SILVER MINES LIMITED — AGM Information 2020

Nov 26, 2020

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Annual General Meeting 27 November 2020

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Disclaimer

The material in this presentation contains certain forecasts and forward-looking information, including regarding possible or assumed future performance or potential growth of Silver Mines Limited (“SVL”). Such information is not a guarantee of future performance and involves unknown risks and uncertainties, as well as other factors, many of which are beyond the control of SVL. Actual results and developments may differ materially from those expressed or implied by these forward-looking statements depending on a variety of factors.

No representation or warranty, expressed or implied, is made or given by or on behalf of SVL, any of SVL’s directors, or any other person as to the accuracy or completeness or fairness of the information or opinions contained in this presentation and no responsibility or liability is accepted by any of them for such information or opinions or for any errors, omissions, misstatements, negligent or otherwise, or for any communication written or otherwise, contained or referred to in this presentation.

Accordingly, neither SVL nor any of the SVL directors, officers, employees, advisers, associated persons or subsidiary undertakings shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying upon the statement or as a result of any admission in, or any document supplied with, this presentation or by any future communications in connection with such documents and any such liabilities are expressly disclaimed.

Nothing in this material should be construed as either an offer to sell or a solicitation of an offer to buy or sell securities.

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Silver Mines Limited Introduction

BOWDENS SILVER A MAJOR ASSET FOR DEVELOPMENT

Feasibility complete for 2.0 Mtpa development. Submitted for Development Approval. One of the largest undeveloped silver deposits globally. Major Exploration Targets at Bowdens and surrounds: Confirmed significant high-grade extensions to mineralisation close to mine. Discovered new base-metal massive sulphide including gold.

Discovered porphyritic felsic intrusion under the current resource. Commenced 10,000 metre drilling program.

TUENA GOLD PROJECT

Exciting new gold project, initial drilling (4,000 metres) commenced. Substantial land package adjoining and south of McPhillamys Gold Project (Regis Resources).

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Silver Mines Limited Snapshot

	Capital Structure ASX:SVL	Capital Structure ASX:SVL
	Shares on Issue	1,026.5m	Options
	Current Share Price	A$0.20	Sept 2021 @ $0.06	116.7m
	Undiluted Market Capitalisation	A$205m	Aug 2021 @ $0.10	4.65m
	Cash (end September 2020)	A$9.1m	3 year milestone @ $0.20	5.0m
	Directors		Institutional Shareholders
	Keith Perrett, Chairman		Sprott	Konwave
	Anthony McClure, Managing Director		Regal	Brick Lane
	Peter Langworthy, Non Executive Director
	Jonathan Battershill, Non Executive Director
	Assets
	Bowdens Silver Mineral Resources		163 Moz Silver	275 Moz Silver Equivalent
	Ore Reserve		66 Moz Silver	97 Moz Silver Equivalent
	Major Exploration Package Central New South Wales, Australia, Bowdens Silver Extensions and the Barabolar Project, Tuena Gold Project – exciting new gold exploration play.		High order targets include precious metals epithermal, base metal VMS, Orogenic Gold, Intrusion Related Porphyry.

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2020 Year in Summary

• Environmental Impact Statement completed and Development Application lodged for the development of the Bowdens Silver Project.

• Expanded drilling program commenced at Bowdens Silver targeting high grade silver.

• Three new licences granted at Tuena (total now 747 square kilometres).

• Inaugural drilling program planned at the Tuena Gold Project (and commenced subsequent to year end).

• Royalty buyback completed at Bowdens Silver.

• A$24.75m raised (before costs) by way of equity placements to institutional, professional, and sophisticated investors.

• Current 12 month share price range $0.05 (July 2019) - $0.295 (August 2020).

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Quality Jurisdiction - New South Wales, Australia

• New South Wales, Australia a quality jurisdiction.

• Major minerals projects in the state include;

• Cadia/Ridgeway, Newcrest (650,000oz Au, 65,000t Cu pa).

• Cowal, Evolution (260,000oz Au pa).

• Northparkes, CMOC (60,000t Cu, 50,000oz Au pa).

• Plus coal mining exports (170 million tonnes pa).

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Bowdens Silver – A Major Asset

• 100% owned.

• Mineral Resource 275 Moz silver Eq (163 Moz silver).

• The largest undeveloped silver deposits in Australia and one of the largest in the world.

• Feasibility Study complete mid 2018.

• Development Application and Environmental Impact Statement (EIS) submitted.

• Primary aspects of EIS show very positive outcomes across the board.

• Public exhibition period closed 27[th] July, outstanding support locally.

• Clear pathway to development approval.

• Quality projects with strong employment outcomes are required post COVID-19.

