Americas Gold & Silver Executes Operational Transformation at Historic Galena Mine

• Americas Gold & Silver has successfully implemented longhole mining at Galena mine for the first time in two decades, achieving significant productivity improvements under CEO Paul Huet's leadership over seven months.
• The company is investing $100 million in debt funding to upgrade shaft capacity from 700 to 1,800 tons per day and expand operations, positioning for substantial production increases.
• New offtake agreements will monetize previously penalized metals (antimony, copper, gold), with antimony representing a major opportunity as the only producing antimony mine in the US.
• Management targets crossing 2 million silver ounces annually (from current 1.3-1.4 million) and aims to restore Galena to its former 5+ million ounce capacity.
• Share price has quadrupled, institutional ownership increased from 7% to 63%, and the company was added to major silver ETFs, while maintaining strong cash flow potential at current silver prices.

Americas Gold & Silver Corporation is executing a comprehensive operational and financial transformation under new leadership, positioning the company to capitalize on favorable silver markets and critical mineral opportunities. Paul Huet, CEO and Oliver Turner, Corporate Development have implemented a focused strategy centered on maximizing returns from their existing Galena and Kosala assets rather than pursuing external growth opportunities.

Operational Turnaround Through Proven Mining Methods

The cornerstone of Americas Gold & Silver's transformation lies in successfully reintroducing longhole mining methods at the century-old Galena mine in Idaho. This represents a significant operational milestone, as the technique hadn't been successfully implemented at the site for over two decades.

The longhole mining approach delivers substantial efficiency gains compared to traditional cut-and-fill methods. Where conventional mining required multiple workers and extensive manual drilling, the new system uses a single operator with remote-controlled equipment to achieve higher productivity rates. The first test stope, measuring approximately 60 feet in strike length and 60 feet in height, was successfully carved out and mucked, demonstrating the viability of the approach.

Management emphasizes that this isn't experimental technology but rather a return to proven mining fundamentals. The technique is already being successfully employed by neighboring operations in the same geological formation, providing confidence in its applicability at Galena.

Infrastructure Investment To Expand Capacity 

The company has secured $100 million in debt financing to fund critical infrastructure upgrades, with the primary focus on expanding shaft capacity. The current system can handle approximately 700 tons per day of combined ore and waste material, a constraint that has limited operations for the past two decades.

The upgrade program consists of two phases designed to more than double daily capacity to over 1,800 tons. Phase one involves upgrading motor sizes in the main hoist system, while phase two focuses on improving the braking system. Both phases are reportedly ahead of schedule and expected to be completed by year-end.

"Our shaft, our infrastructure - if you look back for the last 20 years, you will see that we have had the ability to move approximately 700 tons of rock a day in that shaft. Our goal is to get it to over 1,800 tons a day."

This infrastructure investment is essential for accessing higher-grade ore zones and removing accumulated waste that currently blocks access to productive areas. The increased capacity will enable more efficient waste management and allow the mine to process higher volumes of ore through the existing 750-ton-per-day mill.

Unlocking Byproduct Value Through Strategic Partnerships

A significant value driver for Americas Gold & Silver involves monetizing metals that were previously penalized under legacy offtake agreements. The company has partnered with Ocean Partners and Teck Resources on new offtake arrangements that begin January 1, 2026, transforming antimony, copper, and gold from cost centers into revenue generators.

Historical data reveals the magnitude of this opportunity. Over the past 20 years, Galena has produced nearly 20 million pounds of antimony that generated penalties rather than payments. With current antimony prices, this represents approximately $500 million in foregone value, though Huet acknowledges this calculation uses today's pricing for historical production.

The strategic importance of antimony has increased dramatically following China's export restrictions in late 2024. As the only currently producing antimony mine in the United States, Galena is uniquely positioned to serve domestic demand estimated at 40 million pounds annually.

Recent metallurgical testing has demonstrated 99% recovery rates for antimony from copper concentrates, with additional benefits including copper recovery and arsenic reduction. The company is evaluating options for processing this material, including potential government partnerships and grant opportunities.

Interview with CEO Paul Huet & Oliver Turner, Corporate Development

High Grade Ore Provides Exploration Upside

Galena mine operates with exceptionally high silver grades, mining over 400 grams per ton in a global market where fewer than five operations achieve similar grades. Recent drill results have identified zones with grades significantly higher than current mining areas, including intercepts of 24,913 grams per ton with 17% copper over narrow intervals.

"We're already mining one of the highest grades in the world. You look at who on the planet right now is mining silver at 400g/t. You'll find the list is less than five people."

The exploration results suggest substantial upside potential, with some intersections showing grades 60 times higher than current mining areas. While these represent narrow high-grade zones requiring selective mining techniques, they demonstrate the geological potential for expanding high-grade resources.

Management prioritizes grade optimization over tonnage maximization, recognizing that the 750-ton-per-day mill capacity requires focus on ore quality rather than quantity. This approach aligns with the company's narrow-vein mining expertise and infrastructure constraints.

Corporate Restructuring Improves Market Position

The company has undergone significant corporate restructuring to attract institutional investment and improve market accessibility. Institutional ownership has increased from 7% to 63% since the management takeover, with strategic placement of shares among long-term investors who supported the team's previous success at Karora Resources.

