Kuya Silver Corporation (CSE: KUYA) (OTCQB: KUYAF) (FSE: 6MR1) is pleased to announce plans to accelerate production growth and resource development at its Bethania silver mine through a targeted modernization program and a new underground geological campaign. Together, these initiatives are designed to fast-track throughput expansion, enhance operational efficiency, and improve the understanding of the potential of the mineralized system to support future mine life extension.

Highlights

• Modernization Program to accelerate production ramp-up through the modernization of internal underground haulage infrastructure, improve material handling efficiency, and provide a pathway to higher throughput rates.
• Geological Program involving ~4,000-5,000 meters of boreholes from within the existing underground mining infrastructure at the Santa Elena concession, aimed at obtaining critical information for mine planning and gaining a better understanding of the mineralized system at depth to support long-term operations.
• Combined investment of approximately USD $3 million expected to significantly de-risk and enhance the medium and long-term production profile of the Bethania Mine.

The program includes internal development to modernize material handling systems at the mine and comprehensive data collection to gather geotechnical and geological information at depth to support resource growth. This combined investment, expected to be approximately USD $3 million over the next six to nine months, should have a significant impact on the operation’s efficiency, not just to meet short-term production goals, but also lay the foundation for future expansion.

Modernization Program to Accelerate Production and Throughput

A central pillar of this initiative is the strategic development of an expanded internal underground hauling and transportation path system within the existing mine infrastructure. This project focuses on creating a more efficient connection between levels to significantly improve the flow of material, personnel, and ventilation while also improving safety.

• Objective: To facilitate a transition to modern, trackless haulage vehicles, replacing the legacy rail-and-cart system to significantly improve material movement efficiency and safety.
• Impact on Production: This upgrade is a key enabler to de-bottleneck operations, allowing the Company to reach its initial 350 tpd milestone more reliably and quickly, while also providing the necessary infrastructure to support higher throughput rates in the future.
• Design: The expanded underground development will have dimensions of 3.5 m by 3.5 m, which allows for the accommodation of modern equipment, improved operational airflow and safety factors.

Background

Based on the technical design work in the Company’s Preliminary Economic Assessment (Bethania Silver Project – NI 43-101 Technical Report, Amended and Restated Preliminary Economic Assessment, October 20, 2023), the initial plan was to use the two pre-existing adits independently to achieve production of up to 350 tpd. However, more recent operational analysis identified an opportunity to add expanded infrastructure to accelerate production in the short term and allow for increased capacity in the longer term.

The current mine is accessed by two adits equipped with a narrow-gauge track for rail carts. The new internal development, with a cross-sectional area more than double that of the existing infrastructure, is designed to accommodate trackless, light-tonnage haulage vehicles (LTHVs). This transition from a legacy rail system to modern rubber-tired equipment is the cornerstone of a broader shift to semi-mechanized mining, which blends traditional methods with more efficient and modern material handling capabilities. It is important to note that while this new infrastructure is being developed, the current materials handling system (i.e. rail) can continue to operate as previously planned.

Given the vast benefits expected for this modernization, the design was added to the registered mine plan (filed annually with government authorities) at the end of 2024, and internal budgeting suggested that construction could begin as soon as at the end of 2025. If funded exclusively through internally generated cash flow, the project would be expected to take until mid-to-late 2027 for completion, while production continued to use the two pre-existing adits independently in the normal course. Kuya Silver’s recently improved financial strength allows the Company to move more quickly on this critical growth initiative, and subject to the successful selection of the construction strategy and mobilization, could be completed more than a year sooner than previously expected.

“This modernization program is the critical path to accelerating our production profile and unlocking higher throughput rates,” said Christian Aramayo, Chief Operating Officer of Kuya Silver. “The analysis by our operations team was clear: developing this 3.5m x 3.5m internal infrastructure to connect our main production levels is the key to transitioning from a legacy rail system to modern, efficient, and safer trackless haulage. This is not just an incremental improvement; it’s a fundamental upgrade to the mine’s logistics that will provide immediate benefits in safety and efficiency. It de-risks our path to 350 tpd and provides the optionality we need for future growth.”

*Note: The Bethania Project preliminary economic assessment, updated October 20, 2023, is available on the Company’s website, https://www.kuyasilver.com/investor/reports and on SEDAR+ https://www.sedarplus.ca.

