Climate Change Data

Environmental Metrics

ESG Focus Areas

• Safety
• Social Responsibility
• Environmental Responsibility

Environmental Achievements

• Minimized environmental impact of operations and implemented reclamation efforts.
• Received recognition for compliance with health and safety standards at San Ramon Mine, La Cuchara Mine, and Guadalupe mill by the Mexican Secretary of Labour and Social Welfare.

Social Achievements

• Employs workers from local communities, fostering understanding and providing financial benefits.
• Keeps community members informed of activities and addresses concerns.
• Developed recreational areas and parks.

Governance Achievements

• Established a Mine Safety Committee and employs a Safety Officer.
• Maintains a paramedic and onsite ambulance for emergencies.
• Board of Directors oversees management’s responsibility for financial reporting and internal control systems through an Audit Committee.

Climate Goals & Targets

Environmental Challenges

• Declining grade at Mirasol Mine nearing end of life.
• Highly variable grade at San Ramon Mine.
• Lower silver prices impacting Capire open pit mine economics.
• Mexican mining tax changes and hauling costs affecting Capire.
• Commodity price risk (silver price volatility).

Mitigation Strategies

• Expanding the tailings capacity at Guadalupe mill.
• Purchasing additional surface lands near Guadalupe mill for future tailings capacity.
• Expanding the main mine ramp at San Ramon to increase efficiencies.
• Developing San Patricio Silver Mine to replace Mirasol.
• Lowering production costs and mining higher grade mineralization.
• Re-evaluating Capire open pit silver mine when silver prices improve.

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• 2017 TSX Venture 50

Environmental Metrics

ESG Focus Areas

• Community Support
• Responsible Social and Environmental Policies
• Health and Safety
• Environmental Footprint Minimization
• Progressive Reclamation

Environmental Achievements

• Planted 6,800 trees in 2017
• Maintained near-zero lost-time injuries for two years
• Progressive reclamation practices

Social Achievements

• Employs nearly 300 locals
• Contributes to schools and the community
• Mine safety standards recognized with Award of Excellence from Mexico’s Secretary of Labour and Social Welfare in 2016
• Mine rescue team placed fourth overall in a regional rescue competition in 2017

Governance Achievements

• Named to the 2017 TSX Venture 50

Climate Goals & Targets

Environmental Challenges

• Slightly lower grades of silver from mines
• Weak silver prices
• Fluctuating US dollar
• Unexpected drop in share price mid-year due to an individual investor divesting shares

Mitigation Strategies

• Increased mill throughput to 532 TPD (6% increase over 2016)
• Produced additional gold (540 ounces)
• Processed more tonnes
• Actively controlling costs
• Negotiated significantly lower refining fees for 2018

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Award of Excellence from Mexico’s Secretary of Labour and Social Welfare (2016)

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Community Relations

Environmental Achievements

• Planted approximately 6,000 trees in 2021 and a further 10,000 trees in 2022/2023. Planted 833 agave plants in 2022, with plans for 3,000 more in the next 12 months. 100% of mine water is recycled or lost to evaporation. Established a test site for solar power in 2021.
• For each tree removed, the Company planted a further 7 trees.

Social Achievements

• Upgraded roads, built a new school, and a health clinic. Built soccer fields and basketball courts for local communities. Provided tools, materials and supplies for community infrastructure projects. Assisted with water infrastructure for farmers and communities.
• Employs most workers from local communities. Provided essential information to employees and their families regarding COVID-19. Took on geology and engineering students for coop semesters.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Inflationary pressure on supplier prices, increased labor union compensation, stronger Mexican Peso, increased consulting costs due to Mexican tax authority compliance requirements, declining silver price, rising costs.
• Recent Mexican legislation requiring reorganization of subsidiaries to comply with new employment and taxation requirements.

Mitigation Strategies

• Hiring freeze and layoffs, deferral of non-critical projects, budget reduction for exploration, exploration partnerships, cost reduction strategies focusing on higher-grade mineralization and lower production costs.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Community Relations
• Environmental Stewardship

Environmental Achievements

• Planted approximately 6,000 trees of various indigenous species in 2021; a further 10,000 trees are to be planted in 2022/2023.
• Planted 833 agave plants in 2021, with plans for a further 3,000 in the next 12 months.
• 100% of mine water is either recycled or lost to evaporation.
• Established a test site to provide electricity to the mine administrative building with solar panels in 2021.

Social Achievements

• Upgraded roads, built a new school, and a health clinic in 2021 by providing tools, materials and supplies while the communities provide labor.
• Built soccer fields, basketball courts, and other facilities for local communities.
• Built water tanks and provided plastic pipes for water storage and distribution to farmers and communities.
• Employs most workers from local communities.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Lower silver prices impacting revenue and earnings.
• Higher cost per tonne due to increased exploration and development.
• Excessive haul costs due to wet rainy season in Q3 2021.
• Mexican mining tax changes.
• COVID-19 pandemic and related government restrictions.

