operations

Zacatecas State's geopolitically stable environment and Mexico's membership in NAFTA provides a secure operating environment for the Cozamin Mine. The Cozamin mine site is very accessible and the area has excellent infrastructure with roads, power, and water access available at the mine site and services available in the surrounding communities. In addition, the city provides an environment for the employees of the Cozamin Mine to live and raise their families in an area with excellent educational and medical facilities. Zacatecas has a strong mining tradition, dating back hundreds of years, providing the Cozamin Mine with a community both knowledgeable and skilled in mining.

The underground mining method at Cozamin is longhole stoping. Mined ore is brought to surface via either a shaft or two production ramps. The ore is trucked to the crusher and processed through a three stage crushing plant and stored ahead of the grinding circuit, where it is reduced in size and then sent to flotation. The flotation steps involve flotation of copper, followed by zinc and lead. All products go through multiple stages of upgrading (or cleaning) in the flotation circuit ending with a silver-rich copper concentrate, a zinc concentrate and a silver-rich lead concentrate.

Commercial production commenced in September 2006 and Capstone completed exploration, development and initial production at 350,000 tonnes per year (tpy) on time and under budget with an initial three year mine life in reserves. Production at Cozamin was quickly expanded by 120% in the first 12 months with all capital expenditures funded from cash flow generated by the mine, and a further expansion in 2008 saw production rise to 1 million tpy. Production is from the Mala Noche Main Zone and the Mala Noche Footwall Zone (MNFWZ), which is higher in grade, but narrower widths than the Main Zone.

In 2018, an updated Mineral Resource estimate was published based on ongoing exploration work in the MNFWZ with the goal to further extend mine life. In addition, Capstone commenced mining in the San Rafael Zinc Zone to utilize surplus mill capacity and increase by-product revenue.