Kuya Silver: A Rising Force in High-Grade Silver Mining

0:04 Good morning or good afternoon, depending on where in the world you're signing in from today. I appreciate it as always, you guys joining us today for a live webinar. I am joined today by David Stein, CEO and director of Kuya Silver. How are you today, David? I am good, thanks, Romeo. Awesome. So you're, yeah, no, it's great. So here's how today's gonna work. First, I'm gonna throw it to David for a presentation. He's gonna run through it, then I've got some questions for him, and then we'll go to questions from the live audience. So today is an interactive event. That chat button at the bottom right, you can use any time during today's event to ask a question to

0:36 David. If for whatever reason we don't get to your question today, I'm still going to send the entire transcript of the event to the Kuya team. So they'll get back to you as soon as possible. So don't worry if for whatever reason we don't get to your question today, but I will try to get to as many as possible. The other thing I'll say as far as housekeeping is today's event is being recorded and will be available for replay likely in the mid-afternoon today. So it should pop right in your inbox and you can feel free to share it along once you see it. It'll also be available on YouTube slightly later in the afternoon. Without further ado, get into the protein of today's event. I'm going to throw it to David for a presentation. Okay, thank you very much.

1:13 So I'm gonna talk about Kuya Silver. We're an exciting silver producer that is growing quickly. And

1:25 I am very very excited to introduce it to those of you who don't know the company and to give an update to those who already know us. Before I start, I think I wanna give a bit of a special disclaimer today, which is that we announced a private placement financing in March 7th, I believe. It should have been closed by now, but we had just an administrative issue with one of our investors that has delayed the closing, which will be resolved very, very soon. So it's basically closed and I'm not marketing this private placement, this presentation we're doing today.

2:15 Yeah, we're not marketing any placement and I think that's it's just important to say that upfront, just so nobody is confused about that. The deal is closed. We went very, very well. And we're ready to move on and start getting some really exciting production results out of Bethania. So the other thing I will say before I get into the meat of the presentation is I'm giving the presentation for the most part, as if the majority of the audience is new investors or people who have not seen us before. I think that's gonna be a lot of you, I understand.

3:03 However, for those of you who do know Kuya there is going to be updates in the presentation and Got a couple of things in there for you as well but you know the majority is just going to be an overview of the company why I think you know now is the right time to be investing in Kuya and You know this is also the first presentation We've done with 6 And we'll be doing more of these on a regular basis going forward. So in the future, we can have more specialized presentations about different aspects of the company. But today is going to be sort of the first pass overview about why we think Kuya is not only a great investment, but the best silver play out there.

3:52 And as a big shareholder myself, I'm very confident in that. So with that, let's move forward. We've got the 2 assets. One is in our flagship asset is the Bethania mine in central Peru. We just started production there a couple months ago. We're ramping up production there and I'll spend most of the presentation talking about Bethania. Northern Ontario, we have a big district that we are exploring as well, have had great results, made new discoveries in the Cobalt Camp, new silver discoveries, probably for the first time in many, many decades. So it's an exciting project, and that's kind of our secondary, earlier stage project that we have.

4:39 You know for for those of you who are maybe not sure about why investing in silver versus, let's say, other metals out there. This is 1 slide that kind of sums up the opportunity for silver, in my opinion, which is that If you do look at silver and gold, gold follows this to some to the same degree as well. It really does over the long term protect value and wealth against inflation. And a great example of this is you know if you look at minimum wage 1965 was a dollar 25 an hour. You were getting paid in coins that were 90 percent silver at the time. If you just took your your quarters and you melted those down today without they'd be worth 30 dollars.

5:33 So and you know minimum wage in the US I think now you know is still you know well under $20 an hour 17 16 something like that in some states even less. So So you're actually better off with the silver.

5:51 And you know that that's the story really. And that's why it's so exciting to be to be part of this and basically be able to mine real money. There's lots of great other uses for silver as well as we know. But you know I think this is a big one that will really make a big difference in the in the coming in the coming years here as as investment demand for precious metals becomes more of a focus.

6:18 Okay, one thing I just want to do again, this is, you know, for people who follow us, we are, you know, now that we have almost closed this financing, we'll be in the position to talk more about our ramp up in guidance going forward. We're not going to do much of that today at this presentation, but we will be able to put out a press release in the month of April in the next few weeks with more details about how things are going and our guidance for the ramp up from basically from now, from this day forward. And obviously the money that we raised is gonna be a big part of that. We've got Silver King's Joel results as well that we owe the market. So we're busily preparing that press release as well. That will actually probably come out first.

