The Zaruma Gold Mine, Dynasty’s flagship project, is located in the Zaruma-Portovelo Mining District of southern Ecuador, 3km north of the town of Zaruma. This district is a significant, high-grade goldfield, having produced over 5 million ounces of gold historically.

Since 2003, Dynasty has established underground mining as well as processing operations at the Zaruma Gold Project. The underground mine portal is roughly 7.5 km from the processing facility.

The Project has numerous underground veins available for exploitation, and the Technical Report for the project, which contains a preliminary economic assessment indicated the Zaruma Gold Project could have a 15-year mine life, based on current operating and financial metrics. The underground veins tend to be less than 1.5 metres in width, so generally the rate of production will be limited due to the size of stopes and the amount of development required to bring stopes into production.

The processing plant (a conventional crush, mill, leach, Carbon-in-Pulp (CIP), elution and electrowinning circuit) is well established. Depending on head grade, up to approximately 25% of the gold can be taken out of circuit via the gravity concentration system. There are other processing flowsheet options available which this project could embark upon to further increase both throughput and precious metal recoveries (adding increased throughput capacity, for example), such as a floatation circuit for increased recovery of silver and possibly other base metals.

Key Highlights

  • Underground mine with decline access from surface
  • Mined by a combination of shrinkage stoping and cut-and-fill stoping methods
  • Measured and Indicated gold resource of 1,094,000 oz at an average grade of 13.01 g/t* Au
  • Inferred gold resource of 1,448,000 oz at an average grade of 12.16 g/t Au
  • Began production under Dynasty’s ownership in 2012 and announced commercial production October 1, 2013
  • In 2012, produced and sold 16,500 ounces of gold and 33,700 ounces of silver for gross proceeds of approximately US$28.4 million
  • In 2013, sold 27,580 ounces of gold and 58,320 ounces of silver for gross proceeds of US$39.4 million (US$23 million prior to commercial production and US$16 million post commercial production.
  • In 2014, sold 28,350 ounces of gold and 60,272 ounces of silver for gross proceeds of US$37 million
  • Owner-operated, 100% owned, royalty of 3% of total gold revenue to government, royalty of 1.5% of net value to previous concession owner
  • Operates under a “Small Scale Mining Licence” in Ecuador which allows for up to 300 tonnes per day to be mined from any one concession – Dynasty is able to mine from several different concessions concurrently
  • Zaruma processing plant, located 7.5 km from the mine portal, is a combination of a concentrate gravity recovery system with a leaching and Carbon-in-Pulp circuit, and has a capacity of approximately 1,100 tonnes per day
  • Management well-aligned with shareholders (+29% ownership)


The Zaruma Project is located in the central to north-central part of the Portovelo-Zaruma gold mining district in southern Ecuador, in which the total historic gold production from high grade quartz vein systems was estimated to be approximately 4 to 5 million ounces.

The hills of Zaruma and Portovelo have been mined for gold and silver for centuries. The Incas had been extracting gold and silver from the area with hydraulic mining of the oxidized parts of veins when Mercadillo, one of Pizarro´s force, followed the Rio Amarillo River upstream and encountered the Inca mine and founded the town of Zaruma in 1549. Exploitation of the Zaruma and Portovelo districts continued during the time of Spanish colonization until 1870 when an Ecuadorian-Chilean company was established.

In 1880, Grant Zaruma Company, registered in England, bought controlling shares of the Ecuadorian-Chilean mining company. Operational rights were immediately endorsed to Southern American Development Company (SADCO), an American company, which operated the mine from 1897 to 1950 by gaining control of the district’s main gold deposits in 1897. Exploration programs of SADCO commenced in 1896 and brought the mine into production at 108 tonnes per day in 1905. The mine was subsequently deepened to 13 levels located at an elevation of 270 metres above sea level and 800m below the uppermost workings. In the 53 years that followed, SADCO recovered some 3.5 million ounces of gold and 12 million ounces of silver from 7.6 million tonnes of ore at a cut-off grade of 14.4 g/t Au and 48.9 g/t Ag.

Lower levels of the Portovelo mine were flooded in 1944 and facing increasing costs, taxes and a complicated political situation, SADCO finally withdrew from the country in 1950 and the Ecuadorian government took over the mine. A state-owned company, CIMA, took over the mining operations in the area until 1980 and it is estimated to have produced a further 375,000 oz of gold between 1950 and 1965. In 1984, thousands of poverty-stricken miners invaded the old SADCO pits and small-scale and artisanal mining has continued in this area in specific locations. It is estimated that an additional 35,000 to 50,000 oz of gold has been produced each year since then by informal miners, small-scale operating mining societies and principally from the family-owned BIRA. Statistical information from the 1990s indicates that mining from the Zaruma and Portovelo areas could be some 3 million tonnes.

In the mid-1990s several foreign companies attempted to consolidate the area and carried out systematic exploration programs. In 1995, the Canadian-based TVX Gold Inc. reached agreements with most of the Zaruma area mining societies and informal miners and started with underground and surface mapping particularly within the Zaruma and Muluncay areas from March 1995 until February 1996. When TVX withdrew from Ecuador in 1998, all information was acquired by IAMGOLD. IAMGOLD continued with more extensive exploration programs including surface trenching, surface and underground sampling, surveying and diamond drilling. IAMGOLD significantly improved the Zaruma Gold Project area with legal consolidation of titles, adding valuable information to the project database, employing systematic geochemical data quality control and undertaking geological modelling.

In August, 2003 all the IAMGOLD properties were acquired by Minera Australiana, Mineaustralia S.A, a company of which Robert Washer, Dynasty’s President and Chief Executive Officer, was General Manager. In October, 2003, the properties were transferred Dynasty for reimbursement of transaction costs only. Dynasty also acquired the IAMGOLD data as part of its purchase of the concessions.

(as per Zaruma Technical Report linked below)

Measured Indicated Inferred
Location Tonnes
Au (g/t)
Au (Ozs)
Grade Au
Au (Ozs)
Au (g/t)
Au (Ozs)
Cabo de Hornos 1.30 13.99 585,000 0.86 12.46 343,000 3.0 12.30 1,201,000
Barbasco 0.19 11.05 66,000 0.09 10.81 33,000 0.3 12.13 128,000
Ayapamba 0.07 12.64 30,000 0.06 11.63 23,000 0.2 12.40 96,000
Vizcaya 0.03 8.40 8,000 0.02 8.40 6,000 0.1 8.40 23,000
Total 1.59 13.48 689,000 1.03 12.18 405,000 3.7 12.2 1,448,000

- Mineral Resources that are not Mineral Reserves have not demonstrated economic viability.
- A cut-off grade of 2.06 g/t Au was used to derive the Mineral Resource estimate. 

Zaruma Gold Project Technical Report, September 17, 2014

The Company has filed a report entitled "Independent Preliminary Assessment - Zaruma Gold Project - El Oro Province - Ecuador" dated September 17, 2014, which contains a Preliminary Economic Assessment ("PEA") based upon an updated mineral resource estimate on its Zaruma Gold Project. The Technical Report was prepared by Consulting Mining Engineer Mr RL Procter BSc (Eng), MBA, MIMMM, CEng, and Consulting Geologists Mr AJ Maynard, BAppSc (Geol) MAIG, MAusIMM and Mr PA Jones, BAppSc (Geol), MAIG, all of whom are independent "qualified persons" as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"). The full text of the Zaruma Report is available for review on SEDAR at (filed September 18, 2014, file size 11,398k) and technical reports.