Technical Report Update on the Lindero Heap Leach Project ......Figure 13-3 HPGR Particle Size...

Technical Report Update on the Lindero Heap Leach Project Salta Province, Argentina

Prepared for:

GOLDROCK MINES CORPORATION

Prepared by:

Report Date: 23 February 2016 Effective Date of Resources: 23 October 2015

Technical Report Effective Date: 2 January 2016

Authors: Carl E. Defilippi, SME Registered Member, Kappes Cassiday & Associates

Paul Tietz, C.P.G., Mine Development Associates Thomas L. Dyer, P.E., Mine Development Associates

David G. Thomas, P.Geo., DKT Geosolutions

Kappes, Cassiday & Associates 7950 Security Circle Reno, NV 89506-1995

Lindero Project – NI 43-101 Technical Report i

Kappes, Cassiday & Associates Table of Contents February 2016

TABLE OF CONTENTS

1.0 SUMMARY ......................................................................................................... 1-1

1.1 Introduction .............................................................................................. 1-1 1.2 Key Outcomes .......................................................................................... 1-1 1.3 Property Description and Location .......................................................... 1-2 1.4 Accessibility, Climate, Local Resources, Infrastructure and

Physiography............................................................................................ 1-3 1.5 History...................................................................................................... 1-4 1.6 Geological Setting and Mineralization .................................................... 1-5 1.7 Deposit Types .......................................................................................... 1-6 1.8 Exploration ............................................................................................... 1-6 1.9 Drilling ..................................................................................................... 1-7 1.10 Sample Preparation, Analysis, and Security ............................................ 1-8 1.11 Data Verification .................................................................................... 1-10 1.12 Mineral Processing and Metallurgical Testing ...................................... 1-12 1.13 Mineral Resource Estimates .................................................................. 1-13 1.14 Mineral Reserve Estimates .................................................................... 1-18 1.15 Mining Methods ..................................................................................... 1-19 1.16 Recovery Methods ................................................................................. 1-20 1.17 Project Infrastructure ............................................................................. 1-22 1.18 Market Studies and Contracts ................................................................ 1-23 1.19 Environmental Studies, Permitting and Social or Community Impact .. 1-24 1.20 Capital and Operating Costs .................................................................. 1-26 1.21 Economic Analysis ................................................................................ 1-29 1.22 Adjacent Properties ................................................................................ 1-31 1.23 Project Implementation .......................................................................... 1-31 1.24 Interpretation and Conclusions .............................................................. 1-32 1.25 Recommendations .................................................................................. 1-33

2.0 INTRODUCTION ............................................................................................... 2-1 2.1 Effective Dates ......................................................................................... 2-3 2.2 Previous Technical Reports ..................................................................... 2-3 2.3 List of Abbreviations ............................................................................... 2-4

3.0 RELIANCE ON OTHER EXPERTS .................................................................. 3-1 3.1 Environmental .......................................................................................... 3-1 3.2 Tenure ...................................................................................................... 3-2

Lindero Project – NI 43-101 Technical Report ii


3.3 Permitting ................................................................................................. 3-2 3.4 Hydrology and Hydrogeology ................................................................. 3-3 3.5 Taxes ........................................................................................................ 3-3

4.0 PROPERTY DESCRIPTION AND LOCATION ............................................... 4-1 4.1 Location ................................................................................................... 4-1 4.2 Property and Title in Argentina ............................................................... 4-2 4.3 Tenure History ......................................................................................... 4-6 4.4 Surface Rights .......................................................................................... 4-8 4.5 Royalties ................................................................................................ 4-11 4.6 Permits ................................................................................................... 4-11 4.7 Environmental ........................................................................................ 4-16 4.8 Comments on Section 4 ......................................................................... 4-16

5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY ..................................................................................... 5-1 5.1 Accessibility & Infrastructure .................................................................. 5-1 5.2 Climate ..................................................................................................... 5-1 5.3 Infrastructure ............................................................................................ 5-2 5.4 Physiography............................................................................................ 5-4 5.5 Comments on Section 5 ........................................................................... 5-5

6.0 HISTORY ............................................................................................................ 6-1 7.0 GEOLOGICAL SETTING AND MINERALIZATION ..................................... 7-1

7.1 Regional Geology .................................................................................... 7-1 7.2 District Geology ....................................................................................... 7-4 7.3 Arizaro Deposit Geology ......................................................................... 7-6 7.4 Lindero Deposit Geology ....................................................................... 7-14 7.5 Mineralization ........................................................................................ 7-23 7.6 Comments on Section 7 ......................................................................... 7-27

8.0 DEPOSIT TYPES ................................................................................................ 8-1 8.1 Geological Model and Concepts .............................................................. 8-2 8.2 Exploration Concepts ............................................................................... 8-3 8.3 Comments on Section 8 ........................................................................... 8-3

9.0 EXPLORATION.................................................................................................. 9-1 9.1 Arizaro Deposit ........................................................................................ 9-1 9.2 Lindero Deposit ....................................................................................... 9-7 9.3 Comments on Section 9 ......................................................................... 9-17

10.0 DRILLING ......................................................................................................... 10-1 10.1 Arizaro Project ....................................................................................... 10-1 10.2 Lindero Deposit ..................................................................................... 10-7

Lindero Project – NI 43-101 Technical Report iii


10.3 Drill Program Conclusions and Recommendations ............................. 10-14 10.4 Comments on Section 10 ..................................................................... 10-14

11.0 SAMPLE PREPARATION, ANALYSIS AND SECURITY ........................... 11-1 11.1 Introduction ............................................................................................ 11-1 11.2 Drill Hole Sampling Method ................................................................. 11-1 11.3 Trench and Road-cut Sampling Method at Arizaro ............................... 11-2 11.4 Trench Sampling Method at Lindero ..................................................... 11-3 11.5 Sample Preparation and Assaying ......................................................... 11-4 11.6 Bulk Density/Specific Gravity ............................................................... 11-8 11.7 Comments on Section 11 ....................................................................... 11-9

12.0 DATA VERIFICATION ................................................................................... 12-1 12.1 Arizaro Deposit ...................................................................................... 12-1 12.2 Lindero Deposit ................................................................................... 12-19

13.0 MINERAL PROCESSING AND METALLURGICAL TESTING ................. 13-1 13.1 Introduction ............................................................................................ 13-1 13.2 Summary of Recoveries and Leaching Parameters ............................... 13-1 13.3 Testwork Programs ................................................................................ 13-2 13.4 Sampling ................................................................................................ 13-5 13.5 Mineralogy and Petrography .................................................................. 13-9 13.6 Crushing Work Index and Abrasiveness .............................................. 13-12 13.7 Paste pH, Eh and Dissolved Oxygen ................................................... 13-13 13.8 Head Analyses ..................................................................................... 13-14 13.9 Particle size distribution ....................................................................... 13-16 13.10 Rock Density Test Work ...................................................................... 13-17 13.11 Bottle Rolls .......................................................................................... 13-18 13.12 Drain Down Tests, Slump Data and Permeability ............................... 13-19 13.13 AllOX Puncture Test ............................................................................ 13-21 13.14 Blast Testing ........................................................................................ 13-22 13.15 Cyanide Column Tests ......................................................................... 13-24 13.16 Leaching Parameters ............................................................................ 13-26 13.17 Gold Recoveries ................................................................................... 13-33 13.18 Production Model and Curves ............................................................. 13-35 13.19 Copper Behavior and SART ................................................................ 13-37 13.20 Water Quality ....................................................................................... 13-42 13.21 Detoxification Testwork ...................................................................... 13-43 13.22 Arizaro Deposit - Bottle Rolls ............................................................. 13-45 13.23 Additional Test Work – Lindero Deposit ............................................ 13-45

