Kuya Silver: Silver Kings Project Mid-Year Update

0:04 Good morning, good afternoon or good evening, depending on where in the world you're signing in from when you watch this. I'm lucky enough to have with me today David Stein, president, CEO and director of Kuya Silver. David, how are you today? I'm great. Thanks for having me on today, Romeo. Awesome. I know most silver investors, certainly most of the audience on 6, know Kuya for the Bethania mine in Peru. But this news that just came out this morning is about materials sitting on surface in Ontario. What made you take a serious look at old stockpiles and tailings across your Silver Kings project?

0:39 Well, it's really 2 things. First of all, they should know us for Bethania. That's our flagship and growing and we're doing exploration there. It's very, very exciting and there's going to be lots of good news and exciting news coming out from Bethania in the second half of this year. But We have had this project in Northern Ontario for a few years now. And we wanted to really show 2 things with the work that we've done recently. Number 1 is that we are advancing the project in a way that adds value because this is something that we do really think is a hidden gem within the portfolio of projects that we have.

1:32 Even though Bethania is the flagship and it will continue to be probably for many years. We feel that we're not getting any value for our other silver assets including Silver Kings and for that matter also the U.M. Had the J.V. In Saudi Arabia. So we want to we wanted to do some work on the project to demonstrate the value there to the market and to ourselves. And we'll continue to do that. At the same time we also want to show that we're being fiscally prudent that we're not. You know I think there could be a tendency for junior company in our position to spread ourselves too thin. And we're really not doing that. The amount of money that we're spending on Silver Kings is very minimal.

2:24 But it is high value and high return value for our money. And you know getting back to your question what we found is that probably the cheapest way that we can find ounces on our property and move them towards potentially even a production decision in the next year or So is to start with the rock and the piles that are just sitting on surface already, because

2:53 you don't have to do any of the deep 2,300 meter drilling that we've done in the past, very successfully, mind you, But we don't need to do that. It's sitting right there on surface. It doesn't need any underground mining or anything that would be either expensive or time-consuming to permit. So we really have something here that's quite unique. And it's because this is 100,120-year-old mining camp where there's been a lot of activity in the past. And now with silver prices much higher than they've ever been in this, you know, in this project's history, it's time to go back and look at some of these piles, this material that's just sitting there to see if we can create some hidden value there.

3:40 Yeah, I actually wanted to talk about the history for a second because I know, like you said, Cobalt Camp has over a century of mining history behind it. Just curious, why did the miners of that era leave so much silver and cobalt behind on the surface in the first place? Well, depends what era you're talking about. But if you go back to some of the piles that we have on our properties go back to the early 1900s like around 1910 when the cobalt camp was actually reaching its peak production

4:15 And the miners at the time were going after very, very high grade silver veins that you could basically see with the naked eye. Because they were so high grade that you're mining metallic silver that at first was sticking out of the ground or right at surface right underneath the the overburden and then eventually going underground doing shafts and tunnels and going underground to mine this stuff And and so the stuff that they would have been throwing away in some cases and we know this to be the case anecdotally because we found this stuff on our property would be material that would either have silver veinlets that you might miss with the naked eye, or you might see them, but just think that's too low grade for us, so we're gonna leave that.

5:11 But those silver veinlets, for example, that might be in the wall rock surrounding a high-grade vein that can still run you know over 1% silver 10,000 grams per ton. We drilled through some of that stuff when we made our angus vein discovery so that's how we know what the grades can be in that type of material. And again, that would have just been thrown away in the early 1900s.

5:39 As the decades moved on, the mining got a little bit more sophisticated, but there's still, you know, they were still mining much higher cutoff grade than we would be looking at today, for example. Sure. I know you sampled 2 very different types of material here, the historic tailings, but also the the coarser blast stockpiles. Walk us through how the reprocessing case differs between those those 2 groups. Sure, the the most the the biggest area and probably the most tonnage that we would have would be historical tailings. And we have a couple of sources of historical tailings. One is by the mill, what we call the Kerr Lake Mill now, which was a producing mill up until the early 80s.

6:34 And it would actually briefly run in the 2010s but unsuccessfully as well so there's some newer equipment in that mill that we own and then the The silver center area where there were a number of other mines now, but these tailings go back much. They're much older there. You're looking at stuff that could be as much as 100 years old there. And obviously, the earlier you go, the less silver was recovered because processing methods continue to improve the deposits are more or less the same. I think when you look across the whole region but the processing methods would gradually improved.

7:18 And so when you look at the tailings, you get higher grade with the older tailings, but still significant with the Kerr Lake Mill tailings, what we call Kanedaka tailings, which was one of the older names for that mill. Now, that material is spread out over these tailings. Some of them were deposited in lakes, some of them were kind of make little ponds or marshes. They're very flat, they're easy to kind of see what's there from surface, easier to estimate, we believe, what's there. And the grade is, we expect, is going to be more homogeneous as you go through those piles. They're also already crushed very finely, essentially milled already.

