indication of potential pit size.

Minto Explorations will be seeking amendments to its current operating permits from the Yukon government in order to increase production and expand mining operations into the newly identified ore deposits (Area II, Area 118, Ridgetop, Minto North and Minto East).

 

 

*Totals may not add exactly due to rounding 

 

*Totals may not add due to rounding
**M&I = Measured and Indicated

The mineral resources are reported at a 0.5% copper cut-off for all deposits and the mineral reserves are reported at a 0.62%, 0.55%, 0.58% and 0.56% copper cut-off grade (CCOG) for Minto Main, Minto North, Ridgetop and Area 2/118 respectively.

Click HERE for the News Release 2009 Year-End Reserve & Resource Estimates and Methodology.

 

Classification	Tonnes (000's)*	Copper (%)	Gold (g/t)	Silver (g/t)	Contained Cu (000s lbs)*	Contained Gold (000s oz)*	Contained Silver (000s oz)*
Measured (M)	10,417	1.39%	0.56	4.6	319,078	188	1,557
Indicated (I)	23,944	0.96%	0.32	3.4	506,014	247	2,594
Sub-total (M+I)**	34,362	1.09%	0.39	3.8	825,091	435	4,150
Additional Inferred	6,504	0.90%	0.30	3.1	129,606	63	642

*Rounded to nearest thousand **Totals may not add exactly due to rounding

Click HERE for the News Release 2010 Mineral Resource Estimates and Methodology

Resource Expansion

 

In 2006, Capstone geologists identified a possible extension to the Minto Main deposit, 130m south of the pit currently under development. An aggressive drill program in 2006 resulted in the discovery and definition of a significant new mineral resource called Area 2. Within 20 months from discovery, Area 2 was converted into a mineral reserve that supported a 45% increase in mill throughput and a 43% increase in total project copper and gold production.

During 2007, significant new copper-gold mineralization was discovered in the southwest corner of Area 2, Area 118, Ridgetop, Gap, Copper Keel S. and Airstrip SW. New mineral resource estimates were completed for the Area 118 and the Ridgetop deposits, while mineral resource estimates for the Main Minto and Area 2 deposits were updated to incorporate the results of 101 new holes drilled across these four deposits in 2007. Contained copper in mineral resources increased by 50% and precious metals by approximately 40% as a result of drilling in 2007. This follows on from a 60% gain in contained copper in mineral resources based on drilling in 2006, for a 140% gain in copper resources in two years.

2008 in-fill drill programs were undertaken at the Area 118 and Ridgetop deposits to upgrade the confidence level in these areas. Area 2 and Area 118 are now recognized as the same deposit, with the former being thrust partially over the latter on a series of thrust faults. A new mineral resource estimate based upon drilling in 2008 and 2009 for the combined Area 2 / Area 118 deposit was announced in June 2009. Also in 2008, step out drilling at Ridgetop discovered a previously unknown high grade extension. A new estimate for Ridgetop was also reported in June 2009. The potential for expanded production based on increased resources is being addressed by a Phase IV expansion study to be completed in late 2009. Capstone is also planning to evaluate the resource potential at cut-offs below 0.5% copper, to determine the overall potential of this mineralized system and to gauge expanded bulk mining scenarios.

Exploration in 2009 got off to a great start with another very high grade copper-gold discovery, Minto North, located just 600m north of the Minto open pit. Minto North has now been drilled to sufficient standards to support an indicated and inferred mineral resource and infill drilling in June and July 2009 was targeted to boost confidence level to support measured and indicted standards throughout. Also in 2009 extensive infill drilling was completed at Ridgetop where favorable results in 2008 indicated a high grade region were followed up and a second high grade region was recognized in 2009. Late in 2009, a sixth discovery was made at Minto East, a relatively deeper, high grade mineral resource lying immediately east of the Minto Main pit.

The December 2009 pre-feasibility study describes the potential for supplemental mill feed from undergrounds sources. Potential to convert some of the deeper mineral reserves in the Area 2 pit in conjunction with mining lateral extensions of this higher grade mineralization by underground methods provided the impetus to begin the evaluation of this option. 

In August 2010 the NI 43-101 compliant mineral resource estimate for four separate undeveloped deposits  including Area 2/118, Ridgetop, Minto North and Minto East announced that at a 0.5% CCOG the total pounds in resources outside of the Main pit now stands at 825 million pounds of copper.

 

Processing

The process facility built at the Minto Mine utilizes a conventional circuit comprised of a crusher, SAG and ball mills for grinding, and flotation to produce concentrates that are filtered and stockpiled in a storage facility for later shipping to the port of Skagway, Alaska, for export overseas. A filtered tailings system is being used to mitigate reclamation costs by allowing dry stacking of tailings.

The Minto concentrator initiated production ahead of schedule in May 2007 with a design daily production rate of 1,563 tonnes per day. A Phase II mill expansion was completed in mid-December 2007, six months ahead of schedule, increasing throughput to 2,400 tonnes per day. Commissioning was completed in February 2008 and ramp up to full Phase II production capacity was completed in mid-March 2008. The plant throughput was subsequently increased to 3,200 tonnes per operating day in 2009 through improvements the process plant, the Phase III expansion.

A Pre-feasibility Study (completed in December 2007) incorporated the economic potential of the Area 2 deposit and laid out the basis for a Phase III mill expansion to a nominal (before allowances for availability and maintenance) 3,500 tonnes per day. Exploration subsequent to the resource estimates used in the PFS suggests additional potential beyond that laid out in the PFS. A new PFS completed in December 2009 focused on mining the near surface mineralization and increasing mill throughput to a nominal 4,100 tonnes per day. The study also considered the option of adding a high-grade underground feed to increase production and/or reduce costs.

 

Metallurgical Information

Metallurgical programs undertaken indicate recoveries from the Main Minto deposit averaging approximately 93-94% for copper, 74% for gold and 85% for silver. The Main Minto deposit produces a high grade concentrate, averaging approximately 40% copper, 10g/t gold and 150g/t silver. The concentrates are free of any penalty level elements.

By using a coarser grind, a mill expansion from 2,400 to 3,200 nominal tonnes per day was achieved in 2009.

Test work on Area 2 at the coarser primary grind and regrind, resulted in copper recoveries of between 90% and 94%, averaging 92%, with the exception of the P Zone. Gold recovery at the coarser primary grind was lower at an average of 64% than the standard Minto grind, or about 11% lower. On average, the copper concentrate grade was about 3% higher at 41.3% copper at the coarser primary grind with regrind in comparison to the standard Minto primary grind. Silver recovery averaged 81%, lower than the Minto Main deposit. The concentrates are forecast to be free of any penalty level elements.

Additional metallurgical work carried out for the Ridgetop and Minto North deposits indicates similar metallurgical responses to those encountered with the Minto Main and Area 2 deposit, except the upper zone at Ridgetop, which has some partially oxidized sulphide minerals that result in slightly lower recoveries.

 

Price Protection/Hedging 

Click here to view the full report.

December 2007 Area 2 Pre-feasibility Study

Click here for full Pre-feasibility Study Highlights

A Pre-feasibility Study ("PFS") completed in December 2007 laid out a path for significantly increased copper production and enhanced project economics, based solely on the drilling completed up to that time. The PFS looked at the economic potential of the Area 2 deposit, and incorporated several other concurrent Minto Project improvements that were identified post the August 2006 Feasibility Study, including the implementation of a coarser grind flotation feed. The PFS estimates a 45% increase in mill throughput, from 2,400 tonnes per day to 3,500 tonnes per day, and a 43% increase in total project copper and gold production with increased copper and gold production.

The PFS represents an interim update on the Minto Project with mineral resource estimates as of the end of 2006 and costs as of the end of 2007. However, continued exploration success in 2007, 2008 and 2009, which could result in further reserve increases beyond those outlined in the PFS, and other optimization opportunities, suggest that additional value remains to be extracted from the Minto Project and Capstone will continue to pursue the crystallization of these value opportunities. Based on the results of this study, Minto Explorations ("MintoEx") will be seeking amendments to its current operating permits from the Yukon government in order to increase production and modify operating parameters to accommodate these and other proposed operational improvements.

 

June 2008 Technical Report

The complete technical report on the Phase IV PFS was filed in December 2009.
Click here to view December 2009 Technical Report

As part of its on-going process of optimizing production from the Minto Mine, in the June 2008 technical report, Capstone rescheduled mining of the open pit in order to bring high grade copper-gold production forward from 2010 into 2009 and the latter part of 2008. The results of this were published in a Technical Report ("TR") completed in June 2008. This rescheduling results in similar production in 2008 to that previously forecast in the PFS (approximately 55 million pounds of copper) but increased production in 2009 and reduced production in 2010 versus what was outlined in the PFS. Minto Explorations is seeking amendments to its current operating permits from the Yukon government in order to increase production and expand mining operations into the newly identified ore deposits (Area II, Area 118, Ridgetop, and Minto North). In addition, Capstone will include the installation of a gravity gold recovery plant in the grinding circuit in order to recover free gold that is present, however no benefit from this optimization has been assumed in the production forecast since the benefits of this will have to be demonstrated through production.