14.0 MINERAL RESOURCE ESTIMATES ............................................................ 14-1

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14.1 Arizaro Deposit - Summary ................................................................... 14-1 14.2 Arizaro - Resource Drill Database ......................................................... 14-1 14.3 Arizaro - Geologic Background ............................................................. 14-4 14.4 Arizaro - Geologic Model ...................................................................... 14-5 14.5 Arizaro - Mineral Resources ................................................................ 14-12 14.6 Arizaro - Discussion and Recommendations ....................................... 14-18 14.7 Lindero Deposit Summary ................................................................... 14-19 14.8 Lindero - Database ............................................................................... 14-19 14.9 Lindero - Geological Models ............................................................... 14-20 14.10 Lindero - Mineral Resource Classification .......................................... 14-39 14.11 Lindero - Assessment of Reasonable Prospects for Economic

Extraction ............................................................................................. 14-40 14.12 Lindero - Mineral Resource Statement ................................................ 14-43 14.13 Lindero – Discussion and Recommendations ...................................... 14-45 14.14 Lindero - Risk and Opportunity Assessment ....................................... 14-45

15.0 MINERAL RESERVE ESTIMATES................................................................ 15-1 15.1 Pit Optimization ..................................................................................... 15-1 15.2 Pit Designs ............................................................................................. 15-6 15.3 Dilution ................................................................................................ 15-14 15.4 Reserves and Resources ....................................................................... 15-14

16.0 MINING METHODS ........................................................................................ 16-1 16.1 Material Types ....................................................................................... 16-1 16.2 Mining Method ...................................................................................... 16-1 16.3 Mine-Waste Facilities ............................................................................ 16-2 16.4 Mine-Production Schedule..................................................................... 16-2 16.5 Equipment Selection and Productivities ................................................ 16-7 16.6 Mine Personnel ...................................................................................... 16-8

17.0 RECOVERY METHODS .................................................................................. 17-1 17.1 Process Design Basis ............................................................................. 17-1 17.2 Processing Rate ...................................................................................... 17-4 17.3 Crushing Area ........................................................................................ 17-5 17.4 Leach Pad and Leach System ................................................................ 17-7 17.5 Solution Management .......................................................................... 17-12 17.6 ADR Plant ............................................................................................ 17-14 17.7 Process Solution & Makeup Water ...................................................... 17-16 17.8 Process Water Balance ......................................................................... 17-16 17.9 Process Reagents & Consumables ....................................................... 17-22 17.10 Additional Plant Design Considerations .............................................. 17-22

Lindero Project – NI 43-101 Technical Report v


17.11 SART ................................................................................................... 17-23 18.0 PROJECT INFRASTRUCTURE ...................................................................... 18-1

18.1 Access Roads & Site Access.................................................................. 18-2 18.2 Power Supply ......................................................................................... 18-3 18.3 Water Supply ......................................................................................... 18-5 18.4 Process Area Buildings ........................................................................ 18-10 18.5 Mine Area Buildings ............................................................................ 18-12 18.6 Camp .................................................................................................... 18-14 18.7 Diesel Fuel Delivery and Storage Systems .......................................... 18-16 18.8 Site Services ......................................................................................... 18-16 18.9 Site Fencing ......................................................................................... 18-17

19.0 MARKET STUDIES AND CONTRACTS ....................................................... 19-1 19.1 Gold Pricing ........................................................................................... 19-1 19.2 Gold Industry Trends ............................................................................. 19-1 19.3 Doré Production Rate ............................................................................. 19-2 19.4 Refinery Selection .................................................................................. 19-3 19.5 Refining Terms ...................................................................................... 19-3 19.6 Gold Production Schedule ..................................................................... 19-3 19.7 Refining and Transportation Costs ........................................................ 19-4

20.0 ENVIRONMENTAL STUDIES, PERMITTING AND SOCIAL OR COMMUNITY IMPACT .................................................................................. 20-1 20.1 Environment ........................................................................................... 20-1 20.2 Socio-Economic and Cultural Aspects ................................................ 20-34 20.3 Permitting ............................................................................................. 20-38 20.4 Closure ................................................................................................. 20-42 20.5 Closure Cost Basis ............................................................................... 20-49 20.6 Recommendations ................................................................................ 20-52

21.0 CAPITAL AND OPERATING COSTS ............................................................ 21-1 21.1 Capital Costs .......................................................................................... 21-2 21.2 Mining Capital Costs ............................................................................. 21-5 21.3 Processing Capital Costs ........................................................................ 21-8 21.4 Operating Costs .................................................................................... 21-20 21.5 Basis of Operating Cost Estimate ........................................................ 21-22 21.6 Mining Operating Costs ....................................................................... 21-25 21.7 Process Operating Cost ........................................................................ 21-31 21.8 General and Administrative ................................................................. 21-40

22.0 ECONOMIC ANALYSIS ................................................................................. 22-1 22.1 Summary ................................................................................................ 22-1

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22.2 Methodology .......................................................................................... 22-3 22.3 General Assumptions ............................................................................. 22-4 22.4 Financial Model and Results .................................................................. 22-7 22.5 Sensitivity Analysis ............................................................................. 22-12

23.0 ADJACENT PROPERTIES .............................................................................. 23-1 24.0 OTHER RELEVANT DATA AND INFORMATION ..................................... 24-1

24.1 Hydrology .............................................................................................. 24-1 24.2 Geotechnical Studies .............................................................................. 24-7 24.3 Operations Strategy .............................................................................. 24-18 24.4 Project Security .................................................................................... 24-19 24.5 Health and Safety ................................................................................. 24-21 24.6 Risks and Opportunities ....................................................................... 24-22 24.7 Project Implementation ........................................................................ 24-28

25.0 INTERPRETATION AND CONCLUSIONS ................................................... 25-1 26.0 RECOMMENDATIONS ................................................................................... 26-1

26.1 Arizaro Deposit ...................................................................................... 26-1 26.2 Lindero Deposit Expansion and Exploration Activities ........................ 26-1 26.3 Engineering & Procurement Activities .................................................. 26-2 26.4 Detailed Engineering ............................................................................. 26-3 26.5 Test Work............................................................................................... 26-3

27.0 REFERENCES .................................................................................................. 27-1 28.0 AUTHORS’ CERTIFICATES........................................................................... 28-1

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TABLE OF FIGURES

Figure 4-1 Location Map ................................................................................................. 4-1 Figure 4-2 Corporate Holding Structure ......................................................................... 4-7 Figure 4-3 Pertenacia Layout Map .................................................................................. 4-8 Figure 4-4 Pocitos Gas Compression Plant Location ................................................... 4-10 Figure 4-5 Water, Camp and Surface Rights Map ........................................................ 4-11 Figure 7-1 Regional Geology........................................................................................... 7-3 Figure 7-2 District Geology ............................................................................................. 7-5 Figure 7-3 Arizaro Porphyry Units .................................................................................. 7-7 Figure 7-4 Alteration Map of the Arizaro Prospect ....................................................... 7-11 Figure 7-5 Plan of Lindero Deposit ............................................................................... 7-15 Figure 7-6 Cross-section through Lindero Deposit ....................................................... 7-16 Figure 7-7 Plan View of Alteration Zones at the Lindero Deposit ................................ 7-20 Figure 7-8 Plan of Mineralized Bodies at the Lindero Deposit ..................................... 7-25 Figure 8-1 Copper-Gold Porphyry Model ....................................................................... 8-1 Figure 9-1 Stereographic Projection (to Upper Hemisphere) of Structures and Veinlets at

Arizaro ................................................................................................................. 9-5 Figure 9-2 Arizaro Section 3950...................................................................................... 9-7 Figure 9-3 Trench Locations and Soil Grid Layout for the Lindero Deposit ................ 9-14 Figure 10-1 Drill Location Map of the Arizaro Deposit ................................................ 10-4 Figure 10-2 Drill Hole Locations and Orientations ..................................................... 10-13 Figure 11-1 Photo of Drill Core before Sampling ......................................................... 11-2 Figure 11-2 Photo of Channel Sample ........................................................................... 11-3 Figure 12-1 Arizaro Specific Gravity Data – Goldrock and ACME comparison .......... 12-5 Figure 12-2 Core Recovery versus Gold Grade - >0.2g/t Au Intervals Only ................ 12-7 Figure 12-3 Arizaro Blank Analyses - Gold .................................................................. 12-9 Figure 12-4 Control Chart for SRM STD 2a ACME – Gold ....................................... 12-11 Figure 12-5 Control Chart for SRM STD 4a Alex Stewart – Gold ............................. 12-13 Figure 12-6 Quarter-Core Absolute Relative Difference - Gold ................................. 12-15 Figure 12-7 Pulp Duplicate Relative Difference ARD09 through ARD16 - Gold ..... 12-17 Figure 12-8 Pulp Duplicate Absolute Value of Relative Difference ARD09 through