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Bowdens Silver Timeline

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September 2017
Mineral Resource Complete
(275 Moz Ag Eq)
May 2018
Ore Reserve Complete
(97 Moz Ag Eq)
June 2018 May 2020 2020/21
EIS Complete Approval
Feasibility Study
DA Submission Processes
Complete
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May 2020 2020/21
EIS Complete Approval
DA Submission Processes
& Optimisation
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Bowdens Silver Feasibility Study

Physical Metrics	Unit	Value
Production Life	Years	16.5
Ore Mined	Mt	29.9
Waste Mined	Mt	48.2
W:O Strip Ratio	x	1.6
Ag Recovered in Concentrate	Moz	52.91
Zn Recovered in Concentrate	kt	108.0
Pb Recovered in Concentrate	kt	79.3
Financial Metrics	AUD M	USD M
Revenue	1,899.5	1,424.7
Operating Expenses	1,340.8	1,005.6
Operating Margin	558.7	419.0
Capital Costs	AUD M	USD M
Initial	246.0	184.5
LOM Sustaining	53.9	40.4
Unit Costs (Silver Basis)	AUD/ounce	USD/ounce
C1 Costs	15.47	11.60
All in Sustaining Cost (AISC)	17.25	12.94

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Gold : Silver Ratio

Gold/Silver Price Ratio Since 2000

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120
110
100
90
80
70
Average 66.6
60
50
40
30
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
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Implied Silver Prices

Implied Silver Price at US$2000 Gold

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80
66.67
70
60
WE ARE 50.00
50 HERE
Low
40.00
Au:Ag
40
33.33
28.57
30 25.00
22.22
20.00
Average
20 Au:Ag
10
0
Gold : Silver Ratio
US$/oz
Implied Silver Price
100 90 80 70 60 50 40 30
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*Average Gold: Silver = 66.6, Low = 32.0 since 2000

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Silver Uses

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Silver Uses and Market

• As an element, silver is the best electrical and thermal conductor among metals.

• Demand for silver is currently benefiting from new applications in photovoltaic cells (for solar panels), water purification, electronics, electric vehicles, robotics, industrial automation, aerospace, pharmaceuticals, and biosciences.

• Physical silver demand is approximately 1000 million ounces per year.

• Primary use segments are industrial fabrication (60%), jewellery (20%), coins and bars (15%) and silverware (5%).

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• Approximately 20% of industrial demand is utilised for production of photovoltaic cells.

• Solar power, 5G electronics, EV investment agendas will be a major driver going forward.

• Major international investment houses are predicting +US$30 per ounce silver in 2021 with upside cases over US$50 per ounce.

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Bowdens Silver Exploration

A Major Silver System

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Regional Geology

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Basement Paleozoic geology, Central NSW

• The Ordovician Macquarie Arc/Lachlan Fold Belt of Eastern Australia contains preserved porphyry volcanic arc environments.

• Macquarie Arc of NSW contains world-class;

• Cadia/Ridgeway,

• Cowal,

• Northparkes and others.

• The Bowdens portfolio demonstrates that the eastern limb of the Macquarie Arc has the potential for significant mineral systems.

• • Substantial work by UNSW.

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Regional Geology

• Extensive tenement holding (2007 km[2] = 496,000 acres) controlled by Silver Mines.

• Northeast corner of Lachlan Fold Belt & Macquarie Arc.

• Wide range of prospective deposit types over different time periods (Ordovician, Siluro-Devonian, Carboniferous and Permian).

• Mineral deposit styles/potential include:

• Cadia/Ridgeway style Porphyry (Cu-AuMo).

• Epithermal (Au-Ag).

• McPhillamy’s style Shear hosted gold with base-metal association.

• Woodlawn style Volcanogenic Massive Sulphide (VMS).

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• Bowdens Style epithermal (Ag-Zn-Pb).

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Site Geology

163 Moz Ag 275 Moz Ag Eq

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Bowdens Silver Extensions – Gravity Survey

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Bowdens Silver Extensions

• First target is Northwest Zone that contains high-grade silver with zones up to 15 metres thick, 200 metres wide and 250 metres down plunge.

• Open in several directions.

• Also to target buried porphyry source and structural control in the NW target corridor.

• 10,000 metres drilling well advanced.

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• Two diamond drilling rigs on site now.

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Bowdens Silver Extensions

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Barabolar Project

Unlocking a Major Mineralised System

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Highly Altered and Mineralised Skarn
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Unlocking a Major Mineralised System

• Barabolar Project area located 10 kilometres northwest of Bowdens.

• 9000 x 2000 metre corridor of base-metal and precious metal soil anomalies.

• Mineralised skarn mapped over 5000 by 800 metres.

• Porphyry system type alteration assemblages.