 

December 2009 Phase IV Expansion Pre-feasibility Study

Capstone reported the results of the Phase IV Pre-feasibility Study ("Phase IV PFS") for the expansion of the Minto Mine on December 15, 2009. This study details the basis of ramp up in mill throughput to a nominal 4,100 tonnes per day ("tpd") throughput and 91.3% availability, resulting in 1.37 million tonnes per year processed in an optimised mill, with ore to be extracted from new mineralized areas discovered since 2006. The Phase IV PFS results in a total of 366 million pounds of copper in concentrate produced over an eight year mine life, commencing January 2010. Permit amendments are required for production in 2012 and beyond.

Brief highlights of the Phase IV PFS are summarized below, while additional detail follows:

• Increase in mill throughput to 4,100 tonnes per operating day, resulting in a sustained 1.37 million tonnes of ore per year (3,750tpd after allowances for maintenance and availability);
• Proven and probable mineral reserves increased to 10.9 million tonnes grading 1.64% copper, 0.64 g/t gold, and 5.9 g/t silver, for a contained 395 million lbs of copper, 224,000 oz of gold, and 2.0 million oz of silver;
• Mine life extended to 2018 with an average of 45 million pounds of copper production per year, with additional upside opportunities identified, as discussed below;
• Life-of-mine capital cost of C$48.2 million, primarily based on an assumption of conversion to self mining, which decision will be subject to a cost-benefit analysis vs. remaining with contract mining;
• Life-of-mine cash costs of US$1.34/lb of copper, after by-product credits (with gold at US$300/oz and silver at US$3.90/oz, as per the agreement with Silver Wheaton);
• Net present value, at a constant US$2.25/lb copper price for unhedged production and a 7.5% discount rate, of C$199 million before tax and C$160 million after tax, which amounts increase to C$291 million before tax and C$218 million after tax at a flat US$2.60/lb copper price for unhedged production, and to C$395 million before tax and C$281 million after tax at a flat US$3.00/lb copper price for unhedged production;
• Important opportunities identified for incremental higher grade production relatively early in the mine life from underground mineral resources not within the current Phase IV pits or the current mineral reserve.

The Phase IV PFS also discusses two possible options for further increases in production and/or increases in mine life and mineral reserves: (1) a possible further increase in mill capacity to 7,500 tpd of throughput, focused on open pit mining of mineral resources outside of the current proposed open pits, and (2) the possible development of a 1,000-2,000 tpd underground mine to provide higher grade feed relatively earlier in the mine life than an expanded open pit operation. On preliminary analysis, the underground option appears to have a more attractive investment profile. As a result, the underground option is being prioritized in 2010, offering the potential for higher production and/or lower costs than those outlined in the Phase IV PFS.

Project Risks & Opportunities

 

1. Timing and approval of permit revisions, which could delay access to new mining areas if not granted in time to allow stripping of Minto North in 2012;
2. Exchange rates, metal prices and external influences;
3. Grade control, given the relatively narrower mineralized horizons in the Phase IV pits as compared to the Minto Main pit.

The most important opportunities to improve the project are:

1. Optimization of mine plan to smooth out the production profile and optimize stripping;
2. Underground production potential, bringing currently defined ex-pit high grade feed to the mill relatively early in the mine life. A conceptual level review was completed that involves underground extraction of higher grade ore, eliminating the need for further plant expansions and allowing processing of higher grade ore sooner than in an expanded open pit scenario:
3. Conversion of current inferred mineral resources within existing Phase IV pit outlines to higher classifications, increasing the mineral reserve and reducing strip ratios:
4. Conversion of current higher grade inferred mineral resources outside the existing Phase IV pit outlines to higher classifications, possibly resulting in increased mineral reserves; and
5. Discovery of new mineral resources and mineral reserves.

Underground Mining Opportunity

As part of the review of the mineral resources for the Phase IV PFS, options for extracting deeper portions of the resources that remain outside of the open pit limits were examined. One consideration was the potential for underground extraction of mineral resources, particularly in the Area 2/118 areas, and the potential of other deeper, but higher grade discoveries such as Minto East and Copper Keel.

Click HERE for Minto Phase IV Pre-feasibility Technical Report, December 15, 2009.

Based on geologic and geotechnical information, mining conditions in these areas appear to be good and may be able to support high extraction, relatively low cost, room and pillar mining. In order to access both the Area 2 and Area 118 mineralization, a 1,650m long, 5m by 5m decline at -15% has been considered, with additional development required to access mineralization and provide ventilation, with capital costs for such development estimated at C$11.3 million (which includes leased underground equipment, along with required infrastructure). Should the underground mining potential of the Area 2/118 (and possibly the Minto East) zones be shown to be favourable, it is estimated that an additional $8-10 million would be required to purchase mining equipment, additional infrastructure and mine development to build the potential mine production to a level of 1,000 to 2,000 tpd. Such production could be used to supplement open pit production, providing higher grade feed within 2-3 years, thereby increasing overall metal production, without further plant expansions, and extending the mine life by stretching out the open pit production. Should underground development occur, it could (a) provide supplemental higher grade feed relatively quickly and (b) provide further impetus for the exploration of other deeper, underground mining targets that have not been pursued to date.

If a $30/t average underground mining cost is assumed and a processing and G&A cost of $23.09/t is used (as in Phase IV PFS) then the estimated underground cut-off grade it would be about 1.5% copper in situ. This equates to an approximate cut-off NSR value of $60.00/t. The underground option has not been factored into the Phase IV PFS and represents a significant upside opportunity that MintoEx intends to pursue in the near term.

Permitting

The Minto Mine is currently permitted to process up to 1,314,000 tonnes of ore per year, or 3,600 tonnes per day. Further increasing the mill production and incorporating mining in Area 2, Area 118, Ridgetop and Minto North will require amendments to existing permits. Capstone will be making formal application for the required permit amendments in 2010 and plans to work closely with Yukon Government, Selkirk First Nation and other stakeholders on these permit amendments.

Exploration

Prior to Capstone's takeover of Minto Explorations Ltd. in 2005, exploration had focused mostly on bringing the Main deposit into production and had largely downplayed the exploration potential of the surrounding area. In contrast, Capstone has made exploration a high priority since acquiring the property and has demonstrated the excellent potential at Minto by making six discoveries in just over three years. This success is largely due to a paradigm shift in the exploration model. All previous exploration had focused on prospective targets as if they were separate, discrete deposits; Capstone, however, views the entire mineralized area as one very large mineralized super-system that was subsequently dismembered by post mineral faulting.

By progressively modeling in 3D each new success, Capstone geologists are piecing the super-system back together and gaining knowledge of where to look outward from the known toward the unknown. In tandem with this approach, Capstone geologists also exploit two of the defining characteristics of Minto-Type mineralization, that is: magnetism and chargeability. Total Field Magnetic (TFM) and Induced Potential (IP) geophysical surveys have been used to great advantage at Minto. When the two approaches, 3D geological modeling and geophysics are used in tandem the result is a powerful exploration tool.

In 2005, geological modeling of the Main deposit, in support of the Bankable Feasibility Study, lead to the identification of Area 2 as a possible extension (direct or faulted off) to the Main deposit. Area 2 was discovered in 2006 by diamond drilling. Later in 2006, Copper Keel (north) was also drill discovered, principally because it was recognized that the mineralized structures at Minto are gently folded or buckled, and that Copper Keel represented a synformal fold axis. Fold closures are frequent structural traps for hydrothermal mineralization. This inferred fold axis corresponded exactly with a magnetic high.

Discovery of Area 118 was made in 2007 as a result of using geophysical data to look for possible extensions to Area 2. It is now recognized by Capstone geologists that Area 2 and Area 118 are the same deposit, the former being partially thrust over the latter. Also in 2007, the Copper Keel South/Airstrip prospects were located by following the Cooper Keel fold axis up plunge, toward the south, into an area of strong IP anomalies.

Discovery of high grade mineralization at Ridgetop (ASARCO's Area 1) was made in 2008, after recognition that an IP anomaly identified in 2007 did not coincide with the previously known weak and sporadic mineralization. Rather, the IP anomaly flanked the ASARCO drill area on the east side. Subsequent step-out drilling in 2008 intersected much higher grades than previously known, and with much better continuity. In 2009, Minto North and Minto East were discovered, approximately 600m north of the Main open pit on the first drill hole of the season testing coincident magnetic and IP anomalies. Assay data released to date shows that this is one of the highest grade deposits in the belt. Also of particular note is the alignment of the five principal deposits within a distinct NNW trending corridor, the "Priority Exploration Corridor". Future explorations will focus on this trend and also on indentifying parallel trends such as Copper Keel. The northern half of the property is poorly drill tested, despite many geophysical anomalies and even outcropping copper-gold mineralization. Levering of the success at Minto North, Capstone is laying the ground work in 2009 to make this a priority area for future work. Since Capstone's acquisition of the Minto Project in 2005, total copper contained in all classes of mineral resource have increased a net 163%, gold 223% and silver 118%, even after mineral resource depletions from two years of mining.

