GR Silver Fall Summit: 2020 Round Up and Outlook for 2021

0:11 Hi everyone, thank you for joining GR Silver Mining's live investment summit today hosted by SIXX, 2020 Roundup and Outlook for 2021. I have President and CEO, Marcio Fonseca, with me today. And we're going to start off with a short video from his most recent trip to Mexico. Afterwards, Marcio will walk you through a company presentation, and after that, we will be accepting questions live. As a reminder, you can always submit your questions in a Q&A panel in the right-hand side of your screen at any point

0:41 during the presentation. Without further ado, let's play the video. And the recent new discovery at the San Marcial project. As you know, we have the Port of Fort in Mexico, and these are the 2 key assets, the Palmazos and San Marcial. And we've been working on the ground, on the surface of Palmazos, and we're very excited about all the drilling that we are doing in the project.

1:24 Here, Marcio is discussing the drill programs and progress with the geologists. He will now talk about the updates from that trip in today's presentation. Thank you again for the opportunity to be here today. The presentation is about to update all the progress to date at the Plomozo Silver Project. Just came back from Mexico where I have an update with the 20 geologists and as an additional information today we have 5 drill rigs on site 2 at Sun 1, 3 at Plomozas including one of the 3 at Plomozas is underground and we have increased the budget with more additional drilling in this project based on the latest news. So I'll be making some forward-looking statements today about the results. This is a cautionary statement.

2:12 So what's happening with the company? We are at full speed on the PLOMOSSES and some Marcial projects because we consider that we'll be able to integrate this project in the next year, creating a much larger resource. And at some stage, at the same time, we have advanced a lot in the evaluation of, on the Trinidad project that we are looking for the acquisition. We had 5 geologists in the ground sampling, taking samples, doing shallow drill holes, and we are far advanced in the project to make a decision about the acquisition of the Latrine DA, which I can explain later in more detail.

2:53 So today, how much cash we have in the bank? Close to 7 million Canadian. The share has been trading large volumes in the last couple of months, a lot of volatility, more related to the volatility in the market. Warrants and options are in the money, which are likely to bring close to 8 million Canadian dollars to the bank. So the company is pretty much fully funded and well supported by the shareholders, including the large funds, large resource funds, and 1st Majestic became one of the largest shareholders of the company.

3:28 We had in the last couple of months, we had additions to the board, but I explained this before. We have well-known mine executives and well-known Mexican lawyers supporting the company. So let's talk about our projects and the updates. The Plomozas and San Marcial

3:52 located over here are the key assets of the company. But we also are looking about this gray area, that's the La Trinidad project, which we believe we can integrate with this too. And for the first time, GR Silva is going to be the first company that controls all the key assets in the Rosario mining district.

4:18 Where are we drilling? We are drilling at Plomozas. 2 areas, San Juan and Plomozas mine area. And we are doing some work at San Marcial as well because we finished the underground development and we are doing a lot of surface sampling prepared for additional drilling.

4:41 We still believe that Plomoza and San Marcial have a lot of similarities of the San Dimas mining district which is probably 250 kilometers to the north. San Dimas is a well-known world-class gold-silver project, with a lot of gold and silver veins. And since we acquired Plomoza, We have discovered a lot of similar faults, mineralized structures that we believe are similar to the geological setting at San Dimas. And what we are doing now is evaluating this area between Plomoças and São Marcial as part of the potential acquisition from MECO Mining. But as we speak, we are drilling with 2 drill rigs at São Juan and at the Plomozas mine area.

5:37 3 rigs at Plomozas, 2 surface, 1 on the ground, and 2 at Sun 1. Most of the presentation today will be about updates of Plomoza and some updates from the latest new releases at San Juan and San Marcial.

