A RAMP-UP QUARTER

Commissioned by owners, SilverCrest Metals, the Las Chispas processing plant in Mexico declared production in November 2022.

Las Chispas, which can be found 180 kilometres northeast of Hermosillo, Mexico and just 12km from the community of Arizpe, is steeped in history.

Rich silver veins were discovered near Arizpe by soldiers in 1640, although notable exploration and production didn’t begin until the late 1800s.

The Las Chispas Mine is known for its world-class silver mineral specimens including polybasite, stephanite, native silver and pyrargyrite. Specimens are on display in private collections and museums worldwide.

Q4 2022 was considered a ramp-up quarter for the Canadian headquartered business.

During the period, recovered metal, including inventory, was 11,940 ounces of gold and 1.20 million oz of silver. In addition, metal poured totaled 10,896 oz gold and 1.06 million oz silver.

The mine is now energised by national grid power with improved stability, and local community-based multi-year projects have advanced with a focus on water and sewage infrastructure.

Development at Las Chispas has been supported by contractors such as CoMinVi, a Mexican based business specialising in the construction of underground and open-pit mining works and the exploitation of mineral deposits.

CoMinvi’s work at Las Chispas included development of 757 linear metres (increased from a planned 550) as well as the implementation of ventilation by means of counter-wells. These have been created with a leg machine and long-boring equipment, enabling better ventilation for the extension and deepening of works at the mine.

The exploration at Las Chispas focused on assisting operations with database management, grade control, drilling on new vein targets, and delineation drilling of planned mining stopes.

On its success toward the end of 2022, Silver Crest Metals COO, Pierre Beaudoin, commented:

“2022 was a pivotal year for SilverCrest with construction completed slightly ahead of schedule and under budget which is a rare achievement in this industry. This milestone set the positive tone for the ramp-up and declaration of commercial production in Q4, 2022. We are currently working on optimisation of Las Chispas operations, and we expect to complete its Updated Technical Report in Q2, 2023 to provide the foundation for production and cost guidance going forward.”

In addition, CEO N. Eric Fier said:

“We are very pleased with our progress at Las Chispas. Within five months of our first metal pour we declared commercial production, refinanced our previous project financing facility, which we did not fully draw, and reduced our total debt outstanding from $90 million to $50 million. As we begin 2023, our focus is on generating revenue and using established cost controls to maximise free cash flow and pursue growth opportunities.”

Silvercrest Metals

SilverCrest Metals owns two additional properties - El Picacho and Cruz De Mayo, as well as on-hold projects at Angel de Plata and Estacion Llano.

El Picacho is located approximately 85 kilometres northeast of Las Chispas and comprises 11 mining concessions totalling approximately 7,060 hectares.

Dating back to the 1800s, the El Picacho property was a historic gold and silver producer, with grades greater than 15 gpt gold.

In 2017, SilverCrest Metals completed underground channel sampling as part of a due diligence exercise. Results from 10 underground bulk channel (back or roof of ramp) samples, over an estimated strike

Cominvi

We are a mining company with more than 19 years of experience. We are specialized in the construction of underground mining works and exploitation of deposits. We develop jobs for national and foreign companies. Our services include engineering, development, fortification, production and hauling.

Throughout our history, we have collaborated on more than 35 projects with leading companies in the mining sector. Our performance has positioned us as a benchmark in the Mexican Republic thanks to our global mentality with an objective vision of quality, safety and teamwork.

“Our strength is our people.” We are distinguished by the experience of our collaborators, our state-of-the-art knowledge in mining, the safety of our processes, the latest technology in our equipment and our responsibility towards the environment in our operations.

At COMINVI, our main quality objective is our commitment to comply with the programmes established by our clients to their full satisfaction. For this reason, we are proud to have the confidence of SilverCrest in “Las Chispas” mine in Sonora, Mexico.

length of 50 metres, showed an average true width of 6.0 metres and grade of 13.66 gpt Au and 50.8 gpt Ag, or 1,075 gpt AgEq.

Two initial standard bottle rolls for metallurgical test work on these samples, completed by SGS de Mexico, showed composite recoveries of greater than 90% for both gold and silver.

A recent release from the company shows that it has three drill rigs operating at the El Picacho property, with approximately 13.6 kilometres of vein strike length. It currently has all access rights and necessary drill permits for continued drilling over a five year licence period.

Meanwhile, the Cruz de Mayo Property consists of two mineral concessions, Cruz

Since January 2021, we have witnessed and participated in the construction of the infrastructure of the entire project, as well as the start-up of its concentrator plant, a benchmark of its kind in Mexico.

We have implemented a strict quality control for the different exploitation methods by long hole stoping, cutting and filling in order to seek the optimization of these processes for a greater recovery of the metallic contents of its narrow veins.

COMINVI’s collaboration with “Las Chispas” will extend until December 2026. For almost 5 more years, we will have the opportunity to collaborate in this project regarding the preparation, development and production of one of the most important mines in the Mexican mining sector and in the state of Sonora. As part of the plan, we are renewing our fleet of machinery and equipment to ensure compliance with the unit’s objectives.

These actions reinforce our commitment to excellence, providing our best effort and achieving the planned production goals based on our philosophy of safe work and quality, supported by our most important value “Our people” and strengthened by the teamwork between our client and COMINVI.