The Phase 1 2010 drill program is designed as a first pass to test for extensions to several areas where mineral resources or high grade exploration intercepts are known but not adequately defined. These target areas include the southern margins of the Area 2/118 deposit and the Minto East discovery from 2009. The holes released to date as part of the 2010 program, show that three existing mineral resource blocks are open for expansion: Area 2 deep and Area 2 shallow are open to the south and Copper Keel North is open to the north and west. In addition, the new intercepts from Minto East indicate a sufficient extent of mineralization that suggests a mineral resource will be delineated here.

Further drilling and evaluation is planned in these areas in order to increase confidence levels to a point sufficient to support a conversion to mineral reserves, if economic factors warrant, by demonstrating both continuity of grade and thicknesses.

Click HERE for the Exploration Corridor Map

Pre-feasibility

Background

A Definitive Feasibility Study ("DFS") on the Minto Main deposit was conducted in 2006 by Hatch and positive results of the study led to the construction of the mine and mill. Commercial production was declared on October 1, 2007 with ore being extracted exclusively from the Main pit. In 2006, Sherwood geologists identified a possible extension to the main deposit, 130m south of the pit currently under development. An aggressive drill program was conducted which resulted in the discovery and definition of a significant new resource called Area 2. To assess the economic potential of the Area 2 resource, a Pre-feasibility Study ("Area 2 PFS") was completed under the supervision of SRK Consulting (Canada) Inc. and published in 2007.

Subsequent discoveries that expanded Area 2 and discovered and defined Area 118, Ridgetop and Minto North warranted completion of an updated PFS, which was published in December 2009. The pre-feasibility study for the Phase IV expansion ("Phase IV PFS") of the Minto copper-gold mine details the basis of ramp up in mill throughput to a nominal 4,100 tonnes per day ("tpd") throughput and 91.3% availability, resulting in 1.37 million tonnes per year processed in an optimised mill, with ore to be extracted from new mineralized areas discovered since 2006. The Phase IV PFS results in a total of 366 million pounds of copper in concentrate produced over an eight year mine life, commencing January 2010. Permit amendments are required for production in 2012 and beyond.

The Phase IV PFS also discusses two possible options for further increases in production and/or increases in mine life and mineral reserves: (1) a possible further increase in mill capacity to 7,500 tpd of throughput, focused on open pit mining of mineral resources outside of the current proposed open pits, and (2) the possible development of a 1,000-2,000 tpd underground mine to provide higher grade feed relatively earlier in the mine life than an expanded open pit operation. On preliminary analysis, the underground option appears to have a more attractive investment profile. As a result, the underground option will be prioritized in 2010, offering the potential for higher production than outlined in the Phase IV PFS.

Expanded Scope

In addition to looking at the economic potential of the Area 2 deposit, the study was expanded to incorporate several other concurrent Minto Project improvements that were identified post-DFS, including:

• Implementation of coarser initial grinding in conjunction with a regrind of rougher cell concentrates;
• Increase in mill capacity to 3,500 tonnes per day;
• Utilization of grid electrical power;
• Review of waste rock and tailings deposition options;
• Optimization of the pit slopes for the Main pit based on new geotechnical data and analysis;
• Improved recoveries for partially oxidized material.

Highlights

The PFS was completed in December 2009 and laid out the basis for production from the Area 2/118, Ridgetop and Minto North deposits at a higher mill throughput than was defined in the 2006 DFS completed by Hatch Ltd. or the Area 2 PFS. Highlights of the Phase IV PFS include the following:

• Increase in mill throughput to 4,100 tonnes per operating day, resulting in a sustained 1.37 million tonnes of ore per year (3,750tpd after allowances for maintenance and availability);
• Proven and probable mineral reserves increased to 10.9 million tonnes grading 1.64% copper, 0.64 g/t gold, and 5.9 g/t silver, for a contained 395 million lbs of copper, 224,000 oz of gold, and 2.0 million oz of silver;
• Mine life extended to 2018 with an average of 45 million pounds of copper production per year, with additional upside opportunities identified, as discussed below;
• Life-of-mine capital cost of C$48.2 million, primarily based on an assumption of conversion to self mining, which decision will be subject to a cost-benefit analysis vs. remaining with contract mining;
• Life-of-mine cash costs of US$1.34/lb of copper, after by-product credits (with gold at US$300/oz and silver at US$3.90/oz, as per the agreement with Silver Wheaton);
• Net present value, at a constant US$2.25/lb copper price for unhedged production and a 7.5% discount rate, of C$199 million before tax and C$160 million after tax, which amounts increase to C$291 million before tax and C$218 million after tax at a flat US$2.60/lb copper price for unhedged production, and to C$395 million before tax and C$281 million after tax at a flat US$3.00/lb copper price for unhedged production;
• Important opportunities identified for incremental higher grade production relatively early in the mine life from underground mineral resources not within the current Phase IV pits or the current mineral reserve;
• A C$20 million allowance has been made in the cash flow model for post-closure abandonment and reclamation.

The Phase IV PFS represents an interim update on the Minto Project with resource estimates as of the end of April 2009 and costs as of the end of 2009. However, continued exploration success in 2009, which could result in further reserve increases beyond those outlined in the Phase IV PFS, and other optimization opportunities, suggest that additional value remains to be extracted from the Minto Project and Capstone will continue to pursue the crystallization of these value opportunities.

Permitting

In order to implement the life-of-mine plan set out in the Phase IV PFS, amendments will be required to the current operating permits and licences at the Minto Mine for production in 2012 and beyond. With the Phase IV PFS as a guide, MintoEx has commenced the process of preparing an application for such amendments, which application it intends to file with the Yukon regulators in the first half of 2010.

In the financial model, C$20 million has been allowed for mine site reclamation following closure. However, it should be noted that this amount is an allowance; the actual reclamation cost will be estimated in conjunction with regulators during the permitting process.

Economics

SRK reports that the estimated economic benefit of mining the Minto Phase IV deposits is sufficient to take the Phase IV expansion project to the next level. While more detailed work will be required to optimize the project, there is adequate economic justification for MintoEx to proceed with further work and, in particular, the application for licence and permit amendments from the Yukon Government.

The table below shows the comparison of Phase IV PFS Base Case (at a flat US$2.25/lb for unhedged copper production) and Alternate Cases (at a flat US$2.60 and US$3.00/lb for unhedged copper production, respectively). The Phase IV deposits add economic benefit to the mine, yielding a Base Case pre-tax Net Present Value at a 7.5% discount rate ("NPV7.5%") of C$199 million. The Alternate Case models yield a substantial improvement in the project economics due to higher metal prices based on current forward projections.

Comparison of Phase IV Base and Alternate Cases

Item	Unit	Phase IV PFS Base Case	Phase IV PFS  Case 2	Phase IV PFS  Case 3
Waste mined (millions)	tonnes	70.4	70.4	70.4
Ore mined (millions)	tonnes	10.0	10.0	10.0
Total mined (millions)	tonnes	80.4	80.4	80.4
Strip ratio (waste: ore)	W:O	7.0	7.0	7.0
Mill Feed*	Mt	10.9	10.9	10.9
Copper mill head grade	% Cu	1.64%	1.64%	1.64%
Gold mill head grade	g/t Au	0.64	0.64	0.64
Silver mill head grade	g/t Ag	5.9	5.9	5.9
Copper in concentrates (millions)	lb	366	366	366
Gold in concentrates (000s)	oz	166	166	166
Silver in concentrates (000s)	oz	1,685	1,685	1,685
Concentrate Grade	% Cu	40%	40%	40%
Copper Price Unhedged production, flat)	US$/lb	$2.25	$2.60	$3.00
Copper Price (LOM average, including hedging)	US$/lb	US$2.25	US$2.55	US$2.90
Gold price (net received from Silver Wheaton)	US$/oz	$300.00	$300.00	$300.00
Silver price (net received from Silver Wheaton)	US$/oz	$3.90	$3.90	$3.90
Exchange rate	US$/C$	$0.91	$0.91	$0.91
NSR	C$/t milled	$75	$86	$99
Unit Mining Costs	C$/t mined	$2.31	$2.31	$2.31
Unit Total OPEX (incl. royalties)	C$/t milled	$42.86	$42.92	$42.98
Unit On-site OPEX (inc. royalties)	US$/lb Cu payable	$1.20	$1.20	$1.20
Unit Off-site OPEX	US$/lb Cu payable	$0.29	$0.29	$0.29
Unit By-product Credit	US$/lb Cu payable	$0.15	$0.15	$0.15
Unit OPEX net by-product credits	US$/lb Cu payable	$1.34	$1.34	$1.34
Total Capital (initial, sustaining)	C$ millions	$48	$48	$48
Allowance for closure costs	C$ millions	$20	$20	$20
NPV7.5% pre-tax	C$ millions	$199	$291	$395
NPV7.5% after tax	C$ millions	$160	$218	$281
*Note: Mill Feed includes Ore Stockpile

*Note: Mill Feed includes Ore Stockpile

Base case sensitivity analyses were run for copper grade, copper price, capital expense ("CAPEX"), and operating expense ("OPEX"). Each variable was changed from -20% to +20% of the base case value. Each variable was changed independently of the other variables so there is no compounding effect of multiple variable modifications. The results show the project is most sensitive to copper grade followed closely by copper prices. Normally grade and metal price effects are equal but in Minto's case, the copper price is hedged for some of the production so the effect of copper price is tempered with some metal price certainty.


