Zacatecas Silver Corp. — Audit Report / Information 2020

Jan 7, 2021

Zacatecas Ni43-101

INDEPENDENT TECHNICAL REPORT ON THE ZACATECAS PROPERTIES, ZACATECAS STATE, MEXICO

NI 43-101 TECHNICAL REPORT

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High grade silver mineralization
Panuco
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Prepared for

Zacatecas Silver Corp.

By

Dr Paul Pearson & Juan-Manuel Morales-Ramirez

24[th] December 2020

Eff ective Date 24[th] December 2020

Zacatecas Silver Corp. Ni43-101

EXECUTIVE SUMMARY

Introduction

• Dr Paul Pearson and Mr Juan-Manuel Morales-Ramirez (together the “Authors”) were requested by Zacatecas Silver Corp. (the “Company”) to produce a National Instrument 43-101 compliant Technical Report (the “Report”) for the Zacatecas Silver-Polymetallic Project (the “Property”) in Mexico.

• Th e Report was prepared in respect of a proposed initial public off ering of the Company and the listing of the common shares of the Company on the TSX Venture Exchange. Th e Authors understand that the report may be used to assist with raising capital in the public markets.

Property Description and Location

• Th e Property is located adjacent to the city of Zacatecas, in the municipalities of Panuco, Veta Grande, Morelos, Zacatecas and Guadalupe, Zacatecas State, Mexico — it consists of 149 mining concessions covering 7826 hectares. Th e Property is centred on latitude 22°49’2.89” N and longitude 102°33’48.72” W.

• Th e Company acquired 100% of the Property through its wholly owned subsidiary (Desarrollos Mineros Zacatecas Silver, S.A. de C.V. or “DMZS”) from Impulsora Minera Santacruz, S.A. de C.V. (“IMSC”) (a wholly owned subsidiary of Santacruz Silver Mining Ltd) — subject to a purchase agreement dated August 31, 2020 as amended on December 23, 2020.

• As part of the Purchase Agreement, Desarrollos Mineros Zacatecas Silver, S. A. de C. V. also assumed certain royalties, as outlined in Section 3.5 of this Report.

• In consideration of the Property, the Company issued 5,000,000 common shares to IMSC and is required to make a cash payment of US $1,500,000 on the date the Company lists its common shares on the TSX Venture Exchange. Th e Company will pay all outstanding taxes due on the Property — approximately US $200,000.

• As of the eff ective date of this report, Zacatecas Silver Corp. does not have surface rights agreements with any landowners, which must be negotiated. Th e Company is planning an extensive surface drill program in 2021 which will require certain permits as outlined in Section 3.9 of this Report. Th e Property is clear of federally protected natural areas. Th e Authors are not aware of any environmental liabilities.

Accessibility, Climate, Infrastructure and Physiography

• Th e Property is located close to the cities of Zacatecas and Guadalupe — both capable of providing a skilled workforce and infrastructure for exploration and development. All project areas on the Zacatecas Property are easily accessed by unpaved roads off paved public highways. Climate allows year-round operation. Topography is generally subdued with occasional moderately steep hills. Elevations vary from 2300 to 2600 masl.

History

• Th e Zacatecas Mining District has had a long history of mining dating back to pre-colonial times. Mining by the Spaniards commenced in 1548 and by the late 1800’s silver from the Zacatecas Mining District accounted for 60% of the value of all Mexican exports. Th e Mexican Geological Survey estimate that almost 750 Moz of silver was produced from the Zacatecas Mining District between 1548 and 1987.

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• Between 1994 and 2010 Golden Minerals completed extensive geological mapping, and trench and surface rock-chip sampling, within the Zacatecas district.

• Between 2007 and 2011 Golden Minerals drilled 36,178 meters of diamond core at Panuco, Muleros, El Cristo and San Manuel-San Gil — of which over 23,000 metres were at Panuco. Four hundred and eleven trenches were excavated for a total of 14,641 m — 83 trenches totalling 4540 metres were excavated at Panuco.

• In October 2016, Santacruz Silver Mining Ltd completed an historical resource estimate of the Panuco Deposit, as set forth in the technical report titled “2016 Mineral Resource Estimate – Panuco Deposit, Zacatecas, Mexico” dated November 3, 2016. Th e report was prepared by Van Phu Bui, P. Geo, and Gary Henry Giroux, P. Eng, and fi led on www.sedar.com (“2016 Panuco Historical Resource”).

• In 2019, Santacruz completed an updated historical inferred resource estimate, as set forth in the technical report titled “Technical Report – Veta Grande Project, Zacatecas State, Mexico” dated August 20, 2019. Th e report was prepared by Van Phu Bui, P. Geo and Michael O’Brien, P. Geo and is fi led on www.sedar.com (“2019 Panuco Historical Resource”). Th e resource was estimated using a drill dataset comprising 75 diamond holes, 866 down hole surveys and 2607 assay samples. A surface trench database totalling 183 trenches for 1813 samples was also used.

Th e 2019 Panuco historical inferred resource reported 3,954,729 tonnes at 153 g/t Ag Eq. (136 g/t Ag, 0.14 g/t Au, 0.012 % Pb and 0.11% Zn) for a total of 19,472,901 ounces Ag Eq. — based on a cut-off 100 g/t Ag Eq. Operational recoveries similar to the Veta Grande vein were used — being gold (52.2%), silver (62.1%), lead (87.9%) and zinc (78.6%). US $1350/oz gold, US $16/oz silver, US $0.90/lb (lead) and US $1.10/lb (zinc) were assumed.

Th e Authors have not done suffi cient work to classify the 2019 Panuco historical resource as a current mineral resource or mineral reserve, and the Company is not treating the historical estimate as a current mineral resource or mineral reserve.

Geological Setting and Mineralization

• Th e regional distribution of epithermal deposits in Mexico indicates they are spatially closely associated with regional faults — as is the case in the Zacatecas region where major deposits occur along the crustal boundary between the Guerrero Terrane (to the west) and the Oaxaquia Block (to the east).

• Th e geology of the Zacatecas area consists of Triassic metamorphic rocks of the Zacatecas Formation overlain by basic volcanic rocks of the Upper Jurassic or Lower Cretaceous Chilitos Formation. Tertiary rocks consist mainly of a Paleocene and/or Eocene red conglomerate unit which is overlain by Eocene to Oligocene rhyolitic tuff s and intercalated fl ows. Some Tertiary rhyolite bodies cut the Mesozoic and Tertiary units and display characteristics of fl ow domes.

• Mineralization at Zacatecas relates to Tertiary magmatism and associated volcanic activity. Mineralization at Panuco, Muleros, El Cristo and San Manuel-San Gil is hosted in the Chilitos Formation — massive lavas and pillow lavas of basalticandesitic composition, interbedded with sedimentary rocks, volcanoclastic rocks, and limestones.

• At district and prospect scale mineralization is hosted in steeply dipping epithermal veins with dominant northwestsoutheast strike. Mineralized systems are defi ned by multiple sub-parallel veins, which often terminate in a series of splays. Vein fl exures are common. A north-south oriented hematitic breccia that is up to 800 m long and 40 m wide crops out at San Manuel-San Gill — the north-south orientation more typical of gold-rich epithermal systems at Zacatecas.

• Silver, gold, and base metal mineralization is hosted in multiphase, crustiform and colloform banded quartz-calcite veins, vein breccias, and quartz vein stockworks within zones of strong argillic alteration. Mineralization is best developed within coherent andesite volcanic rocks and volcano-sedimentary units.

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• Galena, sphalerite, chalcopyrite and argentite are the main economic sulphide minerals — gangue includes quartz, calcite, pyrite, arsenopyrite, hematite, goethite, illite and clay minerals.

Deposit Type

• Th e Zacatecas mining district covers an area of over 700 km[2] . It is part of the largest silver province in the world — the Mexican Silver Belt — which extends from Sonora in the north to Oaxaca in the south, and defi nes a ca . 1500 km long northwest-southeast trending belt that includes the world-class mining districts of Zacatecas, Guanajuato and Fresnillo. Most mineralization is of an epithermal type.

• Th e epithermal deposits within the Zacatecas District — and the silver-gold-base metal mineralization on the Property — display characteristics of intermediate and low sulfi dation styles. Camprubi and Albinson (2007) proposed a new empirical classifi cation for Mexican epithermal deposits — better suited to mineralization at the Property where veins may be of intermediate sulphidation, hybrid intermediate-low sulphidation, or low sulphidation type.

• Economic mineralisation, if present, is restricted to a discrete vertical interval of 200-300 m (low sulphidation veins) and 400-800+ m (intermediate sulphidation veins). Identifying the “tops” and “bottoms” of the mineralized system is essential for placing the level of erosion, or the location of a drill hole intercept, within the broader context of a deposit’s vertical extent — allowing for more eff ective drill targeting.

Exploration

• Th e Company has not yet undertaken systematic fi eld-based exploration on the Property. In anticipation of future fi eld work, the Company has acquired high-resolution satellite imagery, specifi cally high resolution Worldview 3 imagery (34 cm panchromatic and 1.36 m 8-band multi-spectral VNIR resolution).

• Ground control points are currently being acquired by the TerraSar-X satellite — with cited positional accuracy of <20 cm accuracy in X, Y and Z.

• Th e Company is presently generating an AW3D Enhanced 50 cm DTM and 1 m topographic contours using multiview Maxar archive imagery. Th is will provide the topographic surface model for all future mapping and 3D modelling work.

Drilling

• To date there has been no drilling by the Company on the Property. Historic drilling by Golden Minerals is discussed in Section 5.2 of this Report.

Sample Preparation, Analysis and Security

• Given the time that has expired since Golden Minerals completed their work at the Property, the Authors were not able to verify the security, sample preparation and assay protocol, or QA/QC protocol used. For this reason, the Authors elected to re-sample the complete second half of the historic drill core comprising 178 sample intervals used in the historic Panuco calculation, 26 samples from El Cristo, nine samples from San Manuel-San Gil and one sample of Muleros core.

• Th e Authors submitted samples to ALS for sample preparation and analysis — samples were delivered to ALS by the Authors ensuring that chain of custody was maintained. Sample preparation, sub-sampling protocol and analysis followed industry-recognized standards of best practice for the style of mineralization and type of sample. Th e Authors submitted samples in batches of 20 comprising 16 samples, a fi eld blank, a CRM (certifi ed reference material), one crush duplicate and one pulp duplicate. Assay results are pending.

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Data Verifi cation

• Given that the Company is yet to commence fi eld-based exploration and are planning 11,750 m of diamond drilling at Panuco, San Manuel-San Gil and El Cristo in 2021, the Authors conducted extensive verifi cation of all facets of the historic dataset.

• Th is included collection of 214 drill core samples and 11 channel samples from trenches for re-assay. All samples were submitted to ALS for analysis — chain of custody was always maintained by the Authors; insertion of fi eld blanks provided an appropriate test for contamination during sample preparation; and the use of CRMs (certifi ed reference materials) provided a monitor of laboratory accuracy. Assay results are pending.