7:08 And then we will have regular financial updates and production press releases. We definitely want to move to more of a regular cadence in terms of updating the market. It was very difficult when we were in the first few months of startup as to what to say. But we're now in the position where we can start to give the market more regular feedback. And I think that will help a lot in terms of, you know, just understanding how, you know, how things are going and how well the mine is ramping up. All right. Big gap between silver mining shares, the SILJs in blue and you've got the silver price in the pink. So I won't spend a lot of time on that. But that's obviously been, you know, is a very, very interesting opportunity for investors here.

8:00 The silver equities, meaning the silver mining shares, have really not performed very well since really late 2022, early 2023. And Obviously, there's different reasons for that. We can maybe talk about that more in the Q&A, but I think there's great value in the sector as a whole and even more so with Kuya. With Kuya, the opportunity here as we move from being a sort of a junior that's essentially sucking cash all the time to a company that actually has positive cash flow. And we're on the precipice of getting there now.

8:47 What you do see in the market is it makes a big difference in the valuation. So if we look at you know our true peers and and our true peers are the companies that are primary silver producers. There's only 5 or 6 of them in the world that actually are cash flow positive and produce mostly silver by revenue. A lot of other silver companies have silver in the name but actually don't produce very much silver or They don't or they produce more gold or zinc as a byproduct or co-product. But we're going to be one of these very few elite kind of companies that get huge valuations as soon as they become profitable essentially. And you can kind of see that here with some of these examples on here.

9:34 And you know the one thing I want to look at is or go back to because we're going to talk about this a little later is you know if you can get to sort of towards 100 million a year in EBITDA which obviously we we think we can do with Bethania, but we'll all explain that later. Already, just with the one mine, we'd actually have more EBITDA or cash flow than First Majestic with all of their mines as of last year. And they had, prior to the merger with Gathos, they had a market cap of $1.8 billion. So there's huge, huge growth potential here from our 20 some million EBITDA or enterprise value today. You know you're looking at multiples and multiples of potential value just by going from being cash flow negative to cash flow positive. That's I think the biggest biggest reason why these companies kind of do take off like we've seen over the last few years.

10:33 I is probably the newest one to kind of join this group and they've done extremely, extremely well. All right now let's talk about Bethania. We're located in central Peru in a mining belt here, just west or east of Lima. The mine's located here. We have road access. Basically, you can get there from Lima, driving along the coast and north, or from Huancayo, driving south. Huancayo is a big city, relatively close by, 3, four-hour drive to the mine, And it's got half a million people. So we've got a lot of access to infrastructure, support services, et cetera, labor in the area. It's a great place to be.

11:19 Look Peru's not the same. The whole country has been really improving a lot. And and is looking like a great place to be a mining company especially relative to some of the other countries out there. But within Peru, I think we're frankly in the best area, which is that central Peru area where you've got good infrastructure and also a strong mining culture. All right. I really before we get into sort of the nitty gritty of what's going on at the Sanya I really think it's important to look at where we can take this asset and then you know and then we can sort of take a step back and look at some of the details. And so this is something relatively new. It's not a forecast.

12:07 It's not something that there's gonna be a lot of data on today. However, this is internally, this is what we do believe we can do with Bethania which is the 100 100 plan and what that means where we get that number those numbers are that that slogan is 100 million of silver resources and 100 million a year of free cash flow. And you know from where we're starting today that's a huge huge task but we believe we have the assets to do it. And obviously it's a massive opportunity. It's a billion dollar opportunity frankly for us. And we're going to put everything we can into achieving that over the coming years. We obviously got the startup done and now it's moving on. The next kind of mini goal we have is to break even at the mine. We think we can do that in Q2 of this year, which is this quarter right now. So so let's see.

13:06 The phase 1 is to get to the 350 ton per day mining rate. That's we've already talked about that. More importantly than the than the rate per se is actually the silver that we produce, which will be about between 1.2 and 1.5 million ounces equivalent per year. We do produce 80% of our revenue from silver. So that's an important thing to keep in mind. Very difficult to find 80% exposure to silver, 80 or even higher than that. There's very few companies, maybe 1 or 2 others out there. Most of the companies, you know, you're looking at 50 to 60 percent silver. So we really give investors a supercharged exposure to silver if you if you are bullish on silver. 350 tons per day. If you kind of go back to our our PEA which we put out a couple of years ago we you know we would be producing Average life of mine at about $12 an ace a 6. So that's the cost add $3 an ounce. That's our estimate for toll milling And you get about 20 million a year in cash flow at $30 solver so that's kind of round about what we would expect sort of using our P.A. And then updating it for the toll milling and some of the changes that we've made since. Now we do want to build the plant. And when we do build that we'll be able to drop a few dollars an ounce cost.