Risks & Opportunities

1. Timing and approval of permit revisions, which could delay access to new mining areas if not granted in time to allow stripping of Minto North in 2012;
   
   
2. Exchange rates, metal prices and external influences;
   
   
3. Grade control, given the relatively narrower mineralized horizons in the Phase IV pits as compared to the Minto Main pit.

The most important opportunities to improve the project are:

1. Optimization of mine plan to smooth out the production profile and optimize stripping;
   
   
2. Underground production potential, bringing currently defined ex-pit high grade feed to the mill relatively early in the mine life. A conceptual level review was completed that involves underground extraction of higher grade ore, eliminating the need for further plant expansions and allowing processing of higher grade ore sooner than in an expanded open pit scenario:
   
   
3. Conversion of current inferred mineral resources within existing Phase IV pit outlines to higher classifications, increasing the mineral reserve and reducing strip ratios:
   
   
4. Conversion of current higher grade inferred mineral resources outside the existing Phase IV pit outlines to higher classifications, possibly resulting in increased mineral reserves; and
   
   
5. Discovery of new mineral resources and mineral reserves.

Unless otherwise stated, all reporting is in Canadian dollars and metric units.

To view News Release summarizing the results of the Phase IV PFS, please click here.

To view the full Phase IV PFS, please click here.

Exploration Programs

2010 Exploration Program

Capstone has approved a budget of approximately US$5.3 million focused on Minto East, Copper Keel, Area 2 and Titan 24 targets.

This work will support the evaluation of a proposed underground mining option, targeting high grade mineral resources that are adjacent to or below the open pits outlined in the Phase IV Preliminary Feasibility Study ("Phase IV PFS"), the results of which were announced on December 15, 2009. 

Capstone completed and expanded Titan-24 geophysical survey (please refer to September 1st, 2010 News Release) with Quantec that covered approximately 80-85% of the Minto mine property and defined 73 targets, including 19 high priority targets.This geophysical tool represents another opportunity for Capstone to refine and expand its targeting of anomalies.

Please follow the link below to a map identifying the priority exploration areas for 2010:

http://www.capstonemining.com/i/photos/minto/2010-04ProposedMintoDrillProgram.jpg

Please follow the link below to a map identifying the priority exploration areas for 2010 showing Titan 24 IP chargeability at 700m elevation:

 http://www.capstonemining.com/i/photos/minto/2010-04ProposedMintoDrillProgram700elTitanIP.jpg

Please follow the link below to a map identifying the priority exploration areas for 2010 showing airborne magnetics:

 http://www.capstonemining.com/i/photos/minto/2010-04ProposedMintoDrillProgramMag.jpg 

2008 Exploration Program

Sherwood has budgeted a $4.4 million, 20,000 metre drill program for 2008 with the following priorities:

• Evaluate the potential of the Upper Minto Valley for new discoveries (complete);
• In-fill drill the 2007 discoveries at Area 118 and Ridgetop to increase the resource confidence level;
• Step out drilling in the Area 2, Area 118 and Ridgetop areas with the objective of expanding the known mineralization into previously untested areas;
• Test other targets.

To date, results have been reported from thirteen holes drilled in the Upper Minto Valley, a previously unexplored and large area west of the Minto and Area 2 deposits. New copper-gold intercepts were encountered opening up potential for discoveries in previously unexplored areas on the Minto property. Drilling has now moved on to other priority areas identified in 2007, including possible extensions to the Area 2 deposit, further definition of the Area 118 and Ridgetop discoveries to increase the resource confidence level, as well as exploring additional targets. The 2008 exploration program is a component of our overall strategy to maximize the value of the Minto Mine by developing additional high grade reserves that could justify further increases in production by increasing mill throughput.

2008 Drill Hole Location Map

2007 Exploration Program
Sherwood's successful 2007 exploration program delivered high grade copper-gold mineralization from a number of targets. The program was carried out in two phases and was comprised of 91 exploration drill holes and 10 geotech/metallurgical drill holes totalling 23,292 metres of diamond drilling. Significant new copper-gold mineralization was discovered at the Area 118, Copper Keel, Airstrip and Ridgetop prospects and in the Gap between the Minto Mine and Area 2. Each of these areas has the potential to provide additional near surface resources beyond those considered in the December 2007 pre-feasibility study. Mineral resource estimates incorporating the results of the 2007 drilling are underway. In addition to near surface mineralization, several deeper high grade intersections at the Minto Mine are opening up the vertical dimension to this highly prospective property, a dimension that has received little exploration attention in the past. Highlights of each phase are as follows:

Phase 1 Highlights:

Phase 1 was completed in May 2007 and consisted of six deep exploration holes totalling 2,259m and five metallurgical drill holes totalling 443m.

• Six deep exploration holes tested the 'Gap' target between, beneath and adjacent to the Minto Mine and Area 2 resource areas. The 6 exploration holes confirmed the presence of multiple, stacked, foliated and mineralized horizons throughout the 'Gap' target area and suggests there is reasonable geological continuity between the two areas;
• Five metallurgical drill holes were drilled in the southern part of the Minto Mine reserve to collect metallurgical sample material for the current grinding optimization study. These holes equalled or exceeded grades and thicknesses projected from the resource model, including another exceptional gold intercept grading 46.2g/t gold over 1.1m and significantly higher than expected copper grades in another hole.

2007 Phase 1 Drill Hole Location Map
Minto-Gap-Area 2 Cross Section

Phase 2 Highlights:

Phase 2 commenced in June and was completed in October with a total of 85 exploration drill holes and 5 geotech holes for 20,917m of drilling completed. The objective of the Phase 2 exploration program was to more fully define the limits of the Area 2 deposit and provide technical information for the PFS, but mostly to broadly test a wide swath of the Minto property to the south, west and between the Minto and Area 2 deposits. Significant new copper-gold mineralization was discovered at at the Area 118, Copper Keel, Airstrip and Ridgetop prospects. In addition, an extensive geophysical program was completed. Highlights from Phase 2 include:

• Ridgetop - located approximately 1km south of the Minto open pit, assay results confirmed the presence of near surface (3-12m deep) copper-gold mineralization, including chalcocite enrichment zones, over significant thicknesses. Results included 10.3m of 2.72% copper and 1.37 g/t gold, 7.5m of 2.08% copper and 0.81 g/t gold, and an exceptionally thick, near surface intersection of 88.8m grading 0.75% copper including 13.7m of 2.04% copper.
• Area 118 - located approximately 350m south of the current open pit and immediately adjacent to the Area 2 deposit, Area 118 is a large system, measuring more than 500m by 200m in aerial extent. Preliminary interpretations of drilling to date favour a fault model in which the Area 118 mineralization is equivalent to the deeper Area 2 horizons that are now faulted upward and juxtaposed against upper Area 2 mineralization. 2007 drilling indicates the presence of a higher grade core within the Area 118 deposit and provided further confirmation of high grade copper-gold mineralization where the Area 118 and Area 2 deposits join. Results included 9.1m of 3.40% copper and 0.87g/t gold and 15.0m of 3.09% copper and 1.03g/t gold.
• Airstrip SW-Copper Keel - located approximately 500m east of Ridgetop, this prospect was thought to comprise two separate targets but now appears to be one system with two markedly different styles of copper mineralization. One is the chalcopyrite-bornite-magnetite-gold mineralization typically found throughout the Minto project. The second type is coarse grained chalcocite-gold (+/- native copper) associated with mixed iron oxides. Results included 4.1m of 3.10% copper and 2.27 g/t gold starting at only 68.2m below surface and 2.79% copper and 0.93g/t god over 4.2m starting at only 99.9m below surface.
• Potential Area 2 expansion to the southeast - Hole 07SWC-269 stepped out more than 110m to the southeast of the nearest 2006 Sherwood hole used in the Area 2 Pre-feasibility Study, opening up the potential for a near surface expansion of the Area 2 deposit. The drill hole encountered shallow, high grade mineralization which is in close proximity to the Area 2 reserves. The good grades and shallow depths of this mineralization in an area immediately adjacent to Area 2 make this a high priority target for drill testing in 2008 and could lead to potential resource expansions.
• Gradient IP Geophysical Survey - results include the definition of a large chargeability anomaly in an under-explored area that was previously thought to be of low prospectivity. The edge of this new anomaly correlates with recent drill discoveries of high grade copper-gold mineralization at Airstrip and Copper Keel, suggesting additional potential beyond the scope of recent drilling. Also of potential significance are several newly identified chargeability anomalies located north of the main Minto pit, indicating exploration potential north of the Minto Mine, in areas that have received only very cursory exploration drilling.