ARD16 - Gold .................................................................................................. 12-18 Figure 13-1 Metallurgical Testwork Sampling Locations ............................................. 13-8 Figure 13-2 Hammer Mill Particle Size Distribution of Phase III Material ................ 13-16 Figure 13-3 HPGR Particle Size Distribution of Phase V Material ............................. 13-17

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Figure 13-4 Photographs of Blast Testwork ................................................................ 13-23 Figure 13-5 Crush size versus Recoveries for Phases II, III, IV .................................. 13-26 Figure 13-6 Polysius Abrasion Comparisons .............................................................. 13-27 Figure 13-7 Recovery Curves for Various Crusher Types .......................................... 13-28 Figure 13-8 Cyanide Consumptions (Laboratory) as a Function of Solution to Ore Ratio

for All Lithologies, Phases II, III, V ................................................................ 13-30 Figure 13-9 Recoveries as a function of leaching time for a 10m lift ......................... 13-32 Figure 13-10 Head Grades Versus Recoveries for 6.3mm and 9mm Material ............ 13-34 Figure 13-11 Field Recovery Curves for All Met Types ............................................. 13-37 Figure 14-1 Arizaro Drill-Hole Location Map .............................................................. 14-3 Figure 14-2 Section 7223950 Arizaro Geologic Model with Gold Domains ................ 14-7 Figure 14-3 Section 7223950 Arizaro Block Model: Gold Block Grades................... 14-17 Figure 14-4 Lindero Lithological Domains ................................................................. 14-23 Figure 14-5 Plan 3760–Model Gold Grade Blocks, Composites and Search Ellipses 14-24 Figure 14-6 North–South Section Showing Gold Grades of Blocks and Composites 14-25 Figure 14-7 East–West Section Showing Gold Grades of Blocks and Composites .... 14-26 Figure 14-8 Section 2623155 E, Showing Composites and OK Model Gold Grades . 14-36 Figure 14-9 Geotechnical Pit Slope Parameters .......................................................... 14-42 Figure 14-10 Lindero Grade – Tonnage Curve ............................................................ 14-46 Figure 15-1 Graph of Whittle Results ............................................................................ 15-5 Figure 15-2 Lindero Ultimate Pit Design ...................................................................... 15-9 Figure 15-3 Phase 1 Pit Design ................................................................................... 15-11 Figure 15-4 Phase 2 Pit Design .................................................................................... 15-12 Figure 15-5 Phase 3 Pit Design .................................................................................... 15-13 Figure 16-1 Owner Mining Mine Organizational Chart ................................................ 16-9 Figure 17-1 Overall Process Flowsheet ......................................................................... 17-2 Figure 17-2 Overall Site Layout .................................................................................... 17-3 Figure 17-3 Lindero Projected Field Heap Recovery Curves by Met Type ................ 17-11 Figure 17-4 Process Water Balance Diagram, Average Precipitation Year ................ 17-21 Figure 18-1 Project Location Map ................................................................................. 18-2 Figure 18-2 Well Test Locations ................................................................................... 18-8 Figure 20-1 Example of Air Quality Sampling Equipment ......................................... 20-12 Figure 20-2 Ecological Units ....................................................................................... 20-19 Figure 20-3 Project Location in Relation to National Parks ........................................ 20-20 Figure 20-4 Location of Archaeological Sites ............................................................. 20-21 Figure 20-5 Training is an Important Part of the Company’s Culture ......................... 20-35 Figure 22-1 After-Tax IRR vs. Gold Price, Capital Cost, and Operating Cash Cost .. 22-13 Figure 22-2 NPV @ 0% vs. Gold Price, Capital Cost, and Operating Cash Cost ....... 22-14

Lindero Project – NI 43-101 Technical Report ix


Figure 22-3 NPV @ 5% vs. Gold Price, Capital Cost, and Operating Cash Cost ....... 22-15 Figure 22-4 NPV @ 8% vs. Gold Price, Capital Cost, and Operating Cash Cost ....... 22-16 Figure 24-1. Water Sources Near Project Area ............................................................. 24-2 Figure 24-2 Arita, Chachas, Lindero and Emboscadero Sub-Basins ............................. 24-3 Figure 24-3 Geoelectric Profile of Chachas Sub-Basin ................................................. 24-6 Figure 24-4 Location of Potential Clay Borrow Sources, October 2013 Study ......... 24-12

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LIST OF TABLES

Table 1-1 Arizaro Reported Resource ........................................................................... 1-15 Table 1-2 Lindero Mineral Resource Statement ............................................................ 1-18 Table 1-3 Proven and Probable Reserves and Associated Waste by Phase ................... 1-19 Table 1-4 Summary of Pre-Production Capital Costs .................................................... 1-27 Table 1-5 Lindero Project Average Operating Cost ...................................................... 1-29 Table 1-6 Life of Mine Economic Summary ................................................................. 1-30 Table 1-7 Sensitivity Analysis (After Tax) .................................................................... 1-31 Table 2-1 QPs, Areas of Report Responsibility, and Site Visits ..................................... 2-2 Table 4-1 Tenure Boundary Co-ordinates ...................................................................... 4-7 Table 4-2 Required Key Permits and Authorizations, including Agencies ................... 4-13 Table 9-1 Summary of Exploration Programs Carried Out at Arizaro ............................ 9-1 Table 9-2 Summary of Exploration Programs Carried Out on the Lindero Deposit ....... 9-8 Table 9-3 Trench and Road Cut Samples ........................................................................ 9-9 Table 9-4 Location of 2010 drill holes .......................................................................... 9-16 Table 10-1 Summary of drilling campaigns at the Arizaro Project ............................... 10-3 Table 10-2 Summary of drilling campaigns at the Lindero Deposit ............................. 10-9 Table 12-1 MDA Verification Sample Results ............................................................. 12-4 Table 12-2 Standards with Gold Analyses................................................................... 12-12 Table 12-3 Average Values for Core Duplicate Difference Parameters, Gold ............ 12-14 Table 12-4 Pulp Duplicate Gold Results .................................................................... 12-16 Table 12-5 Summary of Collar and Down-hole Surveys ............................................. 12-20 Table 12-6 AMEC Independent Sampling Results ...................................................... 12-23 Table 12-7 Summary of QA/QC Samples, Rio Tinto Campaign ................................ 12-25 Table 12-8 Summary of QA/QC Samples 2005–2006 Campaign ............................... 12-28 Table 12-9 2005–2006 ACME SRM Sample Analyses .............................................. 12-29 Table 12-10 Summary of QA/QC Samples 2006 Campaign ....................................... 12-30 Table 12-11 2006 ACME SRM Sample Analyses ...................................................... 12-31 Table 12-12 Summary of QA/QC Sample 2006 – 2007 Campaign ............................ 12-32 Table 12-13 2006-2007 Alex Stewart SRM Analyses ................................................. 12-33 Table 12-14 Summary of QA/QC Sample Analyses 2007–2008 Campaign ............... 12-35 Table 12-15 2007–2008 Alex Stewart SRM Analyses ................................................ 12-35 Table 12-16 Summary Statistics, Comparison of Trenches with Drill Holes .............. 12-37 Table 13-1 Project Heap Leach Recoveries ................................................................... 13-1 Table 13-2 Heap Leaching Parameter design criteria ................................................... 13-2