14:30 So that's good. It'll bump up our cash flow a little bit. But more importantly, it allows us the platform to grow the mine to be to a much bigger size. We're going to be we're going to be maxed out at what kind of production we can get using toll milling. But if we have our own plant, then basically the shackles are off and we can produce as much as the resource will allow us to produce. And with that, I think, you know, given our a hundred million ounce kind of target, which we do see the potential in the district, you know, we'd be looking at something in the neighborhood of 5 million ounces after expanding the mill. And if we do that and we can make a $20 margin on that, there's where you get 100 million in free cash flow.

15:15 So again, that's a probably 4 or 5 years down the road. That's a long term goal, but it's important to have those goals. And it's important investors see the opportunity here. This isn't just a small mine that's going to go into production and, you know, and make 10 or 20 million a year. That's really just phase 1. And then we're going we've got the opportunity to make this into you know frankly one of the you know biggest and most profitable silver mines in the world. OK. Here's Here's why we think that we'll start with the looking plan view down at the mine and the property that we have 4,300 hectares. The mine itself is located only on about 15 hectares of this, the corner here where I'm circling. We've got other targets that we've already explored and put out results on.

16:06 Carmelitas, Tito, et cetera. I'll talk about those again in a minute. But we've got this huge land package around the mine that's obviously very attractive, lots of structure, lots of mineralization, and, you know, we've really just scratched the surface in terms of where to go here. So 43, we've actually picked up some more land since then. So maybe 4,500 hectares now. And only 15 of which has any resources on it right now. And even on those 15, it's still open at depth. So there could be a lot more in that original 15 hectares, as I'll show you in a minute.

16:51 All right, for those of you who don't know the company as well, here's our resource, it hasn't changed in several years. But this is what we did with our drill program a few years ago. Basically what we are our our priority here was to develop a mine model. We've been very production focused really since we went public back in 2020. And And we've done that in order to try and put a lid on potential dilution. I'll talk about that later. Obviously, we still have needed money over the years and we've still had had some dilution in the share price, as all juniors do. But, you know, by moving as quickly as possible into production, we kind of give our shareholders a fighting chance. And that's what we're doing. But anyway, so that's why we haven't done a lot of exploration lately. But we're about to restart that as we start building more cash at the operation.

17:51 All right, here's just some of the key numbers from our PEA, from our production, what's going on in the mine. I won't spend much time on this. This is mostly ancient history now, but just a good in terms of something to refer to in terms of what we're looking at doing now.

18:15 The production at the mine last year, we started first with reconditioning. So that was basically going back underground after 8 years and making sure it was safe, redoing some of the support which were necessary. And we completed that all mostly in Q1 of last year. Then we started to do some very limited mining over the Q2 and this and our summer last year. And we we were able to start kind of ramping up more production, really at the beginning of this year.

18:54 So we've got more consistent daily production going right now. Now the next goal is to get to 100 tons per day. We think we can get that in the next few months. So stay tuned. We'll give more details about that. But that goal is now within reach and definitely the financing we just did it really helped us with that. And then, you know, phase 4 is to basically get reinvest cash flow from the mine to get to 350 tons per day.

19:25 Okay. So now getting back to the 100-100 plan, we need to get more resources. 100 million ounces of silver. We currently, if you go back to our resource a few slides ago We currently have 14 million ounces equivalent between indicated and inferred So, you know to get to a hundred It's a it's a big it's a big increase, but we believe we can do it, and I'll show you how. First of all, again, just to remind you, this is our land package, okay? So we're gonna go to all of these spots where there's red lines in a minute. And I'll show you how where we think we can get more resources. One thing to keep in mind, historically, our discovery cost has been 20 cents per ounce.

20:12 So, you know, if we can continue on that kind of rate of discovery. If we put another 10 million, this is US dollars into exploration over the next few years, we should be able to discover 50 million ounces, 20 million, 100 million ounces. And so that's what we want to do over the next let's say 3 years or so. It's not going to happen all at once. It's going to take time. It's going to take money. But you know we we we want to be able to do that from cash flow from the mine. And we're you know we're we're in the position we can do that very soon. Okay, so let's start with the easiest, the lowest of the low-hanging fruit. I mean there's a lot of low-hanging fruit, but here's the lowest of the low-hanging fruit. It's just to go into the mine itself and start exploring at depth.

