Mr. James Anderson reports

GUANAJUATO SILVER PROVIDES MID-Q4 PRODUCTION UPDATE

Guanajuato Silver Company Ltd. has provided an operations update prior to year-end 2023. Production results are generated from the company's wholly owned El Cubo mine complex, the Valenciana mine complex (VMC) and the San Ignacio mine in Guanajuato, Mexico, and the Topia mine in Durango, Mexico.

November production results demonstrate improved performance

During the second and third quarters of 2023, the company completed several changes to operations at all of Guanajuato Silver's producing silver mines (see Guanajuato Silver's news release dated Nov. 24, 2023) -- most notably:

• Mining operations were adjusted at El Cubo to significantly increase the number of available mining stopes.
• Dewatering commenced at El Cubo to access higher-grade mineralized zones located in deeper areas of the Villalpando section of the mine.
• The business model at Topia was changed to centre on purchasing mineralized material from underground contract miners and local operators.

Results from October to the end of November have demonstrated improvements across almost all measurable categories.

James Anderson, chairman and chief executive officer of Guanajuato Silver, said: "As previously reported, we have adjusted several operating procedures and made significant capex [capital expenditure] investments designed to increase efficiencies and better overall commercial performance. Results to date are very encouraging; we appear to be back on track in terms of the progress of the ramp-up at El Cubo as we have increased the available production stopes there from 10 to 23; also, our new business model at Topia is generating much healthier economics. At San Ignacio, November was the best single month on record regarding tonnes mined. We are confident that the trajectory of this success will continue well into the new year."

Decision to transition to dry stack

After a comprehensive internal review, Guanajuato Silver has decided to proceed with the installation of a dry stack tailings facility at the company's wholly owned El Cubo mine complex. A dry stack tailings facility employs a filter press that will extract approximately 82 per cent of the water from the tailings generated during mineral processing; this water can then be reused and recycled continuously. The dry tailings process is much easier to rehabilitate, reduces future environmental impact and increases overall safety for local communities by increasing the structural integrity of the tailings deposit; and it would extend the tailings capacity at El Cubo by an estimated 18 to 20 years. Guanajuato Silver anticipates the start of production of the new dry stack facility to commence in the second half of 2024, and the company will provide more details on specific timing later in 2024.

James Anderson, chairman and chief executive officer, added: "Transitioning our El Cubo tailings to a dry stack technique further enhances Guanajuato Silver's commitment to become one of Mexico's most environmentally friendly mining companies. This decision to move away from the current Mastrantos basin system at El Cubo will add up to 20 years of tailings capacity while confirming our commitment to employ the best and most environmentally sound contemporary mining techniques."

About Guanajuato Silver Company Ltd.

Guanajuato Silver is a precious metal 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 complex, the Valenciana mine complex and the 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.

Technical information

Reynaldo Rivera, vice-president of exploration of Guanajuato Silver, 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.

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