2007 Phase 2 Drill Hole Location Map
Detailed Gradient IP -- Sept 2007

Mineral resource estimates incorporating the results of the 2007 drilling are underway and all 2007 drill information was used to lay out the priorities for a significant 2008 exploration program to follow up on the exciting 2007 discoveries. Given the very encouraging 2007 exploration drill results, there would appear to be excellent opportunities for further resource additions that could potentially support additional production expansions or an increased mine life.

2006 Exploration Results
In 2006, Sherwood completed a total of 24,252 metres (79,567 feet) of NQ diamond drilling in a two-phase program.

• Phase 1 comprised 4,129 metres of resource definition drilling within the main deposit and a limited amount of exploration drilling. The resource definition drilling was successful in confirming higher gold grades in the northern 1/3rd of the Minto deposit and three of the five exploration holes resulted in the discovery of a significant new body of mineralization -- the "Area 2" discovery.
• Phase 2 was planned as a 16,500m exploration program focused on several exploration targets outside of the main Minto deposit. Given the outstanding results from Area 2, the program was expanded to 20,123m and resulted in the delineation of a significant zone of high grade copper-gold mineralization at the Area 2 target, approximately 130m from the open pit (click here). Drilling extended far beyond of the initial target area and a significant new resource was defined.
  • The total contained metal in the Area 2 Measured and Indicated Resource estimate represents a 61% increase in contained copper and a 75% increase in contained gold versus the resource estimate for the main Minto deposit at a 0.5% copper cut-off.
  • Area 2 is being advanced through a pre-feasibility study with the objective of adding to the high-grade reserve base during Q3/2007. It remains open to expansion in a number of directions, offering further potential beyond that defined to date.
• A summary of the 2006 drilling is set out in the table below:

Area	Purpose	No. of Holes	No. of Metres	No. of Feet
Minto Deposit	Resource Delineation and Confirmation	20	2,433	7,982
Area 2	Discovery/exploration & resource delineation	79	18,376	60,289
Other Targets	Testing targets other than Area 2	20	3,443	11,296
	Totals	119	24,252	79,567

2005 Exploration Results
Approximately 6,772m of drilling were completed in 2005 consisted of 57 drill holes including:

• 20 confirmation diamond drill holes within the resource limits;
• 16 step-out diamond drill holes beyond prior resource limits (to the south and west);
• A number of reverse circulation and geotechnical holes to test the proposed waste dump, tailings disposal area, and to assist in pit optimization work .

The 2005 drill program was successful in confirming the existing resource, expanding the high grade Minto copper-gold deposit beyond the limits of prior drilling, upgrading inferred resources within the prior pit limits to the indicated category, and in providing strong evidence for significantly higher gold grades than those estimated from previous drilling.

 HISTORY

View Map Gallery

The Minto project has a history of exploration and development dating back to the early 1970's. In the mid-1990's, a feasibility study was completed by prior owners, permits obtained and construction of an open pit mine commenced. During that period, the mill foundations were poured, the ball and SAG mills were purchased and moved to site, a permanent camp constructed and the site connected to a permitted Yukon River crossing via a 29km production standard access road. Construction was suspended in 1997 after expenditures of approximately $10 million due to depressed copper prices.

Capstone's predecessor, Sherwood Copper, acquired the Minto Project in June 2005 and, in just two years from acquisition, re-drilled the deposit to modern reserve standards, completed a bankable feasibility study, arranged project financing, and built a $100 million open pit copper-gold mine. Commercial production commenced on October 1, 2007. The mill was expanded from its initial design throughput of 1,563 tonnes per day ("tpd") to 2,400 tpd, which throughput was achieved in March 2008. The mill throughput was again increased to a design level of 3,200 tpd during the latter part of 2008, and achieved the expanded design throughput in March of 2009.

To view Stephen Quin's, Capstone's President and COO, official mine opening speech which outlines the history of the Minto project from its discovery in 1970 to the commencement of commercial production in October 2007, please click here.

2010

• February -- Capstone commences 2010 exploration program at Minto copper-gold mine
• March -- Capstone reports first high grade copper-gold results from 2010 drilling at Minto and reports 2009 year-end reserve & resource estimates for Minto Mine
• April -- Capstone reports additional high grade copper-gold results from Area 2 and Minto East areas
• July -- Capstone announces a new high grade copper-gold discovery "Wildfire"
• August -- 44% increase in copper contained in undeveloped M&I mineral resources at Minto

2009

• December -- Phase IV PFS published, extending mine life and increasing mineral reserves.
• November -- Capstone reports discovery of high grade, deeper Minto East mineralization.
• June -- Capstone announces 32% expansion in contained copper in updated mineral resource estimates including net adjustments for mining to the end of 2008.
• March -- Minto mill reaches Phase III design throughput of 3,200 tpd.
• March -- Recognition that the Area 2 and Area 118 deposit are parts of one dismembered larger deposit; combined mineral resource increases.
• February -- Very high grade Minto North copper-gold deposit discovered on 1st hole of 2009 exploration program.

2008

• June -- Capstone announces contained copper in mineral resources increased by 50% and precious metals by approximately 40% as a result of drilling in 2007
• May -- Capstone announces discovery of new areas of copper-gold mineralization in west Minto valley
• April -- Capstone commences 20,000m drill program at Minto
• March -- Capstone completes commissioning the Phase 2 mill expansion increasing mill throughput from 1,563 tonnes per day to 2,400 tonnes per day
• March -- Capstone signs a Memorandum of Understanding with Firestone Ventures Inc. outlining the terms of a Regional Exploration Alliance which would provide Capstone with additional exploration upside in Yukon
• February -- Capstone announces final drill results from the four new discoveries of high grade copper-gold mineralization made during the 2007 exploration program

2007

• December -- Results of Area 2 Pre-feasibility Study announced, increasing reserves and laying out a path for significantly increased copper production (commencing immediately) and enhanced project economics
• December -- Capstone reports that construction of the Carmacks to Stewart transmission line has commenced, which will connect the Minto Mine to lower cost grid power
• December -- Phase 2 mill expansion to 2,400 tonnes per day completed ahead of schedule
• October -- Commercial production declared at the Minto Mine
• October - First copper-gold concentrates shipped from the Port of Skagway bound for smelters in Asia
• October -- Capstone completes 102 hole 23,618m exploration program
• August -- Capstone conducts IP survey over core of Minto property, outlining several prospective targets
• July -- First copper-gold concentrates shipped to Port of Skagway
• May -- Capstone produces first copper-gold concentrates at Minto Mine
• May -- Mill commissioning commences
• May -- Yukon Utilities Board approves revised power purchase agreement
• May -- Capstone discovers high grade copper-gold mineralization in Minto 'Gap' Target
• May -- Capstone commences Phase 2 mill construction from 1,563 mtpd to 2,400 mtpd
• April -- Capstone expands scope of Pre-feasibility Study to incorporate several project optimizations and to evaluate the potential for further production expansions
• February -- Capstone announces Area 2 adds 60% to existing resource base
• January -- Capstone signs agreement with AIDEA to develop and utilize the port of Skagway for the export of Capstone's copper-gold concentrates

2006

• December - Capstone completes geophysical survey which defines multiple exploration targets
• November - Capstone commences pre-feasibility study on Area 2 discovery
• October - Capstone completed a total of 24,252 metres (79,567 feet) of NQ diamond drilling in a two-phase program, confirming and upgrading resources in the main Minto deposit
• October - Capstone receives C$65m project loan facility from Macquarie Bank, completes forward sales equaling 65% of first four years production, and enters into concentrate off-take agreement with very favorable TC/RC terms
• August - Capstone completes feasibility study which demonstrate robust project economics
• June - begins development of Minto Project with mobilization of mining equipment to site
• March - Capstone signs a letter of intent with Yukon Energy Corporation for the provision of grid power to the proposed mine at Capstone's 100% owned high-grade Minto copper-gold deposit
• February - Capstone selects JDS Energy & Mining to be the engineering, procurement and construction management contractor and Clark Builders to be the general contractor for project development

2005

• December - Capstone hires experienced General Manager to oversee completion of its feasibility study, construction and the operations of the Minto project
• December - Capstone retained Macquarie Bank Ltd. as exclusive arranger of the for the debt component of funding the Minto project
• October - Approximately 6,772m of drilling in 57 drill holes including:
  • 20 confirmation diamond drill holes within the resource limits;
  • 16 step-out diamond drill holes beyond prior resource limits (to the south and west);
  • A number of reverse circulation and geotechnical holes to test the proposed waste dump, tailings disposal area, and to assist in pit optimization work
  • The 2005 drill program confirmed the existing resource, expanded the high grade Minto copper-gold deposit beyond the limits of prior drilling, upgraded inferred resources within the prior pit limits, and provided strong evidence for significantly higher than estimated gold grades from previous drilling
• September - Capstone receives a ten-year extension of the Type A Water Licence (to June 30, 2016) which allows Capstone to construct and operate a mine at Minto
• September - Capstone Mining Corp. changes name to CapstoneCapstone Mining Corp.
• August - Capstone commences 10,000m drill program at Minto
• August - Capstone increases ownership to 100% of Minto Explorations, gaining complete control of the Minto Project
• June - Capstone acquires over 94.5% of the shares of Minto Explorations
• May - Capstone locks up an additional 7% of Minto Explorations shares
• April - Capstone mails offer to shareholders of Minto Explorations
• March - Capstone announces agreement with Minto Explorations, Asarco and Falconbridge whereby Capstone will acquire Minto Explorations and all other interests in the Minto property.