5:57 Why we believe we have a potential large-size silver-gold district? Plomoza Silver Project is not just 1 vein, it's a series of veins. As an example, in this presentation, we only are presenting 2 of the series of veins. Plomoza's mine area has an extensive set of faults, these red zones, which host a lot of polymetallic breccias, silver, gold, lead and zinc. But the blue lines can be some potential faults more vertical that host silver and gold. But similar to the Plomoza's mine area, we have the San Juan area, which is 2.5 kilometers. The distance between Plomoza and San Juan is 2.5 kilometers, and they have a lot of similarities, same rocks. So we believe that we have not 1 but a series and we are discovering more zones similar to these 2 between them.

6:55 Today we have 20 geologists working full-time at the company in Mexico. I was there for 2 weeks at the camp that's located right here. And we see that what was before a small lead and zinc mine, today we control a concession that have a series of occurrences of up-term events. And we are going to be more and more aggressive to go drilling shallow holes not only at Plomoza and San Juan but also in the upcoming months outside of these areas. What's happening at the Plomoza's mine area? With the extensive database that we received when we bought this property in March, the 563-year-olds, we are the first company ever to complete a 3D model. We are far advanced in this. We have engaged the qualified person to do the first ever resource estimation for the Plomoza Silver Project.

7:53 Where are we going to do resource estimation? More likely, we are going to do resource estimation on the Plomoza's mine area and the San Juan, aiming to add more ounces to the inventory of ounces of the company. Today we have 39 million ounces indicated and inferred from the San Marcial project, which I'm going to describe later. But these 2 areas with all the drill holes that we received, plus the drill holes that we are drilling, are going to provide us additional ounces. Where are we drilling at the Plomoza's mine area? We are drilling along the strike, and some holes that are deep holes, down deep.

8:42 So there's a series of holes that we are drilling here because we believe that in the past mineralization close to the surface was not properly drilled and we are finding new branches and new veins. That's what we are doing at the Plomoza's mine area. I'll give an example why we're excited about this. When we bought the property, this is a photo of the stove, which is ruining pillar operation that was when the Group of Max shut down. They were mining this level 775. Most of the area was dark. We put a lot of cleaning, removing waste. And we discovered that the mineralization that was mined by Grupo Mexico sits here at the bottom, probably 5 meters wide, which is the breccia with a lot of lead and zinc, silver and gold. But we also discovered that all this hang wall is mineralized, disseminated sulfide with gold and silver grates and copper in a new type of rock, which shows us that the potential to expand the resource and define new areas along the strike and down deep is viable.

10:06 And what are we doing? We are drilling drill holes from the upper levels trying to deep deeper this areas and along the strike. So we can add this to the upcoming resource that we are planning to do between now and first 0.25 2021. That's what's happening at the Plomoza's mine area. And why we are so aggressive with Plomoza's? Going underground, we have seen a lot of massive sulfide in some veinlets or in other wide mineralization, showing that the system, the geological system, is robust, has a lot of setting traps to provide potentially bulk-mineable type of deposits, which can be very attractive as we move forward in the upcoming year with some economics and some engineering.

11:01 Continue to talk about the level 775. This photo on the upper left side here is the underground drilling. We are drilling underground. Again, we are drilling on surface at the Palmozas Mine area, but we are also drilling underground. We started at the Palmozas Mine area and someone with a 4,500 meter surface drilling program, 1,400 meters underground, we have just added on a drill rig and we are adding more, probably close to 4,000 meters of drilling in the project. Why? Because the mineralization that we discovered underground gave some grades like this, up to 37 grams per ton of gold, silver, copper, lead and zinc, showing that the system has a lot of opportunity to define ounces of gold and silver accessible because we don't need to do the underground development. The locations for future drilling, they are there. All the infrastructure, the electricity, water, everything is there. The ground conditions are great. So we have geologists working on the ground, we have a drilling company working on the ground. So we have 2 areas to drill, the surface and underground at the Plomozos mine area.

12:15 Another area that we are very excited, which is 2.5 km from the Palmosas mining area, is the Sun 1. It's important to highlight that when the company acquired this property, we only knew 1 vein here, 400 m long. Today, we know that the system is at least 2 kilometers long, with a series of veins. Today we know that we have at least 6 veins, And we have just discovered 1 vein here as part of integrating the data in 3D and drilling with our drill holes, is what I'm going to show you. The new release just issued today is in this area here, a new vein named Iacota, which we are going to continue to drill.

