Guanajuato Silver Targets High-Grade Pillars at the Valenciana Mines Complex

VANCOUVER, July 11, 2023 - Guanajuato Silver Company Ltd. (the "Company" or "GSilver") (TSXV:GSVR)(AQUIS:GSVR)(OTCQX:GSVRF) is pleased to announce the commencement of a high-grade pillar exploitation program at the Company's 100% owned Valenciana Mines Complex ("VMC") in Guanajuato, Mexico.

James Anderson, CEO & Chairman, said, "After over 450 years of near-continuous production as one of the most significant silver mines in world history, the Valenciana Mines Complex retains hundreds of underground pillars that exhibit some of the highest silver grades within the entire Guanajuato mining district. Immediately following our acquisition of Valenciana, we recognized the substantial mineralized potential available to us contained within the old workings that were left behind by previous operators. Today, we are announcing the commencement of a pillar recovery program, as we begin extracting mineralized material from what has been dubbed the "La Patilla" pillar. We estimate this pillar's grade to be in the range of 300 g/t silver-equivalent to 330 g/t silver-equivalent based on numerous channel samples across the width of the structure. At approximately 100m in length, and averaging 35m in height, with an average mineralized width of approximately 2.75m, volumetrically the La Patilla pillar has the potential to fill our Cata mill to capacity for approximately one full month. Of course, mining in other areas of the mine continues as per our production ramp-up schedule." The potential quantity and grade of silver-equivalent material at the "La Patilla" pillar is conceptual in nature; there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in "La Patilla" being delineated as a mineral resource. Silver-equivalent amounts are based on a ratio of one ounce of gold being equal to 80 ounces of silver; one troy ounce converted to the metric system equals 31.1035 grams.

The Valenciana Mines Complex has hundreds of small and large mining pillars located throughout an underground mine network that extends over 4km in strike length and 700m in vertical extent. The Company is targeting pillars that were all made between the years 1768 and 1950. Because many of these pillars were created during the Spanish colonial period using pre-modern mining techniques, they do not contribute to mine stability and can safely be exploited. Other pillars that qualify for this program will be replaced with backfill waste material as part of a program to return Guanajuato Silver's tailings back underground. Pillars are evaluated for their extraction suitability and mineral potential using the polygon method that calculates the volume, grade and tonnage for each pillar structure. Currently, four pillars are being evaluated in the Cata area of the mine; the Company estimates that that there are a minimum of 50 high-grade pillars that have the potential to be extracted as part of this program.

Figure 1: VMC longitudinal section showing primary areas being targeted for pillar recovery. The area of the La Patilla pillar is highlighted below.

Image: Guanajuato Silver's geological team reviews the La Patilla pillar (the "Sideburn" pillar), which will be the first pillar removed as part of a program to extract numerous high-grade pillars at the Valenciana Mines Complex.

Figure 2: Area of the La Patilla pillar.

About Guanajuato Silver

GSilver is a precious metals producer engaged in reactivating past producing silver and gold mines in central Mexico. The Company produces silver and gold concentrates from the El Cubo Mine Complex, Valenciana Mines Complex, and the San Ignacio mine; all three mines are located within the state of Guanajuato, which has an established 480-year mining history. Additionally, the Company produces silver, gold, lead, and zinc concentrates from the Topia mine in northwestern Durango. With four operating mines and three processing facilities, Guanajuato Silver is one of the fastest growing silver producers in Mexico.

Technical Information

Reynaldo Rivera, VP of Exploration of GSilver, has approved the scientific and technical information contained in this news release. Mr. Rivera is a member of the Australasian Institute of Mining and Metallurgy (AusIMM - Registration Number 220979) and a "qualified person" as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects.

ON BEHALF OF THE BOARD OF DIRECTORS

"James Anderson"
Chairman and CEO

For further information regarding Guanajuato Silver Company Ltd., please contact:

JJ Jennex, Gerente de Comunicaciones, T: 604 723 1433
E: jjj@GSilver.com
Gsilver.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

This news release contains certain forward-looking statements and information, which relate to future events or future performance including, but not limited to, the number of high-grade underground pillars at Valenciana Mines Complex available for potential exploitation and the estimated volume, grade and tonnage of silver-equivalent material contained therein; the ability of the Company to safely exploit certain existing pillars without impacting mine stability including the "La Patilla" pillar and the potential volume of mineralized material that "La Patilla" can contribute to the Cata mill's overall processing capacity; the ability of the Company to backfill waste material to replace removed pillar material as part of the Company's tailing management program; and the Company's status as one of the fastest growing silver producers in Mexico.

