Allied Nevada Gold Corp


	Mining & Processing Hycroft operates twenty-four hours a day, seven days a week. Currently, open pit mining of the Brimstone and Cut-5 oxide mineralization is by simple drill, blast and truck haulage of ore to the heap leach pad. Lower grade ore is placed as run-of-mine ore and higher grade siliceous ore is crushed using a semi-mobile rock crushing unit. Solution from the heap leach pad is processed through the Merrill-Crowe plant and carbon-in-column circuit. The metals are further processed in the refinery to create doré bars, which are sold to outside refineries for further refining. Based on grade, the ore is delivered either to the heap leach pads as run-of-mine material or to the crusher, crushed and placed on the heap leach pads. Ore is crushed to an optimal size of 100% passing 3/8”, improving the recovery of the gold and silver contained in the ore. The percentage of ore crushed in a given year will depend on grade/metal prices and material type. Current performance of the heap leach pad show recoveries of 56.6% for gold and 12% for silver. Metallurgical testing and current performance suggest crushing approximately 32% of the oxide material will improve recoveries to an average of 62% for gold and 16% for silver. Upon the construction of a mill, the higher grade portion of the heap leach ore would be fed to the milling circuit and crushing of ore would be discontinued. The improved recoveries and resulting revenues obtained by milling this ore more than offsets the increased operating costs. Milling this ore improves the overall economic viability for the heap leach (oxide) ore. This change in processing method would result in fewer ounces of metal being produced by the heap leach operation. The Company began implementing an accelerated mining rate in 2010, which will continue through 2011 and 2012. Annual gold production is expected to increase from approximately 130,000 ounces in 2011 to over 275,000 ounces in 2012 and approximately 320,000 ounces in each of 2013 and 2014. Annual silver production is expected to increase from 355,000 ounces in 2011 to over 621,000 ounces in 2012 and over 1.0 million ounces in 2013. The total capital required to implement the Accelerated Heap Leach Mine Plan is approximately $212 million over the life of the mine, of which $29.4 million was spent in 2010. This capital cost includes the larger capacity mining fleet, expansion of the process facilities, mobile crushers, and associated infrastructure, including a rail spur. Assuming a gold price of $800 per ounce and a silver price of $14 per ounce, the Accelerated Heap Leach plan generates a net present value, at a 5% discount rate, of $139.2 million.