13:09 We released today a series of intersections which include our drill holes because we use the existing data to help us to guide for new drill holes. And we are coming across with a variety of mineralization. We have the traditional lead and zinc, silver and gold, but we have wide mineralization. We have mineralization such as this, close to the surface. I'm talking about the whole intersections that are not more than 100 meters from the surface, which is very attractive for the definition of the resources. These holes here, these results, you see in this new figure here, are all located now in a zone that's right here.

14:01 As I showed before, all the release holes before were here and some here.

14:07 And we have just discovered another vein that comes from this area. So we have a series of veins now, 6. When we bought this property, we had only one vein 400 meters long. Now we have a series of 6 veins and we are working on all of them with other geologists to drill rigs. And we are likely to bring new drill rigs to this area as well, as part of our ongoing drilling program.

14:35 That's the update on the San Juan. And we keep discovering some old workings with Bradshaw's veins, with the geologists, a lot of local workers. We are opening, cleaning and sampling because we believe that San Juan Plamoso, the Plamoso Silver Project as a whole, is a district-scale concession, which together with San Marcial and the potential acquisition of the Latinidad, will give us a lot of opportunities to create a sizable resource. When we come across results like this in samples, in core samples that have up to 70 grams per ton of gold, 47 grams per ton of gold, silver, lead and zinc, It shows how rich the system is, the epitermal system. Updates on San Marcial.

15:24 We've been updating and showing that with the new tunnel, that's a big achievement. We excavated, developed a large tunnel that almost can drive in. And we are doing all the support, the ground support to bring the drill rig to keep the conditions. But as part of this work, what was a surprise for the company is Preparing the access for the machine to get access to the underground here, we cut the edge of the hill. And we knew already that the mineralization in the resource area is wide and continuous in this area, with 15, 20 meters, Breccia style of mineralization. But we didn't know much about the foot wall with the excavation of the road, we came across a lot of disseminated sulfite and valence, which might be attractive for drilling in the next couple of months, and we are planning to do that.

16:21 Why? Because what was initially considered waste, now we have a lot of evidence of gold and silver, which can add ounces in the next year when we go and drill and update the resource at San Marcial as well. But to keep clear, the first update, the 1st resource that we are going to issue is the ProMosa Silver Project. And in 2021, more likely to have an updated resource from the San Marcial area, because we are going to drill there as well. Underground, from the underground drill station that's almost ready. We have the drill plan in place, just waiting the geotechnical support. And some drill holes in this new area to define what can be potential mineralization in additional ounces to the existing resource at San Marcial.

17:13 As part of the work that we've been doing with the 20 geologists, some external consultants. We are very excited with the blue sky potential that we have here. At the San Marcial on the left, we are very excited about the 14 new targets that we are going to drill some of them in the upcoming months. And the Plomozas that we have 11. When I say targets, they are potential veins. So if you add 14 plus 11, we make 25 potential vein occurrences that have never been drilled, showing that these 2 assets together, plus the acquisition of the Trinidad, can create a district-scale system and potential for a sizable resource. So that's the timeline we are on track for the resource estimation for the next year.

18:02 We have engaged the QP. We are doing all the modeling with the assistance of the external consultants and the twin geologists. We are drilling as we speak, very aggressive drilling, and aiming to in 12 months to get everything integrated and define a much sizable resource. First in the 1st resource from Plomozas, adding ounces to existing 39 from San Marcial, aiming a target of probably close to 100 million ounce of silver. And the integration of San Marcial, Plomozas, plus some economic studies can make a very attractive silver gold project in the region. The company is still trading a very attractive market cap. We have a lot of upside, fully funded, support of large shareholders.

