Cortez Hills Lower Zone discovery and geologic update

The Cortez Hills Complex is comprised of two in-situ and connected Carlin-type
ore bodies with differing geometries and an exotic satellite deposit (Pediment deposit)
which is eroded and re-deposited adjacent to subcropping Cortez Hills orebody. The
upper portions of Cortez Hills consist of a conical-shaped breccia body generally localized
between Tertiary quartz porphyry sills cutting DevonianWenban Limestone
and locally recognized Horse Canyon Formation (Rodeo Creek Formation equivalent).
This zone is referred to as the Cortez Hills Breccia Zone (CHBZ) and is currently
being mined from surface and underground operations. During the delineation of the
CHBZ, a “Lower Zone” was recognized as differing from the CHBZ due to its tabular
geometry and refractory character. Subsequent exploration delineated the Cortez
Hills Lower Zone (CHLZ) and showed that mineralization is localized along the
north-northwest trending intersection of a complex low angle structural zone and a
steeply west dipping, north-northwest striking dike swarm. The structural zone hostingmineralization
is known as the Ponderosa Fault Zone and transects the carbonate
section from the Hanson Creek Dolomite to the south, through Roberts Mountains
Formation to the base of theWenban Limestone to the north. The formations are locally
folded and imbricated within the Ponderosa fault zone. Tertiary quartz porphyry
dikes and sills also occupy the Ponderosa Fault. The Ponderosa Fault is the
structural conduit that fed mineralizing fluids into the CHBZ. The CHLZ ranges
from 1,500 ft to 3,000 ft below surface. Mineralization in the CHLZ is dominantly refractory
to the north and transitions to dominantly oxide as the zone plunges deeper to
the south. Gold is associated with zones of decarbonatization and local silicification.
Despite the presence of intensely decalcified groundmass, some mineralized intercepts
are associated with abundant calcite veining. The gold system exhibits classic
Carlin-type geochemistry with goldmineralization closely associated with anomalous
concentrations of arsenic, mercury, antimony and thallium. CHLZ gold mineralization
was discovered in 2003, and focused surface drilling delineated the resource from
July 2005 through 2007. TheCHLZremains open to the south and at depth and will be
explored in the future from underground platforms.