Zafranal Project — 2023 Technical Report

This technical report presents the proposed mineral processing route for the Zafranal copper project based on metallurgical testwork completed through June 2012, with comminution and flotation parameters derived from laboratory programs conducted at Plenge Laboratories in Lima and G&T Metallurgical Services Ltd. in Kamloops, British Columbia.

Report context

This technical report and updated preliminary assessment of the Zafranal Project, Peru, is dated 2023 and prepared for AQM Copper Inc. The project is located in southern Peru approximately 150 km by road northwest of the city of Arequipa, on the border between the District of Huancarqui in the Province of Castilla and the District of Lluta in the Province of Caylloma. The report covers mineral processing and metallurgical testing (Section 13.0) and recovery methods (Section 17.0), with supporting comminution and flotation data forming the basis for the proposed process plant design.

Processing route

Metallurgical testwork chronology

Three phases of metallurgical testwork have been completed for the Zafranal Project. Phases I and II were carried out under supervision by AMEC Minproc, Amdel Mineral Laboratories, JKTech, SGS in Santiago, Chile, and Philips Enterprises. Phase I included comminution testing, leaching, mineralogical identification, flotation optimization of three composites, and some variability flotation testing. Phase II included locked cycle flotation testing, further comminution testing, and leach tests. Due to inconsistencies regarding sample management in the AMEC Minproc work, only the comminution testing from Phases I and II was used for the final process design. Phase III testwork was performed concurrently at Plenge Laboratories in Lima, Peru, and G&T Metallurgical Services Ltd. (now ALS Metallurgy) in Kamloops, BC, Canada, between November 2011 and June 2012. The Phase III program forms the basis for the majority of the metallurgical analysis in this report.

Mineralogy

A mineralized material characterization study performed by Teck in 2005 documented that chip samples were dominated by quartz, plagioclase feldspar, and muscovite/sericite, with biotite, chlorite, kaolinite, iron-titanium oxides, and apatite in minor to trace amounts. Sulphide minerals consisted mainly of pyrite, with lesser amounts of chalcopyrite, chalcocite, and covellite. Secondary copper minerals hosted 78% of the total copper in the samples studied, with 94.5% of these minerals exhibiting surface exposures of 10% or greater, suggesting good heap leaching potential at a relatively coarse particle size. No carbonate minerals were identified, indicating that tailings and waste rock may be acid generating in the presence of water.

Phase III mineralogical analysis by G&T on three composite samples (ZFC-MC01, ZFC-MC02, and ZFC-MC03) identified chalcopyrite as the primary copper mineral, with bornite, chalcocite, and covellite present at less than 0.1% each. Pyrite content ranged from 4.5% to 4.8% across the three composites. The copper oxide mineral identified was turquoise, a hydrous aluminium and copper phosphate. Mineral liberation analysis at a primary grind P80 of approximately 150 µm showed chalcopyrite liberation of 59.2% for composite ZFC-MC01 (hypogene), 44.7% for ZFC-MC02 (supergene), and 43.7% for ZFC-MC03 (mixed material). The primary grind P80 of 150 µm was selected for the design of the comminution section.

Feed grade

Three composite samples were prepared for metallurgical testing: ZFC-MC01 (hypogene material), ZFC-MC02 (supergene material), and ZFC-MC03 (mixed sulphide with oxide material). Head assays for the Plenge samples were: ZFC-MC01 at 0.45% Cu, 0.15 g/t Au, 1.20 g/t Ag, 3.70% Fe; ZFC-MC02 at 0.49% Cu, 0.13 g/t Au, 0.60 g/t Ag, 3.60% Fe; and ZFC-MC03 at 0.41% Cu, 0.13 g/t Au, 0.60 g/t Ag, 4.10% Fe. G&T head assays showed slight differences, with ZFC-MC01 at 0.46% Cu, 0.084 g/t Au, less than 1 g/t Ag, 3.50% Fe; ZFC-MC02 at 0.52% Cu, 0.069 g/t Au, less than 1 g/t Ag, 3.40% Fe; and ZFC-MC03 at 0.44% Cu, 3.80% Fe. The design mill feed grade ranges from 0.54% to 0.84% copper and 0.10 to 0.13 g/t gold.

Variability sample testing at Plenge (35 samples) showed copper head grades ranging from 0.20% to 0.99% with an average of 0.44% copper, and gold from 0.02 to 0.37 g/t with an average of 0.13 g/t. G&T variability testing (30 samples) showed copper head grades from 0.22% to 0.88% with an average of 0.49% copper, and gold from 0.03 to 0.26 g/t with an average of 0.11 g/t.

Comminution testwork

Specific gravity determinations from Phase I and II testwork ranged from 2.29 to 2.81, with an average of 2.58 and a 75th percentile value of 2.65. An SG value of 2.70 was used in the process design criteria.

Crusher work index testing on Phase I samples (15 samples) produced an average CWi of 6.28 kWh/t and a 75th percentile value of 7.85 kWh/t, which was used in the design criteria. By rock type classification, hypogene material averaged 7.13 kWh/t (75th percentile 8.61 kWh/t), supergene averaged 6.18 kWh/t (75th percentile 7.65 kWh/t), and oxide averaged 5.04 kWh/t (75th percentile 5.32 kWh/t).

Abrasion index values from Phase I and II testing ranged from 0.014 to 0.630 g, with an average of 0.213 g and a 75th percentile value of 0.279 g used in the design criteria. Hypogene material averaged 0.243 g (75th percentile 0.330 g), supergene averaged 0.198 g (75th percentile 0.257 g), and oxide averaged 0.098 g (75th percentile 0.137 g).