18:48 We control the assets. We don't have big payments. And first time ever a company is in such a position in the Rosario mining district. I'm going to move back to 6 Sigma, if you have any questions, I'm available. Hi, Marcio. Well, thank you very much for the presentation. We had a few questions come in, so let's jump right into it. Our first question is from Rama. They're asking, you mentioned that you have $7 million of cash right now, and is that sufficient to complete the drilling campaign and publish a PEA before going to the markets to raise even more capital? To complete the drilling, yes. To a PA is another point. Let's see how we avoid what's the size of the resource because we might continue drilling as we find more and more veins.

19:42 Great, thank you for that. Our next question is about 1st Majestic. An audience member is asking, what is the role of 1st Majestic? Are they gonna fund the project going forward? Are they gonna be diluted with future raises? The role of 1st Majestic is like any other shareholder. Of course, they were the vendor of the Plomozos project, and they became a shareholder for the issue, issued shares to them, but they also participate in the last financing that was the BOT deal, when we were going to raise 5 million and upraised 9 million Canadian dollars, they request to participate. They don't have a right to anti-dilution clause in the agreements, but it's good to have that kind of shareholder that supports and believes in the project altogether. Great.

20:30 And how about Mako Mining? Will you be advancing negotiations with them for the Lodron Badmine? Yeah, for sure. We are very advanced. And of course, the pandemic in some ways slowed down the work that we are doing since March, but We came back very aggressively last July. We have finished the technical due diligence. We are almost finished in the legal. We are in the documentation stage. We are aiming to close this deal very soon. Great. You mentioned the pandemic a little bit. So how has COVID-19 really affected your operations in Mexico? How have you had to adapt? So like most of the companies operating, Mexican and Canadian companies, we need to adjust and put all the measures in place. We test everybody, everybody that goes to site, including myself or any executives tested before goes to site. It slowed down at the beginning to make sure that everything, all the protocols were in place, but today the tomato geologist, we have a total of 114 employees, contractors, consultants on site. We have a camp for 120 people. So you need to understand that, you need to control the people, make sure that everybody's healthy.

21:39 But we didn't stop working. Let's make that clear. Great to hear that operations are still ongoing and everyone's working safely. Our next question is from Albert. Albert asks, as part of due diligence, is GR Silver able to utilize drill rigs at La Trinidad? Yes, we did some drill holes. Great, short and sweet. Our next question is from Tim. Would you have to build a mill? What we have on site at Plumosas are on the foundations and the infrastructure that is the power line, roads, camps, water tanks and other facilities. Any equipment that's to crush, to mill and to process is not on site. So the answer is yes.

22:29 Great. Looking forward to more notes on that. Our next question is from Ravi. They're asking, what is the market missing with GR Silver? There aren't a lot of silver juniors with 30 to 40 million ounce silver resource out there, but GR Silver seems very undervalued in their opinion. I'll give my perception. I think the market is catching up now to realize that this company is fully funded, do not have big payments to vendors and properties, and we have to fully staffed with Mexicans experienced. The senior management is fluent Spanish so the pandemic didn't stop us to have the remote management and our key most of the key executives have a lot of scheme in the game. We invest money in the company.

23:19 That's great. Next question is from Steven. Does Yakora or any of the other veins at San Juan light up with geophysics and if so could it be used as a targeting tool for additional veins or extension of the known veins? That's a good question, Steve. What we did is when we acquired this project, we received a lot of data including 2 airborne geophysical surveys and 1 ground geophysical survey IP. We hired external experts, geophysicists, we reinterpret everything, model in 3D, and this whole discussion about the new vein is based on that evaluation of the drill holes for the geophysical targets that we are preparing to build in as well. So we have the data now to continue to drill some targets around the Yekora, along the strike and other veins in the area.

24:13 Perfect, thank you very much, Marcio. So what are the upcoming catalysts for GR Silver? You can imagine with 5 drill rigs on site, there's going to be non-stop drilling samples going to the lab. The market needs to realize that now the labs are pretty much loaded up with all the sample, all the companies send samples to them. But we also have still probably close to 300 real holes to validate and release, not only at Diplomoz's mining area in 71, but some other targets around. So the company has a very consistent backup of news flow coming. Great, very excited to follow up on some of those and hear some of those new news.