• One crush duplicate and one pulp duplicate were taken in every batch of 16 samples — the insertion of staged duplicates into the sample stream provides a measure of the heterogeneity of mineralization (for a given sample size), and the precision (or repeatability) of the sampling and sub-sampling protocol. Assay results are pending.

• Th e Authors cross-checked approximately 20% of the historical Panuco assay database against the original ALS assay certifi cates — there were no mismatched or incorrect assay entries. Th e Authors cross-checked selected geological logs against remaining half-cut core and the geological database — the Authors are satisfi ed that rock descriptions and meterage intervals match the drill core and have been correctly entered into the database.

• Th e Company has engaged an independent surveyor to re-survey approximately 20 collar locations at Panuco and 10 at El Cristo and San Manuel-San Gil. Th is work is ongoing.

Mineral Resource Estimates

• Th ere are no current resource estimates for the Property. An historic resource is discussed in Section 5 (History) of this report.

Adjacent Properties

• Several producing mines and advanced exploration properties adjoin the Zacatecas Property. Th e Veta Grande Mine (Santacruz Silver Mining Ltd) and San Acacio Deposit (Defi ance Silver Corp.) are part of the Veta Grande Vein System — the Zacatecas Property bounds the Veta Grande property to the north, west and south.

• Th e El Compass Mine (Endeavor Silver Corp.) is located approximately 2 km to the south of the Company concessions. Th e mine exploits low sulphidation epithermal veins with north and northwest strike — within the context of the district, the veins at El Compass are unusual — they strike predominantly north-south, are gold-rich silver-poor, and have low total sulphide content with very low base-metal content.

• Endeavour Silver Corps concessions — which hosts the El Compass Mine — surround the Companies southernmost concessions.

Th e Authors of this technical report have been unable to verify the information with respect to the Acacio Deposit and notes that the information is not necessarily indicative of the mineralization on the Zacatecas Property.

Other Relevant Data and Information

• Th e Authors are not aware of any other information or data that may be relevant to this report — other than that already disclosed in this report.

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Interpretation and Conclusions

• Mineralization on the Property shares many similarities to other silver-dominant epithermal systems within Zacatecas mining district and the epithermal deposits of the Mexican Silver Belt. Th is provides a foundational understanding of deposits type and a framework on which to develop targets.

• Th e Property includes the advanced Panuco Deposit — with an historical inferred resource estimate — and multiple earlier stage targets. Silver-gold-base metal mineralization is of low sulphidation, hybrid intermediate-low sulphidation and intermediate sulphidation type.

• Th e recognition of hybrid epithermal deposit types, which may display overprinting mineralizing events, indicates there is obvious merit in remodelling the historic dataset to provide a clearer understanding of key controls on mineralization, and better defi ne system the “tops” and “bottoms” (and thus vertical extent) of mineralization. Remodelling of metal signatures, vein textures, vein mineralogy, and alteration assemblages, in conjunction with paragenetic and structural studies, is recommended.

• Th e number of historical drill holes completed by Golden Minerals is relatively small given the number of mineralized systems (Panuco, Muleros, El Cristo, San Manuel-San Gil, and others) at the property — especially as the majority of holes were completed at Panuco.

• Th e Paunco deposit remains open at depth and along strike and requires signifi cant further drill testing. A number is subparallel veins of shorter strike length, splays and dilational jogs also require drill testing. Th e potential strike extension of Panuco Central and Panuco NW veins under Quaternary cover to the northwest requires further investigation. Bench-scale metallurgical tests are recommended.

• Th e Muleros system is defi ned by three main veins and multiple splays which crop out over a strike length of at least 2.5 km. Historical drilling targetted the upper 100 m of parts of two veins. Vein extensions, the Rosario vein and the depth potential of the El Rosario vein remain untested. An area of historical shafts also rquires scout drilling.

• El Cristo is a signifi cantly under-explored target. Th e system most likely represents the northwest strike extsnion of the Veta Grande vein system. It comprises multiple veins, vein breccias and spalys which crop out over a strike length of 2.5 km. Signifi cant further drilling is required.

• Th e San Manuel-San Gilld target is also signifi cantly under-explored. A north-south trending hematic breccia that is 800 m long and up to 40 m wide, is a signifi cant drill target, as gold rich epithermal veins within the district are generally oriented north-south. A number of untested, northwest trending, sulphidic quartz-carbonate veins are also present. Signifi cant further work is required in the San Manuel-San Gill area.

Recommendations

• A 2021 exploration budget of US $4,545,000 is proposed for general Property exploration; metallurgy and step-out, stepback and infi ll drilling at Panuco; exploration drilling at EL Cristo and San Manuel-San Gill; and reconnaissance fi eld work at Orita, Cantera, Monserrat, San Juan, El Peñón and San Judas.

• Most of the proposed exploration budget is for drilling. A total of 10,000 metres of inclined diamond drilling is planned at Panuco — in conjunction with bench-scale metallurgical testing — for an all-in cost of US $3.1 M. A total of 1500 m of inclined diamond drilling is planned at San Manuel-San Gill and 2500 m of drilling is planned at EL Cristo — for an estimated US $1.2 M.

• US $230,000 is budgeted to remodel historic data — this should include re-interpreting the pre-, syn- and post-mineralization structural control on mineralization; re-modelling metal signatures, vein textures, vein mineralogy, and alteration

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assemblages to better pick “tops and bottoms” of precious and base metal intervals; and a paragenetic study designed to better understanding the timing of precious metal mineralization relative to other mineral depositional events.

.

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TABLE OF CONTENTS

Executive Summary.....................................................................................................................................................................................	Executive Summary.....................................................................................................................................................................................	Executive Summary.....................................................................................................................................................................................	i
Table	of Contents.........................................................................................................................................................................................		I
1	Introduction and Terms of Reference.....................................................................................................................................		1
	1.1	Scope of Work..................................................................................................................................................................	1
	1.2	Qualif ed Persons..............................................................................................................................................................	1
	1.3	Sources of Information...................................................................................................................................................	1
2	Reliance on Other Experts..........................................................................................................................................................		3
3	Property Description and location............................................................................................................................................		4
	3.1	Property Location.............................................................................................................................................................	4
	3.2	Verif cation of Licence Title Status.............................................................................................................................	5
	3.3	Grant of Concession........................................................................................................................................................	5
	3.4	Taxes and Fees....................................................................................................................................................................	5
	3.5	Purchase Agreement.........................................................................................................................................................	5
	3.6	Property Royalties, Back In Rights and Encumbrances......................................................................................	5
	3.7	State Royalties and Taxes...............................................................................................................................................	10
	3.8	Environmental Liabilities..............................................................................................................................................	10
	3.9	Permitting............................................................................................................................................................................	11
	3.10	Social Licence and Surface Rights..............................................................................................................................	11
	3.11	Other Risk Factors...........................................................................................................................................................	12
4	Accessibility, Climate, Local Resources, Infrastructure and Physiography.................................................................		14
	4.1	Accessibility.........................................................................................................................................................................	14
	4.2	Climate.................................................................................................................................................................................	14
	4.3	Physiography......................................................................................................................................................................	14
	4.4	Vegetation and Land Use...............................................................................................................................................	14
	4.5	Infrastructure and Local Resources.............................................................................................................................	14
5	History................................................................................................................................................................................................		17
	5.1	District History.................................................................................................................................................................	17
	5.2	Recent Property History................................................................................................................................................	17
		5.2.1 Panuco Area..........................................................................................................................................................	17
		5.2.2 Muleros Area........................................................................................................................................................	18
		5.2.3 El Cristo Area......................................................................................................................................................	20
		5.2.4 San Manuel-San Gill.........................................................................................................................................	21
	5.3	Work By Santa Cruz........................................................................................................................................................	21
6	Geological Setting and Mineralization....................................................................................................................................		24
	6.1	Epithermal Deposits of Mexico...................................................................................................................................	24
	6.2	District Geology................................................................................................................................................................	24

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		6.2.1 Triassic Zacatecas Formation.......................................................................................................................24
		6.2.2 Chilitos Formation.........................................................................................................................................26
		6.2.3 Eocene Zacatecas Red Conglomerate.......................................................................................................26
		6.2.4 Tertiary Volcanics / Volcanoclastics..........................................................................................................26
		6.2.5 Quaternary Cover...........................................................................................................................................28
	6.3	Property Geology..............................................................................................................................................................28
		6.3.1 Panuco Deposit................................................................................................................................................28
		6.3.2 Muleros Target Area........................................................................................................................................29
		6.3.3 El Cristo Vein System.....................................................................................................................................30
		6.3.4 San Manuel-San Gill Vein System.............................................................................................................30
		6.3.5 Other Targets....................................................................................................................................................32
7	Deposit Type.....................................................................................................................................................................................35
	7.1	Epithermal Deposits - An Overview..........................................................................................................................35
	7.2	Low Sulphidation Epithermal Deposit Type - Main Features...........................................................................36
	7.3	Intermediate Sulphidation Epithermal Deposit Type - Main Features..........................................................37
	7.4	Zacatecas Epithermal Deposit Type - Main Features...........................................................................................38
	7.5	Zacatecas Epithermal Deposit Type - Exploration Strategy...............................................................................41
8	Exploration........................................................................................................................................................................................42
9	Drilling...............................................................................................................................................................................................43
10	Sample Preparation, Analysis and Security............................................................................................................................44
	10.1	Golden Minerals...............................................................................................................................................................44
		10.1.1 Sample Security................................................................................................................................................44
		10.1.2 Sample Preparation.........................................................................................................................................44
		10.1.3 Sample Analysis................................................................................................................................................44
		10.1.4 QA/QC...............................................................................................................................................................44
	10.2	Santacruz..............................................................................................................................................................................44
	10.3	Verif cation Sampling by the Authors........................................................................................................................45
		10.3.1 Sample Security................................................................................................................................................45
		10.3.2 Sample Preparation.........................................................................................................................................45
		10.3.3 Sample Analysis................................................................................................................................................45
		10.3.4 QA/QC...............................................................................................................................................................46
11	Data Verif cation..............................................................................................................................................................................47
	11.1	Verif cation Re-Sampling of Drill Core....................................................................................................................47
	11.2	Verif cation Re-sampling of Panuco Trenches.........................................................................................................47
	11.3	Chain of Custody..............................................................................................................................................................47
	11.4	Sample Preparation Protocol.........................................................................................................................................47
	11.5	Assay Technique and Laboratory.................................................................................................................................47
	11.6	Drill Collar Location.......................................................................................................................................................48
	11.7	Historic Assay Database..................................................................................................................................................48
	11.8	Historic Geological Database........................................................................................................................................48
	11.9	Downhole Survey Data...................................................................................................................................................48
	11.10	Specif c Gravity..................................................................................................................................................................48

