Valenciana Mines Complex — 2025 Technical Report

This report describes the processing facilities, flowsheet stages, and reported throughput and recovery data for mineralized material from the Valenciana Mines Complex.

Report context

This technical report, dated December 27, 2025, addresses the Valenciana Mines Complex (VMC). Mineralized material produced from the VMC has been processed at two subsidiary-owned processing plants: the Cata processing plant, located immediately adjacent to the administrative offices within the VMC Property, and the El Cubo plant (also referred to as the CMC processing plant), located at the El Cubo Mines Complex approximately 20 km from the Property by road. Prior to the full re-opening of the Cata processing plant in December 2022, mineralized material extracted from the VMC was sent to the El Cubo plant for processing. The Cata processing plant is currently utilized as the primary processing plant for mineralized material extracted from the VMC.

Processing route

Cata processing plant

The Cata processing plant utilizes five stages: crushing, milling, flotation, thickening, and filtering, as well as concentrate dewatering circuits, to generate sulphide concentrates containing silver and gold, which are sent off site for smelting and refining. The full capacity of the plant is 36,000 tonnes per month (1,200 tonnes per day).

Electricity for the processing plant comes from the Guanajuato State electrical grid. Water comes from underground storage facilities at the lowest levels in the VMC operation. On average, the Cata processing plant uses approximately 834,000 kilowatt-hours of electricity per month. Water supply for the processing plant is 75% recirculated and 25% artisanal water. As of the effective date of the report, there is sufficient water for the Cata processing plant and other requirements.

Mineralized material delivered from the underground mines and outside sources is stored in a surface storage area with a capacity of 3,000 tonnes, located at the top of the plant using gravity as part of the flow. Material from a 1,000-tonne capacity hopper is transferred along a 48-inch-wide belt to a 24-inch by 36-inch PettiBone jaw crusher, where the 12-inch feed is reduced to less than 3-inch diameter. The feed from the jaw crusher is transported along a 36-inch-wide belt and feeds a 6 ft wide by 20 ft long double-bed vibrating Ludowici screen. The upper bed separates material greater than 1 inch and the lower bed separates material less than ¼ inch. Fine material of less than ¼ inch is then fed along a 24-inch belt to a hopper prior to grinding, with current feed on average of 88% less than ¼ to the mill. Oversize from the Ludowici screen is fed to a Metso (300HP) secondary cone crusher for further size reduction, which is then fed back to the Ludowici screen along a 24-inch belt. The crushing circuit has a backup Simmons 5½ short head cone crusher utilized as needed.

Milling and gravity concentration

After crushing, the mineralized material is stored in a series of fines hoppers with a capacity of 1,800 tonnes. Material passes through chutes at the bottom of the hopper to feed three 24-inch-wide belts where it is weighed by a continuous weighing scale and fed into three twin Denver 7 ft by 14 ft ball-mills, coated inside by a chromium-molybdenum alloy shield on the surface of the cylinder and natural rubber on the heads. Grinding material used in these mills are 2.5-inch diameter high chrome alloy cast balls. The ¼-inch crushed material enters the ball mill where movement, impacts, and attrition from the balls promotes wet pulverization, discharged as a thick mineral pulp with approximately 70% solid by weight and 30% water. This pulp is then diluted by adding water and fed into 4 by 3-inch Krebs pumps, then to a series of Gmax G10 hydro-cyclone classifiers (two cyclones per mill), which carry out classification of fines before entering the flotation circuit, with 75% of the material passing minus 200 meshes with automatic sampling. The average content of this material is 28% solid by weight and 72% water. Oversize material is returned to the mill for re-grinding in a closed circuit with a circulating load of 350%. Reagents added as the mineralized material enters the mills include two specific reagents: Cyteg promoter MaxGold 900 and Cyteg promoter 7310, which promote the recovery of silver and gold.

The flow of the ball mills reports to a hydro cyclone and then to a Falcon concentrator model SB2500B. The coarse material separated by the hydro cyclone is fed to the Falcon gravity concentrator. The Falcon concentrator rinses the material in batches for 10 or 15 minutes, depending on the source of the mineralized material, and produces a concentrate with high contents of silver and gold, which is marketed as a separate type of concentrate. The tailings produced by this concentrator go back into the processing plant. The fine mineralized material separated by the hydro cyclone goes directly to the flotation circuit.