Such forward-looking statements and information reflect management's current beliefs and expectations and are based on information currently available to and assumptions made by the Company; which assumptions, while considered reasonable by the Company, are inherently subject to significant operational, business, economic and regulatory uncertainties and contingencies. These assumptions include: our estimates of silver grades, volumes and tonnage of mineralized material within existing pillars at Valenciana Mines Complex and the assumptions and methodologies upon which they are based, including geotechnical and metallurgical characteristics of rock conforming to sampled results and metallurgical performance; available tonnage of mineralized material to be mined and processed; resource grades and recoveries; assumptions and discount rates being appropriately applied to production estimates; the ability of the Company to ramp up processing of mineralized material from existing pillars at the Valenciana Mine Complex and Cata mill at the projected rates and source sufficient high-grade mineralized material to fill such processing capacity; prices for silver, gold and other metals remaining as estimated; currency exchange rates remaining as estimated; availability of funds for the Company's projects and to satisfy current liabilities and obligations including debt repayments; capital cost estimates; decommissioning and reclamation estimates; prices for energy inputs, labour, materials, supplies and services (including transportation) and inflation rates remaining as estimated; no labour-related disruptions; no unplanned delays or interruptions in scheduled construction and production; all necessary permits, licenses and regulatory approvals are received in a timely manner; and the ability to comply with environmental, health and safety laws. The foregoing list of assumptions is not exhaustive.

Readers are cautioned that such forward-looking statements and information are neither promises nor guarantees, and are subject to risks and uncertainties that may cause future results, level of activity, production levels, performance or achievements of GSilver to differ materially from those expected including, but not limited to, market conditions, availability of financing, future prices of gold, silver and other metals, currency rate fluctuations, rising inflation and interest rates, actual results of production, exploration and development activities, actual resource grades and recoveries of silver, gold and other metals, availability of third party mineralized material for processing, unanticipated geological or structural formations and characteristics, geopolitical conflicts including wars, environmental risks, operating risks, accidents, labor issues, equipment or personnel delays, delays in obtaining governmental or regulatory approvals and permits, inadequate insurance, and other risks in the mining industry. There are no assurances that GSilver will be able to successfully exploit sufficient quantities of high-grade silver and other metals at the Valenciana Mines Complex, the El Cubo Mines Complex, San Ignacio and Topia for processing at its existing mills to increase production, tonnage milled and recoveries rates of gold, silver, and other metals in the amounts, grades, recoveries, costs and timetable anticipated. In addition, GSilver's decision to process mineralized material from El Cubo, Valenciana Mines Complex, San Ignacio and Topia is not based on a feasibility study of mineral reserves demonstrating economic and technical viability and therefore is subject to increased uncertainty and risk of failure, both economically and technically. Mineral resources and mineralized material that are not Mineral Reserves do not have demonstrated economic viability, are considered too speculative geologically to have the economic considerations applied to them, and may be materially affected by environmental, permitting, legal, title, socio-political, marketing, and other relevant issues. There are no assurances that the Company's projected production of silver, gold and other metals will be realized. In addition, there are no assurances that the Company will meet its production forecasts or generate the anticipated cash flows from operations to satisfy its scheduled debt payments or other liabilities when due or meet financial covenants to which the Company is subject or to fund its exploration programs and corporate initiatives as planned. There is also uncertainty about the continued spread and severity of COVID-19, the ongoing war in Ukraine and elevated inflation and interest rates and the impact they will have on the Company's operations, supply chains, ability to access mining projects or procure equipment, supplies, contractors and other personnel on a timely basis or at all and economic activity in general. Accordingly, readers should not place undue reliance on forward-looking statements or information. All forward-looking statements and information made in this news release are qualified by these cautionary statements and those in our continuous disclosure filings available on SEDAR at www.sedar.com including the Company's annual information form for the year ended December 31, 2021. These forward-looking statements and information are made as of the date hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances save as required by law.

SOURCE: Guanajuato Silver Company Ltd.