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12	Mineral Processing and Metallurgical Testing......................................................................................................................49
13	Mineral Resource Estimates........................................................................................................................................................50
14	Adjacent Properties........................................................................................................................................................................51
	14.1 Veta Grande Mine (Santa Cruz Silver Mining Ltd).............................................................................................51
	14.2 San Acacio Deposit (Def ance Silver Corp)............................................................................................................51
	14.3 Cozamin Mine (Capstone Mining Corp.)..............................................................................................................53
	14.4 El Compass Mine (Endeavour Silver Corp.)..........................................................................................................53
15	Other Relevant Data and Information...................................................................................................................................55
16	Interpretation and Conclusions.................................................................................................................................................56
	16.1 General Exploration........................................................................................................................................................56
	16.2 Panuco..................................................................................................................................................................................57
	16.3 Muleros Vein System......................................................................................................................................................58
	16.4 El Cristo Vein System.....................................................................................................................................................59
	16.5 San Manuel-San Gill Vein System..............................................................................................................................59
	16.6 Other Concessions...........................................................................................................................................................59
17	Recommendations..........................................................................................................................................................................62
	17.1 General Exploration........................................................................................................................................................62
	14.2 Panuco Exploration.........................................................................................................................................................63
	14.3 Muleros, El Cristo and San Manuel-San Gill Exploration................................................................................63
	14.4 Exploration Other Concessions..................................................................................................................................64
18	References..........................................................................................................................................................................................65
19	Date and Signature........................................................................................................................................................................68
20	Certif cate of Qualif cations........................................................................................................................................................69

LIST OF TABLES

Table	1	List of title concessions.......................................................................................................................................................	6
Table	2	Summary of historic exploration work.........................................................................................................................	17
Table	3	Proposed general exploration budget............................................................................................................................	62
Table	4	Proposed Panuco exploration budget...........................................................................................................................	63
Table	5	Proposed Muleros, El Cristo and San Manuel-San Gill exploration budget..................................................	63
Table	6	Proposed exploration budget for other concession..................................................................................................	64

LIST OF FIGURES

Figure	1	Map of Mexico showing property location.................................................................................................................	2
Figure	2	Mineral title concession map...........................................................................................................................................	4
Figure	3	Photograph of historic workings at El Cristo...........................................................................................................	13

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Figure	4	Photograph of historic workings at Panuco..............................................................................................................	13
Figure	5	Photograph showing typical physiography of the Panuco area..........................................................................	15
Figure	6	Photograph showing typical physiography of the San Gill area..........................................................................	15
Figure	7	Photograph showing surface workings at San Gill area..........................................................................................	16
Figure	8	Map showing Panuco veins and drill hole locations...............................................................................................	18
Figure	9	Map showing Muleros veins and drill hole locations..............................................................................................	19
Figure	10	Map showing El Cristo veins and drill hole locations............................................................................................	20
Figure	11	Map showing San Manuel-San Gill veins and drill hole locations.....................................................................	22
Figure	12	Simplif ed map of Mexican silver belt and major deposits....................................................................................	25
Figure	13	Regional geological map....................................................................................................................................................	27
Figure	14	Geological map of the Panuco vein system................................................................................................................	29
Figure	15	Geological map of the Muleros vein system...............................................................................................................	31
Figure	16	Geological map of the El Cristo vein system.............................................................................................................	32
Figure	17	Schematic showing metallogenic setting of Zacatecas epithermal deposits....................................................	52
Figure	18	Schematic showing vertical extent of Zacatecas epithermal deposits................................................................	39
Figure	19	Map of Adjacent Properties.............................................................................................................................................	51
Figure	20	Geological map of the Panuco showing exploration targets................................................................................	57
Figure	21	Geological map of Muleros showing exploration targets......................................................................................	58
Figure	21	Geological map of El Cristo showing exploration targets.....................................................................................	60
Figure	21	Geological map of San Manuel-San Gill showing exploration targets.............................................................	61

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• 1 INTRODUCTION AND TERMS OF REFERENCE

Dr Paul Pearson and Mr Juan-Manuel Morales-Ramirez (together the “Authors”) were requested by Zacatecas Silver Corp. (the “Company”) to produce a National Instrument 43-101 compliant Technical Report (the “Report”) for the Zacatecas Silver-Polymetallic Project (the “Property”) in Mexico. Th e Property is in the Zacatecas Mining District of Mexico (Figure 1).

Th e Report is being prepared in respect to a proposed initial public off ering of the Company and the listing of the common shares of the Company on the TSX Venture Exchange. Th e Company acquired a 100% interest in the Property, subject to certain underlying royalties, pursuant to the terms of a purchase agreement dated August 31, 2020 (the “Purchase Agreement”) between the Company, Santacruz Silver Mining Ltd. (“Santacruz”), Impulsora Minera Santacruz, S.A. de C.V., being a subsidiary of Santacruz, and Desarrollos Mineros Zacatecas Silver, S.A. de C.V. (“DMZS”), a wholly owned subsidiary of the Company. Th e mining concessions that comprise the Property are registered in the name of DMZS and the terms of the Purchase Agreement are outlined in Section 3 of this report.

1.1 Scope of Work

Th e Authors were asked by the Company to produce a NI43-101 technical report of the Property. Th e Authors understand that the report will be used in support of the Company’s application to list its common shares on the TSX Venture. Th e Authors also understand that the report may be used to assist with raising capital in the public markets.

1.2 Qualifi ed Persons

Th is report was written by Dr Paul Pearson, BSc (Hons), PhD, FAusIMM (“Pearson”) and Mr Juan-Manuel MoralesRamirez, BSc, MSc, P. Geo (“Morales-Ramirez”). Pearson visited the Property between the 10[th] and 19[th] of December 2020. Morales-Ramirez visited the Property between the 12[th] and 18[th] of October 2020 and from the 10[th] to 19[th] of December 2020. Field and site observations were complimented by a comprehensive review of available literature.

Dr Pearson is an independent exploration consultant with 35 years of experience throughout Latin America (including Mexico), Australasia and north Africa. Pearson speaks fl uent Spanish and off ers worldwide consulting services in structural geology, 3D modelling, predictive analytics, project generation and exploration program design. His experience includes the evaluation of intermediate and low sulphidation epithermal gold-silver-base metal systems and their oxidized equivalents — as typical of the deposits in the Zacatecas region. Dr Pearson holds a PhD and BSc (Hons) from the University of Queensland, Australia and is a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM No. 220639). Th e Author is a Qualifi ed Person for the purposes of National Instrument 43-101, the scope of this report, style of mineralization and stage of project.

Mr Morales-Ramirez is an independent exploration consultant with over 40 years of experience focused in Mexico. Th is includes specialist experience in intermediate and low sulphidation epithermal gold-silver-base metal systems as typical of the deposits in the Zacatecas region. Mr Morales holds a bachelor’s degree in Geology from the National Polytechnic Institute, Mexico, and a master’s degree in Geology from the University of Sonora, Mexico. He is a Certifi ed Professional Geologist (CPG-11234) and member of the American Institute of Professional Geologists (AIPG). Th e Author is a Qualifi ed Person for the purposes of National Instrument 43-101, the scope of this report, style of mineralization and stage of project.

1.3 Sources of Information

Th e information in this Report is based on fi eld observations by the Authors and information provided by the Company and Santacruz — which includes drill hole information, claim ownership documents, material agreements, permits and previous work reports related to the Property. Th is Report also references published material as listed in Section 18.

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118° W
102° W
28 ° 28°
Zacatecas State
Zacatecas Property
20 ° 20°
110° W
102° W
94° W
500 km
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Figure 1: Location of the Zacatecas Project (red dot), Zacatecas State (blue outline), Mexico.

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• 2 RELIANCE ON OTHER EXPERTS

Th e Authors relied wholly on information provided by the Company with respect to Section 3.1 (Legal Title), Section 3.2 (Mineral Tenure), Section 3.3 (Royalties and Holding Costs), Section 3.4 (Environmental Liabilities), Section 3.5 (Permitting) and Section 3.6 (Social Licence).

Th is information was provided in a “Legal and Title Review Opinion Letter” provided by Enrique R del Bosque of RB Abogados Law Firm of address Insurgentes Sur 1787 piso 6, Colonia Guadalupe Inn, Mexico D.F. C.P 01020, Mexico. Th e opinion letter was addressed to the TSX Venture Exchange (Vancouver) and Zacatecas Silver Corp. (Vancouver), and dated December 24, 2020.

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3 PROPERTY DESCRIPTION AND LOCATION

3.1 Property Location

Th e Zacatecas Property is located adjacent to the city of Zacatecas, in the municipalities of Panuco, Veta Grande, Morelos, Zacatecas and Guadalupe, Zacatecas State, Mexico (Figure 1). Th e Zacatecas Property consists of 149 mining concessions comprising 7826.3 hectares. Th e Property is centred on latitude 22°49’2.89”N and longitude 102°33’48.72”W on the 1:50,000 topographic map sheets F13-B58 and F13-B68 (Figure 2).

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750,000 mE 760,000 mE
Property Concessions
Urban Areas
Panuco
Muleros
Morelos
El Cristo
San Manuel-San Gil
El Orito
Zacatecas City
Guadalupe City
N
5 km
750,000 mE 760,000 mE
2,540,000 mN 2,540,000 mN
2,530,000 mN 2,530,000 mN
2,520,000 mN 2,520,000 mN
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Figure 2: Mineral title concessions map (see Table 1 for details).

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3.2 Verifi cation of Licence Title Status

Th e authors have relied upon the legal opinion of Enrique R del Bosque of RB Abogados Law Firm with address Insurgentes Sur 1787 piso 6, Colonia Guadalupe Inn, Mexico D.F. C.P 01020, Mexico (“Lawyers”) for verifi cation of title status (see Section 3 — Reliance on Other Experts). Th e result of the legal title opinion conforms with the title information as shown in Table 1.

3.3 Grant of Concession

Article 27 of the Mexican constitution establishes that the Federal Republic owns all minerals found on Mexican Territory. In accordance with the Mining Law (in force since 1992, amended 2014), mining concessions are granted for a period of 50 years from the inscription date. Title expiry dates are shown in Table 1.

3.4 Taxes and Fees

Semi-annual taxes are paid in January and July of each year following the submittal of semi-annual work reports. Taxes are calculated based on the age of the concession within its grant period, the concession size and the annual adjusted quote published by the Offi cial Gazette of the Federation in accordance with Articles 59 and 60 of the Mexican Mining Law (2014). Th e quote is adjusted annually for infl ation. Mining duties paid to the Public Registry of Mines in 2020 by Santacruz Silver totalled MEX $1,726,090 plus VAT (approximately US $86,500 per exchange rate December 20, 2020).

3.5 Purchase Agreement

Zacatecas Silver Corp. entered into a purchase agreement dated August 31, 2020 (the “Purchase Agreement”) with Santacruz Silver Mining Ltd. (“Santacruz”), Impulsora Minera Santacruz, S.A. de C.V. (“IMSC”), being a subsidiary of Santacruz, and Desarrollos Mineros Zacatecas Silver, S.A. de C.V. (“DMZS”), a wholly owned subsidiary of the Company.