Enhanced Geological Program For Mine Planning and Resource Growth

In parallel, Kuya Silver plans to commence an underground geological program to support operations within the Santa Elena concession. These works are designed to gather critical data from deeper levels to inform short, mid, and long-term mine planning.

• Activities: The program includes rehabilitation of existing work areas, preparation of underground operational maneuver chambers, and approximately 4,000-5,000 metres of underground bore holes from within the mine.
• Scope of Work: To support operations, the program includes 30-35 bore holes planned to get a better understanding of the depth extension of the three primary vein systems at Santa Elena Concession of the Bethania mine, as well as testing potential extension(s) to the east within the same concession.
• Purpose: The primary goal is to gain a better understanding of the continuity, geometry and grade of the known mineralized structures at depth. A secondary benefit is to gather additional data on the rock mechanics, which is important to planning the support and safety systems at depth. The information gathered is essential for detailed mine sequencing, resource confidence, and assessing the potential to extend the life of mine through an increase in the resources.
• Location: All work will be conducted underground and within the Santa Elena concession, focusing on the western portion of the concession which hosts the three primary vein systems: Española, 12 de Mayo, and Victoria.

David Stein, Kuya Silver’s President and CEO, remarked, “This investment is laser-focused on accelerating our path to cash flow and building a more valuable, long-life operation. The modernization work is a direct response to our on-the-ground experience and is the key to unlocking higher throughput sooner. The accompanying underground program is equally strategic, designed to give us the in-fill data we need to optimize our mine plan and better understand the true potential at depth. This is a targeted effort to de-risk our future and maximize the value of the Bethania mine for all stakeholders.”

Background

Kuya Silver is preparing to commence geological activities underground at the Bethania Project, the first such program in over four years. Previous operational and technical work, including the 2021 surface program, provided valuable insight into the shallower zones proximal to the current mine workings, allowing for the development of the current geological and production model. The Company’s operational model for the western portion of the Santa Elena mining concession is based on three broadly subparallel and subvertical vein systems: Española, 12 de Mayo and Victoria. Each of the three vein systems is interpreted to be controlled by the respective dominant vein, while each vein system can host numerous subvertical mineralized splays and more shallowly dipping mineralized branches. In some cases, these branches and splays host mineralization that is also included in the Company’s resource estimate (see Bethania Silver Project – NI 43-101 Technical Report, Amended and Restated Preliminary Economic Assessment, October 20, 2023).

Given the substantial existing underground development at the Bethania silver mine, the Company has planned to execute all tasks from the underground complying with its submitted mine plan, focusing primarily on gaining geotechnical and structural information at depth from below the current mine workings. The plan is to gain information on the three major vein systems (identified to date) at depth with a series of boreholes along the current length of the mine workings at the 590 level. This program of specialized boreholes serves two primary operational purposes. Firstly, it allows for the improvement of precision of the modelled vein geometry and grade estimates between the 590 level and the upper levels of the mine, thereby supporting more efficient short-term mine planning. Secondly, the data required will be critical for assessing operational continuity at depth and informing future development decisions including the potential to increase resources.

Some of the boreholes to support operations are planned to test the continuity of mineralized structures and rock mechanics to the east. The scope and location of these boreholes may be optimized based on initial results and operational requirements.

David Stein, Kuya Silver’s President and CEO, remarked, “We have been waiting for more than four years for opportunity to test the depth extension of the Bethania vein system to support our mining operations, and we are excited to launch this important program in the coming weeks. The vast majority of the most current resource estimate is restricted to the upper 200 metres, whereas similar vein systems in Peru and elsewhere can extend considerably deeper. Given the Company’s greatly improved financial position, and expected ramp-up of production at Bethania, our goal will be to sustain these types of investments to gather geological information for many years, whether it be to expand mineralization at the Bethania silver mine itself or testing the many other silver vein targets and past producing mines on our 4,500 ha land package.”

National Instrument 43-101 Disclosure

The technical content of this news release has been reviewed and approved by Kevin J. O’Connell, P.E., Independent Technical Advisor to of Kuya Silver and a Qualified Person as defined by National Instrument 43-101 and David Lewis, M.Sc., P.Geo., Vice President Exploration with Kuya Silver Corp. and a Qualified Person as defined by National Instrument 43-101.

About Kuya Silver Corporation

Kuya Silver is a Canadian‐based, growth-oriented mining company with a focus on silver. Kuya Silver operates the Bethania silver mine in Peru, while developing district-scale silver projects in mining-friendly jurisdictions including Peru and Canada.