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Table 13-3 Key for Lithology Codes and Groupings .................................................... 13-6 Table 13-4 Samples Used in Metallurgical Testwork Programs ................................... 13-7 Table 13-5 Multi-Element Analysis for Phase III material ......................................... 13-11 Table 13-6 Phase III Whole Rock Analysis ................................................................. 13-12 Table 13-7 Summary Results Hazen Comminution Tests ........................................... 13-13 Table 13-8 Summary Results. METSO Comminution Tests....................................... 13-13 Table 13-9 Results from paste pH, Eh and Dissolved oxygen testwork ...................... 13-13 Table 13-10 Total Carbon, Sulfur, Mercury & Soluble Copper Analyses .................. 13-14 Table 13-11 Head analyses for the Lindero Testwork ................................................. 13-15 Table 13-12 Rock Density Results .............................................................................. 13-18 Table 13-13 Phase II and AllOX Bottle Roll Test Summaries .................................... 13-19 Table 13-14 Summary of Compacted Permeability Tests ........................................... 13-21 Table 13-15 Puncture test results ................................................................................. 13-22 Table 13-16 Column Test Work Parameters for all Phases ......................................... 13-25 Table 13-17 Cyanide consumption as a function of Lithology .................................... 13-30 Table 13-18 Column Test Hydrated Lime Consumption as a Function of Lithology . 13-31 Table 13-19 Recoveries as a Function of Lithology and Testwork Phase ................... 13-33 Table 13-20 Project Heap Leach Recoveries ............................................................... 13-34 Table 13-21 Solubility of Cu Minerals in NaCN Solution .......................................... 13-38 Table 13-22 Phase II and III Copper Head Grades and Recoveries ............................ 13-39 Table 13-23 Water Quality Table ................................................................................ 13-43 Table 13-24 Summary of Detoxification Test Results – Total & WAD Cyanide ....... 13-44 Table 13-25 Summary of Detoxification Test Results – Reagent Usage .................... 13-44 Table 13-26 Summary of Arizaro Bottle Rolls – Gold Extraction and Reagent Usage13-45 Table 13-27 Summary of Arizaro Bottle Rolls – Silver and Copper Extraction ......... 13-45 Table 13-28 Consolidation Tests on Oxide and Hypogene Ore .................................. 13-46 Table 13-29 Compacted Permeability Tests on Oxide and Hypogene Ore (2014) ..... 13-47 Table 13-30 HPGR Wear Rate Index Results .............................................................. 13-47 Table 13-31 Estimated HPGR Roll Wear Life ............................................................ 13-48 Table 13-32 Summary of 2015 Compacted Permeability Test Work – Oxide Ore ..... 13-49 Table 14-1 List of Density Values Used in Arizaro Model ........................................... 14-8 Table 14-2 Arizaro Mineral Domain Assay Descriptive Statistics ................................ 14-9 Table 14-3 Arizaro Mineral Domain Composite Descriptive Statistics ...................... 14-10 Table 14-4 Arizaro: Estimation Parameters ................................................................. 14-11 Table 14-5 Criteria for Arizaro Resource Classification ............................................. 14-14 Table 14-6 Arizaro Reported Resource ....................................................................... 14-15 Table 14-7 Arizaro Total Resource .............................................................................. 14-16 Table 14-8 Variogram Parameters ............................................................................... 14-30

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Table 14-9 Grade Interpolation Parameters ................................................................. 14-31 Table 14-10 Rock Codes for CPD1/FPD and S1 Domains and Subdomains .............. 14-32 Table 14-11 Rock Codes for Other Domains and Subdomains ................................... 14-32 Table 14-12 Specific Gravity Values Assigned to Lindero Model .............................. 14-34 Table 14-13 Global Bias Check by Rock Type ........................................................... 14-35 Table 14-14 Relative Differences in Tonnes and Grades at 0.2 g/t Au Cut-Off ......... 14-38 Table 14-15 Costs Used in Mineral Resource Estimate .............................................. 14-41 Table 14-16 Lindero Mineral Resource Statement ...................................................... 14-43 Table 14-17 Sensitivity of Lindero Mineral Resource to Cut-Off Grade .................... 14-44 Table 14-18 Comparison with 2010 Mineral Resource Estimate ................................ 14-45 Table 15-1 Pit Optimization Economic Parameters ...................................................... 15-2 Table 15-2 Cutoff Grades (g Au/t) ................................................................................. 15-3 Table 15-3 Whittle Pit Optimization Results ................................................................. 15-5 Table 15-4 Proven and Probable Reserves and Associated Waste by Phase ............... 15-16 Table 15-5 In-Pit Inferred Resources .......................................................................... 15-18 Table 16-1 Annual Mine Production Schedule .............................................................. 16-4 Table 16-2 Annual Ore Delivery to the Crusher ............................................................ 16-5 Table 16-3 Annual Stockpile Balance .......................................................................... 16-6 Table 16-4 Contractor Mine Personnel Requirements (Phase 1 & 2 Mining) ............. 16-10 Table 16-5 Owner Mine Personnel Requirements ...................................................... 16-10 Table 16-6 Mine Annual Personnel Costs ($000.’s USD) .......................................... 16-11 Table 17-1 Processing Design Criteria Summary .......................................................... 17-1 Table 17-2 Pond Volume Requirements, m3 ............................................................... 17-14 Table 17-3 Average, Wet, and Dry Year Rainfall Data in mm ................................... 17-17 Table 17-4 Site-Wide Average Year Water Requirements .......................................... 17-19 Table 17-5 Heap Leach Water Balance, Average Precipitation Year, Ultimate Heap 17-20 Table 17-6 Projected Annual Reagents and Consumables .......................................... 17-22 Table 18-1 Power Consumption by Area....................................................................... 18-5 Table 18-2 Site Water Demand (Design)....................................................................... 18-6 Table 18-3 Summary of Well Locations and Tests ....................................................... 18-7 Table 19-1 Recent Metals Prices ................................................................................... 19-1 Table 19-2 Summary of Ore Processed and Gold Produced ......................................... 19-4 Table 20-1 Environment Reports Presented to the Provincial Government .................. 20-8 Table 20-2 Averaged Environmental Concentration of Particulate Matter (PM10) .... 20-12 Table 20-3 Water Quality Guideline Levels in Annex IV of Law No. 24,585 ............ 20-14 Table 20-4 Drinking Water Specifications of the Argentine Food Code .................... 20-15 Table 20-5 Taxonomical Classification ....................................................................... 20-17 Table 20-6 Ecological Units ........................................................................................ 20-18

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Table 20-7 Required Key Permits and Authorizations, including Agencies ............... 20-40 Table 20-8 Closure Costs ............................................................................................. 20-51 Table 21-1 Lindero Pre-Production Capital Costs ......................................................... 21-1 Table 21-2 Lindero Project Average Operating Cost .................................................... 21-2 Table 21-3 Summary of Pre-Production Capital Costs by Area .................................... 21-3 Table 21-4 Summary of Pre-Production Capital Costs by Discipline ........................... 21-4 Table 21-5 Mining Capital Costs (US$ 000’s) .............................................................. 21-7 Table 21-6 Future Capital Summary ............................................................................ 21-18 Table 21-7 Lindero Project Operating Cost by Year ................................................... 21-21 Table 21-8 Labor Category and Wages ....................................................................... 21-24 Table 21-9 Annual Mine Operating Costs ................................................................... 21-26 Table 21-10 Contractor Mining Costs ......................................................................... 21-28 Table 21-11 Lindero Detailed Process Operating Cost by Year.................................. 21-32 Table 21-12 Lindero Process Staffing Levels .............................................................. 21-33 Table 21-13 Process Power and Consumption ............................................................ 21-36 Table 21-14 Process Consumable Items ...................................................................... 21-37 Table 21-15 Reagent Prices ......................................................................................... 21-37 Table 21-16 G&A Cost Summary ............................................................................... 21-41 Table 22-1 Life of Mine Summary ................................................................................ 22-2 Table 22-2 Capital Cost Summary ................................................................................. 22-6 Table 22-3 Key Financial Parameters ............................................................................ 22-8 Table 22-4 Cash Flow Analysis ..................................................................................... 22-9 Table 22-5 Sensitivity Analysis (After Tax) ................................................................ 22-12 Table 24-1 Recharge Rates of Arita, Chachas, Lindero and Emboscadero Sub-Basins 24-4 Table 24-2 Pit Campaigns 2010-2014 .......................................................................... 24-9 Table 24-3 Surveys AMEC Campaign 2010-2011 ..................................................... 24-10 Table 24-4 Surveys of Condemnation. 2010. ............................................................ 24-11 Table 24-5 Potential Clay Borrow Sources, October 2013 Study .............................. 24-11 Table 24-6 Samples tested .......................................................................................... 24-13 Table 24-7 Soil Classification .................................................................................... 24-14 Table 24-8 Standard Proctor Test for Soil Samples and Mixtures ............................. 24-14 Table 24-9 Permeability Tests .................................................................................... 24-15 Table 24-10 Cost Areas Affected by Peso Devaluation .............................................. 24-24 Table 24-11 Estimated Effect of Peso Devaluation on Project Capital Costs ............. 24-25 Table 24-12 Estimated Effect of Peso Devaluation on Project Operating Costs ......... 24-25 Table 24-13 Estimated Effect of Diesel Price on Project Operating Costs ................. 24-26 Table 24-14 Procurement Lead Times ......................................................................... 24-30 Table 24-15 Major Construction Contracts / Contractors............................................ 24-31