21:01 Our current resource basically sits in this triangle. It's about 200 meters average width from top to bottom and about 500 meters east to west. It's a swarm of parallel veins, all of which have some resources on them and they're all open at depth. So we seem to be at the top of a hydrothermal system here. You know, some of the comparable silver polymetallic mines out there can go hundreds and hundreds and hundreds even a kilometer deep but we're still very shallow here so you know if we can double this at depth you know let's say go to go to 400 meters deep that would obviously be great and you know that should get us another you know call it 20 million ounces if we get the same ounces per vertical meter that we had up here we should get another 20 million ounces because there's already several million ounces mined out of here as well.

22:05 So this is geologically closer to you know, probably a 20 plus million ounce block and again, if we can repeat that at depth, which there's no reason why you know, we see we can't then that will obviously give us a lot more resources there without even leaving the current mine area. But if we move off to the east here, we do have the extension of the mine of the veins on the other side of the hill, we call that the hilltop zone. There's a kind of a swarm of veins that kind of come out the other side of the hill here. And we think we can kind of connect that all up and double it along strike as well. So if you kind of double it depth and get another, you know, again, This is complete arm waving, but we just want to show people the math of what we're thinking.

22:51 20 million ounces here. And if we can do that again along strike, you basically flip the whole thing over, you get another 30, 40 million ounces over here because there's almost nothing mined out of here, whereas there's quite a bit mined out of here. So that's the potential without even leaving the original Bethania Mine property. And oh, by the way, it's still open to the east here. It's just it goes into a valley. So there's not as much exposure at surface Now Tito is our Sort of next tier target after the mine Bethania mine itself. We like this because the footprint of Tito is really big and because it's got consistent high grades at surface. So this was a kind of a discovery or something that we visited for the first time as CUIA back last year, so just over a year ago. We went and we did a, you know, a comprehensive sampling program of whatever we could find at surface without digging or disturbing anything, any surface.

23:54 We didn't take any machines over here. We haven't drilled yet, but where we found vein mineralization at surface, we sampled it and you can see here, just this one vein is more than 600 meters long and then you've got you know sort of these other veins over here just where we have exposure it's over a kilometer east to west here which means you basically could put the whole Bethania plus hilltop zone right in there and you know it basically would fit. So that's got the same footprint as Bethania. It's similar you know structurally controlled kind of swarm of veins and the grades are very high here. They're higher than Carmelita, so we're more consistently getting 1,000 and 2,000 gram per ton samples at surface here. We do get them at Carmelita's, just not as often.

24:45 Carmelita's, though... Sorry, I should not use the roller for that. Okay, Carmelita's is another potential Bethania, you know, if Tito is Bethania number 2, Carmelita's could be Bethania number 3. Now, it's slightly different in the sense that it's more north-south, the veins, they're kind of chopped up into 2 different zones here on parallel faults.

25:11 But if you stack them back-to-back, they basically have the same strike length as Bethania, again just a little over a kilometer. Again another swarm of veins, we've taken a lot of samples, it looks like another similar to Bethania vein system with high-grade silver, with base metals as well. And so we potentially could have 3 Bethanias here if all 3 of them sort of work at a depth. Kermelita's main has been mined more than any of the other zones that we have outside of the Bethania mine itself. There's workings at 2 different levels

25:53 and several, and workings on 3 different veins. And what the previous, you know, miners did is they actually went each veins was a separate at it. And and so so a little bit more known about this one but all 3 you know all 3 of these zones Carmelis Norte, Carmelis Maine, and and and Tito as well all have this the same potential to be you know tens of millions of of ounces each. So that's kind of how we see we can get to 100 and maybe even, you know, even more over the next, you know, 5 years or so, just through methodical exploration. And that's not to say the rest of the land package we haven't even touched yet.

26:38 All we've done right now so far is we've gone to the very most obvious targets, which are the artisanal mine workings.

26:47 And we've again been basically 100% success every time we go there. So I think there may be a couple more opportunities to do that. And then we're going to have to start doing some more like geophysics and stuff to find the hidden ones. Okay, we'll wrap up quickly with with Silver Kings. I'll spend a few minutes on this. This is our second project in Northern Ontario. It's a little confusing because the town there is named is called Cobalt Ontario and it does. They have produced cobalt the metal as well historically as well as silver. So it was originally a silver mining discovery in the early 1900s.

27:34 Over the years, cobalt was produced as a co-product or byproduct. Some decades when the silver price was low and the cobalt price was high, the cobalt was actually worth more than the silver.

