Outcrop Silver Pursues Potential World-Class Asset with Lean, Focused Strategy

• Outcrop Silver & Gold is developing the high-grade Santana silver project in Colombia, with 37 million ounces in resources currently.
• The CEO aims to significantly expand resources, targeting over 100 million ounces, through additional exploration of identified veins on the property.
• The project has exceptional silver grades, recoveries and payables, making it potentially highly profitable even on a small scale.
• Outcrop is focused on lowering costs and maintaining at least one drill turning for continued exploration.
• The company may pursue a small, low-cost pilot plant to demonstrate economic viability and de-risk the project.

World-Class Silver Grades

Outcrop Silver & Gold is advancing the Santana silver project in Colombia under the leadership of new CEO Ian Harris. With over 25 years of mining experience, Harris aims to rapidly advance this exceptional project. Currently containing 37 million ounces of silver resources, Santana boasts “one of the world’s few true primary silver and high-grade silver projects,” says Harris.

Santana’s potential lies in its exceptionally high silver grades and consistently mineralized veins. Harris states, “It’s got incredibly high recoveries from flotation alone, but it also produces a high precious metal concentrate that could be directly smelted.” This allows for recovery of up to 98% from direct smelting, versus only 75% from typical lead or zinc concentrates.

Interview with President & CEO, Ian Harris

Rapid Resource Expansion Targeted

Despite recent drilling delays after changing contractors, Harris remains focused on exploration expansion, explaining that, “The good news is it didn't chew up the entire budget.” With 21 identified veins on the property outside of the 7 that comprise the current resource, he sees strong potential, stating: "It’s about executing on a resource expansion. It's still significant exploration"

Comparing Santana to profitable, high-grade underground gold mines in Colombia, Harris asserts that the continuity of mineralization provides confidence, saying “We know it hangs together.” He aims to demonstrate this continuity through additional drilling, stating, “At least we can demonstrate that pathway and that's the overall goal here.”

In terms of expansion ambitions, Harris explains, “I think you want to get over that 100 million ounce mark and be able to demonstrate a pathway to that psychological number in the market.” While a smaller, profitable mine is feasible even at current resource levels, Harris maintains, “The problem with doing resources is many people think 'that's what you got' or that it's only going to grow by 10%. But this is a project that can grow by leaps and bounds.”

Pilot Plant Considerations

With current market conditions in mind, Outcrop has tightened spending, with Harris focused on efficient allocation of capital: “The goal is to stay financed...to make sure we keep a drill turning.” However, the potential for a small pilot plant has generated substantial interest. As Harris reveals, "Even a very small production would be super big and carrying about 80% of your exploration cost even at a super tiny scale.”

He continues: “Why get greedy? I got asked 'Why that big? Why not twice as big?' And I said because you don't need to be twice as big.” Avoiding excessive debt or equity financing provides resilience and flexibility in challenging markets.

Overall, Santana offers exceptional leverage to the silver price through its high grades and low operating costs. Despite short-term challenges, Harris maintains strong conviction: "This is a project that can grow by leaps and bounds.” Disciplined capital allocation focused on resource delineation aims to ultimately propel Santana over the 100 million ounce threshold into a globally relevant silver mine.

The Investment Thesis for Outcrop Silver & Gold

• Exceptionally high-grade primary silver project with significant expansion potential through additional drilling along identified veins
• Economics enhanced by high recoveries (up to 98%) and payables from direct smelting versus comparable projects
• Plan to maintain a disciplined drill program targeting substantial resource growth over 100M oz silver
• Pursuing small, low-cost pilot plant to demonstrate economic viability and de-risk project without significant dilution
• Tremendous leverage to potential rises in the silver price
• Undervalued relative to peers, providing an opportunity for substantial returns

Outcrop Silver & Gold's Santana project offers world-class silver grades that could potentially support a highly economic mine even at a small scale. Despite current challenges, the company maintains a focus on value-enhancing exploration while considering innovative approaches to advance the project. The asset exhibits exceptional leverage to the silver price, with vast expansion potential that could propel it into a globally significant silver producer.