Under the terms of the Purchase Agreement, DMZS acquired a 100% interest in the Property, subject to the underlying royalties set forth under section 3.6 below, from IMSC. In consideration of the Property, the Company issued 5,000,000 common shares of the Company to IMSC and is required to make a cash payment of US $1,500,000 on the date the Company lists its common shares on the TSX Venture Exchange. Th e Company also agreed to pay all outstanding taxes due on the Property, which amounted to approximately USD $200,000.

3.6 Property Royalties, Back-in Rights and Encumbrances

Th e Property is not subject to any back-in rights or other agreements and encumbrances. As part of the Purchase Agreement outlined in Section 3.5 of this report, DMZS assumed certain royalties, as outlined in:

• An “Acknowledgement and Assignment Agreement of Royalty Payment Obligation” between IMSC and Minera Cordilleras, S. de R.L. de C.V. (“Minera Cordilleras”) dated April 28, 2016 and an “Assignment Agreement” between Mr Fibela and Minera Cordilleras (the “Fibela Royalty”). Th e Fibela Royalty sets a royalty payment of 2% in favour of Mr Juan Gilberto Fibela Hernández, or the amount of US $575,000 of the “ore” extracted, only and exclusively from the mining concession called SAN GIL, title 217430.

• An “Acknowledgement and Assignment Agreement of Royalty Payment Obligation” entered into between Santacruz Silver and Zacatecas Silver dated May 2, 2016, whereby Santacruz is subrogated to the fulfi lment of all obligations derived from a rights assignment agreement dated June 17, 2008 between Minera Águila Plateada, S.A. de C.V. and Santacruz Silver (“Original Rights Assignment Agreement”). Th e Original Rights Assignment Agreement sets a royalty payment of 1% in favour of Minera Águila Plateada, S.A. de C.V. of the “ore” extracted only and exclusively from the mining concession called SAN SABIANO, title 192567.

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Table 1: List of Mining Concessions

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Table 1: List of Mining Concessions (cont.)

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Table 1: List of Mining Concessions (cont.)

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Table 1: List of Mining Concessions (cont.)

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• An “Acknowledgement and Assignment Agreement of Royalty Payment Obligation” between IMSC and Minera Largo dated April 28, 2016, an “Acknowledgement of Properties Agreement” between International Mineral Development and Exploration Inc. (“IMDEX”), Minera Cascabel S.A. de C.V. and Kerry McDonald and a “Finder’s Fee Agreement” dated October 6, 1994 between Kerry McDonald and IMDEX. (the “IMDEX Royalty”). Th e IMDEX Royalty sets a royalty payment of 1% in favour of IMDEX over the following mining concessions.

AMPLIACION, title 191198; CEVADA, title 191674; LA CASTELLANA, title 192561 PABELLON, title 200057 SAN MARTIN, title 210730 AMPL. SANTA GABRIELA, title 210770 SAN MANUEL, title 210809 2 DA. AMPL. A SANA GABRIEL, title 211769 IF FRACC. I, title 211821 IF FRACC. II, title 211822 QUINTA AMPL AL PATROCINIO, title 212359 ESMERALDA, title 214767 VIOLETA, title 216929 VIOLETA FRACC. II, title 216930 LOS DOS AMIGOS, title 217119 LA FE 1, title 218078 LA FE 3, title 218079 LA FE 4, title 218230 LARGO III, title 219195 PATRICIA, title 224364 SAN LAZARO, title 227728

3.7 State Royalties and Taxes

Upon commercial production, governmental royalties payable under articles 268 and 270 of the Federal Duties Law (Ley Federal de Derechos) are: (i) a mining duty payable on a yearly basis of a 7.5 per cent of the income of the sale of the mineral extracted from a mining concession minus the authorized deductions, and (ii) a mining duty payable on a yearly basis of a 0.5 per cent of the income from the sale of gold, silver or platinum minerals.

3.8 Environmental Liabilities

Mining within the Zacatecas Mining District has occurred at various scales for over 470 years. Drill sites and trenches related to recent Panuco, Muleros, El Cristo and San Manuel-San Gil exploration programs have been restored to their original state by previous operators.

Historical artisanal surface workings up to 30 meters deep are present at Panuco, Muleros, El Cristo and San ManuelSan Gil. In addition, waste rock piles and tailings related to previous exploitation and mining activities currently exist at El Cristo and San Manuel-San Gil.

Given that most of the historical workings are old and have been largely revegetated (Figures 3 and 4) they are unlikely to be considered as an environmental issue.

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3.9 Permitting

Exploration activities that impact the environment are regulated by the Secretaria del Medio Ambiente y Recursos Naturales (SEMARNAT) under the Ley General de Equilibrio Ecologico y Protection Ambiente (LGEEEPA). Permitting requirements are determined by climatic zone, the degree of planned surface disturbance and whether other overriding restrictions such as protected areas exist. For exploration activities such as mapping, geochemical sampling, geophysics, with negligible surface or vegetation disturbance, no permitting is required.

NOM 120 SEMARNAT-2011 (NOM120) is the regulation that establishes the limits and reporting requirements for exploration activities that require surface disturbance — such as trenching and building of access roads. Under this regulation an “Informe Preventivo” must be submitted to SEMARNAT. Th e report describes the proposed surface disturbance and work to be completed, specifi c risks to the environment, plan to mitigate impact, and plans for reclamation following the completion of work.

If the surface disturbance is more than the limits outlined by, or is in an area not covered by NOM120, further environmental studies must be completed and a “Manifestación de Impacto Ambiental” (MIA) must be submitted to SEMARNAT. Th is is an environmental impact statement that must be reviewed and approved by SEMARNAT.

If the mining activity outlined also requires the permanent physical disturbance of the surface such as the construction of mine infrastructure, a “Cambio de Uso de Suelo Forestal e Impacto Ambiental” (CUS) must be applied for.

Th e Company is planning an extensive surface drill program which will require the construction of drill pads and possible access roads — it is likely that an Informe Preventivo will be required. Th e Property is clear of federally protected natural areas.

3.10 Social License and Surface Rights

Th e following condensed interpretation and translation of the Mexican Mining Law on Surface Rights was extracted from the International Comparative Legal Guides website: https://iclg.com/practice-areas/mining-laws-and-regulations/mexico.

Mining concession holders may use lands where mining concessions are located. Use of the lands may be through ownership or possession of lands (e.g., Lease Agreements/Temporary Occupation Agreements/Expropriation through an Administrative Proceeding, and others). Th e Mexican Constitution recognises the following surface rights:

• (i) Bienes Comunales (social land granted to indigenous communities)

• (ii) Ejidos (social land granted to individuals or communities)

• (iii) National Land

• (iv) Zonas Federales (Federal areas, beaches and river causes)

• (v) Private Property.

A private commercial mining company may acquire property types mentioned in points (i), (ii) and (v) above. Typically, the consideration payable for the lands is agreeable between the parties.

In accordance with Mexican Mining Law — mining activities should be approved ahead of any other use or exploitation of the land where the mining concessions are located. Th e Mexican Mining Law and its Regulations provide rules under which a mining concession holder may require the expropriation or the temporary occupation of the land when it does not reach an agreement with the landowner. In the case of expropriation, the consideration is payable based on an appraisal made by an Agency of the Mexican Government.

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As of the eff ective date of this report, Zacatecas Silver Corp. does not have surface rights agreements with any landowners, within the Property.

3.11 Other Factors and Risks

Beyond the information provided in Sections 3.1 to 3.10 of this report, the authors are unaware of any other signifi cant factors and risks that may aff ect access, title, or the right or ability to perform work on the Zacatecas Property.

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Figure 3: Typical view of historic workings at El Cristo. Workings are almost completely in fi lled and re-vegetated. They are unlikely to pose any environmental issue.

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Figure 4: Typical view of the larger workings at Panuco. Workings are partially infi lled, almost completely re-vegetated, and

unlikely to create any environmental issues.

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4 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY

4.1 Accessibility

All target areas on the Zacatecas Property are easily accessed by unpaved roads off paved public highways. Th e more northerly projects of Muleros and Panuco are approximately 15 km north of the city of Zacatecas — they are accessed by the paved highway No. 155.

Within each of the exploration areas — the Panuco Deposit, Muleros, El Cristo and San Manuel-San Gil — there is a network of dirt roads that connect to drill sites and historical workings.

4.2 Climate

Th e climate is typical of the high-altitude Mesa Central, dry and semi-arid. Temperatures typically range from 9°C to 22°C with an average daily mean of 15°C. Maximum temperatures reach 30°C to 38°C during the summer season and minimum temperatures in the winter may drop to 0°C with freezing conditions and occasional snow.

Th e rainy season occurs between June and September each year and the average annual precipitation is approximately 500 mm (Servicio Meteorológico Nacional, 2016). From a climatic perspective it is possible to operate year-round.

4.3 Physiography

Th e Zacatecas Property is in the Sierra Madre Occidental physiographic province near the boundary with the Mesa Central province (Mexican Plateau). Th e region is characterized by rounded, northwesterly-trending mountains. Elevations vary from 2,300 masl to 2,600 masl. Topography is generally subdued, with occasional moderately steep hills (Figures 5 to 7).

4.4 Vegetation and Land Use

Th e property is situated between forested and sub-tropical regions to the southwest, and desert conditions to the northeast. Vegetation consists of natural grasses, mesquite or huizache and crasicaule bushes. Standing bodies of water are dammed as most streams are intermittent.

4.5 Infrastructure and Local Resources

Th e cities of Zacatecas and Guadalupe (located within10 to 15 km of most licences) are signifi cant urban centres capable of providing a skilled workforce. Th ey off er all required amenities — including an airport linking to Mexico City — and can supply all logistic needs.

Zacatecas is connected by rail (Ferrocarrill Mexicano) to other major cities in Mexico and the seaports of Manzanillo and Lazaro Cardenas on the west coast.

Th e towns of Panuco, Vetagrande, Muleros, and Minillas — all within or proximal to the Project — off er little infrastructure other than grid power supplied by the Federal Electricity Commission (CFE) and ground-water from wells supplied by the state.

Th e authors are of the opinion that there is suffi cient space within the concession for mining operations, tailings storage and waste disposal, and processing facilities. Th e Company is currently evaluating water sources for the property.

Mexico is a mining-focused country with a highly skilled and mobile workforce. Th e authors are of the opinion that any development at the Property could be serviced with relevant skilled personnel and equipment.

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Figure 5: Typical view of topography and vegetation at Panuco. The area is semi-arid and sparsely vegetated — vegetation is thicker within seasonally dry drainages.

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Figure 6: Typical rolling topography at San Gill with shallowly incised drainages. Elevation ranges from 2300 to 2600 masl.

Cacti locally form dense clusters.

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Figure 7: View of historic surfi cial workings at San Gill with Cozamin working and plant in the background. This area is one of the steeper at the Property.