27:48 But I would say overall, it's known mostly as a silver camp. In 1911, which was the peak year of mining, the camp produced 35 million ounces of silver. That probably would have made it the biggest silver producer in the world, at least that year, although it dropped off pretty quickly after that. But you know, it's and then the last 40 years or so, it's been basically forgotten about. Very little exploration has been done. A few campaigns here and there when the cobalt price was hot, but again, very little work's been done. So we've taken a big interest in this, consolidated a lot of land. I mean, outside of Agnico Eagle, that's the sort of the historic miner here. They started their company here in this area. We're the biggest landholder and we cover a lot of the historic mines with our properties.

28:40 But we decided to drill some grassroots targets here instead of going after sort of mine extensions and trying to do remnant mining which is still possible here. Since the majority of the mining stopped 50 60 70 years ago there is opportunity for you to go back and do things better and more efficient. However, we decided, you know, we think that there's actually completely undiscovered silver deposits here. And we were right. We made the Angus vein discovery in 2023. We drilled through 200 meters of barren rock, this orange unit to hit the silver veins at depth.

29:19 So pretty much all the discoveries made during the, you know, between 1900 and 1950 or 1960 were made at surface using just old-fashioned prospecting, finding the silver veins at surface and then going down underground at depth. Here there's no silver veins at surface. There is mineralization

29:41 that suggests there could be, and we use that essentially as a clue, as a pathfinder, to find the high-grade silver at depth. Our discovery hole, 15,000 grams per ton over 3.34 meters, was the second best silver drill hole in the entire world in 2023. And we followed it up with several good drill holes since as we've started to kind of drill out that area not easy to drill because obviously you have to drill through a lot of barren rock to get to the target but we've been doing it and this year we made a breakthrough actually we drilled late last year we reported it in January of this year where we found that we could drill through this kind of cluster of veins and get a much wider zone of mineralization.

30:25 So we hit the you know I would say the widest intercept that we've seen in the camp to date 11.4 meters of almost 400 grams per tonne silver.

30:35 And that's because we were drilling through all these individual veins and they're close enough together that you sort of get this you know this bigger zone. That's important because it's very difficult to build up tonnage, i.e. A resource, if you're just only drilling narrow veins, even if they're super high-grade.

30:55 But with this kind of critical mass, we've got a shot to drill out more of a significant resource here. So that's, that's, that was a big breakthrough for us. That was really, you know, the kind of the shining star of this last program that we did. And we're very, very happy with that. I think we've added a lot of value here. Not, We don't get credit for it in the market.

31:18 Grassroots exploration is not worth very much at the moment, but again, we have, it made this a real technical success. And I think a lot of people in industry are starting to take notice. So just to wrap up with a couple of theoretical slides,

31:37 the Lassonde curve first, for those of you who don't know about it, it's a curve that was put out, published by Pierre Lassonde, I think back in the 90s. So it's been around for 25, 30 years, and really shows the kind of the lifecycle of a junior going from discovery through, you know, definition, and then ultimately into production. And we've got 2 projects that are really on the right slope of the Lassonde curve where you want to be. And obviously that's a great place to create value in a good market. We've got,

32:21 this is not updated for the current financing that we, that we just did, but there's, so there's another 10 million shares out to about 118. But that's basically our market cap high management ownership. I've actually been buying shares this past quarter and I participated in the financing. So I think management's still around. 11 12 percent.

32:48 And we've got some big really big great supportive shareholders there you can see as well. Management, I won't go through this. This was on our website, you can go through We've got a great team. And then the last thing I want to say about, you know, just given the fact that we've done a financing recently

33:08 is, you know, something I end up talking about a lot, especially with retail investors is about, you know, financing and dilution. And, you know, so we just closed, We just completed a financing. You know we announced the upsize I guess last week to 2900000.0 Canadian. And. And You know when when a company lists whenever they list I think what you really don't know how many shares are going to be outstanding at the end of the day. OK. And that's obviously very risky for investors. Now you know there's there's if they are able to do something with a company that's not worth very much obviously it's high risk high reward but it's it's There is a lot of dilution risk in those early years, especially if you're a pure exploration company and you've got really no production in sight

34:03 then you know you're just going to be raising money you know year after year every 6 months every year whenever whenever the market allows you to. And obviously you don't know if this max shares here is going to be you know 2x 5x 10x of what you started with. With I think with Kuya we're sort of now past this high risk part. Not to say we'll never issue another share because of course we have warrants. We have options. There's other you know there's other things that could happen. But the reality is we're we're relatively close to that maximum value now.