8:13 So the particle size is very small. So getting back to your question, you don't have to grind the tailings again because it's already been likely. I mean I guess we have to test that still but likely you don't need to grind it again or if you do you're gonna use much less energy than you would for the big boulders and stuff that we have in those blast stockpiles, for example. And so you can essentially jumpstart, if you start running tailings,

8:43 let's say as a first step, which is what we are considering, you can jumpstart the process by essentially skipping the crushing and grinding section of the mill flow sheet and going right to the recovery stage. And then what we would look to do is once we get that up and running, and we're happy with that, we could look at adding crushing grinding and potentially feeding in some of the other stockpiles as well and running it in 1 big system. Great. Now I want to get into the numbers a little bit more, because as you mentioned, the Kerlake Mill stockpile, it came back at 168 grams per tonne silver and 0.36% cobalt, which works out to today's prices, 276 grams silver equivalent.

9:32 What stood out to you most personally when those assays landed? Well that that was that's definitely the highest grade pile that we have or the very not that we have we don't know, because there's many more piles we haven't sampled yet. But of the 7 we sampled, that was the highest grade pile. Also interesting, that one has seen some processing. We know because the particle size is smaller,

10:02 but it's not finely ground to the point where you would do flotation on it, so it's definitely not tailings. So that material, yeah, had very good grade, both silver and cobalt. Some of the other piles that we sampled only had silver or had more silver Some one of them which I believe was Lawson had really high Cobalt and the cobalt was worth more than the silver in the samples that we took. What stood out to me the most probably of all them was actually the tailings from Frontier, which you're getting, you know, to almost 2.5 ounces. So 71 grams per ton silver in that and you know, that's that's a very nice relatively high-grade silver for a for a tailings pile.

10:59 And that's that's something very that would be very interesting to see what we can get on the recovery side as we do more metallurgical testing and test some recovery methods on that. Because if we can get most of that silver, then right there we could have a very interesting project. Right. I know you talked here about lots of piles. The program covered 7 areas, but the press release mentions stockpiles across the land package in the dozens. So as you expand the sampling, how big could the above ground opportunity at Silver Kings be really? Well, because the tailings occupy more space, they, from a surface area and from a tonnage point of view, the tailings are probably going to be the most important.

11:54 But then after that, there's all these blast piles, which there are dozens of them. And we only sampled 4 really in this program. So now we sampled 4 that we know well that we could get access to that we thought had potential. And 3 out of the 4 returned pretty good results. One of them, one of them the Keeley number 3 was was the the lowest grade of all the piles we we tested. So there's definitely a case to be made that over time we should, especially if we determine that there's a processing flow sheet that works for this above ground material, then we essentially have an ongoing source to add more material to this project and keep it going or potentially grow grow the tonnage per day that's the way I would look at it I wouldn't look at it as like we're gonna endlessly sampling and sampling and sampling because you know we're a mining company, not a promoter.

13:08 So we want to see if there's a project here, get it into production, and then we can start going to some of these other piles and adding them to the adding them to the inventory of potential resources that we could have. Now, with that being said, if there is a pile that we think could have, let's say, higher grade in there, we might we might sample that sooner rather than later because it could make a material impact on the project overall but other than that I think we we really we we want to so we want to keep doing some sampling but I guess what I'm saying is don't expect us to sample everything in the whole property. Because we think we can get a really exciting project here well before that would happen.

13:58 Great. 1 day I want to ask, I know silver obviously gets the big headline, but cobalt keeps showing up in the results. And Kerlake even drew in some copper. How does the critical minerals side of the story factor into how you and Kui are thinking about this project? It's an important part because it could be There's definitely a way to lower your cost of capital when you are producing critical minerals And and obviously cobalt is one of the most critical critical minerals and Very rare in the world and very difficult to get outside of Africa period full stop. Mm-hmm, so we have something Potentially very special here, even though you know the the silver at first blush the silver looks like the dominant metal here but we do have you know pretty interesting cobalt grades and so I think I I think it's gonna improve the project economics once we get down the road to testing and doing enough work that we can actually put some numbers around this.

15:16 And then going a little further it creates alternative financing options for us because let's at some point there will be we'll get to a point where we need to put some capex into a plant or something for this And you know that's when this thing goes from like hundreds of thousands of dollars to into the millions. And that's well down the road. But we having the cobalt means that potentially we could bring in a partner to you know to kind of split things. And you know we because we're mainly interested in the silver or we could potentially get some government funding as well. And both of those are on the table. And again, a way to lower the cost of capital and create more return for Kuya shareholders.

16:08 Awesome. You know, the government funding is always interesting for critical minerals. So to wrap up today, I know obviously a lot's going on at Bethania and I'm eager to hear more about that soon. But at Silver Kings, you've laid out a path, more sampling, metallurgical work and eventually a resource estimate. Realistically, what should investors watching this video expect from Silver Kings over the next 6 to 12 months? Well, now that we've done initial work and we've been able to communicate to the market what we're looking at doing here, what our focus is, we can continue to update the market and show, you know, show progress, show that we continue to add value without having to sink a lot of our valuable cash into this project.

16:58 And really that's the goal. So look, I think if we have another update towards the end of the year or something around the end of the year or beginning of 2027 then we'll be able to continue the momentum with this project in terms of creating, reminding investors that this is a valuable part of our company and it's worth a lot more than nothing. And people should consider that when they're investing in investing in Kuya they're kind of getting silver kings and the omedi JV for free and we you know intend to make both of those very valuable projects for us over the time and without you know, distracting us from the You know the giant opportunity that we have with Bethania.

17:52 Awesome. I'm looking forward to the market giving you a bit of credit for SilverKings. Thanks, David, so much for running through today's press release. I'm looking forward to talking again soon. Thanks a lot. My pleasure.