• Several high order prospects:

• Cringle Au-Ag epithermal.

• Kia Ora Skarn (and proximal porphyry): Cu-Ag-Zn-Au.

• Botobolar / Hayshed: abundant coarse molybdenite in associated felsic porphyry.

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Au-Ag Epithermal
Pipeclay porphyry
(off section to south)
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Unlocking a Major Mineralised System

MINERALISED SKARN

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Geophysics and Drilling

• Induced Polarisation (IP) program (~30 line kms) completed.

• Substantial gravity survey completed with interpretation being finalised.

• • Drilling program first half 2021 (subject to approvals).

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Tuena Gold Project

Unlocking a New Mineralised System

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Tuena Gold Project

• Located south of Blayney in New South Wales.

• Historic goldfield with minimal exploration work in the modern era.

• Clear geological analogies to the McPhillamys Gold Project (2.0 Moz gold).

• Mineral system and old gold workings extend over at least 6 kilometres of strike.

• Reconnaissance mapping is identifying previously unrecorded historic workings and shear zones with substantial width.

• Airborne magnetics and radiometrics survey completed.

• Tenement position expanded with 747 km[2] exploration licenses, all granted, all 100%.

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Tuena

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Highly altered mineralised skarn
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• Substantial gold in soil anomalism over a 5.4km by 1.5km corridor.

• Peeks Reef Prospect 900m x 200m soil anomaly >25ppb gold with individual soil assays up to 268ppb gold and rock chip assays up to 76.4g/t gold.

• Cooper & McKenzie Prospect with 850m x 200m soil anomaly > 25ppb with soil assays up to 1550ppb (1.55g/t) gold.

• 4000 metres of RC drilling commenced.

• 13 holes complete, results pending.

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Tuena

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• Gold anomalism northern area.

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Tuena

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Highly altered mineralised skarn
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• Substantial arsenic (a pathfinder element for gold) in soil anomalism.

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Conrad & Webbs - Polymetallic Projects

• Transaction announced 12[th] November 2020.

• Sale of two non-core assets located in the New England region of New South Wales.

• Purchaser Thomson Resources Limited (ASX : TMZ).

• Sale price 75m fully paid ordinary share in Thomson plus 50m options (3 years at A$0.124 exercise price per option).

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• Silver Mines will hold a 19% undiluted interest in Thomson.

• Subject to due diligence completion (December 2020).

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Looking Forward

• Strong Market for Precious Metals.

• Bowden Silver Development Application submitted with a clear pathway approvals.

• Bowdens high-grade targets being addressed in expanded 10,000 metre drilling program

• Drill results continuing through first quarter 2021.

• High-grade results adjoining and below current Mineral Resource area.

• 275 Moz silver Eq system open to north, east and at depth.

• Tuena Gold Project is an exciting new gold exploration play.

• Substantial old gold workings and anomalism with no modern drilling.

• Located south of 2.0 Moz gold McPhillamys (Regis Resources).

• Drilling (4000 metres) well advanced, results pending.

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Anthony McClure
Managing Director
Silver Mines Limited
+61 2 8316 3997
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Appendices

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(as at September 2017) Appendix 1 – Bowdens Silver Resource

30 g/t Ag Eq Cut	Tonnes	Silver Eq.	Silver	Zinc	Lead	Million	Million
	(Mt)	(g/t)	(g/t)	(%)	(% )	Ounces	Ounces
						Silver	Silver Eq.
Measured	76	72	45	0.37	0.25	111	175
Indicated	29	59	31	0.38	0.25	29	55
Measured & Indicated	105	68	41	0.37	0.25	140	230
Inferred	23	60	31	0.40	0.28	23	45
Total	128	67	40	0.38	0.26	163	275

The Bowdens Mineral Resource Estimate has been compiled by H&S Consultants Pty Ltd using Multiple Indicator Kriging and the reporting is compliant with the 2012 JORC Code and Guidelines. For full disclosures refer to the Silver Mines Limited announcement of 19 September 2017.

1. Bowdens’ silver equivalent: Ag Eq (g/t) = Ag (g/t) + 33.48Pb (%) + 49.61Zn (%) calculated from prices of US$20/oz silver, US$1.50/lb zinc, US$1.00/lb lead and metallurgical recoveries of 85% silver, 82% zinc and 83% lead estimated from test work commissioned by Silver Mines Limited.

2. Bowdens Silver Mineral Resource Estimate is reported to a 30g/t Ag Eq cut off and extends from surface and is trimmed to 300 metres RL which is approximately 320 metres below surface representing a potential volume for open-pit optimisation models.

3. In the Company’s opinion, the silver, zinc and lead included in the metal equivalent calculations have a reasonable potential to be recovered and sold.