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5 HISTORY

5.1 District History

Th e Zacatecas Mining District has had a long history of mining dating back to pre-colonial times when local indigenous people (Huichol people) mined silver (and some gold) from the oxide zones of the vein deposits located around what is now known as the State of Zacatecas.

Mining by the Spaniards commenced in 1548 with production from three mines — the Albarrada Mine on the Veta Grande vein system, and the San Bernabe and Los Tajos Mines on the Mala Noche vein system. By the late 1800’s silver from the Zacatecas Mining District accounted for 60% of the value of all Mexican exports. Th e Mexican Geological Survey estimate that almost 750 Moz of silver was produced from the Zacatecas Mining District between 1548 and 1987 (Ponce & Clark, 1988).

Historically only oxide material was mined. In the mid-1900’s attempts were made to extract silver and base metals from the sulphide material — the lack of electric power, labour problems, and low metal prices forced many mines to close sulphide operations. In some cases, the sulphide material was only used as backfi ll.

5.2 Recent Property History

Due to the large number of veins within the Zacatecas Mining District, and the long history of mining, there are a signifi cant number of relatively small mineral concessions. Th e more recent mining history is complex with multiple owners working diff erent combinations of licences and the mining history prior to 1990 is not well constrained or documented.

Between 1994 and 2010 Golden Minerals — via its local subsidiary Minera Largo S. de RL de CV — completed extensive geological mapping, and trench and surface rock-chip sampling, within the Zacatecas district. Th is included the Panuco deposit and the Muleros, El Cristo, and San Manuel-San Gil exploration targets.

Between 2007 and 2011, Golden Minerals completed 36,178 meters of diamond drilling at Panuco, Muleros, El Cristo and San Manuel-San Gil — of which over 23,000 metres were at the Panuco deposit. A summary of works completed is presented in Table 2.

	Drill	Holes	Trench	Trench	Rock Chip	Soils
	Holes	Metres	Trenches	Metres
Panuco	75	23,444	183	4540	80	0
Muleros	37	6704	126	5997	2	0
El Cristo	8	2854	85	4104	46	0
San Gil	9	3176	17		242	765

Table 2: Summary of historic exploration work completed by Golden Minerals. The total number of metres excavated at San Gill in 17 trenches is unknown.

5.2.1 Panuco Area

Between 2006 and 2009 Golden Minerals completed reconnaissance work and geological mapping in the Panuco area. Th ree major vein systems were identifi ed — Panuco NW, Panuco Central and Tres Cruces (Figure 8). Veins trend broadly northwest-southeast and generally dip to the southwest (Figure 8).

Of the 75 inclined HQ diameter diamond drill holes (23,444 m) — 18 holes (4556 m) were drilled in 2009, 14 holes (3548 m) were drilled in 2010, and 43 holes (15,339 m) were drilled in 2011. Intercepts included:

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751,000 mE 752,000 mE 753,000 mE
Zacatecas Silver Corp. N
500 m
Third Party Licence
Historic Shaft
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
751,000 mE 752,000 mE 753,000 mE
Panuco NW Vein
Panuco Central Vein
Tres Cruces Vein
Panuco Central Vein
2,534,000 mN 2,534,000 mN
2,533,000 mN 2,533,000 mN
2,532,000 mN 2,532,000 mN
----- End of picture text -----

Figure 8: Simplifi ed map showing Panuco vein system, Zacatecas Silver Corp. licence boundaries, historic shafts and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

• # Hole PA09-01: 174.46 to 176.25 m (1.79 m) grading 0.32 g/t Au, 517.31 g/t Ag, 0.43% Pb and 2.32% Zn

• # Hole PA10-30: 333.24 to 335.23 m (2.79 m) grading 0.37 g/t Au, 391.92 g/t Ag, 0.03% Pb and 0.04% Zn # Hole PA11-68: 625.00-626.50 m (1.50 m) grading 1.05g/t Au, 668g/t Ag, 0.01% Pb and 0.01% Zn

5.2.2 Muleros Area

Golden Minerals completed reconnaissance work and geological mapping at Muleros between 2006 and 2009. Four sub-parallel quartz-calcite veins were identifi ed over strike lengths of between one to three kilometres (Figure 9). Veins strike 120 to 130° and typically dip 75° to the southwest (with a range of dips from 50°-85°). Individual veins range from <1 to 5 m in thickness, and often brecciated. Argentite, pyrite, galena and sphalerite are the dominant metalliferous sulphide minerals — disseminated silica-pyrite may occur as selvedges.

Approximately 996 surface samples were collected from outcrop and 126 trenches excavated across the vein structures. Silver assays average 40 g/t Ag (<5 g/t Ag to 793 g/t Ag) and gold assays average 0.08 g/t Au (<0.005 g/t Au to 3.3 g/t

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----- Start of picture text -----

751,000 mE 752,000 mE 753,000 mE
N
Zacatecas Silver Corp. 500 m
Third Party
Third Party
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
751,000 mE 752,000 mE 753,000 mE
North Vein
South Vein
El Rosario Vein
2,534,000 mN 2,534,000 mN
2,534,000 mN 2,534,000 mN
2,533,000 mN 2,533,000 mN
2,532,000 mN 2,532,000 mN
----- End of picture text -----

Figure 9: Simplifi ed map showing Muleros vein system, Zacatecas Silver Corp. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

Au). Lead (<2 to 16,300 ppm Pb) and zinc (3 to 13,600 ppm Zn) are highly anomalous. Minor copper (1.19 to 465 ppm Cu) is also present.

Between 2007 and 2008 Golden Minerals completed 37 HQ diamond drill holes totalling approximately 6704 m. Holes were generally drilled at -60° inclination, spaced 100-150 m along strike and averaged 120 m in length — the longest hole was 562.6 m in length. Drilling was designed to test the vein to a vertical depth of about 100 meters. Intercepts included:

• # Hole MU07-01: 63.95 to 65.20 m (1.25 m) grading 0.08 g/t Au, 101 g/t Ag, 913 ppm Pb and 2070 ppm Zn

• # Hole MU07-07: 73.95 to 76.25 m (2.30 m) grading 1.56 g/t Au and 286.26 g/t Ag

• # Hole MU08-35: 261.10 to 66.20 m (1.61 m) grading 1.74 g/t Au and 56.6 g/t Ag

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5.2.3 El Cristo Area

El Cristo is defi ned by a series of veins and vein splays that defi ne an extensional jog with a strike length of approximately 2.5 km and a width of approximately 0.5 km (Figure 10). Other smaller veins are also present and could be more extensive when mapped under cover. Veins trend 120 to 130° and dip between 30 to 70° to the southwest. Veins range between 0.2 and 1.8 m wide and comprises banded quartz-carbonate with argentite-galena-sphalerite-minor chalcopyrite. Based on its along strike position and broadly parallel orientation, El Cristo is likely the north-westerly extension of the Veta Grande system.

Between 2006 and 2013 approximately 1625 trench channel samples and 466 outcrop rock-chip grab samples were collected. Silver assays ranged from <0.5 to 486 g/t and gold assays ranged from <0.005 to 4.8 g/t. Lead (<2 to 33,300 ppm Pb) and zinc (6 to 33,300 ppm Zn) are highly anomalous. Minor copper (1 to 1305 ppm Cu) is also present.

In 2010 Golden Minerals completed 8 HQ diamond drill holes totalling approximately 2854 m. Silver and gold assays were generally of a moderate tenor — lead and zinc were signifi cantly elevated. For example:

• # Hole CR10-04: intercepted 0.82 m grading 0.341 g/t Au, 29 g/t Ag, 26,400 ppm (2.64%) Pb and 62,800 ppm (6.28%) Zn.

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----- Start of picture text -----

747,000 mE 748,000 mE 749,000 mE 750,000 mE
N
500 m
Third Party
Drill Hole
Historic Shaft
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
747,000 mE 748,000 mE 749,000 mE 750,000 mE
2,530,000 mN 2,530,000 mN
2,529,000 mN 2,529,000 mN
----- End of picture text -----

Figure 10: Simplifi ed map showing the El Cristo vein system, Zacatecas Silver Corp. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

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5.2.4 San Manuel-San Gill

Th e San Manuel-San Gill target is relatively unexplored. Quartz-carbonate veins crop out in a variety of strike orientations including 070°, 110° and 340° (Figure 11). Vein widths vary from 0.1 to >7 m and display strike lengths of 400 to 1400 m.

Between 2006 and 2013 Golden Minerals completed soil (785 samples), rock-chip (180 samples) and trench channel (688 samples) geochemical programs. Soils were submitted for MMI (mobile metal ion) analysis which defi ned several silver-lead-zinc anomalies — several of which remain untested.

Nine HQ diameter diamond drill holes were completed in 2011 for a total of 3176 m. Several narrow intercepts included.

• # Hole MG 11-01: intercepted a downhole interval of 1.65 m grading 0.36 g/t Au, 437 g/t Ag

• # Hole MG 11-08: intercepted 4.16 m at 1.14 g/t Au, 128 g/t Ag, 2.23% Pb and 1.86% Zn

5.3 Work By Santa Cruz

Between November 2015 and October 2016 Santacruz conducted surface exploration within the Zacatecas region — including the Property.

Between July and August of 2016 Santacruz conducted surface chip sampling across the Panuco, Muleros, El Cristo and San Manuel-San Gil vein systems. A total of 49 samples were collected at Panuco, one sample was collected at Muleros, two samples at El Cristo and one sample from San Manuel-San Gil.

Chip samples were collected across the width of the vein structure and included altered and mineralized wall rock material on each shoulder of the vein structure. Sample lengths ranged between 0.25 m and 1.9 m and assays between <0.01 g/t Ag and 305.46 g/t Ag. Th e results of this sampling were eff ective at confi rming the presence of mineralization identifi ed previously by Golden Minerals — but did not add to the understanding of any vein systems.

In October 2016, Santacruz Silver completed a historical resource estimate of the Panuco Deposit as set forth in the technical report titled “2016 Mineral Resource Estimate – Panuco Deposit, Zacatecas, Mexico” dated 3[rd] November 2016. Th e report was prepared by Van Phu Bui, P. Geo, and Gary Henry Giroux, P. Eng, and fi led on www.sedar.com (“2016 Panuco Historical Resource”). Th e 2016 Panuco Historical Resource reported 2,642,000 tonnes at 192 g/t Ag Eq. (181 g/t Ag, 0.17 g/t Au, 0.02 % Pb, 0.04% Zn) for a total of 16,342,456 ounces Ag Eq. (cut-off 100 g/t Ag Eq.). Th e resource was based on results from trenching and drilling completed by Golden Minerals (Bui & Giroux, 2016).

Th e 2016 Panuco Historical Resource defi ned “inferred mineral resources”, which is a category set forth under CIM Defi nition Standards for Mineral Resources & Mineral Reserves adopted on May 10, 2014. Th e 2016 Panuco Historical Resource was calculating using 75 drill collars, 866 down hole surveys and 2607 assayed samples. A surface trench database totalling 183 trenches with 1,839 samples was also utilized.