34:41 And and so there's a lot less risk of dilution to investors with a company that's close to being cash flow positive like Kuya.

34:51 And you know these are just some of the other factors that would impact getting into this mature phase. Moving from the venture phase to the kind of the more mature phase. And I think that's where we are right now. We're sort of right here. We've been through here, now we're moving into the mature phase.

35:10 And eventually you get to a point, hopefully, where you're making so much money, you don't know what to do with it anymore. And you start buying back your stock. And that's here. And obviously so it is possible for the for the share the share count to actually decrease. And that would be through share buybacks in the future. And it's obviously something that I think all companies should aspire to and including including Kuya. Now we've got a lot of good uses of proceeds for the cash flow that we have as we've already gone through the exploration building a mill etc.

35:42 So it's not something that you know I see any time soon. But with that being said you know we do at least have the potential as I said before in the presentation We give our shareholders a fighting chance and that's and that's what we want And then if the silver price goes up and we deliver there should be huge huge returns for everyone And that's the end of the presentation.

36:07 Awesome, thanks so much David. So like I said, I got a number of questions for you if you don't mind. I know there's a bunch of great questions in the chat. Some I'll work in because they're similar to what I wanted to ask and some I'll just tackle as soon as we're done. But if you have additional questions, please do shoot them in. I know there's a group that came in about halfway through the presentation. So that chat button at the bottom right of your screen, that's where you can ask David questions.

36:26 So David, way back at the beginning or near the beginning of the presentation, You did highlight that pretty large gap between silver prices and mining company valuations. I'm curious for your view on what catalysts you see in the near term that can help close this gap. And generally but also specifically. Well we might be seeing one of those catalysts right now. It doesn't feel like it. But. One of the big reasons between that separation between the silver price and the equities is really it's it's a flow of funds issue. You know I like I don't think you could really go and say companies are doing better or worse financially than they've done in previous bull markets.

37:17 Mining companies, they tend to be a dog's breakfast with, you know, cost overruns and this and that. But they still go up a lot when you bull market. And we saw that in, you know, in the late 2000s and into the 2010-2011 era. So the thing that we haven't seen in this cycle is the flow of funds into mining. Why? Because they've been captivated by the Magnificent 7. And you know I think you know as well cryptocurrencies to have taken some of the probably some of the more high risk money.

38:03 Some of the gamblers out there are buying those instead of you know instead of the sort of the junior mining lottery tickets. So so I think a combination of those factors now what we may be seeing is a bit of a market reset here with the market crash that we're kind of in the middle of right now. And I think it could be a couple of, you know, I think we've seen this kind of thing before we started 2020 with COVID we saw it in the credit crisis in 2008 and gold and silver rebounded very very quickly and the equities did extremely well. And so it's definitely not a crazy thing to think that that will happen again here.

38:53 And so I think it is it's a you know it's probably a good time to take advantage of that arbitrage. And you know you should see the outperformance from the equities going forward. And I know there's a lot of things that think the same thing. Sure. I've certainly read it this week. I didn't want to zoom in on your exploration targets. I know there's a number of spaces presentation beyond Bethania particularly Tito Carmelita's Carmelita's Norte. What are to you the highest priority targets and where do you see the most immediate growth to the resource coming from? The highest priority is actually Bethania, you know, because we're already there. We can stick drills underground and just drill start below drilling below the veins and you know we should be able to we should be able to you know start building ounces just by essentially lowering the depth of our of our block model And that's why I call it the lowest of the low-hanging fruit. And then the next lowest is probably the eastern extension of Bethania, the hilltop zone.

39:57 So, drilling the vein of the hilltop zone at depth and then connecting it all together with the current resource. Those 2 things alone should sort of double the resource at depth and then double it again along strike. Then in terms of the regional targets, I think we like Tito the best at the moment. And the reason is that the grades we get from surface there are consistently more higher grade. So about every third sample we took was over a thousand grams per ton in our rock chip sampling program there. Whereas at Carmelitas we do get that, but it's more like every one in you know 1 in 10 or 1 in something like that so it's much less often and so that's it that's a really good sign to see that much sort of high-grade mineralization at surface there and as well the footprint is really big it's got you know over a kilometer east to west and that's just what we were able to see at surface and you know there's topography there so those veins you know those veins are probably a lot bigger going into hills and stuff where we can't chase them with our without drilling.

