The Midas Mine is the largest known Au-Ag epithermal deposit along the Northern Nevada Rift (“NNR”) to date, and is located in the mining district of Midas, also known as the Gold Circle district. The Midas deposit consists of a series of complex steeply dipping, quartz-calcite-adularia precious metal veins hosted by volcanic and volcanoclastic rocks and locally contains mineral grades greater than (>) ten ounces per ton (opt) of gold. Gold mineralization occurs as electrum and is intimately associated with selenide and sulfide minerals. It belongs to a suite of middle Miocene low-sulfidation epithermal gold and silver mineralizing systems associated with magmatism and faulting along the NNR (Leavitt et al., 2004). The mineralization model at Midas is a shallow, low-sulfidation, vertically- and laterally-zoned, epithermal gold-silver system. Rocks in the Midas district are primarily ash flow, air-fall and lithic tuffs, felsic plugs, volcanoclastic sediments and gabbroic sills and dikes.
Gold and silver mineralization at Midas is hosted in several north-west striking veins. The veins are divided into four principle groups based on their location and orientation. The two groups hosting mineral resources are the Main Veins which dip easterly and are predominantly gold mineralization, while the East Veins dip to the west and have a much higher silver content then the main veins. The main veins produced in excess of 2.2 million ounces of gold and 26.9 million ounces of silver between 1998 and 2013. Initial production from the East Veins recently began in 2012. Klondex’s previous mineral resource estimate only included the five veins which were the target of near term production. This mineral resource estimate was updated to include all known veins proximal to the Midas Mine workings.
There are several additional veins known to occur within the Midas land package, these have not been included in the mineral resource estimate. The near mine veins at Midas are divided into four major groups. Prior to 2013, all production was from the Main Vein group, particularly the Colorado Grande and Gold Crown Veins. Development of the East Veins began in 2012. The third group of veins is comprised of the Queen and SR veins located to the south of the existing workings and south of the South Owyhee (SOW) Fault. There has been no mining on these veins; they are defined only by surface drilling. They represent a high priority near mine target, and the Queen Vein has been added to the mineral resources estimate. The fourth group of veins are west of the main vein system and includes the Link and Midas Trend veins. Like the southern vein group, these veins have yet to be delineated from underground.
Significant mineral resources have been identified on the main and eastern veins and other veins near the active mine workings. Klondex staff has been actively drill testing these areas and has prioritized them based on ounce expectations, accessibility from existing development and geotechnical, ventilation, and hydrological considerations. Mine plans are being updated on a regular basis as results are received.
The Midas Mine is located on the southeast flank of the Snowstorm Mountain range near the eastern margin of the NNR structural domain, hosted in a bimodal suite of volcanic rocks. Several other structurally controlled, epithermal precious-metal vein deposits are hosted in similar Miocene-age volcanic rocks along the NNR, including Klondex’s Fire Creek Project, Newmont’s Mule Canyon Mine (“Mule Canyon”), and Waterton Global’s Hollister Mine, (under the name of Carlin Resources). All occur along the NNR and share similar mineralization characteristics, including epithermal textures and trace-elements, locally high grade Au and Ag, mid-Miocene ages of mineralization (15.1-15.6 Ma) and close temporal association with the Miocene host rocks.
The NNR is distinguishable on regional-scale magnetic maps as a prominent north-northwest trending lineament of magnetic highs. This distinctive positive magnetic anomaly is caused by Miocene-age syn-rift mafic and intermediate volcanic rocks of basaltic to dacitic composition
The NNR originated at the McDermitt caldera in northwest Nevada, site of the initial eruption of the Yellowstone hot spot, and propagated 500 km to southeast Nevada. The rift is readily visible on regional aeromagnetic maps as a narrow positive anomaly for approximately 250 km and is defined by an accumulation of basaltic to dacitic lava flows and dikes of mid-Miocene age. In the central portion of the rift between the Malpais Rim and Midas, John et al. (2000) defined it as a 5- to 30-km wide north-northwest-trending zone that corresponds to a magnetic high, to mafic dikes and high-angle normal faults that parallel the anomaly, and to middle Miocene volcanic flows that overlie the anomaly. The primary extension direction during rift development and magmatism at 16.5 – 15 Ma was ENE to WSW, perpendicular to the N22°W axis of the rift. These syn-rift faults sharply bound the present-day NNR on the west and decrease towards the east. From 10 Ma to about 6 Ma, the regional stress field rotated clockwise, resulting in an extension direction that was NNW-SSE. This resulted in the formation of horst and graben faults that cut the NNR to form ENE-trending grabens such as the Midas Trough, the Argenta Rim, and the Malpais Rim.
The chemical composition of the volcanic and intrusive rocks varies greatly within the rift, ranging from mafic to intermediate volcanic flows at the Malpais and Argenta Rims, mafic flows at Fire Creek, felsic tuff and andesite at Ivanhoe, and a bimodal sequence at Midas of felsic flows, tuffs and domes, and basaltic sills and dikes. Consequently, rocks from one mining district generally cannot be correlated directly with those from another, except in a time sense where high-resolution radiometric dates are available. Gold mineralization at Midas is structurally controlled by normal faults within the NNR. The style of structurally controlled mineralization observed at the Midas Mine is typical of rift-hosted epithermal style mineralization associated with an intrusive center.