Sierra Madre Gold & Silver - Near-Term Producer With Significant Upside Potential

• Sierra Madre has significantly increased indicated resources at its Tepic silver project in Mexico by 373% to 3.8 million tons grading 7 oz/t silver.
• The company remains focused on restarting near-term production vs expanding resources, with plans to release a mine plan by Q2 2024.
• Sierra Madre can generate early cash flow from extracting 300k tons of broken ore left behind in old workings.
• Management aims to restart the mine with minimal capital expenditure funded through options like offtake agreements.
• The experienced leadership team brings decades of hands-on mining expertise in Mexico to navigate risks and permitting.

About Sierra Madre Gold & Silver

Sierra Madre Gold & Silver (TSX.V:SM)(OTCQX:SMDRF) is advancing precious metals projects in Mexico's most prolific mining districts. The company is focused on restarting production at its permitted La Guitarra mine and exploring high-potential targets at its Tepic and La Tigra properties.

The La Guitarra mine is a past-producing 500 tonne per day underground operation in Mexico's Temascaltepec district. It includes extensive existing infrastructure such as a processing facility that operated until 2018. Resuming operations at this previously producing mine provides a clear path to near-term cash flow potential.

The Tepic project covers over 2,600 hectares hosting low-sulphidation epithermal gold and silver mineralization with a historic resource estimate. La Tigra, just 148km north of Tepic, is another prospect where past mining intersected encouraging shallow mineralization.

Sierra Madre's experienced management team has collectively been involved with over 22 million ounces of gold and 600 million ounces of silver in combined reserves and resources. The group has also raised over $1 billion in capital to advance mining projects, providing valuable expertise for financing and developing Sierra Madre's assets.

Interview with Executive Chairman & COO, Gregory Liller

Substantial Resource Increase Confirms Significant Upside

Sierra Madre recently announced a 373% increase to the project’s indicated mineral resources, which now stand at 3.8 million tons grading 7 oz/t silver. The resource increase was achieved by compiling historical drilling data rather than new drilling, saving substantial time and money.

In addition to indicated resources, Sierra Madre announced 4.1 million tons of inferred resources grading 153 g/t silver from near-surface bulk tonnage deposits. The company also identified an estimated 300,000 tons of previously mined material left behind in old mine workings that can be extracted at minimal cost to provide initial mill feed as operations restart.

According to CEO Alex Langer, “Our objective was always to become the next mid-tier silver producer. This substantial resource increase confirms we acquired a project with significant upside to grow into a mid-tier producer."

Near-Term Production Focus

Despite the large resource increase, Sierra Madre remains focused on restarting near-term production rather than expanding resources. According to COO Greg Liller, “We own a mine, we're just in the process of planning how to feed it and that’ll be our next step.”

The company is currently refurbishing the processing plant and expects to release an initial mine plan by Q2 2024. The existing underground mine workings provide extensive access to stopes containing broken ore left behind by past operators. This material can be extracted at minimal cost to provide initial mill feed and cash flow as full-scale mining operations ramp up.

Liller emphasized Sierra Madre’s advantages as an existing brownfield project with permits, development, infrastructure already in place: “To build something like that today, you're looking at $50 million...we don't have to spend any of that money." The company anticipates minimal capital expenditure to restart the mine, funded through offtake agreements, sale of a royalty, and other non-dilutive financing options.

According to Liller, bringing the La Guitarra mine back into production will cost “very little money” compared to developing a new project. The company is focused on executing a return to production as quickly as possible to take advantage of today's strong precious metals prices.

Conclusion

Sierra Madre Gold & Silver offers investors a unique opportunity to capitalize on high silver and gold prices by restarting production at an existing mine with extensive infrastructure in place. Near-term cash flow potential combined with significant resource upside provide an attractive risk-reward ratio compared to exploration stories or mines requiring large construction capital.

Management’s production focus and intent to minimize dilution differentiate Sierra Madre from the numerous other silver developers in Mexico struggling to finance new projects. Investors seeking leveraged exposure to precious metals prices would do well to consider Sierra Madre as operations quickly ramp up in 2024.

The company’s experienced leadership team brings decades of hands-on experience navigating the risks and intricacies of operating successfully in Mexico. Their confidence that Mexico’s mining reforms will not impact existing projects should provide comfort to investors.