La Laguna Pedernalillo (Laguna) Ag-Au-Hg Tailings Development Project

Project Overview

Orca holds, through its subsidiary Minera Orca, S.A de C.V. (Minera Orca), the extraction licence for the silver-rich Pedernalillo tailings deposit located near the city of Zacatecas in Mexico.

In 2004 Minco Plc commissioned Micon International Limited (Micon) to undertake a pre-feasibility study for the Pedernalillo tailings deposit based on a proposed extraction rate of one million tonnes per year. The study showed robust economics for the project and further drilling was conducted until the end of 2004 to improve the resource classification. In 2005, Minco commissioned Micon to update the resource model and cost estimate, and to conduct a feasibility study for the project, which was completed in January, 2006. In October, 2007, Orca commissioned Micon to complete a Technical Report on the project in accordance with the requirements of Canadian National Instrument 43-101 (NI-43-101) with updated mineral resource/mineral reserve estimates, project economics and a revised plant site location. Micon’s recent work is the subject of a Technical Report (see Technical Report).

Mineral Reserves & Resources

On the basis of the Measured and Indicated Resources suitable for mining and the positive economics Micon has estimated the mineral reserve as a total of 6,799,000 t, containing an average of 57.92 g/t silver, 0.31 g/t gold and 328.92 g/t mercury. This reserve includes only that material that is classified in either the proven or probable categories.