4. Variability of summation may occur due to rounding.

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(as at September 2017) Appendix 2 - Bowdens Silver Resource

	Cut	off g/t Ag Eq	Tonnes (Mt)	Silver Eq. (g/t)	Silver (g/t)	Zinc (%)	Lead (% )	Million Ounces	Million Ounces
								Silver	Silver Eq.
		0	397.2	30.7	17.6	0.18	0.12	225	392
		10	261.7	43.7	25.2	0.26	0.17	212	368
		20	185.2	54.6	31.7	0.32	0.21	189	325
		30	127.9	66.8	39.6	0.38	0.26	163	275
		40	89.2	79.7	48.6	0.43	0.29	139	229
		50	63.6	92.8	58.4	0.47	0.33	119	190
		60	46.1	106.3	69.1	0.51	0.36	102	158
		70	33.7	120.8	80.9	0.54	0.39	87	131
		80	25.1	135.5	93.4	0.57	0.42	75	109
		90	19.2	149.9	105.6	0.59	0.45	65	93
		100	15.1	163.7	117.5	0.62	0.47	57	80
		120	9.6	192.3	141.4	0.67	0.53	44	59

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Bowdens Silver Resource

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(as at May 2018) Appendix 3 – Bowdens Silver Ore Reserve

	Tonnes	Silver	Silver	Zinc	Lead	Silver	Silver	Zinc	Lead
	(Mt)	Eq.	(g/t)	(%)	(% )	Eq.	Million	Kilo-	Kilo-
		(g/t)				Million	Ounces	tonnes	tonnes
						Ounces
Proved	28.6	102.2	69.75	0.44	0.32	93.85	64.05	125.11	91.43
Probable	1.3	84.4	53.15	0.43	0.29	3.60	2.27	5.74	3.91
Total	29.9	101.4	69.01	0.44	0.32	97.45	66.32	130.84	95.33

The Bowdens Reserve has been compiled by AMC Consultants Pty Ltd and is based on the September 2017 Mineral Resource Estimate generated for Silver Mines by H & S Consultants Pty Ltd (see ASX announcement 19 September 2017). For full disclosures refer to the Silver Mines Limited announcement of 30 May 2018.

1. Calculations have been rounded to the nearest 100,000 t, 0.1 g/t silver and 0.01% zinc and lead grades respectively. The Ore Reserve is reported by economic cut-off grade with appropriate consideration of modifying factors including costs, geotechnical considerations, mining and process recoveries and metal pricing.

2. Bowdens’ silver equivalent: Ag Eq (g/t) = Ag (g/t) + 33.48Pb (%) + 49.61Zn (%) calculated from prices of US$20/oz silver, US$1.50/lb zinc, US$1.00/lb lead and metallurgical recoveries of 85% silver, 82% zinc and 83% lead estimated from test work commissioned by Silver Mines Limited.

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Competent Persons Statements

Ore Reserve

The information in this report that relates to Ore Reserves within the Bowdens Silver Project is based on information compiled or reviewed by Mr Adrian Jones of AMC Consultants Pty Ltd who is a consultant to the Company. Mr Jones is a member of the Member of the Australasian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity being undertaken, to qualify as a Competent Person as defined in the 2012 edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (JORC code). Mr Jones consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.

Mr Jones visited the Bowdens mine site during April 2017 to review the operations, consider the conditions of the site, and assess the data collection methods and techniques used by site personnel.

The Ore Reserve has been prepared by Mr Adrian Jones, AMC Consultants Pty Ltd, after peer review of the mining section of the Feasibility Study. Other experts relied upon include H & S Consultants Pty Ltd, GR Engineering Services Limited, ATC Williams Pty Limited. and Jacobs Australia Pty Limited, for Mineral Resources, Metallurgy & Process Design and Tailing Storage Facility design. Work on environmental, marketing and logistics and the financial modelling were undertaken by other consultants on behalf of the Company and certified by representatives of Silver Mines.

Mineral Resources

The information in this report that relates to Mineral Resources is based on work compiled by Mr Arnold van der Heyden who is a Director of H & S Consultants Pty Ltd. Mr van der Heyden is a Member and Chartered Professional (Geology) of the Australian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity being undertaken, to qualify as a Competent Person as defined in the 2012 edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (JORC code). Mr van der Heyden consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.

Exploration and Drill Results

The information in this report that relates to mineral exploration drill results from the Bowdens Silver Project and Tuena Gold Project is based on information compiled or reviewed by Dr Darren Holden who is an advisor to the company. Dr Holden is a member of the Australasian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity being undertaken, to qualify as a Competent Person as defined in the 2012 edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (JORC code). Dr Holden consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.

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