25:00 The next question is from James. What relationships exist with the government or are being built to prevent government tax challenges like the problems that 1st Majestic has been working through on their mines? We have a very good relationship with the government in a way in the state and federal. To give an example, a key director in the company used to be Secretary of Mines in Mexico. That's the level of relationship we have. The issue with 1st Majestic in the moment is without going into more details, is more related to metal stream agreements, which are specific ways to finance mines. We don't have that as we speak. The company has 0 debt. Great to hear. Here's a question that just came in from Matthias. Sorry if I've mispronounced your name. They're asking, when do you expect to publish the next drill results?

25:53 We want to be publishing new results, if not every week, every 2 weeks. That's the schedule that we want to do between now and Christmas. And of course, at Christmas, everybody on site, we have a break and come back in January. Awesome. And will work keep going throughout the break? There will be minimal work, but geologists will have a normal Christmas holiday season and coming back on January 2nd to the site. Excellent. Here's a question from Gregory. He'd like to know a little bit more about the team. Can you talk a little bit about the work experience for yourself, Marcio, and also the head geologist, especially the one that's leading the charge in Mexico. For sure.

26:39 Myself, I'm a geologist, financier, 25 close to 30 years of experience all over Latin America. You can see the name of the companies that the executive management has worked in this company like big banks, big mining companies, big projects, big discovery. The last successful transaction I was directly involved was the growth and successful sale of silvercrest mines to 1st Majestic. We have Treble Wolf, that BP Corporation developed an exploration like myself, a lot of experience in Latin America, big companies, including Spanish. And going back to the head geologist, he's a Costa Rican, senior geologist, a lot of experience in big thermal systems in Bolivia, Mexico, Central America. We have people being trained to be resource geologists. A lot of people geologists.

27:26 Mexicans, we try to favor Mexicans to be to favor local employment. We've had to work with big companies and experience in the district. They know where to find more banks. That's important.

27:41 Great, thank you for that background on the team, Marcio. Next question is from Alan and perhaps the golden question, when do you expect to be in production? To be in production, there's still a couple of steps to be achieved in this company. The first one is to create a sizable resource. That's why we are working with the drilling at Plomoza's mine, area in San Juan, to get close to our target of 100 million ounces. Post that, we are going to update the resource at San Marcial, with the drilling that we are planning for next year, and then doing the preliminary economic assessment. As a conceptual timeline, it's more likely beyond 15 months, because you need to do all the engineering and economic studies. But having said that, you need to take into account that this company has a low risk, because you have the permits to go into production as we speak at Plumosis, because it was a mine. And you have all the key infrastructure, power line and roads that saves a lot of time in the development process of a mining project.

28:46 Great, The next question is from Richard. Do you anticipate any issues with permitting? Based on my experience, I have been working in Mexico for more than 15 years. We did a lot of check on the checklist on due diligence. The areas are mining district, as I said before in the previous question, Lomoza has the permits to be in production, San Marcial has the permits for exploration. As we acquire all the concessions between them, we plan to, we can use 1 permit for production from 1 area to the other concessions. Great. Next question is from Chris. Chris is asking could you cover the ownership structure?

29:28 For sure. I'll go back here. The ownership structure here. We have today 1st Majestic with 17%. They were diluted a little bit from the initial 19% that they had when we bought the property from them because we issued some shares to them as part of the payment was a share cash deal. But today we control 100% of the promosals. After that is management, which before, of course, Majestic come into play as a shareholder, management was the largest shareholder, means a lot of direct investment. Institutions here, funds are in entities like Mackenzie, Sprott Resource Capital, Earth Resource from UK and Swiss-based Gold Silver funds.

