Key Highlights – Infill drilling and channel sampling at Reliquias

Drill Hole SMR128-23-PER (PER vein)
0.30 m @ 2,961 g/t Ag, 0.84% Pb, 2.51% Zn, 0.08% Cu and 1.99 g/t Au

Drill Hole SMR88-BQ-23-PER (PER vein)

• 0.50 m @ 704 g/t Ag, 1.80% Pb, 2.60% Zn, 0.06% Cu and 11.15 g/t Au

Drill Hole SMR87-BQ-23-PZR (PZR vein)

• 1.25 m @ 231 g/t Ag, 3.34% Pb, 5.58% Zn, 0.11% Cu and 4.57 g/t Au

Channel Sample (MTS vein): 1.00m @ 1,343.35 g/t Ag, 1.87% Pb, 2.47% Zn, 0.59% Cu and 1.73 g/t Au

Channel Sample (MTC vein): 1.03m @ 420.32 g/t Ag, 0.66% Pb, 1.72 % Zn, 0.26 % Cu and 1.44 g/t Au

Channel Sample (PER vein): 0.59m @ 1,499.90 g/t Ag, 3.24% Pb, 5.96% Zn, 0.43% Cu and 16.98 g/t Au

Silver Mountain Resources Inc. (TSX-V: AGMR) (OTCQB: AGMRF) is pleased to announce results from channel sampling completed between December 2022 and May 2023, and from the first four drill holes from Phase 2 of its 2023 infill and resource expansion program at its 100% owned Reliquias mine, central Peru. None of these results were included in the current mineral resource estimate announced on April 12^th, 2023.

The Company’s crews have continued to systematically sample the underground workings as part of the preparation work to restart operations in the future. A total of 800 samples were collected from the Sorpresa, Pozo Rico, Matacaballo, Perseguida and Meteysaca veins. All samples were collected perpendicular to the veins using portable rock saws.

The Company also announces that it has received final approval of an Informe Técnico Sustentatorio permit, allowing it to add twenty surface drill platforms on the Pasteur zone.

Alvaro Espinoza, CEO of Silver Mountain, stated, “These channel sampling results confirm the high grades and the continuous nature of our veins, particularly the Meteysaca and Perseguida veins which confirm that the Reliquias deposit could be amenable to modern mining methods without too much dilution. Furthermore, we have now received the first results from Phase 2 of the 2023 infill and resource expansion drilling. Hole SMR128-23-PER, an infill drill hole along the Perseguida vein, has hit 0.30 metres with 102.87 oz/t AgEq (or 3,199.61 g/t AgEq), one of the highest grade intercepts to date.”

Mr. Espinoza continued, “The fully-funded second phase of our 2023 infill and resource expansion drill program continues at full speed and Silver Mountain is rapidly moving the Reliquias Project forward under its two-pronged strategy of advancing towards a production decision and exploring for additional resources. The approval of twenty surface platforms on the highly prospective Pasteur zone is a very positive step forward to fulfil the second part of this strategy. Field crews continue to prospect some of the most promising targets within the Project’s large 60,000 hectare land package, located in one of the most prolific polymetallic belts in the world”.

Channel Sampling Results

Between December 2022 and May 2023, Silver Mountain geologists collected 800 channel samples from several veins. Table 1 and Table 2 show the distribution of samples between the veins and the compiled weighted results respectively. Full results from the underground channel samples are provided in the Appendix to this news release.

Table 1: Distribution of underground channel samples reported in this news release

Notes:
¹ Silver equivalent (Ag_Eq) grades are calculated using metal prices of: silver US$23.30/oz., gold US$1764/oz, copper US$9419/tm, lead US$2188/tm and zinc US$2813/tm. Silver equivalent grade is calculated as Ag_Eq (oz/t) = (Ag (oz/t) + (Au (g/t) * 2.40) + (Cu (%) * 2.70) + (Pb (%) * 0.80) + (Zn (%) * 0.80).  Metal recoveries have not been applied in the silver equivalent value calculation.

Table 2: Weighted assay results from systematic channel sampling along several veins, calculated for contiguous zones on each level.

Channel sampling across a 130 metre long segment of the Meteysaca Vein (“MTS”) on level 520 yielded a weighted average of 22.51 oz/t AgEq with an average vein thickness of 0.73 metres. A channel within this segment of the MTC vein yielded 1.00m @ 1,343.35 g/t Ag, 1.87% Pb, 2.47% Zn, 0.59% Cu and 1.73 g/t Au, some of the highest grade samples collected to date using this method. Figure 1 shows the sampling location and grades found along the MTS vein.

Sampling along the Perseguida vein system continues to find significant gold and silver grades both along the main vein and its splays. An 18 metre long segment along the main vein yielded grades, over an average vein width of 0.50 metres, of 0.50m @ 340.68 g/t Ag, 0.59% Pb, 0.82% Zn, 0.05% Cu and 7.71 g/t Au. Figure 2 shows the sampling location and grades found along the PER vein.

Figure 1: Isometric view of Level 520 of the Meteysaca vein showing the location of systematic channel sampling. Individual channel samples are shown within nine zones, colour-coded according to AgEq values.