41:18 That makes sense. Now Mark in the chat asked and I believe he was talking about these additional targets I asked if you have any drill results on any of them as yet We do not know we have we have haven't drilled since where our resource came out in petania and You know, that's that's something that you know has been we we've obviously gone through 3 or so 3 4 years very difficult markets here. And so what limited capital we've had, we've really focused on production and getting the mind back up and running. And now that we've done that, you know, as we start to build up cash, drilling is a high, high priority for us.

42:03 So we will, we do expect to start drilling. I know possibly as early as later this year, but it's definitely something that's high on the priority list and will happen soon. Got it. I appreciate that context. I want to talk about future cash flow. I wonder if you could touch on the expected ASIC and silver equivalent production at 350 tons per day. Once you hit that level, is there an opportunity to expand beyond that? And is totem milling a long term plan for the company? Or do you think you're going to revisit building a facility on site? Yeah, look, I think again, the best thing to refer to is our PEA on the costs. And The PEA did envisage us building our own plant.

42:50 So, and the life of my anasic was about 12, 12, just over $12 an ounce. With toll milling right now, we're kind of guiding at 350 tons per day, not right now, but at 350 tons per day, it should add another roughly $3 an ounce to the cost. So you're looking at about 15 in total. Obviously that total milling cost would completely go away if we had our own mill. And the answer to your second part of your question is we do plan to build the mill. You know, it's very important to our 100,100 plan to build that mill. You know, we can do a few hundred, you know, we can get up to 350 tons, maybe push it a little bit more, toll milling, but it's not something we really want to rely on more than a few years. We want to get that mill built as soon as we can and start ramping up production and essentially capturing more of the, you know, vertically integrating our production as well. Makes sense.

43:53 And Steve from the chat asks, and I know that that's like the MPA, but how much is the mill going to cost? So the mill and the PEA cost $14 million. That was for everything. So It was for the building itself, the equipment itself, labor to construct it, tailings, big part of the cost, and also all the above ground infrastructure. So everything except the underground mining CapEx, 14 million that was in 2022. Now we're looking at 2025 or maybe 2026 by the time we build it. So you can probably take some inflation and upsize that to about call it 18 to 20 million. I think it's probably about right.

44:48 That makes sense. I'm going to ask you a bit of crystal ball gazing which I know it's a tough couple of weeks for the crystal ball but I am curious where you think silver prices are going to go in the near medium term. Well look I think It's interesting because you know if you look at the Basically the commodities complex as a whole a lot pretty much every single commodity has at some point in the last few years gone to an all-time high. Most recently gold, which is, you know, gold and silver are highly, highly correlated. Yes, their industrial uses are different and silver has more of an industrial usage case than gold does. But they're highly correlated.

45:35 And. And gold's gone to an all time high. So I really do think silver will. It's just a matter of time before it goes to an all time high as well. And, you know, I think, you know, relative to gold, you know, silver, probably, you know, if we were in a more bullish market measured by the gold silver index, which is really a good sentiment indicator because obviously when people are bearish, they're going to favor gold more. It's more liquid, more safe. When people are more bullish, they're going to favor silver more. And so I like to use gold silver, the gold silver ratio as a sentiment indicator really has no my opinion. No other use than that.

46:23 But it's it's works very well. So so we're still in a market that's very cautious, very risk averse. And that's why gold is so much more kind of overvalued relative to silver at about 90 to 1. So I think it goes to 50 to 1 and you're looking at something where silver should be 70 80 dollars an ounce. And that's to me that's to me where I can see it going in the next few years, very, very easily without anything crazy happening. Obviously, if crazy things happen, you know, with the market and with with, you know, geopolitics or tariffs or whatever, it could go even higher than that. Sure. Let's actually, let's get into politics because there's 1 in the chat and then 1 that I wanted to ask. We'll start with North American politics.

47:10 How could potential American tariffs affect companies like Cuyo? Well, we don't see it affecting us at all at the moment because we don't sell anything into the US. So you know, our mining in Peru, essentially we sell it in country to Trafigura and Trafigura has to, or they decide where to export it. Obviously they can export it wherever they want and factor the tariffs in at their end. And you know probably you know it would probably be similar in the case of Silver Kings. We would probably be able to sell our silver in Canada and then it would go off to third parties from there.

47:57 So I don't think it's going to directly affect Kuya at all. Great answer. And there's 1 on Peruvian politics in the chat. TB asks, do you see Peru getting more stable after next spring election? You know, we do. Or at least the same. I mean, it's been very stable since the last president was impeached and replaced. I guess that was in end of 2022. So the last, you know, 2023, 2024, so far in 2025, the country's been very stable. I think, you know, so far, there's been nobody kind of rocking the boat with respect to the election.

