Falcon Concentrators Inc.

9663 - 199A St.

Langley, BC,
Canada V1M 2X7
Phone: +1-604-888-5568
Fax: +1-604-888-5521
Email: falcon@concentrators.net


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May 21, 2009


Goldfields Cerro Corona Project
Cajamarca City PERU

Att. Ruben Zevallos Metallurgical Manager
cc. Hilario Gorvenia Metalurgist Engineer

Ref. Gold Recovery Circuit at Cerro Corona


Dear Sirs:

The following report discusses the gravity testwork that was done by Eng. Jose Palomino on samples
provided by the Cerro Corona operation of Goldfields. Eng. Jose Palomino has been the exclusive
representative for Falcon Concentrators in Peru for over 10 years and is an expert in enhanced gravity
testwork and applications. All testwork results generated by Eng. Palomino are certified and supported by
Falcon as if they were performed directly by Falcon Concentrators Inc.

This report will present data generated by the referred testwork, discuss and make observations regarding
these data and then make recommendations for the Cerro Corona gravity circuit. Through the testwork
conducted we believe that there would be a strong benefit for Goldfields by installing a gravity recovery
circuit at Cerro Corona.


Presentation of Data

The following data is from gravity testwork using a Falcon L40 laboratory-scale concentrator. The L40
concentrator is able to simulate both Falcons Semi-Batch machines for precious metal recovery as well as
Falcons Continuous machines for preconcentration and base metal recovery. The testwork shown in this
report is for simulation of Falcons Semi-Batch machines for recovery of free gold within a grinding circuit.
The recoveries shown in these tables are representative of the theoretical maximum gravity recovery;
however, the concentrate grades at the industrial scale will be much higher. The expected concentrate
grade at the industrial scale can be simulated by hand panning the L40 concentrate.

Table 1 Cyclone Overflow Test
PRUEBA 1 - DEL REBOSE HIDROCICLON (Cyclone O/F)
PRODUCTO Leyes Distribucion Directa%

PESO % PESO
% Cu Au g/t % Fe CuT AuT FeT
CONCENTRADO 147.2 1.5 2.83 31.66 20.7 3.52 28.27 3.93
RELAVE 9852.8 98.5 1.16 1.2 7.56 96.48 71.73 96.07
CABEZA CALCULADA 10000.0 100.00 1.18 1.65 7.75 100.00 100.00 100.00
CABEZA ENSAYADA 1.12 1.52 6.63


Falcon Concentrators Inc.
9663 - 199A St.
Langley, BC,
Canada V1M 2X7
Phone: +1-604-888-5568
Fax: +1-604-888-5521
Email: falcon@concentrators.net


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Table 2 Cyclone Feed Test
PRUEBA 2 - DEL FEED HIDROCICLON (Cyclone Feed)
PRODUCTO Leyes Distribucion Directa%

PESO % PESO
% Cu Au g/t % Fe CuT AuT FeT
CONCENTRADO 194.7 2.1 2.96 36.35 19.52 5.42 33.42 4.26
RELAVE 8980.4 97.9 1.12 1.57 9.5 94.58 66.58 95.74
CABEZA CALCULADA 9175.1 100.00 1.16 2.31 9.71 100.00 100.00 100.00
CABEZA ENSAYADA 1.24 2.28 10.53



Table 3 Cyclone Underflow Test
PRUEBA 3 - DE LAS ARENAS HIDROCICLON (Cyclone U/F)
PRODUCTO Leyes Distribucion Directa%

PESO % PESO
% Cu Au g/t % Fe CuT AuT FeT
CONCENTRADO 1 173.3 1.8 2.94 33.59 19.37 4.39 24.41 3.47
RELAVE 9243.8 98.2 1.2 1.95 10.09 95.61 75.59 96.53
CABEZA CALCULADA 9417.1 100.00 1.23 2.53 10.26 100.00 100.00 100.00
CABEZA ENSAYADA 1.25 2.32 10.44



Discussion of Data

The above results show that a significant proportion of gold can be recovered from the cyclone feed,
overflow and underflow in Cerro Coronas grinding circuit. Although greater than 24% Au recovery can be
expected in the cyclone underflow, we see that an even higher recovery (+33%) can be expected in the
cyclone feed. The increased recovery in the cyclone feed compared to the cyclone underflow can be
explained through the recovery of fine gold particles by the Falcon Concentrator. Although recovery of
coarse Au particles is easier than fine particles, the elevated G-force used by the Falcon Concentrator
allows for the recovery of very fine gold particles that would report directly to the cyclone overflow and would
never be seen by a gravity concentrator operating in the cyclone underflow. The increased recovery in the
cyclone feed compared to the cyclone overflow can be explained by the higher Au grade in the cyclone feed.