2004

• Minto Explorations announces that it is for sale

2002

• a limited amount of the old Asarco core that could be recovered was re-sampled
• all the drill and geophysical data compiled in a data base to aid further exploration
• three Landsat anomalies examined and prospected
• road maintenance scheduled to keep permits active

2001

• additional maintenance of camp facilities
• five confirmation diamond drill holes (552m) in the centre of the deposit
• regional airborne magnetic and radiometric surveys carried out by the Yukon government

2000

• minor maintenance of on-site facilities
• Minto project was put on care and maintenance owing to low metal prices after approximately $10 million was spent on project infrastructure

1999

• production license received
• five diamond drill holes (957m) for engineering purposes

1998

• mill concrete foundations poured with cement trucks form Whitehorse barged across the Yukon River
• Type A water license granted by Yukon government
• concentrator design completed
• access road completed, camp constructed and the location of the proposed tailings dam was grouted
• phase 1 open pit mining plan completed

1997

• a further 12.8km of road construction to complete the new access road
• site for camp excavated
• 72m water well for domestic water supply
• mill site excavated and 2 used grinding mills moved onto site using an ice bridge over the Yukon River
• co-operation agreement signed with Selkirk First Nation

1996

• 16km access road constructed including a barge landing site on the west side of the Yukon River and a bridge over Big Creek
• 4 diamond drill holes (545m)

1995

• 6 diamond drill holes (572m) on magnetic anomalies and 1 condemnation diamond drill hole north of the proposed mill site
• feasibility study completed, reserves are 8,818,000T of 1.73% Cu, 0.014 oz/t Au and 0.22 oz/t Ag at 0.5% Cu cut-off grade (not to 43-101 standards)
• recoveries are 95% for Cu and 85% for Au and Ag
• mine life was projected to be 12 years at production rate of 477,000 tonnes per year

1994

• 19 diamond drill holes (2,185m)
• feasibility study began with engineering and geo-technical studies

1993

• Minto Explorations Ltd. was formed which consolidated the interests of Asarco, Teck Corp. and Falconbridge into one publicly traded junior mining company
• Minto Explorations carried out an airborne geophysical survey and drilled 8 diamond drill holes (960m)

1989

• 84 percussion drill holes (4,897m) on the DEF claims

1984

• 5 percussion drill holes (518m) on the DEF claims
• Silver Standard transfers its interest in the Minto project to Teck Corp.

1975-1976

• joint feasibility studies completed

1974

• winter road built from Yukon Crossing and 58 diamond drill holes (11,228m) on the Minto claims
• additional geophysics, rock mechanics, feasibility studies and 52 diamond drill holes (8,238m) on the DEF claims

1973

• 62 diamond drill holes (7,887m) on the Minto claims which have split ownership
• United Keno Explorations (a joint venture among United Keno Hill, Falconbridge Nickel, and Canadian Superior Explorations) successfully drill into the northern portion of the Minto deposit
• A joint venture between Silver Standard and Asarco successfully drills into the southern portion of the Minto deposit
• bulldozer trenching, EM and magnetic geophysical surveys and 41 diamond drill holes (7,753m) on the DEF claims
• main mineralized body discovered in June

1972

• mapping, airstrip construction and bulldozer trenching, 12 diamond drill holes (1,871m) on 4 zones on the Minto claims
• grid soil sampling and bulldozer trenching on the DEF claims

1971

• follow-up of stream sediment anomalies and staking of the Minto claims in July
• staking of the Minto claims by two independent groups: United Keno Explorations (a joint venture among United Keno Hill, Falconbridge Nickel, and Canadian Superior Explorations), and a joint venture between Silver Standard Mines and Asarco
• soil sampling, IP geophysical surveys and manual excavated prospect pits on the Minto claims
• 7 diamond drill holes (1,158m)
• IP and VLF-EM geophysical surveys, soil sampling and mapping on the DEF claims

1970

• regional stream sediment geochemical survey by the Dawson Syndicate, a joint venture between Silver Standard Mines Ltd. and Asarco Inc.

Table 2: Historical Tonnage & Grade Estimates of the Minto Deposit

Year	Source	Tons	Cu %	Au oz/t	Ag oz/t	Comments
1975	R.J. Prevedi ASARCO	8,441,941	1.74	-	-	Cutoff grade 0.6% Cu
1976	R.T.Heard UKHM	8,219,370	2.04	-	-	-
1976	L.A. Wigglesworth Falconbridge	8,210,219	2.03	-	-	-
1976	R.J. Prevedi ASARCO	7,220,900	1.86	-	-
1980	D.M. Fletcher ASARCO	2,968,600	3.24	0.027	0.411	Cut-off grade 2.0% Cu
1989	J.Proc & H.L.Kingman Minto Explorations	6,368,000	2.11	0.016	0.33	Open Pit and Underground recovery at 75% and 5% dilution Cut-off grade 0.8% Cu
1990	SRK/Falconbridge	7,592,318	1.88	0.016	-	Cut-off grade 0.0%? Cu Includes Lower Zone
1992	J.Proc & H.L.Kingman Minto Explorations	6,071,000	2.21	0.018	0.28	Open Pit and Underground UG = 1,600,000 ton @ 3.73% Cu, 0.038 oz/t Au o.49 oz/t Ag
1995	Montgomery Consultants Minto Explorations	9,700,000	1.73	0.014	0.22	Cut-off grade 0.5% Cu
2005	Giroux Consulting Sherwood Mining Corp.	9,190,000 Measured & Indicated	1.83	0.016	0.232	Cut-off grade 0.5% Cu
2005	Giroux Consulting Sherwood Mining Corp.	770,000 Inferred	1.41	0.013	0.175	Cut-off grade 0.5% Cu

All the resource estimates discussed in the History section of this site prior to 2005 do not follow the required disclosure for reserves and resources as outlined in National Instrument 43-101 as they were prepared prior to the inception NI 43-101. The historic resource figures generated have not been redefined to conform to the CIM approved standards as required in NI 43-101. The resource estimates have been obtained by sources believed reliable and are relevant but cannot be verified. No effort has been made to refute or confirm these estimates and they can only be described as historical estimates.

GEOLOGY

Geological Setting
Property Geology and Lithological Description
Structure
Deposit Types
Mineralization



Geological Setting

The Minto Project is located in the Carmacks Copper Belt along the eastern margin of the Yukon-Tanana Composite Terrane, which is comprised of several metamorphic assemblages and batholiths (Figure 1). The north-northwest trending Copper Belt is host to intrusion-related Cu-Au mineralization. The Yukon-Tanana Composite Terrane is the easternmost and largest of the pericratonic terranes accreted to the Paleozoic northwestern margin of North America (e.g., Colpron et al., 2005). It is regarded to be the product of a continental arc and back-arc system, preserving meta-igneous and metasedimentary rocks of Permian age on top of a pre-Late Devonian metasedimentary basement (e.g., Piercey et al. 2002).
Figure 1: Yukon Geology from Yukon Geologic Survey "Maps Yukon" website (www.geology.gov.yk.ca)

The Minto Property and surrounding area are underlain by plutonic rocks of the Minto Pluton (Early Mesozoic Age) (Figure 2) of the Granite Mountain Batholith that have intruded into the Yukon-Tanana Composite Terrane. They vary in composition from quartz diorite and granodiorite to quartz monzonite. The batholith is unconformably overlain by clastic sedimentary rocks thought to be the Tantalus Formation and andesitic to basaltic volcanic rocks of the Carmacks Group. Both are assigned a Late Cretaceous age. Immediately flanking the Minto Pluton, to the east, is a package of undated mafic volcanic rocks, outcropping on the shores of the Yukon River. The structural relationship between the batholith and the undated mafic volcanics is poorly understood because the contact zone is not exposed. Figure 2: Regional Geology

Geobarometry and geothermometry data (Tafti and Mortensen, 2004) suggests that the Minto Pluton was emplaced at a depth of at least 9 km, while the presence of euhedral to subhedral epidote, interpreted by Tafti and Mortensen as magmatic in origin, suggests a deeper emplacement depth in the order of 18-20 km.

Property Geology and Lithological Description

Much of the geological understanding of the rock around the Minto deposits is based on observations from diamond drill core and extrapolation from regional observations. The reason for this is poor outcrop exposure, and due to the moderate to deep weathering and oxidation of the limited exposed outcrop. The terrain was not glaciated during the last ice age event.

The Minto Main deposit is now exposed in open pit mining. The Area 2 and Area 118 deposits are considered continuous, and reported as one deposit known as Area 2 / Area 118, located immediately south of Minto Main. The Ridgetop deposit is located approximately 300 m south of the Area 2 / Area 118 deposit. The most recently discovered copper deposit to be reported is the Minto North deposit located approximately 700 m north of the Main Minto deposit. In addition to these deposits which all have NI43-101 compliant mineral resources and mineral reserves there are several significant mineral prospects. The most recent of these discoveries is "Minto East" which was discovered in late 2009. These deposits and prospects define a general north-northwest trend informally called the Priority Exploration Corridor or PEC.