Bond ball mill work index testing on 72 samples from Phases I and II produced values ranging from 5.3 to 15.8 kWh/t, with an arithmetic average of 11.2 kWh/t and a 75th percentile value of 12.2 kWh/t used in the design. Hypogene material averaged 11.38 kWh/t (75th percentile 12.56 kWh/t), supergene averaged 11.28 kWh/t (75th percentile 12.05 kWh/t), and oxide averaged 9.31 kWh/t (75th percentile 9.46 kWh/t). For the grinding circuit design, the equivalent Bond Rod Mill Work Index of 13.0 kWh/t was selected.

SAG Mill Comminution testing determined drop weight index values ranging from 1.23 to 12.55 kWh/m³, with a 75th percentile value of 8.61 kWh/m³. Hypogene material averaged 7.38 kWh/m³ (75th percentile 8.69 kWh/m³), supergene averaged 6.43 kWh/m³ (75th percentile 8.61 kWh/m³), and oxide averaged 3.32 kWh/m³ (75th percentile 4.11 kWh/m³). The Axb values from Phase I (15 samples) ranged from 27.4 to 184.2 with an average of 67.6, categorizing the material as moderately soft. Phase II samples (51 samples) were considerably harder, with Axb values ranging from 21.0 to 124.4 and an average of 39.8, corresponding to a moderately hard ranking.

Flotation testwork

Bulk sulphide flotation tests on 35 individual samples and three composite samples were carried out at Plenge using potassium amyl xanthate as collector and methyl isobutyl carbinol as frother, with samples ground to a primary size P80 of 250 µm. Copper concentrate grades obtained ranged from 0.34% to 7.71% copper with recoveries from 7.22% to 94.4% copper. All samples of hypogene or supergene type had copper recoveries in excess of 70%.

Grind size evaluation conducted at G&T on the three composite samples targeted P80 sizes of 210, 150, and 105 µm using PAX as collector and MIBC as frother at pH 10. Composite ZFC-MC01 showed very fast flotation rates for copper at all grind sizes. Composite ZFC-MC02 showed slightly slower flotation kinetics. The effect of grind size was most pronounced on sample ZFC-MC03. The P80 of 147 µm was selected based on decreased iron (pyrite) recovery, increased gold recovery, and similar copper recovery compared with coarser grind. For the process design, a P80 value of 150 µm was used.

Collector reagent evaluation at G&T evaluated four reagent schemes with eight-minute rougher flotation time, achieving over 90% copper recovery for ZFC-MC01, 89% for ZFC-MC02, and approximately 75% for ZFC-MC03. The collector reagent 3418A was chosen based on best results for composite ZFC-MC03 and apparent enhancement of gold reporting to concentrate. Plenge evaluated eight collector reagent schemes with 18-minute rougher flotation time, selecting a combination of 15 g/t A3302 and 15 g/t 3418A based on low iron (pyrite) recovery to concentrate.

Rougher flotation pH evaluation at both laboratories indicated that a pH value of 10 gave the best results for two of the composite samples, with pH 9.5 for ZFC-MC03. A pH value of 10 is included in the design criteria.

Rougher flotation time was determined based on copper recovery results, with 10 minutes selected as a conservative parameter to accommodate slower-floating gold and variability in mineralized material types. This parameter was included in the design criteria.

Concentrate regrind testing indicated that a regrind P80 of 40 µm is suitable for this application, with acceptable copper grades and recoveries achieved. Results were not fully conclusive, and detailed testing across a wider range of regrind sizes is required for the next phase.

Cleaner flotation pH testing at G&T used a pH value of 10 to obtain acceptable copper concentrate grades. A design pH value of 10 has been included in the design criteria, requiring further confirmation.

Locked cycle testing was conducted at both laboratories with different procedures. Plenge used six cycles with 15 g/t A3302 and 15 g/t 3418A collector combination. G&T used five cycles with variable amounts of 3418A collector. Inconsistencies exist in the LCT results from the two laboratories. G&T LCTs conducted at pH 11.0 gave reasonable concentrate grade and recovery values, although the test procedure remained unstable with copper concentrate grade objectives not attained in one instance.

Key reported parameters

Technical qualifications

The metallurgical testwork results presented in this report are based on laboratory-scale programs only and do not represent pilot plant or operating data. No commercial production has occurred from the Property. The Phase I and Phase II testwork programs had inconsistencies regarding sample management, and only the comminution testing from those phases was used for the final process design. The Phase III locked cycle test results from G&T and Plenge showed inconsistencies between the two laboratories, and the G&T LCTs at pH 11.0 remained unstable with copper concentrate grade objectives not attained in one instance. The behavior of gold during flotation requires further investigation, as the data analysis does not clearly indicate whether gold follows pyrite or chalcopyrite, and no correlation was attempted between iron (pyrite) depression at increased pH and gold recovery. Collector dosage was not evaluated as a variable and should be added to a future level of study. The regrind testwork results were not fully conclusive, and detailed testing across a wider range of regrind sizes is required for the next phase of the Project. The report notes that the head grades of the composite samples tested (0.41% to 0.52% Cu) are lower than the nominal design feed grade of 0.54% copper. The design pH value of 10 is subject to confirmation. The report relies on information from third-party sources under the assumption that the contents are accurate.

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Source: Zafranal Project , 2023 Technical Report, Sections 13.0 Mineral Processing and Metallurgical Testing and 17.0 Recovery Methods, AQM Copper Inc., 1295840200-REP-R0001-04.