Flotation circuits

After grinding and conditioning by the initial reagents, the material enters a 20-cubic-meter capacity tank where additional reagents are added (promoter, collector and surfactant: Promoter 7310, Aerophine 3416 both Cyteg, and cc-1065 SF surfactant brand PQM) and agitation incorporates these reagents into the mineral pulp. This material then enters the primary rougher flotation cells, consisting of two stirred cell tanks of 5 cubic metres each (made by Outotec), where a primary concentrate is obtained, paddled and spilled over the edge of both cells where it is collected. Two stages of clean-up are required for this material prior to feeding the next stage of thickening, which occurs in the primary and secondary cleaner flotation cells.

The secondary cleaner flotation cells consist of two banks of Wemco-type cells (6 cubic metres each and three cells per bank). Cell discharge continues as the material cascades toward the secondary rougher flotation cells, comprising three Outotec No. 5 cells, each 5 cubic metres capacity. The spills from these cells are fed to a medium-grained material tank that partially returns to flotation after a regrind stage.

The discharge from the Outotec No. 5 cells feed a bank of eight Wemco-type scavenger cells, with a total capacity of 20 cubic metres. At this stage, the spills of the bank of eight cells join the spills from the previous three Outotec No. 5 cells and are sent to a 4 ft by 5 ft regrind mill. This passes to a hydro-cyclone classifier, with the spill then entering the 20-metre conditioning tank along with the grinding product. The discharge enters the closed circuit to the 4 ft by 5 ft mill.

The material then enters an automatic filter press with 30 plates. The final concentrate has an average water content of 8% by weight. The rest of the reagents necessary for the flotation process are introduced at the beginning of the bank of scavenger cells. The discharge of the scavenger bank, containing on average 28% solid, is sent through a series of pumps to the tailings dam, which is situated 984 meters away, after automatic sampling. The pumps used for this discharge range from 2 to 6 inches by 4-inch Warman 100 hp pumps.

Thickening and filtration

The product from the secondary cleaner flotation cells is sent via a 15HP Gallagher pump through an automatic sampler to a 230-cubic-meter settling tank. Thickening results in material containing 50% to 70% solids by weight, which is then sent to the filtering stage. During this stage water is recovered, recirculated, and utilized at the beginning of the milling stage.

For the filtration stage, a Clever filter press with 30 plates is utilized (63 by 63 cm each plate). Material from the thickener is fed into the filter pack through an Abel piston pump, where the maximum possible amount of water is removed by compressive pressure. The resulting filtered concentrate contains on average 12% humidity. The concentrate is then sampled, weighed, and stored in the concentrate yard prior to sale and shipment.

El Cubo processing plant

Prior to the full re-opening of the Cata processing plant, mineralized material extracted from the VMC was sent to the El Cubo plant for processing from October to December 2022. The El Cubo, or CMC, plant consists of a two-stage crushing circuit, ball mill grinding, reagent storage, flotation, gravity treatment, and concentrate filtration for product shipment. A recent upgrade to the El Cubo plant is the addition of a gravity circuit for the recovery of native silver, gold, and electrum from the hydrocyclone underflow stream. The El Cubo plant processes approximately 1,500 tonnes per day. Electricity for the processing plant comes from the Guanajuato State electrical grid. On average, the El Cubo processing plant uses approximately 1,420,000 kilowatt-hours per month of electricity. Water supply is sourced from existing underground workings and recirculated water from the tailings basins. As of the effective date of the report, there is sufficient water for the El Cubo processing plant and other requirements.

Key reported parameters

Technical qualifications

Reported tonnes mined include mineralized material extracted exclusively from the VMC. Reported tonnes milled and silver and gold production at the Cata processing plant include mineralized material from the VMC as well as supplemental feed from the Cata tailings dump and the Company's El Horcón Project. As a result, mined and milled tonnages are not directly comparable.

Source: Valenciana Mines Complex 2025 Technical Report, December 27, 2025, Section 17 Recovery Methods and Table 17.1.