Hypogene copper sulphide mineralization at Minto is hosted within the Minto pluton, which intrudes near the boundary between the Stikinia and Yukon-Tanana terranes, however since the contact is not exposed it is unclear if the pluton stitches the two terrains. The Minto pluton is predominantly of granodiorite composition. Hood et al. (2008) distinguish three varieties of the intrusive rocks in the pluton. The first variety is a megacrystic K-feldspar granodiorite. It gradually ranges in mineralogy to quartz diorite and rarely to quartz monzonite or granite, typically maintaining a massive igneous texture. An exception occurs locally where weakly to strongly foliated granodiorite is seen in distinct sub-parallel zones several metres to tens of metres thick. A second variety of igneous rock is quartzofeldspathic gneiss with centimeter-thick compositional layering and folded by centimetre to decimetre-scale disharmonic, gentle to isoclinal folds (Hood et al., 2008). The third variety of intrusive rock is biotite-rich gneiss. Capstone geologists consider all units to be similar in origin and are variously deformed equivalents of the same intrusion.

Copper sulphide mineralization is found only in the rocks that have a structurally imposed fabric, ranging from a weak foliation through to strongly developed gneissic banding. For this reason all core logging by the past and present operators separates the foliated to gneissic textured granodiorite as a distinctly discernable unit. It is generally believed by Capstone geologists that this foliated granodiorite is just variably strained equivalents of the two primary granodiorite textures and not a separate lithology. While this interpretation, based upon detailed observations from logging of tens of kilometers of drill core is highly likely, it has not been conclusively proven. Tafti & Mortensen (2004) noted that the relatively massive plutonic rocks have similar mineral and chemical composition as the foliated rocks. Research in collaboration with the Mineral Deposits Research Unit of the University of British Columbia is on-going.

The contact relationship between the foliated deformation zones and the massive phases of granodiorite is generally very sharp. These contacts do not exhibit chilled margins and are considered by Capstone geologists to be structural in nature, separating the variably strained equivalents of the same rock type. Tafti and Mortensen (2004) had interpreted the sharp contacts to be zones of deformed rock within the unfoliated rock (i.e. rafts or roof pendants). More recent deep drilling and deep penetrating geophysics suggest this is not the case, but again has not been conclusively proven. Supergene mineralization occurs proximal to near-surface extension of the primary mineralization and beneath an unconformity defined by conglomerate that is mostly locally derived from eroded and sometimes partially weathered and decomposed granodiorite. The conglomerate has been dated as Cretaceous Age (unpublished date pers. com. Dr. Maurice Colpron - Yukon Geological Survey), and is now recognized in outcrop in a borrow pit exposure located west of the airstrip as well as in numerous recent drill holes. Observations of foliated and even copper mineralized cobbles in drilling indicate that "Minto-Type" mineralization was exposed, eroded and reincorporated in sedimentary deposits by the Cretaceous Age.

Conglomerate and volcanic flows have been logged in drill core by past operators. New drilling has confirmed a widespread presence of conglomerate, but not the volcanic flows. The latter cannot be confirmed by the authors as the drill core from historic campaigns was largely destroyed in forest fires and no new drilling has intersected such rocks. However, undated volcanic rocks are mapped by Hood, near the southwest margin of the property, south of a fault that is inferred from geophysics to separate them from the Jurassic Age intrusive rocks.

Other rock types, albeit volumetrically insignificant include dykes of simple quartz-feldspar pegmatite, aplite, and an aphanitic textured intermediate composition rock. Bodies of all of these units are relatively thin and rarely exceed one metre core intersections. These dykes are relatively late, and observed contact relationships suggest they generally postdate the peak ductile deformation event; however some pegmatite and aplite bodies observed in a rock cut located north of the mill complex are openly folded. It is unclear if this folding is contemporaneous with foliation development in the deformed rocks or post-dates the foliation development. Observations from drill core and open cut benches in the mine show examples where the foliation and the pegmatitic/aplitic intrusions are both folded, as well as examples where the intrusions are not folded, suggesting two populations of minor dykes.

Structure

There are examples of both ductile and brittle phases of deformation affecting the Minto deposits. As noted above copper-sulphide mineralization is strongly associated with foliated granodiorite. This foliation is defined by the alignment of biotite in areas of weak to moderate strain and by the segregation of the minerals into mafic and felsic bands. The mafic areas are comprised of millimetric bands of predominantly biotite with lesser amounts of magnetite and accessory amounts of hornblende and garnet. The felsic bands tend to be thicker, forming layers of a centimeter or so in thickness that are comprised of predominantly plagioclase feldspar, sometimes with orthoclase over growths and lesser amounts of quartz. The banded rock is interpreted to represent areas of higher strain, and these rocks have a distinct gneissic texture. Individual deformation zones form sub-horizontal horizons within the more massive plutonic rocks of the region and can be traced laterally for more than 1000 m in the drill core. They are often stacked in parallel sequences analogous to stacks of pancakes. The regular, sub-horizontal nature of the deformation zones allows a high degree of predictability when planning diamond drilling campaigns. Contrary to some previous reports, the foliated zones do not appear to inter-finger with the more massive rocks. Rather, observations from pit benches within the mine show that blocks of unfoliated granodiorite are sometimes incorporated within the thicker deformation zones that surround them, more in the manner of horses within the deformation zones.

The similarity of chemistry and texture of both the deformed and the massive granodiorites suggest the deformation zones are structural in origin and not stratigraphic, but this still needs to be confirmed by more rigorous science. Several of these foliated units can be traced in drill holes over long distances at similar elevations and are good marker horizons locally; they are used to guide exploration drilling and 3D geological modeling.

However the absence of chill margins or absorption rims at contacts, combined with the great depth of emplacement (Tafti and Mortensen, 2004) likely preclude them from being remnant rafts or roof pendants of metasedimentary or metavolcanic strata, as some workers have postulated. No sedimentary or volcanic features have been observed in these foliated and mineralized rocks. A structural origin remains the best explanation.

Therefore it is postulated that the foliated granodiorite represent healed, shallowly dipping shear zones within the Minto Pluton, and may have formed when the rocks passed through the brittle/ductile transformation zone in the earth's crust in transition from a deep emplacement environment to eventual exhumation of the batholith. They may represent thrust faults related to regional crustal thickening of the Yukon-Tanana Terrain when the batholith was being exhumed.

Internally to the enveloping surfaces the foliation exhibits highly variable orientations within individual deformation zones including frequently observed small-scale folds. The foliation is often observed to be at a high angle to contacts with the more massive textured rock units but occasionally it is also observed to align parallel to the contacts locally making a sense of shear unclear. Observations by Hood et al. (2008) along a transect in the Area 2 deposit suggest that foliation orientations within deformed horizons have a geometry of tight to isoclinal folding with a wavelength on the order of about 30 m. The observed trend of folds within this area is approximately north-northwest, parallel to regional structural trends (Tempelman-Kluit, 1984). The ore--bearing zones are also occasionally openly folded on a scale of several hundred metres. Based upon horizon modeling for resource estimation by Capstone geologists at Ridgetop and Area 2 the folds have wavelength of about 280 m. The folds appear to be gentle in amplitude with approximately north-south axial traces. Simple shear strain of the foliated zones is also noted adjacent to some late cross-cutting fault zones.

Late brittle fracturing and faulting is noted throughout the property area. Some of these faults are significant from an economic standpoint. The Minto Creek fault (MC Fault) bisects the Minto Main deposit, dividing it into north and south areas and is modeled as dipping steeply north-northeast with an apparent left lateral reverse displacement. The northern block moved up and to the west relative to the southern block. Both the vertical and horizontal displacements are evident by offsets in the main zone mineralization, but appear to be minimal. A lack of marker horizons in the plutonic rocks, however, makes it difficult to determine the absolute magnitude of the movement (Figure 3). Figure 3: North- South Cross Section through Minto Deposit showing DEF Fault and MC Fault

The DEF fault defines the northern end of the Minto Main deposit. It strikes more or less east-west and dips north-northwest and cuts off the main zone mineralization, as shown in Figure 6.3. The vertical orientation of most of the drilling is less than optimal to intersect steep to vertical faults. It may share a similar sense of movement to the MC fault, but a significant amount of displacement is inferred. Determining the magnitude of this displacement could lead to locating an extension of the main zone mineralization on the north side of the DEF fault. This late block faulting is noted throughout the Minto Pluton and in some instances a rotational component is noted as well. Tafti & Mortensen (2004) found the Cretaceous Age Tantalus Formation rotated up to 60 degrees from horizontal in areas located south of the Minto deposit.

A zone of pervasive fracturing on the west side of the Main deposit limits ore grades in this direction. Limited historical drilling west of this structure did intersect some weak copper mineralization, although foliated horizons do not line up across this fracture zone. It is presumed to be one of the north-south faults that are part of the late brittle conjugate set.