Resource blocks were defi ned using dimensions of 20 m along strike, 5 m across strike and 5 m vertical — blocks were then superimposed over wire-frames of visually logged mineralization and adjusted to ensure all resource blocks were constrained by geology. Grades for gold, silver, lead and zinc were interpolated into the blocks using ordinary kriging. Assumptions used in the 2016 Panuco Historical Resource include the following metal prices: gold price of US $1100/ oz, silver price of US $17/oz, lead price of US $0.80/lb and zinc price of US $0.80/lb. Th e 2019 Panuco Historical Resource assumed operational recoveries similar to the Veta Grande and La Cantera System being: gold at 70%, silver at 79.2%, lead at 84.2% and zinc at 82.2%. Th e authors consider the 2016 Panuco Historical Resource relevant as it defi nes the extent of and models the Panuco deposit.

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747,000 mE 748,000 mE 749,000 mE 750,000 mE
Third Party
N
500 m
Drill Hole
Third Party
Historic Shaft
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
747,000 mE 748,000 mE 749,000 mE 750,000 mE
2,528,000 mN 2,528,000 mN
2,527,000 mN 2,527,000 mN
2,526,000 mN 2,526,000 mN
----- End of picture text -----

Figure 11: Simplifi ed map showing the San Manuel-San Gill vein system, Zacatecas Silver Corp. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

Th e authors have not done suffi cient work to classify the 2016 Panuco Historical Resource as a current mineral resource or mineral reserves, and Zacatecas is not treating the historical estimate as current mineral resources or mineral reserves .

In 2019 Santacruz Silver completed an updated historical resource estimate as set forth in the technical report titled “Technical Report – Veta Grande Project, Zacatecas State, Mexico” dated 20[th] of August 2019. Th e report was prepared by Van Phu Bui, P. Geo and Michael O’Brien, P. Geo, and fi led on www.sedar.com (“2019 Panuco Historical Resource”). Th e 2019 Panuco Historical Resource reported 3,954,729 tonnes at 153 g/t Ag Eq. (136 g/t Ag, 0.14 g/t Au, 0.012 % Pb, 0.11% Zn) for a total of 19,472,901 ounces Ag Eq. (cut-off 100 g/t Ag Eq.). Th e 2019 Panuco Historical Resource used “inferred mineral resources”, which is a category set forth under CIM Defi nition Standards for Mineral Resources & Mineral Reserves adopted on May 10, 2014.

Th e 2019 Panuco Historical Resource estimate was calculated using 75 drill collars, 866 down hole surveys and 2,607 assayed samples. A surface trench database totalling 183 trenches with 1,813 samples was also used. Resource blocks

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were defi ned using with dimensions of 20 m along strike and down dip, and 1 m across strike. Grades for gold, silver, lead and zinc were interpolated into blocks using the following estimation algorithms: Panuco central — ordinary kriging; and Panuco NW and Tres Cruces — inverse distance squared. Assumptions used in the 2019 Panuco Historical Resource include the following metal prices: gold price of US $1,350/oz, silver price of US $16/oz, lead price of US $0.90/lb and zinc price of US $1.10/lb. Th e 2019 Panuco Historical Resource assumed operational recoveries similar to the Veta Grande System being: gold at 52.2%, silver at 62.1%, lead at 87.9% and zinc at 78.6%. Th e authors consider the 2019 Panuco Historical Resource relevant due to its identifi cation, defi nition and modelling of the Panuco deposit.

Th e authors have not done suffi cient work to classify the 2019 Panuco Historical Resource as a current mineral resource or mineral reserves, and Zacatecas is not treating the historical estimate as current mineral resources or mineral reserves.

Although the 2019 Historical Resource is considered to be a reliable estimate, the authors re-sampled approximately 8% of the drill core intervals used in the resource calculations and 11 channel samples from historic trenches, and submitted these samples to ALS for independent check assay. Th e authors completed additional data verifi cation including resurveying of select diamond drill holes collars; review of graphic drill core logs, comparison of these logs with remaining half-cut core, and a cross-check of selected geological logs against database entries; plus a check of original ALS assay certifi cates against the assays and drill hole database. Remodelling of the current Panuco resource is ongoing pending receipt of check sample assays.

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6 GEOLOGICAL SETTING AND MINERALIZATION

Th e Zacatecas mining district covers an area of over 700 km[2] . It is part of the largest silver region in the world — the Mexican Silver Belt — which extends from Sonora to Oaxaca and defi ne a ca. 1500 km long northwesterly-trending belt that includes the world-class mining districts of Zacatecas, Guanajuato and Fresnillo.

Zacatecas covers the eastern fl ank of the southern Sierra Madre Occidental province and the central-western limit of the Mesa Central physiographic province. Th e Mesa Central is an elevated plateau that partially overlaps the Sierra Madre Occidental along its northwestern boundary and is bounded to the south by the Mexican Volcanic Belt.

Silver mineralization within the Zacatecas district occurs mainly in epithermal veins — less commonly in skarn and manto-type replacement bodies. Mineralization was associated with Tertiary magmatism and volcanic activity — with key controls on mineralization provided by major crustal structures.

6.1 Epithermal Deposits of Mexico

Epithermal deposits — especially those rich in silver — have traditionally been the most economically important in Mexico. Within the Zacatecas region they include such world class examples as Fresnillo (>2.25 Boz Ag production and future ore reserves), high-tonnage deposits such as Real de Ángeles and low-tonnage (between 5 and 7 Mt) high-grade deposits (800 and 1500 ppm Ag) such as Sombrerete and Colorada.

Th e epithermal deposits known to date in Mexico are generally middle Eocene to early Miocene in age and are mainly low and intermediate sulphidation types formed under alkaline/neutral chemical regimes. Th eir distribution matches the distribution of early to mid-Tertiary volcanism (Figure 12) associated with the evolution of the Sierra Madre Occidental and the Sierra Madre del Sur (Damon et al., 1981; Clark et al., 1981, 1982; Camprubí et al. 1982 and 2003a). Deposits are broadly grouped into three age categories based on their association with coeval volcanic activity: 1) older than ca. 40 Ma; 2) between ca. 40 to 27 Ma; and 3) younger than ca. 23 Ma — deposits in the Zacatecas are between 27 to 40 Ma in age.

Th e regional distribution of epithermal deposits in Mexico indicates they are closely associated in space with regional faults. Th is is the case in the Zacatecas region where major deposits are located along the crustal boundary between the Guerrero Terrane (to the west) and the Oaxaquia Block (to the east) — defi ned in the Zacatecas region by the San Luis–Tepehuanes fault zone (SLTFZ). Th e SLTFZ trends broadly northwest-southeast, but locally trends northwards from the Real de Asientos and Zacatecas deposits, before fl exing westwards at Fresnillo. Change in fault orientation may be important with respect to the structural localisation and control of the world class Fresnillo deposit.

6.2 Property Geology

Th e Zacatecas Mining District occurs in a structurally complex setting, associated with siliceous to intermediate subvolcanic and volcanic rocks, underlain by sedimentary and meta-sedimentary rocks. Th e geologic units of the Zacatecas area include Triassic metamorphic rocks of the Zacatecas Formation and overlying basic volcanic rocks of the Upper Jurassic or Lower Cretaceous Chilitos Formation. Tertiary rocks consist mainly of a Palaeocene and/or Eocene red conglomerate unit overlain by Eocene to Oligocene rhyolitic tuff and intercalated fl ows. Some Tertiary rhyolite bodies cut the Mesozoic and Tertiary units and posses the characteristics of fl ow domes

6.2.1 Triassic Zacatecas Formation

Th ese are the oldest rocks in the district. Th ey crop out to the northwest and southwest of Zacatecas city and comprise

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110° W 100° W
N
500 km
Sombrerete
Fresnillo
Zacatecas
El Orito
Real de Asientos
Mexican Volcanic Belt
Sierra Madre Occidental
Guerrero Terrane
Oaxaquia Block
Mesa Central
Guerrero Terrane Boundary
Most Prospective for Epithermals
Au-Ag <30 Ma
Ag-Pb-Zn >30 Ma
30° N
20° N
----- End of picture text -----

Figure 12: Simplifi ed geology of northern and central Mexico showing epithermal deposits of the Silver Mexican Belt, key terrane boundaries, the Mesa Central physiographic block, and the Guerrero Terrane Boundary. Note how the Fresnillo, Zacatecas and Real de Asientos deposits are proximal to this crustal suture — which presents as the San Luis-Tepehuanes Fault Zone in the Zacatecas Region. Modifi ed after Albinson et al, 2001 and Zamora Vega, 2018.

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an Upper Triassic marine sequence of siltstones, sandstones, conglomerates and limestones which have been metamorphosed to slates, phyllites and sericite-schists, quartzites and recrystallized limestones. Th e Zacatecas Formation hosts the El Bote and Pimienta vein systems to the west of the city of Zacatecas

6.2.2 Chilitos Formation

Overlying the Zacatecas Formation is the late Jurassic to early Cretaceous volcano-clastic Chilitos Formation. Th is formation comprises massive lavas and pillow lavas of basaltic-andesitic composition, interbedded with sedimentary rocks, volcanoclastic rocks and limestone. Th e Chilitos Formation exhibits greenschist facies metamorphic grade and is in thrust contact with the Zacatecas Formation.

Th e Chilitos Formation is host to several silver occurrences within the Zacatecas Mining District, including the Veta Grande, Panuco, Muleros, El Cristo and San Manuel-San Gil vein systems.

6.2.3 Eocene Zacatecas Red Conglomerate

• Th e Zacatecas Red Conglomerate Formation is a 200 to 400 m thick, polymictic, clast-supported conglomerate containing rounded to sub-rounded fragments of the Zacatecas and Chilitos Formations — the unit thus post-dates both formations. It was most likely deposited during the Paleocene to Eocene. Th e Red Conglomerate mainly outcrops immediately to the south and southeast of Zacatecas city. It is conformable with and intercalated with the overlying rhyolite breccias of the Alamitos volcanoclastics which has been dated at 46.8 Ma. (Ponce & Clark,1988). Th e Zacatecas Red Conglomerate marks the fi nal stage of the Laramide Orogeny.

6.2.4 Tertiary Volcanics / Volcanoclastics

Eocene volcanism in the Zacatecas district is part of the voluminous igneous activity of the Sierra Madre Occidental silicic province (Aguirre-Diaz and Labarthe–Hernandez, 2003). Rhyolitic ignimbrites, lava domes, plugs and dykes unconformably overlie or intrude older rocks. Magmatism spanned ca. 9 million years from 50.8 to 41.7 Ma. Volcanic rhyolitic tuff s with fl ow intercalations are locally interbedded with the Zacatecas Red Conglomerate.