Lindero Project – NI 43-101 Technical Report xiv


Table 26-1 Long Lead Time Items (Greater than Six Months) ..................................... 26-2

Lindero Project – NI 43-101 Technical Report Page 1-1

Kappes, Cassiday & Associates Section 1 - Summary February 2016

1.0 SUMMARY 1.1 Introduction Kappes, Cassiday and Associates (KCA), Mine Development Associates (MDA) and DKT Geosolutions Inc. (DKT) were commissioned by Goldrock Mines Corp. (Goldrock) to prepare an independent Qualified Person’s review and NI 43-101 Technical Report (the Report) for the wholly-owned Arizaro–Lindero gold project (the hereafter referred to as the Project or the Lindero Project) located in the Salta Province of Argentina. Goldrock controls 100% of the Lindero Project through its wholly-owned indirect Argentinean subsidiary, Mansfield Minera S.A. (Mansfield); in this report, “Goldrock” refers collectively to Goldrock and Mansfield. This report is an update to the prior feasibility study and Technical Report issued in July 2013, considering some minor changes in approach to the development of the Lindero deposit, and also advancement of basic engineering studies and other work programs for the Lindero deposit. The Project has all approvals in place to commence construction. This report includes the Arizaro deposit mineral resources reported previously in July 2013. Note no further development of the Arizaro deposit has taken place since the issue of the July 2013 technical report and the Arizaro mineral resources reported herein are considered current. This technical report summarizes the results of the updated feasibility study for the Lindero deposit. 1.2 Key Outcomes The Report discloses the results of the updated Feasibility Study completed on the Lindero deposit during 2015. Key outcomes of the study were:

Proven and Probable Mineral Reserves of 82.5 Mt grading 0.63 g/t Au (1.68 Moz contained gold);

Planned conventional open pit mining operation using truck and shovel mining methods, producing 6.84 million tonnes of ore per year over a nine-year pit life;

Total life-of-mine gold production of 1,149,000 ounces; Planned conventional heap leach operation that has a 12 year life;



Financial analysis of the base case (US$ 1,200/oz Au and a discount rate of 5%) showing after-tax Project NPV of US$151.8 million, internal rate of return (IRR) of 26.5%, average annual after-tax cash flow value (Production Years 1-12) of US$35.5 million, and payback period of 2.0 years; and

All-in life-of-mine average sustaining cash costs of US$716/oz Au. Based on the results of drilling 29 core holes at the Arizaro deposit, MDA has estimated an Indicated Mineral Resource of 31.0 Mt grading 0.34 g/t Au (338 Koz contained gold) and an Inferred Mineral Resource of 27.4 Mt grading 0.26 g/t Au (230 Koz contained gold) . 1.3 Property Description and Location The Lindero Project is located 260 km due west of Salta City, Argentina, the main service center of the region, at latitude 25o 06’ south and longitude 67o 45’ west. Drive time from Salta to the Project is approximately 7 - 7.5 h, over a road distance of 420 km. The nearest town to the Lindero Project is Tolar Grande (population 250), located 75 km to the northeast.

Access to the project is via National Route 51, which passes through the towns of San Antonio de Los Cobres and Olacapato, and Provincial Route 27, via Pocitos and Tolar Grande. The Lindero Project contains two known porphyry gold-copper deposits that are the subjects of this report; the Arizaro deposit is located three kilometers southeast of the Lindero deposit. 1.3.1 Mineral Tenure and Surface Rights The mineral tenement holdings cover 3,500 ha, and comprise 35 pertenecias, each of 100 ha, which are constrained by Gauss Kruger Posgar co-ordinates generated by survey. Tenure is held in the name of Mansfield Minera S.A. (Mansfield), a wholly-owned subsidiary of Goldrock. There is no expiry date on the pertenecias, providing Goldrock meets expenditure and environmental requirements, and pays the appropriate annual mining fees.



A 3% provincial royalty “boca mina” is payable on revenue after deduction of direct processing, commercial and general and administrative costs. There are no royalties payable to any other third party. Surface rights are owned by the provincial state (Propiedad Fiscal) of Salta. There are no reservations, restrictions, rights-of-way or easements on the Project to any third-party. Goldrock holds a registered camp concession, and a granted and surveyed access right-of-way. Water permits and rights of access to the Project are guaranteed through water and access licenses granted by the Mining Court of Salta. 1.3.2 Environmental and Permitting Specific approvals and permits have been granted to commence the construction of the Project. In November of 2010, the Company submitted the EIA (exploitation) report for the Lindero Project, and in November 2011, the Company received approval of this EIA through the issue of the Declaracion de Impacto Ambiental (DIA). The DIA is the guiding (primary) operating permit during the life of the Project. It is also a requirement for the granting of most sector permits for the Project. Since the discovery of gold mineralization at the Project in 2000, the Company has presented more than 20 other environmental reports describing various activities such as extraction of samples at initial stages, soil sampling, a program of geophysical surveys, and details of access roads, drilling programs, camp installation, and runways. These reports consist of a brief description of the environmental baseline, the project, environmental impact, and ways to prevent and mitigate that impact. On many occasions, the Government of Salta Province has inspected the various activities. There are no known current environmental liabilities for this Project. 1.4 Accessibility, Climate, Local Resources, Infrastructure and Physiography The Lindero Project is located 260 km due west of Salta City, Argentina, the main service center of the region, at latitude 25o 06’ south and longitude 67o 45’ west. Access to the project is via National Route 51, which passes through the towns of San Antonio



de Los Cobres and Olacapato, and Provincial Route 27, via Pocitos and Tolar Grande. A 4,000 m long Project airstrip is also nearby, situated about 10 km from the proposed Project plant site. The Project is located in the Argentinean puna, a cool, arid zone that commences at an elevation of approximately 3,500 to 4,000 m. The average annual rainfall is about 37 mm, distributed irregularly throughout the year. The annual average temperature is 3.9°C. The warmest months are January and February; the coldest month is July. Existing Project infrastructure comprises a climate station, two man camps that can accommodate approximately 100 people. Site access will be primarily by existing national and provincial roads that will be used during construction and operation. Argentina has sufficient experienced and skilled professionals to run the proposed Lindero operation. Power for the Project will primarily be provided by natural gas generators, based on trade-off studies (diesel versus natural gas power stations) for optimum power supply performed during the pre-feasibility and feasibility studies. Fresh water supply to support the mine and process operations will be provided by two permitted wells located 13 km to the east and three smaller capacity permitted wells located on the Lindero property. 1.5 History Gold–copper mineralization associated with potassic alteration was first discovered by Goldrock geologists at the Arizaro prospect in November 1999, and led to claim staking. Work completed to date has been either by Rio Tinto, during a joint venture, or by Goldrock staff, and consists of reconnaissance and detailed geological mapping, soil geochemistry (talus fines), trench excavation, sampling, and mapping, ground magnetics and induced polarization geophysical surveys, road cut sampling, core drilling, a core-relog program, generation of a three-dimensional (3D) geological model for the Lindero deposit, and metallurgical testwork. A pre-feasibility study for the Lindero deposit was completed by AMEC in 2010, assuming a production throughput of 30,000 tonnes of ore per day. A feasibility study for the Lindero deposit, using a reduced throughput of 18,750 tonnes per day, was



completed by KCA in May 2013. An updated Technical Report was issued in July 2013 to include the reporting of the adjacent Arizaro mineral resources. 1.6 Geological Setting and Mineralization In the Central Andes, the altiplano or puna is a high plateau of more subdued relief between the Eastern Cordillera, a rugged region usually rising to between 3 kilometers and 4.5 kilometers, and the Western Cordillera, which is a high spine of mountains that may reach as much as 5 kilometers in height. The Arizaro Volcanic Complex, which consists of two superimposed concentric volcanic centers, the Arizaro and the Lindero cones, is located in the Arcihibarca volcanic arc at the southern margin of the Salar de Arizaro basin. Basement rocks crop out to the north of the Lindero deposit, and consist of coarse-grained Ordovician granites, which are uncomformably overlain by Early Tertiary red bed sandstones. The Lindero–Arizaro complex, a series of diorite to monzonite porphyritic stocks, intrudes these units. Overall, the Arizaro deposit as currently defined is roughly circular in plan view, extending 650 m north-south and 600 m east-west. The gold-copper mineralization is associated with strong potassic alteration with a surrounding zone of propylitic alteration. The higher-grade core of the deposit, with gold grades averaging 0.6 g/t gold, is characterized by magnetite- and biotite-rich breccias. Surrounding the mineralized breccias, gold grades average 0.2 g/t gold. Copper grades are more consistent across the deposit averaging 0.15% copper. Thin veins (



quartz, quartz–magnetite–sulfides, biotite-magnetite– chalcopyrite, magnetite–chalcopyrite and quartz–limonite–hematite stockworks which are strongly associated with K-feldspar alteration. This association is very common in the east zone of the deposit, where the highest gold grades occur. At other locations where one or more stockwork types are missing or the intensity of fracturing is lower, mineralization tends to be weaker and the grades of gold tends to be lower (approximately 0.4 g/t Au). Gold mineralization at Lindero is characterized by free gold, which is associated with chalcopyrite and/or magnetite grains with rare interstitial quartz. The weathered oxidation zone at Lindero is generally poorly developed and averages 44 m in thickness. The Arizaro prospect has styles of mineralization with copper–gold grade strongly correlated with different alteration assemblages. Mineralization is mainly associated with potassic alteration. This occurs generally in multi-directional veins, vein stockworks and disseminations. Chalcopyrite and bornite are the main copper minerals. Gold is mainly associated with chalcopyrite, quartz, and anhydrite veinlets. Gold–copper grades average 0.6 g/t gold and 0.15% copper. 1.7 Deposit Types The deposits and prospects found within the Project area are considered to be examples of porphyry-style deposits, in particular gold-rich porphyries. 1.8 Exploration The Arizaro prospect was discovered in 1999 as a result of a regional program of exploration undertaken by Goldrock. Since then, exploration programs have been conducted in the area consisting of initial exploration by Goldrock during 2000–2001 (consisting of geology mapping, soil sampling, trenches) and a follow-up program by Rio Tinto during 2002–2003 (consisting of geophysics and two initial drill holes). Three drill programs were conducted by Goldrock during 2010 to 2012 consisting of a total of 27 holes. The Lindero deposit was discovered in late 2000. Several exploration programs have been conducted by Goldrock and Rio Tinto on the Lindero deposit:



Goldrock Campaign: August 2000–October 2001, which included geologic

mapping, soil sampling, and trench sampling; Rio Tinto Campaign: May 2002–February 2003, which included road

sampling, geophysics, and drilling (10 holes for a total of 3,279m); Goldrock Campaign: October 2005–January 2008, which included geological

mapping and modeling, trenching, and a significant drilling program (106 holes for a total of 30,024m);

Goldrock Campaign: September 2008 and August 2010–November 2010, which consisted of additional drilling (23 holes) for the pre-feasibility study.

1.9 Drilling Drilling on the Arizaro deposit was conducted from 2002 to January 2013 and totals 29 core holes (8,855 m). Drilling completed on the Lindero deposit from 2002 to November 2010 comprised 139 core drill holes (38,137 m). 1.9.1 Arizaro Drilling Rio Tinto drilled the first two holes at Arizaro between November and December 2002, testing mineralization identified by trenching. These holes totaled 629 meters. Goldrock tested the deposit with 27 core holes drilled from August 2010 through January 2013 and totaling 8,226.5 meters. All were core holes drilled using HQ (63.5 mm diameter) for the first 300 meters and were subsequently reduced to NQ (47.6 mm diameter). Logging of core utilized standard logging procedures, recording geological and geotechnical information. Drill collars were located using a differential global positioning system (DGPS) instrument. The drill holes were down-hole surveyed using a surface-recording gyroscopic instrument. The holes were generally orientated perpendicular to the high grade breccia mineralization. Dips vary depending on the target and range from -50° to -89°, averaging -70°. The spacing between drill holes is approximately 50 m on the surface and increases to 100 m at depth. 1.9.2 Lindero Drilling A total of 139 core holes (38,137 meters) were drilled at the Lindero deposit from April 2002 to November 2010, of which the first 10 were drilled by Rio Tinto, followed by 106



exploration holes drilled by Goldrock as well as 23 geotechnical and condemnation holes. All except the geotechnical and condemnation holes were drilled using HQ (63.5 mm diameter) for the first 300 m, and were subsequently reduced to NQ (47.6 mm diameter). Logging of core utilized standard logging procedures, recording geological and geotechnical information. Drill collars were located using a differential global positioning system (DGPS) instrument. During Rio Tinto’s exploration drilling in 2002 by Connors Drilling and Goldrock’s 2005–2006 campaign by Patagonia Drilling, no downhole surveys were undertaken. Downhole surveys between 2006 and early 2008 were typically taken using a Reflex Maxibor® instrument, with surveying carried out on the new holes and on older holes drilled in previous campaigns. During 2008, Goldrock identified a survey error with these data. Where possible, drill holes were resurveyed using a SRG Gyroscope®; the 2009 program resurveyed about 80% of the then-existing drill holes. Drilling conditions were good during Rio Tinto’s drilling program, and core recovery was generally above 90%. For all of Goldrock’s diamond drilling, drill core recovery measurements are collected on each hole as it is being drilled; drill hole recovery for Goldrock’s drilling has averaged 92.68%. The average depth of the core holes is 300 m and the deepest hole reached 576 m depth. The holes were generally orientated perpendicular to the mineralization forming a radial pattern, except in the eastern portion where the holes are either perpendicular (azimuth 270°) or parallel (azimuth 190°) to the main mineralized body. Dips vary depending on the target and range from -50° to -89°, averaging -70°. The spacing between drill holes is approximately between 40–50 m on the surface; drill holes are further apart at depth. 1.10 Sample Preparation, Analysis, and Security All of the diamond drill holes at the Arizaro and Lindero deposits have been sampled by sawing the core into halves. One-half is then collected for analysis and one-half kept in the core box for library storage at the project site. Core sampling for the 2002 Rio Tinto program and all Goldrock programs was carried out at 2 m intervals, irrespective of lithology. The primary assay laboratory for the Rio Tinto campaign at both Arizaro and Lindero was ALS Chemex (now ALS Minerals), Vancouver, Canada; ALS Chemex prepared samples at its Mendoza, Argentina facility. Check assaying for Rio Tinto’s drilling was