Figure 2: Isometric view of Level 560 of the Perseguida vein showing the location of systematic channel sampling. Individual channel samples are shown within nine zones, colour-coded according to AgEq values.

2023 Drilling Results

The Company recently completed the first phase of underground infill and resource expansion drilling at Reliquias, using BQ diameter core. The second phase of this program, using larger diameter NQ and HQ core, began in June 2023. So far, the Company has received results from the first four completed holes from Phase 2, drilled along the Sacasipuedes  and Perseguida  veins. All four holes hit silver and polymetallic mineralization. Figure 3 and Table 3 show the drill hole location and a summary of results respectively.

Figure 3: Location of initial four drill holes from Phase 2 of the 2023 drill program

Notes:
¹ Silver equivalent (Ag_Eq) grades are calculated using metal prices of: silver US$23.30/oz., gold US$1764/oz, copper US$9419/tm, lead US$2188/tm and zinc US$2813/tm. Silver equivalent grade is calculated as Ag_Eq (oz/t) = (Ag (oz/t) + (Au (g/t) * 2.40) + (Cu (%) * 2.70) + (Pb (%) * 0.80) + (Zn (%) * 0.80).  Metal recoveries have not been applied in the silver equivalent value calculation.

Table 3: Summary of initial results from Phase 2 drill holes

Holes SMR-131-23-PER and SMR-128-23-PER were collared from the same platform along the Perseguida vein, aimed at validating the high grade historical resource blocks and extending the mineralization at depth. Results confirm that high grade silver extends below the previously mined areas, and further drilling will test the grade continuity of this vein both along strike and down dip.

Notes:
¹ Silver equivalent (Ag_Eq) grades are calculated using metal prices of: silver US$23.30/oz., gold US$1764/oz, copper US$9419/tm, lead US$2188/tm and zinc US$2813/tm. Silver equivalent grade is calculated as Ag_Eq (oz/t) = (Ag (oz/t) + (Au (g/t) * 2.40) + (Cu (%) * 2.70) + (Pb (%) * 0.80) + (Zn (%) * 0.80).  Metal recoveries have not been applied in the silver equivalent value calculation.

Figure 4: Long section along the Perseguida vein showing initial results from Phase 2 of the 2023 drilling program

Finally, the Company reports that results from four Phase 1 drill holes, testing the Pozo Rico vein system, have been received. None of these holes were included in the current resource estimate. Location information and a summary of the results from these four holes are shown in Figure 5 and Table 4 respectively. Drill hole SMR88BQ-23-PZR, a stepout hole, hit significant gold and silver grades, extending mineralization approximately 100 metres along strike and 50 metres at depth (see Figure 6). This mineralization remains open in all directions.

Figure 5: Location of Phase 1 Pozo Rico BQ diameter drill holes.

Table 4: Summary of results from previously undisclosed Phase 1 BQ diameter drill holes

Notes:
¹ Silver equivalent (Ag_Eq) grades are calculated using metal prices of: silver US$23.30/oz., gold US$1764/oz, copper US$9419/tm, lead US$2188/tm and zinc US$2813/tm. Silver equivalent grade is calculated as Ag_Eq (oz/t) = (Ag (oz/t) + (Au (g/t) * 2.40) + (Cu (%) * 2.70) + (Pb (%) * 0.80) + (Zn (%) * 0.80).  Metal recoveries have not been applied in the silver equivalent value calculation.

Figure 6: Long section along the Pozo Rico Vein showing previously undisclosed intercepts from Phase 1 of the 2023 drill program

The 2023 drill program consists of two phases: an initial 3,500 metre phase using BQ diameter core (now completed); and a second 12,500 meter phase using NQ and HQ diameter core. Full results from the BQ diameter drilling have now been announced (see also March 29^th and July 19^th news release at https://agmr.ca/news/ ). The second phase of infill drilling started in June 2023 and continues with 3 rigs working in the upper levels of the MTC (Matacaballo), MTS (Meteysaca), and SCS (Sacasipuedes) vein systems, where high grade historical resource blocks remain outside of the current resource estimate. The Company plans to incorporate these high-grade blocks in future resource estimates. Results will be announced as they become available.

Qualified Person

Antonio Cruz Bermudez, , P. Geo.  Registered Member MAIG is an independent consultant of the Company and the Qualified Person (within the meaning of NI 43-101) responsible for the MRE, has reviewed and approved the scientific and technical information contained in this news release.

About Silver Mountain 

Silver Mountain Resources Inc. is a silver explorer and mine developer planning to restart production at the Reliquias underground mine and undertake exploration activities at its prospective silver camps at the Castrovirreyna Project in Huancavelica, Peru.

For additional information in respect of the Castrovirreyna Project, please refer to the Company’s technical report, titled NI 43-101 Technical Report Mineral Resource Estimate for the Reliquias Mine, Huancavelica- Peru, dated March 27, 2023, effective date March 18, 2023, available at https://sedar.com.

For further information about our drill program, including cross sections of the main veins with drill hole locations, please refer to our corporate presentation, available on our website at www.agmr.ca