• Rhyolite Plugs and Domes : Intrusion of rhyolite plugs and domes was spatially related to the Mala Noche fault zone. Intrusives includes the San Gil and La Sierpe plugs and dykes (which intrude the Jurassic–Cretaceous volcano-sedimentary sequence) and the El Magistral plug (which is emplaced along the contact between the Jurassic– Cretaceous volcano-sedimentary sequence and the Zacatecas Formation). Zamora-Vega (2018) cites U-Pb zircon crystalization ages of 50.19 ± 0.53 Ma to 50.73 ± 0.37 Ma.

Dyke-hosted magmatic and hydrothermal breccias are present. Barren magmatic breccias are located close to the contact with the volcano-sedimentary succession. Angular hydrothermal breccias comprise clasts of rhyolite cemented by chalcopyrite-pyrite bearing quartz.

Th e La Bufa rhyolite dome is structurally controlled by the La Cantera fault — which down-faults the Zacatecas conglomerate against the Jurassic-Cretaceous volcano-sedimentary sequence. Zamora-Vega (2018) cites a U-Pb zircon crystalization age of 48.64 ± 0.50 Ma.

• Ignimbrites : Th e La Virgin Ignimbrites — a 200 m thick voluminous pyroclastic unit — is the youngest volcanic units. It extends from the southern part of the El Orito vein system more than 5 km to the south. It is not observed within the concessions.

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----- Start of picture text -----

750,000 mE
N
Panuco Deposit
5 km Muleros
El Cristo
San Manuel-San Gill Veta Grande
San
Acacio
Cozamin
Orito
El Compass Mine
750,000 mE
Company Concessions Zacatecas Conglomerate
Chilitos Volcanics
Faults
Quaternary Alluvium Chilitos Andesite
Rhyolite Chilitos Basalts
Zacatecas Formation
2,530,000 mN 2,530,000 mN
2,520,000 mN 2,520,000 mN
----- End of picture text -----

Figure 13 and Bui and O’Brien (2017).

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6.2.1 Quaternary Cover

Quaternary gravels, sands and silts are locally developed and may obscure vein extensions in some areas. A thin veneer of Quaternary material is often present in drainages.

6.2 Property Geology

With the exception of the Orito vein system, located within the southern-most concessions of the Property, all other veins systems are hosted exclusively by basaltic and andesitic volcanic rocks, volcanoclastic rocks and interbedded marine sedimentary rocks of the Chilitos Formation. Within the Zacatecas Property the Chilitos Formation has been mapped as its component lithologies — yet stratigraphic relations have not been established between lithologies and they may represent lateral facies changes.

6.2.1 Panuco Deposit

• Panuco Lithology : Th e Panuco vein system is hosted by andesitic fl ows, mixed andesites and andesitic tuff s and volcanoclastic sediments of the Chilitos Formation (Figure 14). A small rhyolite body crops out along the western extension of the Panuco Central Vein and its emplacement was likely related to the Eocene intrusion event observed along the Mala Noche Fault system. Jasperoids — presumably related to silica deposition during the mineralizing event — crop out locally.

Quaternary regolith is extensive especially in the northwest of the Panuco system (Figure 14) and may obscure lateral vein extensions.

• Panuco Structure : Th e Panuco vein system is hosted by an anastomosing array of brittle transcurrent-normal faults that strike between 140°-145°, dip 60°-75° southwest, and can collectively be traced over a 4 km strike length. Th e system is defi ned by three prominent vein structures — Panuco NW, Panuco Central and Tres Cruces using the nomenclature of Bui and O´Brien (2019). Tristan-Gonzales et al. (2012) suggested that movement along these faults was initially right-lateral followed later by normal left-lateral. Veins pinch and swell from <10 cm to >6 m thickness in outcrop and drill sections.

Th e Panuco Central vein can be traced over a strike length of 2300 m and dips between 52° and 76° to the southwest. In the southeastern area of the Panuco Central vein, drilling has traced the vein approximately 755 m down dip from surface — in the northwestern area of the Panuco Central vein drilling has traced the vein approximately 410 m down dip from surface.

Panuco NW is eff ectively a splay extension of Panuco Central vein that has been traced over a strike length of 1500 m. It dips between 54° and 78° to the southwest and drilling by Golden Minerals has traced the down-dip extension approximately 480 m down dip from surface.

Th e Tres Cruces vein has been traced over a strike length of 870 m, dipping between 67° and 86° to the southwest. Drilling has traced the vein down dip to approximately 388 m below surface. .

In addition to the three main vein sets — sub-parallel subordinate veins have also been identifi ed especially within the structural hanging wall of each vein (Figure 14).

• Panuco Mineralization : Silver, gold, and base metal mineralization at the Panuco deposit is hosted in breccia veins, banded, crustiform and colloform quartz-calcite veins, and quartz vein stockwork within zones of strong argillic alteration. Mineralization is best developed within coherent andesite volcanic rocks and volcanosedimentary units.

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----- Start of picture text -----

751,000 mE 752,000 mE 753,000 mE
Zacatecas Silver Corp. N
500 m
Third Party Licence
Historic Shaft
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
751,000 mE 752,000 mE 753,000 mE
Panuco NW Vein
Panuco Central Vein
Tres Cruces Vein
Panuco Central Vein
2,534,000 mN 2,534,000 mN
2,533,000 mN 2,533,000 mN
2,532,000 mN 2,532,000 mN
----- End of picture text -----

Figure 14: Geological map of the Panuco vein system, Zacatecas Silver Corp. licence boundaries, historic shafts and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

Th e veins are composite in nature — multiple pulses of quartz-sulphide precipitation are apparent and a late infi ll of quartz and/or carbonate (generally calcite) is commonly present. Galena, sphalerite, chalcopyrite and argentite are the main economic sulphide minerals —gangue includes quartz, calcite, pyrite, arsenopyrite, hematite, goethite, illite and clay minerals.

• # Panuco Alteration : Clasts within veins are strongly quartz-illite+/-kaolinite-calcite altered. Argillic alteration is strong proximal to veins and extends with decreasing intensity up to 15 m into the enclosing wall rocks. Propylitic alteration is widespread.

6.2.2 Muleros Target Area

• Muleros Lithology : Veins at Muleros are hosted by the Chilitos Formation (Figure 15). Th is is a marine volcanoclastic and sedimentary sequence of andesitic to basaltic pillow-lavas, andesitic fl ows and tuff s, intercalated with lessor mudstones and basinal limestones. Dioritic dykes, sills and laccoliths were emplaced at broadly the same time. Quaternary regolith and alluvium is extensive and may obscure vein extensions.

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• Muleros Structure : Th e Muleros vein system is hosted by transcurrent-normal faults that strike approximately 110° and can collectively be traced over a 3 km strike length. Th e system is defi ned by three principal vein structures — the South Vein, the North Vein (Sabino Vein) and the El Rosario Vein (Figure 15). Th e South and North Veins dip between 55-80°to the southwest and the Rosario Vein dips 70-80° to the northeast. Veins vary from <1 to 5 m in true thickness.

Th e North and South veins splay to the northwest. Drilling has shown that veins may coalesce and splay at depth, and pinch and swell in width from <10 cm to >6 m.

• Muleros Mineralization : Silver and base metal mineralization at the Muleros deposit is hosted in brecciated veins, banded, crustiform and colloform quartz-carbonate veins, and quartz vein stockworks, within zones of strong argillic alteration. Metallic minerals include galena, sphalerite, chalcopyrite, argentite and proustite — gangue includes quartz, calcite, pyrite, arsenopyrite, hematite, goethite, illite and clay minerals.

• Muleros Alteration : Argillic alteration is generally strong to intense proximal to veins and may extend with increasing intensity for up to 10 m into the wall rocks. Clasts within veins are intensely clay-silica altered.

• 6.2.3 El Cristo Vein System

• El Cristo Lithology : Th e El Cristo system is hosted by the Chilitos Formation — a sequence of andesitic to basaltic pillow-lavas, andesitic fl ows and tuff s, intercalated with mudstones and basinal limestones of marine affi nity.

• El Cristo Structure : Th e El Cristo vein system comprises several subparallel veins which form a sigmoidal complex that coalesces to the northwest and southeast. Veins extends for over 2.5 km along a strike of 120° to 130° over a width of up to 600 m (Figure 16). Dip varies from vertical to 60° to both northeast to southwest.

• El Cristo Mineralization : Silver and base metal mineralization at El Cristo is hosted in brecciated veins, banded, crustiform and colloform quartz-carbonate veins, that vary in thickness from 10 cm to 7 m.

MADSA completed a petrographic and fl uid inclusion study of 12 surface samples taken along the strike length of the El Cristo vein system (Albinson, 2009). Th e study noted four paragenetic stages: 1) early brecciation of and cementation of wall rock fragments by fi ne grained silica-disseminated pyrite; 2) deposition of complex banded, coarse-crystalline quartz-calcite-sulphide; 3)late coarse-crystalline quartz and amethyst as centimeter-sized prismatic crystals in vughs; and late coarse crystalline calcite infi lling vughs.

6.2.4 San Manuel-San Gill Vein System

• San Manuel-San Gill Lithology : Th e San Manuel-San Gil vein system is underlain by basaltic and andesitic volcanics, volcanoclastics, interbedded marine sedimentary rocks of the Chilitos Formation. To the south of the concessions, Tertiary rhyolite fl ows and domes are observed on Cerro San Gil and Cerro Seirpe — rhyolites are interpreted to have intruded a fl exure in the in the Mala Noche structure and provide evidence of proximal heat source for hydrothermal system. Most of the San Manuel-San Gil area is covered by recent regolith and soil cover.

• San Manuel-San Gill Structure : Two major structural trends are present at San Manuel-San Gill: a NS oriented hematitic breccia; and NW oriented quartz-carbonate-sulphide veins (Figure 17).

Th e hematitic breccia has a NS-trending strike of approximately 800 m, is up to 40 m wide, and is most likely vertical. Th e NS orientation of the breccia suggest the system may be gold-enriched — as evidenced by other goldmineralized NS oriented veins in the Zacatecas region. Th is is consistent with the results of the fi ve hole drill pro-

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----- Start of picture text -----

751,000 mE 752,000 mE 753,000 mE
N
Zacatecas Silver Corp. 500 m
Third Party
Alluvium
Regolith
Andesite Tuff / Volcano- Third Party
clastics
Andesite Tuff / lavas
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
751,000 mE 752,000 mE 753,000 mE
North Vein
South Vein
El Rosario Vein
2,534,000 mN 2,534,000 mN
2,534,000 mN 2,534,000 mN
2,533,000 mN 2,533,000 mN
2,532,000 mN 2,532,000 mN
----- End of picture text -----

Figure 15: Geology of the Muleros vein system. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

gram of Golden Minerals which returned assays such as 4.16 m at 1.14 g/t Au, 128 g/t Ag, 2.23% Pb and 1.86% Zn (Hole MG 11-08).

Quartz-carbonate-sulphide veins of between 10 cm to >7 m wide, trend NW-SE over a strike length of at least 2 km. Individual veins are between 400 to 1400 m long. Veins splay to the SE where multiple sub-parallel veins intersect — but do not cross — the hematite breccia.