Relatively speaking, a gravity recoverable gold content of greater than 30% is considered very high there
are many copper-gold producers that have found a positive financial benefit by operating primary gravity
circuits with less than 5% gravity recoverable gold in their ore. There are three main reasons why it would be
beneficial to operate a gravity recovery circuit even when overall gold recovery may not increase:

Free gold requires the most effort to float. It is necessary to use much more intensive flotation
procedures when trying to recovery free gold by flotation compared to sulfide-associated gold. If the
free gold is removed from the circuit before flotation then it is very likely that the overall flotation
mass yield can be decreased, producing a higher grade copper concentrate while reducing
residence time and reagent costs.

Falcon Concentrators Inc.
9663 - 199A St.
Langley, BC,
Canada V1M 2X7
Phone: +1-604-888-5568
Fax: +1-604-888-5521
Email: falcon@concentrators.net


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Gravity gold concentrate can be sold directly to a refiner or can be processed by an Intensive Leach
Reactor to produce a gold product. A gravity gold concentrate will generate more revenue than gold
that is sold for credit in a copper concentrate. First, when free gold is removed from the copper
concentrate then sampling error is reduced and metallurgical accounting between the plant and the
smelter will improve dramatically. Second, free gold sold directly to a refiner as a gold product will
be paid at a higher rate than the credit given by a smelter for gold in a copper concentrate. Third,
payment for a free gold concentrate will be much faster than waiting for credit from a smelter.

Gravity recovery circuits can better handle changes in grade and circuit upsets. Compared to
flotation circuits, centrifugal concentrators can do a much better job in handling changes in feed
grade and can act as control over spikes in Au grade, which are typically due to changes in free
gold content. Without an installed gravity circuit, spikes in free gold can result in gold being lost to
tailing whereas a gravity circuit would recovery this free gold ahead of flotation.



After considering the positive benefits of installing a gravity circuit, the next question to answer is what
percentage of the circulating load to treat by gravity. The following graph shows a mathematical model of the
expected gravity gold recovery as a percentage of the circulating load treated. Although this particular graph
references cyclone underflow data, the same is true for cyclone feed although cyclone feed will show slightly
better results.



Graph 1 Expected Recovery vs. Percentage of Circulating Load Treated


We can see from the above graph that the rate of increase in recovery slows as greater percentages of the
circulating load are treated. We can also see from the graph that most of the recovery benefit (~90%) is
obtained when approximately 40% of the circulating load is being treated.
Falcon Concentrators Inc.
9663 - 199A St.
Langley, BC,
Canada V1M 2X7
Phone: +1-604-888-5568
Fax: +1-604-888-5521
Email: falcon@concentrators.net


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Recommendations

Since Cerro Corona is operating at ~800tph with a 200% circulating load, this means that ~2,400tph are
being fed to the cyclones in the grinding circuit. Treating 40% of the cyclone feed requires 960tph being fed
to the gravity circuit - this generates a theoretical gold recovery of 30% (33% maximum recovery x 90%
gravity recovery effort).

To treat this 960tph in the circulating load, Falcon recommends three SB5200 enhanced gravity
concentrators. The SB5200 concentrator has a maximum capacity of 400tph, but an appropriate design
throughput would be 350tph, giving an overall design capacity of 1,050tph to accommodate circuit upsets or
to provide the potential to increase the gravity recovery effort within the grinding circuit. Further, Falcon
recommends the use of an Intensive Leach Reactor to clean the gravity concentrate since the efficiency of a
leach reactor is typically much higher than a shaking table or similar device for concentrate cleaning.

Assuming a head grade of 1.5g/t and a recovery of 30% to the grinding circuit, this amounts to over 100,000
oz/year recovered in the gravity circuit, or US$91Mil/year at $900/oz. Assuming that a gravity gold
concentrate is paid at 99% value and gold in copper concentrate is paid at 95%, there is the potential for a
revenue increase of more than US$3.6Mil/year on Au payment alone. The approximate capital cost of the
proposed gravity concentrators is less than US$500,000.

Falcon encourages the personnel at Cerro Corona to contact Goldfields St. Ives mine in Australia which has
been successfully operating two Falcon SB2500s and one Falcon SB1350 for a number of years now.







If you have any questions about the material presented in this report, please do not hesitate to contact me
directly at Falcons head office in Canada, or Eng. Jose Palomino in Lima, Peru.

Best regards,


Andrew Gillis
Falcon Concentrators Inc.