Volcan Summary
Andina's 100%-owned Volcan Gold Project is located in Chile's Region III approximately 800 kilometres north of Santiago, 120 kilometres east of Copiapo city and 23 kilometres northeast of the Maricunga gold mine (formerly known as the Refugio mine). The property is strategically located in the prolific Maricunga Gold Belt, which hosts a number of important gold deposits, including the Maricunga gold mine (Kinross) the La Coipa mine (Kinross), the Cerro Casale deposit (Kinross/Barrick), and the Lobo-Marte deposit (Kinross). In total, more than 60 million ounces of gold have been identified in the Maricunga Gold Belt.
The Volcan Gold Project encompasses 24,840 hectares, including 15,040 hectares acquired from Barrick Gold Corporation in May 2009.
Volcan is in the early development stage, with a preliminary economic assessment and conceptual development plan targeted for completion in early 2010. To date, more than 100,000 metres of drilling have been completed at Volcan, resulting in the definition of three gold deposits (Dorado East, West and Central) and two gold zones in the Ojo de Agua area.
As of September 10, 2009, the updated resource for the Dorado deposits estimated measured and indicated mineral resources of 492.5 million tonnes at an average grade of 0.62 g/t Au for 9.8 million ounces of contained gold and inferred resources of 36.8 million tonnes at an average grade of 0.65 g/t Au for 768,000 ounces of contained gold. Both estimates are at a cut-off grade of approximately 0.3 g/t Au.
In November 2007 and May 2008, Andina released the results of preliminary metallurgical test work which returned average projected recoveries of approximately 72% at a resource grade of 0.85 g/t gold. This demonstrates the amenability of Dorado mineralization to hydrometallurgical gold extraction, including simple heap leaching, and is similar to recoveries at the nearby Maricunga mine.
Development of Volcan is not complex and is expected to have comparatively low development costs based on: metallurgical testing to date, location in Chile, access to infrastructure and proximity to surface of deposit, compared to other gold deposits of similar magnitude.