Mitigation Strategies

• Shifting strategy to focus on lower cost, high-grade production.
• Expanding exploration and development into new areas to provide higher margins.
• Upgrading shaft and underground railroad infrastructure to access additional veins for mining.
• Implementing strict COVID-19 protocols for employees, providing essential information, and monitoring.
• Temporarily suspending mining operations in April 2020 to comply with government measures.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Engaging local community for logistical support and assistance in drilling programs.

Climate-Related Risks & Opportunities

Physical Risks

• Excessive haul costs due to wet rainy season.

Transition Risks

• Not disclosed

Opportunities

• Reducing carbon footprint through solar power and LED lighting.

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Recognition for compliance to health and safety standards by the Secretary of Labour and Social Welfare in Mexico.

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Signed a battery and solar power generation agreement with Bell Internacional (equipment provided by Tesla Inc.) estimated to provide more than 85% of Plomosas’ energy needs with implementation planned for mid-2024
• Adding tailings capacity at the Guadalupe processing complex at Zacualpan, including work on a third tailings facility with a provisional life of nine years
• Planted approximately 6,000 trees of various indigenous species over the last two years. A further 10,000 trees are expected to be planted over the next year or so.
• Planted approximately 1,000 agave plants. Plans are in place for a further 3,000 agaves to be planted over the next year or so.

Social Achievements

• The employment of most workers from local communities helps to foster understanding, and direct involvement in the Company’s operations.
• The Company continues to provide tools, materials and supplies while the communities provide labour for community projects. The Company continues to upgrade roads and has built a new school as well as a badly needed health clinic.
• The Company has also built soccer fields, basketball courts and other facilities for local communities.
• The Company has also built water tanks and providing plastic pipes for water storage and distribution.

Governance Achievements

• The Board of Directors oversees management’s responsibility for financial reporting and internal control systems through an Audit Committee.

Climate Goals & Targets

Environmental Challenges

• Industry-wide cost pressures from inflation and a strong Mexican peso
• Concerns about the transferability of surface titles, permits, and licenses at Plomosas
• Disrepair of the Plomosas mill, mobile equipment, and infrastructure
• Existing mining plans and underground development needing improvement for safety and future operations at Plomosas
• Previously unpaid suppliers at Plomosas
• Issues with regulators and litigations resulting from previous activities at Plomosas

Mitigation Strategies

• Aggressive cost controls and production efficiencies
• Assessing potential changes in mining processes and new technologies to improve margins and offset higher supplier and labour costs
• Deferring a number of non-critical projects to offset higher costs
• Substantial rehabilitation of the Plomosas mine, plant and equipment
• Hiring of new technical and supervisory staff at Plomosas
• Addressing existing mining plans and underground development at Plomosas
• Rehabilitating or replacing a significant part of the Plomosas infrastructure
• Redesigning the underground mining plan at Plomosas
• Dealing with previously unpaid suppliers at Plomosas
• Resolving or recovering from issues with regulators and litigations at Plomosas

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Emissions Reduction
• Community Relations
• Operational Efficiency

Environmental Achievements

• Reduced carbon dioxide emissions by nearly 90% at Plomosas mine through Tesla solar partnership and AI-controlled battery storage.

Social Achievements

• Employs a 99% Mexican workforce.
• Prioritizes ESG as it directly impacts the community.

Governance Achievements

• Experienced management team with extensive mining experience.

Climate Goals & Targets

Environmental Challenges

• Rising costs due to operational inefficiencies and under-capitalization (Plomosas)
• Energy cost rises

Mitigation Strategies

• Mill upgrade at Plomosas to improve efficiencies.
• Tesla solar partnership to reduce energy costs and emissions.
• Cost efficiency controls in place at Zacualpan to ensure margin and mine-level EBITDA.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Planted over 15,000 trees and 2,900 agave plants for carbon sequestration and community development.
• Engaged independent engineers to study the Guadalupe tailings impoundment and are following their recommendations.
• Work on tailings pond facility #3 is continuing, which is projected to accommodate approximately nine years of production from the Guadalupe mill complex in the future.

Social Achievements

• Appointed Janet Meiklejohn to the board of directors, bringing over 25 years of experience in corporate finance.
• Established an effective relationship with mine workers, local contractors, and personnel.
• Regularly upgrades roads, built a new school and a modern health clinic, and invests in social facilities for local communities.
• Employs local community members, fostering understanding and cooperation.
• Takes on geology and engineering students for co-op semesters.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Industry-wide cost pressures impacting profitability.
• Extreme weather in September resulting in loss of power and washouts, impacting production at Zacualpan.
• Fluctuating currencies impacting profit margins.
• Ongoing negotiations and arbitration regarding adjustments to the Plomosas acquisition price.

Mitigation Strategies

• Strict cost controls and focus on production efficiencies.
• Assessing potential changes in mining processes and new technologies to improve margins.
• Exploring options to establish significant carbon-reducing infrastructure initiatives.
• Addressing limitations in underground and mill operations at Plomosas as production increases.
• Expanding existing and designing a new, larger tailings pond at Plomosas.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather (power outages, washouts)

Transition Risks

• Changes in mining legislation in Mexico

Opportunities

• Carbon-reducing infrastructure initiatives at Plomosas (solar and battery power).

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed