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Operations

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Mineral Ridge

Deposits
The Drinkwater and Mary/LC are the two main deposits currently in production. In its July 21, 2014 news release, the Company reported on an updated Life of Mine Plan ("LOM") for the Mineral Ridge Operation that includes the Drinkwater, Mary/LC, and the five satellite deposits, Brodie, Bluelite, Solberry, Wedge and Oromonte. (see Mineral Reserve & Resource Estimates).

Operations Area Map (PDF 4.0 Mb)

Drinkwater Deposit

The Drinkwater deposit extends over a strike length exceeding 750 m (2,500 ft) and down dip extension of over 600 m (2,000 ft). It was partially mined by underground methods from the 1860s to the early 1940s and by open pit methods from 1989 to 1999. Scorpio Gold commenced pre-production mining in the Drinkwater pit on May 31, 2011 and achieved commercial production status effective January 1, 2012.

The Company's review of historical data indicated that mineralization was left behind in the high wall at the northwest end of the Drinkwater pit. Results from drilling in 2012-13 on the Drinkwater Highwall zone and its northwest trend confirmed this and have been modelled and incorporated into the Drinkwater mine plan for potential extraction.

Mary/LC Deposit

The Mary deposit is located immediately southeast of the Drinkwater pit. Scorpio Gold commenced pre-stripping operations in the Mary pit in December 2011 and initial ore production in Q2 2012. Exploration drilling in 2011 indicated that the gold mineralization extended further southeast from the Mary zone to the adjacent Mary LC zone, encompassing a strike length of 780 metres. Subsequent work determined that the Drinkwater, Mary and Mary LC zones were not isolated deposits but represented one continuous zone of mineralization.

Drilling in 2012 and 2013 was designed to support modification of the original Mary pit design to the southwest to include the continuation of mineralization into the Mary LC zone. A highly successful program led to completion of a mineral reserve and resource estimate for the Mary/LC and incorporation of the expanded pit design into the updated LOM. Development of the expanded pit commenced in 2014.


Satellite Deposits

The satellite Brodie, Bluelite, Solberry, Wedge and Oromonte deposits are situated west and southwest of the Drinkwater pit and lie in close proximity to the leach pad. These deposits are part of a semi-continuous trend of mineralization within a shallow-dipping stratigraphic horizon. They lie on the western flank of an anticlinal fold structure and are considered to be related to mineralization within the Drinkwater-Mary trend, which lies on the eastern flank.

An unpdated LOM incorporating the Drinkwater, Mary/LC and satellite deposits was reported in the Company's July 21, 2014 news release. The cut-off date for the LOM study was March 31, 2014. Continued drilling on the satellite deposits post this cut-off date is designed to potentially upgrade and increase the reported mineral reserve and resource estimate and potentially extend life of mine.

Brodie & Bluelite Deposits

The Brodie and Bluelite deposits are located 975 metres (3,200 feet) and 1,100 metres (3,600 feet) southwest, respectively, of the Drinkwater pit. Previous operators thought the Brodie and Bluelite deposits were separate mineralized bodies; however, results of Scorpio Gold's drilling has demonstrated they are one semi-continuous zone. The mineralized corridor encompasses a strike length of some 1,370 metres (4,500 feet) and is situated immediately adjacent to the leach pad.

Brodie and Bluelite have been incorporated into the updated LOM (see Mineral Reserve & Resource Estimates). Drilling has continued on both deposits as well as mineralized structural corridor that trends between them. Results are very encouraging and are expected to increase and upgrade the current reserve and resource estimate for these deposits.

Brodie Drill Plan (PDF 1.5 Mb)

Bluelite Drill Plan (PDF 1.3 Mb)

Solberry Deposit

The Solberry deposit lies west of the Drinkwater pit and 600 meters (1,970 feet) northwest of the leach pad. Solberry has been incorporated into the updated LOM (see Mineral Reserve & Resource Estimates). Further drilling to potentially increase and upgrade the current reserve and resource estimate is planned in 2014.

Solberry Drill Plan (PDF 1.1 Mb)

Wedge Deposit

The Wedge deposit is located 225 metres (740 feet) southwest of the Drinkwater pit and immediately adjacent to the leach pad. Wedge has been incorporated into the updated LOM (see Mineral Reserve & Resource Estimates). Results from the expansion drilling program post the March 31, 2014 cut-off date for the LOM study are very encouraging and are expected to increase and upgrade the current reserve and resource estimate for this deposit.

Wedge Drill Plan (PDF 1.4 Mb)

Oromonte Deposit

The Oromonte deposit lies northwest of the Wedge deposit and 425 metres (1400 feet) west-southwest of the Drinkwater pit. A mineral resource estimate has been calculated for the deposit (see Mineral Reserve & Resource Estimates) but currently there is no economic pit shell developed for Oromonte.

A higher-grade zone of mineralization intersected in 2011-2013 drilling lies below the current extent of the estimated resource,. The zone trends northerly and lies along the edge of a geophysical magnetic high. It has been intersected at 85 to 115 metres vertical depth and, although not accessible by open pit mining, may be amenable to underground extraction should further results support underground development. Historical underground workings are known to lie approximately 180 meters to the east. The significance of these drill results in context with their structural and geophysical setting will be evaluated for follow up in 2014.



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