GR Silver Reports Significant Drill Results at San Marcial

0:04 Hello everyone, thank you for your patience. We're joined with Eric, obviously, President and CEO of GR Silver, to discuss last week's news regarding draw results at San Marcel. I have a few questions keyed up for Eric, but as this is a live event, we do encourage you to submit your questions using the chat feature, which can be found at the bottom of your screen. Many of you have already figured that out. And as always, this event is being recorded and will be available shortly after we conclude. Eric, before we dig into the draw results, congratulations on stepping into the president and CEO role on a permanent basis earlier this month. You've worn a few different hats at GR Silver over the years from chairman to CEO and back again. How has that journey shaped the way you're leading the company this next chapter?

0:50 Yeah, well, obviously we all miss the leadership that Marcy provided. He was the founder of the company, the president and CEO. Since his sudden and tragic passing then at the end of March, my focus is still on continuity. I'm of the vision for the company, making sure our teams in the field and market are aware of that continuity that we have a plan and we have the resources to fulfill that plan. We've got a spectacular high-grade silver dominant system at Plymoussas in some of Plymoussas project and we've got a wonderfully talented and experienced exploration team to explore it. So continuity is the focus in the first phase. Great. Let's start with the headline number from last week's release. Hole SMS267 returned 21.9 meters at 168 grams per ton silver, including the higher grade core of 6.15 meters at 447 grams per ton. Can you walk us through what this intercept tells you about the Southeast extension and why it matters for the bigger picture at San Marcial?

1:54 Sure. The very first thing I want to point out is that we're exploring the large system here. And at the core of that is an intrusive body. It might be made up of multiple phases of intrusion, but that's the core. And sitting on the shoulder of that intrusive body is a hydrothermal breccia. It's a wide body oriented to the northwest, again, sitting on the shoulders of that intrusive core. And where that breccia is intersected by cross-cutting northeasterly structures, that literally opens up the breccia, and that's where high-grade mineralization is deposited. These are called dilation zones. A great example of that is the high-grade hit that we reported in May, which was SMS 2604,

2:42 which reported 45 metres averaging 1.6 kilos per tonne silver. So as you mentioned, SMS 2607 returned 22 metres, averaging 168 grams silver. That's representative of the breccia outside of a ventilation zone. So we're systematically mapping out the extent of that hydrothermal grid chip and we're going to be coming back as we progress the 20,000 meter program to test the dilation zones within that following up the higher grade and that should build down just rather quickly. Now these new holes confirm high grade silver count and at least 150 meters beyond the boundary of your 2023 resource estimate. For investors trying to understand what this means in practical terms. How should they think about the potential impact on future resource growth?

3:33 Right, Well, I'm not going to predict what our upcoming mineral resource estimate is going to be, but historically, we've built ounces at the rate of 4,000 ounces of filler per meter drilled. So that reflects the high-grade nature of the mineralization that we're following up, how shallow it is, so the drill holes are shorter, and how thick it is. So we're not facing small 1 or 2 meter veins here. The average thickness of the San Marcial mineralization in the 2023 mineral resource estimate was 22 meters. So very, very thick. And the parallel breccia target is a newer story for the company, and the release describes what may be 2 distinct mineralization, mineralizing events, rather, with gold showing up in a way it doesn't in the main resource area.

4:22 What is the geology telling you there and how does gold potential change the way you think about the district?

4:28 Yeah, you're right. The Parallel breccia is a relatively new story for us and we're learning how that mineralization was deposited there. Our first hypothesis was that, as the name implies, it's a parallel breccia to the main San Marcial breccia, but closer to that intrusive core. We're learning that it may be slightly different with more near-surface veins and bone lumps and disseminated mineralization than maybe more closely related to crosscutting northeasterly structures. If that's the case, what you have to do is turn the drills around, swing them by 90 degrees, and start testing what's happening along those cross-cutting structures. So that's the way we're beginning to view it. The lesson is that you have to be pragmatic and follow where Mother Nature leads. Fortunately, we've got a really stellar exploration team that can deploy sophisticated techniques to follow up that new system.

5:23 Right, right. Now, back in May, you reported what you called the project's best ever intercepting hole SMS-26-4, over 45 meters, at more than 1,600 grams per tonne silver. How do the latest results fit alongside that discovery and what's the plan for following up on that dilation zone? Right well when you're following up a large system that's complex like this, you have to be very systematic, especially like at San Marzio. And so that's what we're doing. We're pragmatic, however, in following Mother Nature where she leads. As we complete the halls that we have set up logistically in the program, we're then able to look at how we can return to follow up these higher grade dilation zones.

6:11 That flexibility is essential. Unfortunately, we've got a 20,000-metre program that's large enough that allows us that flexibility and rest assured I'm going to come back to testing out those higher grade dilation zones as the program progresses. Yeah, I'm glad you brought that up. You're part way through a 20,000 metre drill program with 3 rigs turning. Can you give us a sense of how the program is structured and what's being completed so far and how you're prioritizing targets as new data comes in?

6:41 Yeah, we're currently through about a quarter, the first quarter of the program. And we faced some real challenges. In November last year, Marcy did a great job recognizing the increasing security risks in Sinaloa and conducted a once-month pivot, moving the logistics base from Sinaloa into Durango. But that logistics base is further from the project and things have taken longer given the distance, the security challenges in the region and especially now that we're into the rain season here. The safety and security of our teams, our employees and our contractors is our number 1 priority. So we are upgrading our access road through Durango and when that's ready and when security and the weather allow, we hope to bring in a force assist rig to accelerate the program and these are going to be allocated to optimal effect when available.

7:36 Now, Plomosas is often described as an immersion high-grade silver district rather than a single deposit with existing infrastructure, road access and permits already in place. What advantages does that give GR Silver compared to other explorers at a similar stage? Yeah, you're right. The recognition of that district scale potential on St. Marcial is relatively new. We have, however, the former Plomosis mine within 10 kilometers to the north of San Marcial. And that one was in operation from 1986 to 2000. So as you mentioned, that brings us existing infrastructure, including power and access and permits. So we hope to use these advantages and continue to demonstrate to the Mexican authorities that we're good corporate citizens doing the right thing for our local communities, so that we can advance San Marcial's project more quickly by doing so. After all, we all recognize that time is money and that advancing fund marketing is to the benefit of everybody.

8:37 Looking ahead to the balance of 2026, what are the key catalysts investors should be watching for, whether that's assay results still pending, progress toward an updated resource estimate, or other milestones on the horizon that you want them to be aware of. And exactly right. So the key catalyst, of course, of delivery on the 20,000 metre drill program have results out in batches every month or so. Once the program's complete, then we'll be looking at the mineral resource estimate update, and then that will be followed by an integrated preliminary economic assessment, looking at both the Plumosis line and San Marcial together as 1 entity, taking advantage of some of those things that you just mentioned. Great. Eric, thank you so much. There's no questions, just a commentary on the reverb. We're going to try and fix this on our end and post edit here, so don't worry, everyone.

9:30 I'm going to see if our creative team can do some movie magic. And we look forward to the next update, Eric. And thank you for your patience, everyone.