48:47 And, you know, we'll have to see who ends up running as the big candidates. But it's been, you know, I think we've seen a general improvement in sort of the bureaucracy there. Real professional people involved in all aspects of government, which it was looking like it was going the other way there for a while back in 2021, but it's really kind of swung back in favor in a positive way. So we're quite quite happy with that. And you know I know there's some really good positive things they're working on as well. And let's see if they can you know improve the sector even further. I think you know mining is a big important driver there.

49:37 And. And you know they've got the infrastructure to be a huge player in mining With you know these big copper billion dollar copper mines they have there. They've got some big gold mines So and big companies are there so we're kind of we've also got that safety net I would say of being a you know Even if we even if we go to 5 million ounces a year at Bethania we're still going to be relative to those copper and gold mines, we're still going to be tiny and kind of under the radar. So we kind of have that as an umbrella as well. I got 2 Bethania questions from the chat. The first one from early in the presentation, just curious what the timeline is for that phase 1 at Bethania.

50:25 Well, we'll probably give more guidance about that over the course of the next few months, but it certainly could be as early as the end of this year that we could get there and and won't be any sooner than that. So I think that would be sort of our Our upside target would be to get that all done by the end of this year. And if not, it'll be as soon as possible in the following year. I think, you know, obviously that's a group. It's an important goal for us as a company. From an investment point of view, Even if we can get half the way there, we're going to be making some pretty significant cash flow and de-risk the project a lot. I think our stock price will be worth way, way more than it is today, even if we can get part of the way there. So I don't think there's a lot of downside.

51:24 But but obviously, that's something that we're very focused on, how we can get there as quickly as possible. Great. No, appreciate that. And Thomas from the chat asks, do you have a good operations team or speak to the operations team at Bethania? We do. I co-founded the company with our COO, Christian Naramayo. Probably have him on one of our 6 calls at some point. He's a great advocate for the project as well. And so he actually lives down in Lima and we've built a great team around him down there. And we do have a really nice, tight operations team right now. Obviously, we're going to add to that over the coming months as we expand production.

52:14 But Yeah, we've, you know what, I think, you know, we've, we've gotten, we've got, we've had, you know, a lot of success. If you go back through the history of Kuya, we've got had a lot of success, you know, getting things done operationally with limited resources by being frugal and creative. That's really a testament to Christian and his team. And we've also been able to get permits. And that's a kind of a testament to our legal team as well. So between our legal and our operations team down in Peru, I think they've done a fantastic job and it's a huge asset for us. Awesome. Yeah. Looking forward to meeting more of the team. So I think a lot of the questions in the chat from here have been tackled actually by a presentation already. So I do want to wrap up with this, which is for investors new to KUYA, and I know there's a number of them in the room.

53:07 What would you say are the top reasons to invest now rather than waiting until you're further along the production curve? Well, I think, you know, the more you wait in terms of us getting those production results out the more that's going to be priced into the stock. I think it's not at this point probably the main thing that's sort of the difference between being you know 30 cents and 50 cents and a dollar is Production results and where we are in that ramp up and and so it's it's kind of a risk reward opportunity. But I do think and then obviously the X factor is what happens with the silver price.

53:54 Because obviously if the silver price does rally here and we get more people exiting out of tech and into old old and old industry like mining value plays which you know that's a secular shift that I think is starting to happen. Then you know then then the valuation will look we'll be looking at will just be that much more in terms of where our shares or what our shares should be worth. So I think it is a great time to do it now. I think with this, frankly, with this financing that we've just done, it's de-risked a lot of you know, it gives us that sort of war chest to be able to, you know, I've talked about it as being a shot in the arm for the injection, for the mine operations.

54:54 It's just good to have when you need to do a little job here or there, to do a development here, to some kind of little mini project here. These are the things that if you're a big company and you've got lots of money, nobody ever hears about. But as a small company, these things become really important and now we have the funds to be able to tackle some of those things and really get the production up quickly. So I think that's a good reason as well, just to bite the bullet and get into Kuya now. Awesome, well with those, I'll leave everybody for the day. David, thanks so much, this was so fun. Thanks everybody in the room for joining us today. If you have any additional questions or is there anything else you wanna know, feel free to respond directly to the replay that'll come into your inbox later today. I'll make sure that the Kuya team gets it. But thank you so much everybody for joining and I hope the rest of your day is wonderful.

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