performed by Alex Stewart Laboratories in Argentina, Bondar Clegg Laboratories in Canada, and an un-named location of ACME Laboratories. The drill core from the 2005-2008 Goldrock exploration campaigns at the Lindero deposit was sent to ACME Laboratories in Mendoza, Argentina, for sample preparation, and was analyzed at the ACME laboratory in Santiago de Chile, Chile. The Argentinean and Chilean laboratories of Alex Stewart and ALS Chemex were used for check assaying. The primary assay laboratories for the 2010-2013 Goldrock exploration campaigns at the Arizaro deposit were Alex Stewart for the 2010 drilling and ACME for the subsequent drilling. Check analyses were performed at ACME, Alex Stewart and ALS Chemex. All laboratories are, and were, independent of Rio Tinto and Goldrock, and typically held accepted international accreditations. Samples were typically dried, crushed, and pulverized to a nominal 95% -150 mesh (ALS Chemex) or a nominal 95% -200 mesh (ACME). Samples were assayed for gold using fire assay with atomic absorption (AA) finish, and for 35 elements using inductively coupled plasma (ICP) spectrophotometry. Copper values above 1% were re-run with AA. Rio Tinto included pulp duplicates, coarse duplicates, blanks and standard reference materials (SRMs) in the drill sample submissions to the laboratory. A quality assurance and quality control procedure (QA/QC) was implemented throughout the Goldrock drill and trench sampling programs, and included submission of SRMs, blanks, field duplicates and check samples. Field duplicates were prepared from quarter core samples. During Goldrock’s drilling, a 7-cm to 10-cm length core sample was collected at 10-m intervals for bulk density measurements, which were performed by Goldrock personnel using water-displacement methods. Measurements were taken on 493 samples from Arizaro and 841 samples from Lindero. Goldrock also contracted ACME laboratories to check the bulk density measurements using a wax-coated water-immersion technique; ACME analyzed 215 samples from Arizaro and 148 samples from Lindero. Sample security has relied upon the fact that the samples were always attended or locked in the core facility. Chain-of-custody procedures were consistent with standard practice of any sample shipment to the analytical laboratories.



1.11 Data Verification 1.11.1 Arizaro Deposit MDA verified the Goldrock drill data by completing a thorough audit of the drill data, conducting a site visit, and analyzing the QA/QC data and results. The database audit consisted of checking the digital collar, down-hole survey, assay, and lithology data against source documents, which included original lab certificates, surveyor’s notes, and Goldrock geologic logs. The drill-hole collar locations were checked against the current topography and also verified in the field. Total depths were verified against the core log and core photos. The Arizaro logged geology was checked against the geology observed in the core for six Goldrock holes, while the digital lithology data were checked for reasonableness in the process of working on the geologic model. MDA did not observe any material differences between the digital logs and the core geology. MDA electronically audited the gold and copper assay data set against a complete compilation of digital source data from both Alex Stewart and ACME labs. The audit of the complete assay database resulted in corrections to the data within 12 sample intervals, an error rate of less than 0.5%. Nine quarter-core verification samples were collected by MDA. The verification results confirm the presence of gold mineralization at Arizaro, though there is significant variability in the gold assays, and there is evidence of a negative bias in the MDA gold and copper values. The database used in the resource estimate includes all changes resulting from the data audit and is considered acceptable for use in future modeling and resource work. Goldrock inserted a total of 720 quality control and quality assurance (“QA/QC”) blanks, standard reference materials (“SRMs”), and quarter-core field duplicates into the regular sample stream at the rate of one blank, SRM, and duplicate in every batch of 20 samples sent to the lab. In addition, 482 original pulps were sent to second and third labs for re-assay as a check on the original lab accuracy.



The QA/QC results show a low bias in the Alex Stewart gold data within holes AR03 through ARD08 and a high bias in the ACME data in holes ARD09 through ARD16. There is also evidence of a lack of precision, in the form of increased blank and SRM sample failures, in the ARD09 through ARD16 ACME data. These factors result in a low risk to the global estimate but an increased risk in the local gold grade estimate.

The high sample variance, and associated evidence of increasing variance with grade is some of the drill data, indicates a coarse gold nature to a portion of the gold mineralization. This imparts a low to moderate risk to the local gold estimate.

QA/QC analyses of the copper data indicate no material concerns. The copper data have limited blank and/or SRM failures, no evidence of lab bias, and low sample variance in quarter-core and pulp duplicate data. 1.11.2 Lindero Deposit A number of data verification programs and audits have been performed over the project’s history, primarily in support of compilation of technical reports. These include reviews by independent consultants Roscoe Postle Associates (Fuchter and Rennie, 2003), American Au Ag Associates (2004), and Golder Associates (Godoy and Palmer, 2008). No material errors were noted with the data on completion of the audits. AMEC performed an audit of the digital database for the Lindero deposit in 2009, which consisted of Microsoft Excel® spreadsheets and MapInfo® tables. The audit consisted of checking the geological, survey, assay and QA/QC digital data against source documents to ensure correct data entry as well as data integrity checks such as checking for overlapping intervals, and data beyond total depth of hole. AMEC selected core from 13 drill holes (representing over 10% of the total number of drill holes) during a site visit in order to examine the lithological contacts between the different rock types defined by Goldrock. Following the database audit, AMEC noted some deviations within the down-hole survey data; the depth intervals of those drill holes with excessive horizontal deviations were flagged and were subsequently incorporated as uncertainties during resource classification. The lack of assay certificates for the drill holes from the Rio Tinto drilling campaign was considered during resource classification. There is no evidence of a positive bias in gold grades associated with decreasing core recoveries in the oxide zone.



No material sample biases were identified from the QA/QC programs. Analytical data that were considered marginal were accounted for in the resource classifications. AMEC reviewed the results of the ACME specific gravity measurements for the Lindero deposit and compared them with Goldrock‘s specific gravity measurements. A consistent low bias was observed in the Goldrock results, and a correction factor was applied to these data. AMEC also selected 20 quarter-core sample intervals from half-core to confirm the presence of gold mineralization at the Lindero deposit. The results of AMEC‘s independent samples agree reasonably well with the original sample assays. The AMEC values confirm the presence of gold mineralization at the Lindero deposit, and confirm that gold grades above 1 g/t Au can be expected. AMEC has not completed verification of data collected in subsequent exploration campaigns on the Lindero deposit. 1.12 Mineral Processing and Metallurgical Testing Use of the term “ore” in this section is solely in a metallurgical sense and does not reflect the economics of the mineralization in the Arizaro or Lindero deposits. 1.12.1 Arizaro Deposit Kappes, Cassiday & Associates completed coarse ore bottle roll tests lasting 53 days on four different drill core composites from the Arizaro deposit. Two of the composites represented high and medium grade magnetite breccia mineralization, and two represented high and medium grade diorite mineralization. Gold extraction on the samples of magnetite breccia was 67% and 64% for the high and medium grade samples, respectively; silver extraction was 67% and 50%, while copper extraction was 22% and 26%. For the samples of diorite mineralization, gold extraction was 72% and 73% on the high and medium grade samples, respectively; silver extraction was 60% and 43%; and copper extraction was 33% and 17%.



1.12.2 Lindero Deposit Two major campaigns of metallurgical testwork were undertaken for the Lindero deposit, first in 2002 by Rio Tinto, and then from 2004–2010 by Goldrock. The 2002 Rio Tinto testwork was not used to support the feasibility designs. Metallurgical testing included petrography, gravity separation, cyanidation and flotation tests, bottle roll leach tests, column leach tests, Bond abrasion index and Bond crusher impact testing, physical testing utilizing high pressure grinding roll (HPGR) crushers, HPGR pilot scale grinding tests, as well as jaw, cone and impact crushing tests. The work indicated the Lindero ores were typically abrasive, had low work indices, and that higher recoveries were generally observed with smaller crush sizes, and lower recoveries with larger crush sizes. Heap leach processing was considered appropriate for the Lindero ore. Testwork indicated that the ore typically requires a long leach time to achieve acceptable recoveries. Based on the tonnage and recovery for each ore type as supplied by Goldrock, the estimated field recovery for oxide ore (Met Type 2) is 73.6% and the estimated field recoveries for hypogene ore Types 1, 3, and 4 are 67.9%, 69.3%, and 61.2% respectively. The average life-of-mine field gold recovery is projected at 68.3% at a crush size P80 of 9mm. Field cyanide consumption is projected to be 0.45 kg/tonne ore, and lime addition is estimated at 2.5 kg/tonne ore. A small amount of copper is present and leachable in the Lindero ore, which is addressed by specific design features in the ADR plant along with an included contingency for a future copper recovery system. 1.13 Mineral Resource Estimates 1.13.1 Arizaro Deposit The Mineral Resource estimate for the Arizaro deposit was prepared in 2013 under the supervision of Paul G. Tietz, C.P.G. and Senior Geologist with MDA. The Effective Date of the resource estimate is 1 July 2013. There has been no further development work at Arizaro since the completion of the 2013 mineral resource and therefore the mineral resource estimate is considered current as of the date of this report. All of the Arizaro sample data, including samples from 29 core holes and 27 surface trenches, were used in modeling, estimating, and classifying the Arizaro resource. Drill