30:16 And SSR mining still has a small position that has been diluted because we used some shares when we bought the San Marcial project. And JDS Mining is a mine engineering, they build mines based in Canada that participated in initial private placements as seed capital for the company once we set up the business. Thank you very much. Our next question is from Ravi. They're curious to ask your opinion on the yoyo effect going along with the price of silver right now. It seems that with the ongoing pandemic, vaccine news, which obviously has an impact on metals prices, vaccine news is coming out every Monday before the market opens. So it's been 3 weeks in a row that it's brought silver down a little bit. What's the impact going to be on silver prices and maybe even on GR silver?

31:09 We have seen an immediate impact that's more negative. That's what you can see in the share price. We came back strongly from 54 to 70 cents in the last week, 10 days, the share price came back to the mid 50s. But what I believe is that there's a bullish sentiment that silver and gold are going to outperform in the next 12 months, and particularly for companies that have high quality assets, that have great thickness, economic aspects that can show that high margin, which is really in demand in the silver and gold space. Great. The next question's from Richard. At what point will you stop drilling, given that you can drill for another year or more?

31:59 That's a good question. When you have 25 targets, it's hard to stop drilling. But at some stage, we need to say it's time to put it all together. If I were to put a timeline, probably more than 24 months still drilling, a lot of drilling. But in the meantime, there will be a series of resources, estimations, updates in I43.01, and as we keep drilling, for sure discoveries. That's great. Sounds like a lot of good news upcoming. Our next question is from Steven. Any delays in lab results like there are in Canada? That's true. And we are experiencing a much longer time between sending the sampling and get the results. What used to be 2 weeks, now is 3, 3.5, even 4.

32:52 And we want to maintain the same lab so we can keep the quality and all the certification. So we do not want to cut corners. So that's what is really facing the company but having the 5 drill rigs, having the plus 300 drill holes to look at and validate is a big plus for the company to maintain the news. The next one's from Gregory. What is the TPD capacity of the existing mill and how old is the mill? So just to make sure everybody understands, there is no mill on site. There is only the infrastructure to put the mill. The crushing mill and the plant were removed by Grupo Mexico. The previous lead and zinc is malmine operated at 600 tons per day of capacity.

33:41 But we don't know yet what was going to be the final capacity of this project because we are going to integrate Plomoza and San Marcial, a much larger project. Speaking about the mineralized units, Manuel is asking what type of rock is the different mineralized unit found in Plomoza's mine? So Plomoza is a typical thermal deposit. And what we see here is that most of the rocks are volcanic rocks, underside and rhyolites. And The type of mineralization are veins and breccia that sits on faults and these faults have different angles. Some are low angle, 45 degrees, some are steep angle, vertical, and being in different angles have different type of veins with different type of mineralogy.

34:36 Here's another question from Rama. When do you expect to publish the NI43101 resources? We have a target by the PDAC next year to have the resource for Plomoza's silver project for the 2 areas the Plomoza's mine area and zone 1 but as you see today we saw today we keep discovering veins so that might add some sort of delay because more veins more answers. Great So I do think that is all the questions that we have today. Double checking here. Yeah, I think those are all the questions that we have for today. Marcio, I want to thank you very much for going through all of our questions and taking us through the most recent news release and the presentation.

35:26 Everyone in the audience, thank you for submitting your questions. If we didn't get a chance to get to your question or if you thought of 1 just now, or even after the webinar, please feel free to contact the team directly. Vanessa has kindly left her contact details there, vanessa at grsilvermining.com. And she'll be happy to take your questions. She is the corporate communications personnel at the GRSilver team. Please also stick around after the webinar. We have a short survey where you can leave your direct contact details for the team to reach out and follow up with you directly if that's your preferred method. And for more information you can always go to the GR Silver Mining website which is conveniently named grsilvermining.com. And of course we'll have a copy of the recording on six.com for everyone to review afterwards.

36:15 Marcio I'd like to hand you back to Mike for the final word. Thank you very much for SIGS for organizing and we are very excited about all the assets that we have in Mexico and with the fully integrated team and for investors, you can see that we are working hard and there'll be a very solid and constant flow of news in the next couple of weeks and months to come. Thank you very much. Thank you everyone, take care and until next time. Bye now.