HELIOSTAR ANNOUNCES 2024 PRODUCTION GUIDANCE FOR ACQUIRED MINES

Upon completion of the acquisition of the San Agustin mine and the La Colorada mine in Mexico, Heliostar Metals Ltd. has provided gold production guidance for July to December, 2024. The projects have operated for the commercial benefit of Heliostar Metals since July 11, 2024.

Highlights:

• Production guidance for July to December, 2024, of 19,350 to 19,750 gold ounces and 20,000 to 20,250 gold equivalent ounces;
• Cash cost guidance of $1,500 (U.S.) to $1,600 (U.S.) per gold ounce and ASIC (all-in sustaining cost) guidance of $1,650 (U.S.) to $1,750 (U.S.) per gold ounce;
• Immediate objectives are to expand annual production and grow resources;
• Five drill rigs turning across portfolio.

Heliostar chief executive officer Charles Funk commented: "Heliostar is now a cash-flow-positive gold producer with significant potential and an underexplored portfolio of properties with significant resource growth potential. Today's guidance for the second half of 2024 shows strong cash flow margins. This cash flow is being reinvested in our Mexican assets and represents the first significant investment these assets have received in many years. The immediate focus is to add to the current production at La Colorada and to advance Ana Paula to a production decision in 2025. The company has five drill rigs turning across its portfolio with the objective to grow the resource base to support our plans to grow into a mid-tier gold producer."

Production guidance

Total gold sales from the San Agustin mine and the La Colorada mine during the July to December, 2024, period (being the second and third quarters of the company's financial year) are expected to be 19,350 to 19,750 ounces (20,000 to 20,250 ounces) at a cash cost of $1,500 (U.S.) to $1,600 (U.S.) per ounce and an AISC of $1,650 (U.S.) to $1,750 (U.S.) per ounce.

The La Colorada mine continues to produce gold from leach pads after the previous operator paused mining in September, 2023. The company has maintained an elevated staff level, adding to site costs as it determines the economic viability of restarting mining operations using previously stockpiled material. Recent work has identified a 4.2-million-tonne stockpile as a possible ore source. The company further plans to complete a prefeasibility study in early Q1 2025 with a view to restarting mining operations in the Creston pit in mid-2025.

The San Agustin mine recently ceased mining activities due to permit constraints and is producing gold from existing leach pads. The company has submitted a permit application to expand the open pit that would allow mining at San Agustin to recommence in 2025. Without approval, the San Agustin mine will transition to care and maintenance upon completion of leaching operations.

Drilling and technical trade-off studies continue at Ana Paula. The company plans to complete a feasibility study on Ana Paula by the end of 2025 to allow for a construction decision shortly thereafter.

During the interim period between execution of the share purchase agreement with Florida Canyon Gold Inc. and closing of the acquisition, Florida Canyon Gold retained $5-million (U.S.) in proceeds from the cash flow generated from mining operations at the projects.

Statement of qualified persons

Gregg Bush, PEng, and Mike Gingles, qualified persons, as such term is defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects, have reviewed the scientific and technical information that forms the basis for this news release and has approved the disclosure herein. Mr. Bush is employed as chief operating officer of the company and Mr. Gingles is employed as vice-president of corporate development.

Cautionary production disclosure

In the period between announcement of the transaction and the company filing updated technical reports, the company advises that a production decision on the projects has not been based on a preliminary economic assessment or a feasibility study of mineral reserves, demonstrating economic and technical viability, and, as a result, there may be an increased uncertainty of achieving any particular level of recovery of minerals or the cost of such recovery, including increased risks associated with developing a commercially minable deposit.

Historically, such projects have a much higher risk of economic and technical failure. There is no guarantee that production at the projects will continue as anticipated or at all or that anticipated production costs will be achieved.

Failure to continue production at the projects would have a material adverse impact on the company's ability to generate revenue and cash flow to finance operations. Failure to achieve the anticipated production costs at the projects would have a material adverse impact on the company's cash flow and future profitability.

Mineral resources are not mineral reserves and do not have demonstrated economic viability. There is no certainty that the production scenarios set out in this news release will be realized.

About Heliostar Metals Ltd.

Heliostar is a gold producer with production from operating mines in Mexico. This includes the La Colorada mine in Sonora and San Agustin mine in Durango. The company also has a strong portfolio of development projects in Mexico and the United States. These include the Ana Paula project in Guerrero, the Cerro del Gallo project in Guanajuato, the San Antonio project in Baja Sur and the Unga project in Alaska, United States.