Mr. James Anderson reports

GUANAJUATO SILVER RESTARTS THE CATA MILL AT THE VALENCIANA MINES COMPLEX

The Cata mill has begun precious metals processing at Guanajuato Silver Company Ltd.'s (Gsilver) wholly owned Valenciana mines complex (VMC) in Guanajuato, Mexico.

James Anderson, chairman and chief executive officer, said: "With the Cata mill now operational, Guanajuato Silver adds a third processing facility to our growing inventory of operating assets. The Cata mill is the last major asset acquired as part of the 2022 transaction with Great Panther to be placed back in service. With four operating silver mines and three production plants, we remain one of the fastest growing silver producers in Mexico."

Commissioning of the Cata mill began during the last week of December, 2022, with mineralized material coming from VMC and the San Ignacio mine. The company intends to start processing at a run-rate of approximately 8,000 tonnes per month with the goal of ramping up to 20,000 tonnes per month by year-end; full capacity at the Cata mill is 36,000 tonnes per month. The Cata plant, which comprises three balls mills and a two-stage crushing system, is in excellent working order; no significant capex (capital expenditure) was required prior to restart.

The company plans to operate the Cata mill with production from both VMC and the San Ignacio mine; it anticipates achieving initial metallurgical recoveries in the 83-per-cent-to-85-per-cent range for silver and gold.

The Cata mill is located at approximately the midpoint of the 4.2-kilometre strike length that spans mineralization at VMC; it sits immediately adjacent to the company's administrative offices, assay lab and one of two primary access shafts. In November, 2021, the Cata mill was put on care and maintenance by the previous operator due to a lack of tailings capacity. In response, the company intends to backfill tailings underground using a hydraulic fill system that will make use of select voids and open stopes that have been created at VMC over the past 450 years of underground mining. The hydraulic fill system will not only provide VMC with additional tailings capacity, but the process also represents a more environmentally benign approach to tailings management.

Technical information

Reynaldo Rivera, VP (vice-president) of exploration of Gsilver, has approved the scientific and technical information contained in this news release. Mr. Rivera is a member of the Australasian Institute of Mining and Metallurgy (AusIMM -- registration No. 220979) and a qualified person, as defined by National Instrument 43-101 -- Standards of Disclosure for Mineral Projects.

About Guanajuato Silver Company Ltd.

Gsilver is a precious metals producer engaged in reactivating past producing silver and gold mines in central Mexico. The company produces silver and gold concentrates from the El Cubo mine, Valenciana mines complex and San Ignacio mine; all three mines are located within the state of Guanajuato, which has an established 480-year mining history. Additionally, the company produces silver, gold, lead and zinc concentrates from the Topia mine in northwestern Durango. With four operating mines and three processing facilities, Guanajuato Silver is one of the fastest growing silver producers in Mexico.

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