spacing is approximately 50 meters within the center of the deposit, increasing to over 75 meters to 100 meters at depth and along the deposit boundaries. The geologic model is based on 12 cross sections spaced 50 meters apart and looking due north. The modeled rock types were used to assign densities into the block model and to guide the gold mineral domain model. Quantile plots of gold and copper were made to help define the natural populations of metal grades to be modeled on the sections. Low- and high-grade gold mineral domains controlled grade estimation and density; the low-grade gold domain was used to constrain the copper mineralization. The cross-sectional alteration and gold domains were rectified three-dimensionally to level plans on 8-m intervals that coincide with the mid-bench of each level of blocks within the block model. Solids of five lithologies were created directly from the cross-sectional model, and the solids were used to code the block model on a block-in, block-out basis. MDA assigned density values to various groups of rocks, ranging from a low of 2.43g/cm3 to 2.54g/cm3; internally within the deposit, the three lithology densities were over-ridden by the gold domain densities based on the model block elevations. MDA chose to cap 19 high-grade samples (17 gold and 4 copper) which MDA believe are not representative of their domain populations and which could have an undesirable effect on grade estimation. The capped assays were composited to 4-m down-hole lengths (half the model block height), honoring all mineral-domain boundaries. The volume inside each mineral domain was estimated using only composites from inside that domain. The block model estimate reflects the relatively even distribution of metal grades occurring as porphyry-style disseminated and stockwork mineralization. A central higher-grade corridor is associated with near-vertical north-trending magnetite and biotite breccias. The estimation used inverse distance to the second power (“ID²”) to interpolate grades into the domains. Ordinary kriging and nearest neighbor estimates were also made as checks on the ID² estimate. To aid in determining search distances, variograms for each metal domain were made in numerous orientations and at various lag lengths. For estimation, the copper mineralization is constrained within the outer, low-grade gold mineral domain. The surface trench copper data contain isolated high-grade values that are possibly due to surface enrichment. To control the effect of these values, the estimate limited the trench data to within 50 meters of the topographic surface. Below this depth,



only drill data were used to estimate copper. MDA classified the gold resources in order of increasing geological and qualitative confidence into Indicated and Inferred categories to be in compliance with Canadian National Instrument 43-101 and the CIM definition standards. MDA classified the Arizaro resources by a combination of distance to the nearest sample and the number of samples, while at the same time taking into account reliability of underlying data and understanding of the geology. There are no Measured resources at Arizaro at this time because of the limited drill data and geologic uncertainties as to spatial location of the lithologic units and corresponding mineralization. Resources associated with the trench data are limited to Inferred only. The resource classification would likely rise with further drilling and increased geologic knowledge. The Arizaro resources are summarized in Table 1-1. The stated resource is fully diluted to 8m by 8m by 8m blocks and is tabulated on a gold cutoff grade of 0.2 g Au/t. In consideration of the depth limits of any potential open pit mining, the Arizaro resource was limited to a bottom elevation of 3,850 meters, approximately 300 meters below the general surface.

Table 1-1 Arizaro Reported Resource

The resource estimate is reasonable, honors the geology, and is supported by the geologic model. There is risk in the current model due to uncertainties in the geologic interpretation as a result of the limited drill data. This geologic risk is considered moderate on a local scale, but is considered low for its impact on the the current global resource estimate. The presence of coarse gold brings some risk to the grade model and estimate, but this is considered low for the global estimate.



There is potential for additional mineralization in all directions as the margins of the deposit have not yet been drill-defined. Additional infill drilling is recommended to bring greater confidence to the interpretation of the mineralization and increase the resource classification. 1.13.2 Lindero Deposit The 2015 Lindero Project Mineral Resource estimate and grade shells were prepared by David G. Thomas, P.Geo., who previously estimated the Lindero Mineral Resources in 2013 and was previously employed as a Principal Resource Geologist with AMEC. Goldrock retained DKT to complete a re-tabulation of the Mineral Resources for the Project in 2015. The block grade estimates and Mineral Resource classification have not been changed. DKT used updated metal prices, mining, and processing costs provided by Goldrock to calculate a marginal cut-off grade to compare with Goldrock’s suggested cut-off grade and to generate an updated optimized pit shell. The updated metal prices, mining and processing costs were reviewed by DKT. The optimized pit shell constrains the Mineral Resource to material with “reasonable prospects of economic extraction” as per the 2014 CIM Definition Standards Mineral Resources and Mineral Reserves. The drill hole database that supports mineral resource estimation comprises 17,753 samples from 121 core holes (34,656.8 m) and 32 trenches (1,268 m) collected between 2002 and 2008 by Rio Tinto and Goldrock. The database was closed for estimation purposes on 31 July 2009. Geological models used to constrain the resource estimation comprised seven lithological models, supplied by Goldrock. AMEC constructed a surface to represent the base of oxidation in order to reproduce vertical trends in the gold grades. Assay and density data were composited into 4 m down-hole intervals. Results from the Lindero contact profiles showed that hard, soft, and firm contacts exist. Firm boundaries were modeled by allowing composites on the other side of the boundary to be used in estimation of blocks in the first pass but not in subsequent passes. Raw assay data on 2 m composite lengths were examined to assess the amount of metal that is at risk from high-grade assays. Grade caps of between 0.75 g/t Au and 3 g/t Au were imposed on selected domains; this removed between 1% and 2% of the contained



metal in each domain. Lindero exhibits a low coefficient of variability and small-nugget effect. Blocks within a mineralized domain were interpolated using composites assigned to the same domain. AMEC chose to interpolate the grades using ordinary kriging (OK), as the grade distribution is reasonably smooth. A three-pass method was employed to assign estimated grades. Model validation comprised construction of a gold nearest-neighbor (NN) model to compare to the OK block model to check for bias, a detailed visual validation of the Lindero resource model, swath plot validation, and a check on the change of support smoothing. No major errors were noted following completion of the checks, and the model was considered acceptable for estimation purposes. Mineral resources are classified as Measured when a block was located within 35 m of the nearest composite and two composites from two additional drill holes was within 45 m. Mineral resources were classified as Indicated when a block was located within 54 m of the nearest composite and one additional composite from another drill hole was within 90 m. Mineral resources were classified as Inferred when a block was located within 70 m of the nearest composite. To assess reasonable prospects of economic extraction, the mineralization was confined within a Lerchs-Grossman optimization and a gold price of US$1,350/oz (updated from $1,450/oz), a treatment and refining cost of US$10.21/oz (updated from $6.19/oz), a mining cost of US$1.80/t (updated from US$2.10/t), processing and G&A costs of US$5.72/t (updated from $5.20/t) and an average process recovery of 70% (unchanged from 2013 estimate). The mineralization within the conceptual pit that satisfies these requirements equates to an updated cut-off grade of 0.19 g/t Au (previously 0.16 g/t Au) being used to constrain the mineral resources, which increased by a small amount from the 2013 resource estimate. Goldrock requested that DKT use a 0.20 g/t Au cut-off grade for the updated resource statement. Mineral Resources for the Project were classified under the 2014 CIM Definition Standards for Mineral Resources and Mineral Reserves. Mineral Resources are inclusive of Mineral Reserves, and are summarized in Table 1-2. The Qualified Person for the Mineral Resource estimate is David G. Thomas, P.Geo. Mineral resources are reported at a gold price of US$1,350 per ounce and have an effective date of 23 October 2015. DKT cautions that Mineral Resources that are not Mineral Reserves do not have demons

Technical Report Update on the Lindero Heap Leach Project ......Figure 13-3 HPGR Particle Size...

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Transcript of Technical Report Update on the Lindero Heap Leach Project ......Figure 13-3 HPGR Particle Size...