A 2.5-to-1 share consolidation has positioned the stock above critical price thresholds that enable margin trading and professional desk participation. This structural change is expected to increase daily trading volumes and improve liquidity for larger institutional investors.

"What we've done since October is take this register from 7% institutionally owned up to 63% institutionally owned. And very early on, we made sure that the stock that was becoming available was ending up into the hands of our core shareholders that supported us at Karora Resources."

The company's inclusion in major silver-focused ETFs, including the SIL index, has created additional institutional demand and improved market visibility. This positioning supports the company's transition from a retail-focused story to an institutionally-backed growth vehicle.

Financial Framework & Cash Flow Trajectory

Management projects significant cash flow generation at current silver prices, though specific cost guidance remains limited pending operational improvements. The company uses $29 silver for internal budgeting, providing substantial margin of safety at current prices near $42.

The financial strategy emphasizes self-funding growth from operational cash flow rather than continuing equity dilution. With the debt financing providing necessary capital for infrastructure and operational improvements, the company aims to achieve sustainable profitability and fund future expansion internally.

"For us, our focus has always been, no matter what company we've been with, whether it's Klondex, Karora, America's Gold and Silver, it's about turning the mines around, getting that mine to work. We don't rely on other pieces of foundations of money coming in through the door."

The Mexico operations at Cosalá continue performing well and are transitioning into the higher-grade EC120 zone, providing cash flow support during the Galena transformation period. This diversification helps bridge the operational transition while infrastructure improvements are implemented.

The Investment Thesis for Americas Gold & Silver

• Operational Leverage: Proven management team implementing longhole mining methods that increase productivity and reduce costs per ounce through improved efficiency and higher-grade ore access.
• Infrastructure Multiplier: $100 million investment to more than double shaft capacity creates a platform for substantial production increases without proportional cost increases.
• Byproduct Monetization: Transition from penalized to paid metals (antimony, copper, gold) represents pure margin enhancement on existing production, with antimony offering strategic premium as only US producer.
• Grade Premium: Mining among world's highest silver grades (400+ g/t) provides inherent margin protection and upside leverage to silver prices.
• Market Access: Corporate restructuring has created institutional following, improved liquidity, and positioned company for larger investment flows through ETF inclusion.
• Cash Flow Inflection: Combination of higher production, lower costs, and byproduct revenues creates multiple paths to significant free cash flow generation at current commodity prices.
• Strategic Optionality: Established operations provide platform for regional consolidation and expansion opportunities once core assets are optimized.

Macro Thematic Analysis

Americas Gold & Silver operates at the intersection of several compelling macro themes that enhance its investment attractiveness. The global silver market is experiencing renewed institutional interest driven by industrial demand growth, particularly in solar applications and emerging technologies, while investment demand reflects concerns about monetary policy and inflation. Simultaneously, the critical minerals shortage has elevated antimony from an industrial byproduct to a strategic national security priority following Chinese export restrictions.

The company's unique position as the only producing antimony mine in the United States provides exposure to a critical mineral supply chain that has been disrupted by geopolitical tensions. US antimony consumption of approximately 40 million pounds annually was previously supplied primarily through Chinese imports, creating an immediate domestic supply gap that Americas Gold & Silver is positioned to address. This dynamic has attracted government attention and potential support, including Department of Defense grants and strategic partnerships that could provide additional revenue streams and operational support.

The convergence of high silver prices, critical mineral shortages, and domestic supply chain priorities creates a favorable operating environment for the company's transformation strategy. Management's focus on operational excellence rather than speculative expansion aligns with investor preferences for proven execution over development risk.

TL;DR

Americas Gold & Silver is executing a comprehensive operational turnaround at its century-old Galena mine, implementing longhole mining methods and infrastructure upgrades funded by $100 million in debt financing. The company uniquely benefits from being the only producing antimony mine in the US following Chinese export restrictions, while mining some of the world's highest silver grades. Management's track record and focus on cash flow generation over growth creates multiple value drivers converging toward significant free cash flow inflection.

FAQ's (AI Generated)

Q: How does the antimony opportunity impact financial projections? 

Historical 20 million pounds of unmonetized antimony represents ~$500 million at current prices. New processing achieves 99% recovery rates, transforming previously penalized byproduct into revenue stream with minimal additional operational costs.

Q: What is the timeline for reaching 2+ million silver ounces annually? 

Management targets crossing 2 million ounces next year, with shaft upgrades completing by year-end and longhole mining ramping throughout 2026. Full 5+ million ounce potential represents longer-term target requiring sustained operational improvements.

Q: How sustainable are current silver prices for the business model? 

Company budgets internally using $29 silver, providing significant margin of safety at current $42 levels. High-grade ore (400+ g/t) provides natural hedge against price volatility compared to lower-grade operations.

Q: What differentiates this from other silver mining investments? 

Unique combination of highest-grade silver production globally, only US antimony producer status, proven management execution, and immediate cash flow potential without development risk typical of mining investments.

Q: Why did institutional ownership increase so dramatically? 

Share consolidation enabled margin trading access, ETF inclusion created forced buying, and management's Karora track record attracted institutional following. Strategic placement with long-term investors provides stable shareholder base.

Q: How does the Mexico operation fit into the overall strategy? 

Cosalá mine provides steady cash flow during Galena transformation, transitioning to higher-grade EC120 zone. Dual-asset portfolio reduces operational risk and provides financial bridge during infrastructure investments.