While the limits to Minto Main mineralization on the north and west sides are structural in nature, the southern limit is an erosion channel cutting below the elevation of the mineralization and thereby removing it. This zone of deeper erosion is a paleo-channel that is interpreted to follow another roughly east-west striking fault. Only on the east side does mineralization appear to fade out and have no obvious structural limit.

The boundary between the Area 2 and Area 118 deposits is an intermediate NE dipping fault. The displacement of the mineralization is significant. At least two parallel structures displace mineralized domains in Area 118. The shear sense on this structure has not been analyzed in detail, but attempts to correlate ore zones across the main boundary fault are complicated by the difficulty in finding a specific characteristic to unambiguously identify the zones. The easiest zone to identify (based on mineralization and texture) is the "N" zone and it has up to 66 m of vertical throw across the boundary fault. Other zones show changes in thickness and orientation, suggesting the presence of pure strain and block rotation. A similar NW striking fault zone appears to be present that defines the northeastern boundary of the Ridgetop deposit, and defines the outcrop of Cretaceous conglomerates. The dip of this structure is unknown.

All mineralized horizons exhibit locally pervasive fracturing (typically chloritic or hematitic), which are interpreted to postdate the main copper-sulphide mineralization event. This late structural/hydrothermal event may have potential economic significance, as coarse-grained visible gold has been logged on chloritic and epidote-lined fractures.

Deposit Types

All of the known deposits on the Minto property have the same style of mineralization and are all considered to be similar deposit types. In all cases, mineralization is associated with primary copper sulphide mineralization (except for supergene enriched zones noted in Ridgetop and Area 118) restricted to sub-parallel foliated horizons within a grandioritic pluton. There are no deposits closely analogous to the Minto deposit on a world-wide basis because there is no consensus as to the origin of the Minto deposit. At various times since its discovery the Minto deposit has been described as an example of Porphyry Copper, Volcanogenic Massive Sulphide (VMS), Redbed Copper, Magnetite Skarn (see discussion by Pearson and Clark, 1979) and Iron Oxide Copper Gold "IOCG"(Minto Explorations Ltd., 2003).

Based on the preceding paragraph it is reasonable to say that the origin of the Minto deposit is enigmatic. Various workers appear to have ascribed different interpretations for the most part based on their empirical observations, the background of the observer, and/or the popular models of the day. The abundance of the high Cu/S mineral bornite in a moderately oxidized magmatic system along with the obvious magnetite association suggests that Minto belongs to one of two recognized deposit types: Magnetite Skarn or Iron Oxide Copper Gold. The lack of a typical calc-silicate skarn mineral assemblage seems to preclude the skarn deposit type, thus appears to leave the IOCG model or alternatively to a previously unrecognized deposit type.

The host rocks to the Minto deposits were emplaced in a deep batholitic setting (exceeding 9 km deep to perhaps as much as 18-20 km deep), which is not considered to be the typical porphyry environment. The host is a moderately oxidized magma (Tafti and Mortensen, 2004) with widespread iron oxide (predominantly magnetite with lesser hematite) mineralization. At least some of the hematite is supergene in origin, but it is unclear if some hematite is also primary. There are very strong structural controls on ore mineral emplacement and there is no apparent genetic link to a specific phase of intrusion. Typical porphyry-type alteration zoning such as widespread propylitization, argillization, barren silicic core, or large barren pyritic halo is not recognized. Stockwork style, fracture or vein mineralization is also not present.

Examples of IOCG mineralization with some similar characteristics and setting to Minto include Copperstone in Arizona, Caldelaria in Chile and Ernest Henry in Australia (Williams et al., 2005). From a genetic and structural prospective, albeit not size wise, the Sossego Deposit in Brazil may be a reasonable analog. While an IOCG origin for the Minto Deposit cannot be unequivocally demonstrated, the authors are of the opinion that this style of deposit provides the most consistent model for our current level of understanding.

Mineralization

The Minto deposits have essentially no surface exposure with the exception of minimal exposure in historical trenches of the shallow oxidized zones associated with the Ridgetop deposit and more recently now exposure in mine benches in the Main deposit open pit. Observations for the deposits are based on hand-specimen and petrographic studies of drill core. The primary hypogene sulphide mineralization consists of chalcopyrite, bornite, euhedral chalcocite, and minor pyrite. Metallurgical testing also indicates the presence of covellite, although this sulphide species has never been logged macroscopically. Texturally, sulphide minerals predominantly occur as disseminations and foliaform stringers along foliation planes in the deformed granodiorite (i.e. sulphide stringers tend to follow the foliation planes). Sulphide mineral content, however, tends to increase where this foliation is disrupted by intense folding. In addition, semi-massive to massive mineralization is also observed; this style of mineralization tends to obliterate the foliation altogether. Silver telluride (hessite) is observed in polished samples but has not been logged macroscopically. Native gold and electrum have both been reported as inclusions within bornite and accounts for the high gold recoveries in test concentrates. Occasionally, coarse free gold is observed associated with chloritic or epidote lined fractures that cross-cut the sulphide mineralization. The free gold may be due to secondary enrichment during a later hydrothermal process overprinting the main copper sulphide-gold event. Sulphide mineralization is always accompanied by variable amounts of magnetite mineralization.

The Minto Main deposit exhibits crude zoning from west to east. The bornite zone is dominant in the west while a thicker, lower grade chalcopyrite zone is dominant on the east side of the deposit. The bornite zone is defined by the metallic mineral assemblage magnetite-chalcopyrite-bornite. Bornite mineralization is conspicuous, but chalcopyrite is the dominant sulphide species. Stringers and massive lenses of chalcopyrite with various quantities of bornite are typical. Massive mineralization occurs locally over intervals exceeding 0.5 m in thickness and semi-massive mineralization over several metres in thickness may occur. In these sulphide rich areas, textures often resemble those seen in magmatic sulphide zones with sulphide mineralization interstitial to the rock forming silicate minerals. The higher grade portion of the Minto Main deposit roughly corresponds to the bornite zone. Local concentrations of bornite up to 8% are seen. The precious metal grades are elevated in the bornite zone (very fine gold and electrum occur as inclusions in bornite) and occurrences of coarse grained native gold are noted almost exclusively in bornite-rich material. The chalcopyrite zone is characterized by the metallic mineral assemblage of chalcopyrite-pyrite +/- very minor bornite and magnetite.

Empirical observations indicate the highest concentrations of bornite are associated with coarse grained, disseminated and stringer-style magnetite mineralization, up to 20% by volume locally. The stringers of magnetite are often folded or boudinaged, suggesting that at least some of the magnetite mineralization predates peak ductile deformation.

Sulphide mineralization on the other hand, shows both evidence and absence of ductile deformation locally and is interpreted to have formed contemporaneous with, or late in the ductile deformation history.

The Minto North Deposit also exhibits a zoning from west to east. High-grade bornite-dominant mineralization is observed in the west with lower grade chalcopyrite-dominant mineralization in the east. The bornite zone is defined by the metallic mineral assemblage bornite-magnetite-chalcopyrite. Bornite mineralization occurs as strong disseminations and foliaform stringers locally > 10% to occasional semi-massive to massive lenses up to 2 m in thickness. Chalcopyrite concentrations are typically within the 1 to 2% range. Precious metal grades are elevated in the bornite zone, and visible gold has been observed on several occasions.

Mineralization at Area 2 / Area 118 is distinct in that mineralization is predominantly disseminated (+ occasional foliaform stringers) and that semi-massive to massive sulphide mineralization is absent; as a whole, the mineralization is more homogenous and consistent as compared to Minto Main and Minto North. The primary mineral assemblage at Area 2 / Area 118 includes chalcopyrite-bornite-magnetite with minor amounts of pyrite; and a crude zoning is present in that the higher grade northern half of the deposit shows increased bornite concentrations up to 8% locally.

Mineralization at Ridgetop is subdivided into the near surface oxidized upper zones (chalcocite is the dominant sulphide) and the more typical primary sulphide mineralization of the lower zones. The lower zones are defined by a mineral assemblage of chalcopyrite-magnetite with minor amounts of pyrite. Chalcopyrite is the dominant sulphide in the lower zones, and bornite is only observed in minor amounts. Texturally, chalcopyrite occurs as disseminations and foliaform stringers, and is rarely observed as semi-massive to massive veins. Magnetite is coarse grained, disseminated, stringer-style, and can occur in bands up to 0.3 m in thickness, up to 20% volume locally.

These empirical observations of bornite/chalcopyrite relative abundances are supported by a copper and gold grade trend in mineral resources discovered to date within the PEC where the Ridgetop deposit sits at the lower grade chalcopyrite dominated southern end and Minto North sits at the much higher grade bornite dominated northern end of the currently defined trend.

Maps

EXPLORATION CORRIDOR MAP AUGUST 2010
MINTO PHASE IV EXPANSION PFS	MINTO DEPOSITS AERIAL VIEW

Technical Reports Technical Report, December 2009	Technical Reports Technical Report, June 2008
Technical Reports Titan‐24 DC / IP Survey Geophysical Report	Appendix Technical Report Appendix, December 2009

 

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