• San Manuel-San Gill Mineralization : Silver, gold, and base metal mineralization is hosted in breccia veins, banded, crustiform and colloform quartz veins, and quartz vein stockwork within zones of strong argillic alteration. Ore minerals include galena, sphalerite, chalcopyrite and argentite. Gangue minerals include pyrite, hematite, goethite, quartz, calcite, illite and clay minerals.

• San Manuel-San Gill Alteration : Alteration envelopes around fault-veins is variable depending largely upon host

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----- Start of picture text -----

747,000 mE 748,000 mE 749,000 mE 750,000 mE
N
500 m
Third Party
Quatrenary
Volcanoclastics
Andesite /
Andesitic Tuff s
Drill Hole
Historic Shaft
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
747,000 mE 748,000 mE 749,000 mE 750,000 mE
2,530,000 mN 2,530,000 mN
2,529,000 mN 2,529,000 mN
----- End of picture text -----

Figure 16: Geology map of El Cristo. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

lithology. Argillic alteration of andesitic fl ows sills and dykes is limited to narrow envelopes — alteration in volcanoclastics and sedimentary units is more pervasive and extends meters from the vein. Late stage calcite veins generally lack alteration selvedges.

6.2.5 Other Targets

Outside the central block of concessions that forms the bulk of the Zacatecas Property are satellite concessions that have not been part of the recent exploration. Th ese blocks include the El Oro, El Orito, La Cantera, Monserrat, El Peñón, San Judas and San Juan (Figure 2).

• Orito Concession : Th e Orito concessions are located within and along the southern boundary of the city of Zacatecas. Th e concessions overlie the Orito vein system which is hosted volcanoclastics of the Chilitos Formation. Mineralization is present in three parallel north-northwest striking veins that dip 54°-85° to both the east and west. Mineralization is confi ned to veins and consists of banded sulphides and adularia. Th e El Compas vein system to the south of the Orito concessions is gold rich and silver-base metal poor (Zamora-Vega, 2018).

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747,000 mE 748,000 mE 749,000 mE 750,000 mE
Third Party
N
500 m
Quaternary Hematite
Breccia
Jasperoid
Andesite /
AndesiteTuff s
Volcanoclastics
Third Party
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
747,000 mE 748,000 mE 749,000 mE 750,000 mE
2,528,000 mN 2,528,000 mN
2,527,000 mN 2,527,000 mN
2,526,000 mN 2,526,000 mN
----- End of picture text -----

Figure 17: Geology map of the San Manuel-San Gill vein system. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012).

• Cantera Concession : Th e Cantera concessions are located along the northern limits of the city of Zacatecas and host veins of the Cantera-El Bote vein system. Veins strike southeast, dip 60° to 90° to the southwest, and juxtapose the volcanic rocks of the Chilitos Formation to the north against the Zacatecas Red Conglomerate to the south. Th e Cantera concessions surrounds the past producer Cantera Mine of Santacruz Silver.

• Monserrat Concession : Th e Monserrat concessions are located along the eastern margin of the Sierra Zacatecas — the southeastern projection of the Veta Grande vein system. Th e concessions overlie andesites, basalts, and volcanoclastics of the Chilitos Formation.

• El Peñón Concession : Th e El Peñón concession is located approximately 20 km north of the city of Zacatecas. Th e concession overlies the contact between the volcanoclastics of the Chilitos Formation and porphyritic rhyolitic intrusives. Mineralization comprises a manganese prospect that has not been described.

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• San Juan Concession : Th e San Juan concession is located 6 km east of the city of Guadalupe on highway 45. Th e concession covers andesites of the Chilitos Formation. Mineralization is hosted by a 1.7 m wide oxidized vein that trends 290°, dips 70° northeast, and strikes 200 m.

• San Judas Concession : Th e San Judas concessions are located to the east of El Orito. Work by previous owners was limited to mapping veins hosted within phyllites and sandstones of the Zacatecas Formation.

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7 DEPOSIT TYPE

Th e Zacatecas Silver District is one of the most prolifi c silver producing areas in the world with an estimated production of in excess of 681 million ounces of silver during the period 1546 to 1895 (Geological Mining Monograph of the State of Zacatecas).

Silver mineralization occurs mainly in intermediate sulphidation epithermal veins — less commonly in low sulphidation epithermal veins. Skarn and manto-type replacement bodies are present but are not common. Mineralization is spatially and temporally associated with Tertiary volcanic activity — with key controls on mineralization provided by major crustal structures.

On a global scale intermediate and low sulfi dation deposits are generally mutually exclusive in time and space. Th is is not the case in the Zacatecas District where both intermediate and low sulphidation styles are present — both types may even occur within a single deposit. Deposits are Tertiary in age (Middle Eocene to Early Miocene). Th eir space and time distribution closely follows the evolution of the continental arc volcanism of the Sierra Madre Occidental and Sierra Madre del Sur.

Th e relative timing of deposit formation within the Zacatecas District is contested. Authors such as Camprubi and Albinson (2007) consider the formation of low and intermediate sulphidation deposits was broadly coeval and the result of a single prolonged hydrothermal system — which evolved from an intermediate-sulfi dation state (Mala Noche and Stage I of the Veta Grande vein systems) into a low-sulfi dation state (El Orito vein system and stage II of the Veta Grande vein). Other authors such as Zamora Vega et al. (2008) suggest that the low sulphidation mineralization is a later and separate event.

Irrespective of the timing of formation, from an exploration perspective, it is important to note that some deposits within the company’s concessions are hybrid intermediate and low sulphidation systems. As such, changes in metal tenor, vein texture and alteration assemblage typically used to pick the ‘tops and bottoms’ of mineralization in low and intermediate sulphidation systems, may show considerable variation from classic epithermal deposit models. Th is has important implications for exploration targeting.

7.1 Epithermal Deposits — An Overview

Epithermal Au and Ag deposits of both vein and bulk-tonnage styles may be broadly grouped into high, intermediate and low sulphidation types based on the sulphidation states of their hypogene sulphide assemblages (Sillitoe and Hedenquist, 2003).

• High sulphidation deposits contain sulphide-rich assemblages of high sulphidation state such as pyrite-enargite, pyrite-luzonite, pyrite-famatinite, and pyrite-covellite (Einaudi et al., 2003).

• Intermediate sulphidation deposits contain minerals with sulphidation states between those of high and low sulphidation types such as chalcopyrite, FeS-poor sphalerite, galena and tetrahedrite-tennantite (Einaudi op. cit.).

• Low sulphidation deposits contain the low-sulphidation pair pyrite-arsenopyrite — the latter present in minor quantities within banded veins of quartz, chalcedony, adularia and subordinate calcite. Very minor amounts of copper (<100–200 ppm) may be present as chalcopyrite or, less commonly, as tetrahedrite-tennantite (Einaudi op. cit.).

A review of worldwide examples of major epithermal deposits (e.g. Berger and Bonham, 1990 and Sillitoe, 2002) suggests a reasonable correlation between various epithermal types and subtypes, and specifi c volcano-tectonic settings.

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• High sulphidation epithermal deposits occur mainly in calc-alkaline andesitic-dacitic arc terranes. Sillitoe and Hedenquist (2003) suggest that arcs subjected to neutral stress conditions, or mild extension, host many of the world’s premier high-sulphidation deposits — although there are some examples from compressive arcs.

• Intermediate sulphidation deposits — as with high sulphidation types — generally occur in calc-alkaline andesiticdacitic arcs. More felsic rocks may be locally important hosts. Th e major intermediate-sulphidation deposits are generally associated with neutral to mildly extensional arcs.

• Low sulphidation deposits are generally confi ned to bimodal magmatic suites, in and around rifts generated during intra-, near-, and back-arc extension, as well as in post-collisional settings. In Mexico, this setting is rarely associated with major volcanic centres — but is more frequently associated with localised dome development.

Th e common spatial and temporal association between high and intermediate sulphidation deposits in and around individual volcanic centres (Margolis et al., 1991; Sillitoe 1999), in conjunction with other evidence such as fl uid inclusion data, suggests a close relationship with magmatism relationship (Sillitoe and Hedenquist, 2003). In some cases there is evidence for a spatial, and occasionally genetic relationship between high and intermediate sulphidation epithermal deposits (Sillitoe, 1999; Hedenquist et al., 2000), and deposit types may be considered as transitional in some instances.

In contrast, low sulphidation epithermal deposits form distal to the magmatic source and the over-lapping spatial and temporal nature of low and intermediate sulphidation epithermal deposits — as is the case at within the Zacatecas District — is less well documented. In order to understand the characteristics of such hybrid epithermal systems — and thus in formulating exploration strategies and challenges — it is important to understand the main features of classic low sulphidation (Section 7.2) and intermediate sulphidation (Section 7.3) types.

A hybrid model for Zacatecas-type deposits that exhibit silver-dominant low sulphidation characteristics, but with polymetallic intermediate sulphidation roots (Ag-Zn-Pb-Cu), is discussed in Section 7.4.

• 7.2 Low Sulphidation Epithermal Deposit Type — Main Features

Despite local variations, low sulphidation epithermal deposits worldwide display the following main characteristics:

• Metal Signature : Gold, silver, argentite and electrum are common in association with pyrite, marcasite, pyrargyrite, acanthite and Ag-selenides. Minor iron-rich sphalerite, galena, tetrahedrite-tennantite and chalcopyrite, and minor to very minor arsenopyrite ± pyrrhotite, may be present. Total sulphide content is generally <2% (by volume) — dominated by pyrite and/or marcasite. Antimony and mercury defi ne the tops of the mineralized system.

• Gangue Minerals : Gangue minerals are dominated by bands of chalcedony and cryptocrystalline quartz. Adularia, illite or smectite may be present. Calcite gangue is generally minor and late. Baryte is uncommon — fl uorite may be locally present. Pyrite and/or marcasite are the dominant sulphide gangue minerals.

Colloform banded quartz (ginguro texture) and other boiling textures (carbonate replacement textures) are typical of bonanza zones. Open-space fi lling, symmetrical and other layering, and crustiform, comb-structure, colloform banding are common. Multiple brecciation and locally developed breccias are also common.

• Deposit Morphology : On a regional scale deposits are related to regional-scale fracture systems related to grabens, calderas, fl ow-dome complexes and rarely maar diatremes. Extensional structures in volcanic fi elds — normal faults, fault splays and dilational jogs — serve to focus fl uids and metal deposition. Metal deposition may also occur in permeable host rock lithologies.

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Upward-fl aring ore zones centred on structurally controlled hydrothermal conduits are typical. Large veins (>1 m wide and 100’s of metres in strike length) are common — within a given district multiple veins form sub-parallel to anastomosing vein swarms. Quartz vein stockworks — especially in the hanging wall and between major structures — may form bulk targets. Breccias are locally developed and are attractive high grade targets. Disseminated mineralization may develop.

Vein systems can be laterally extensive but ore shoots have relatively restricted vertical extent. High-grade ores are commonly found in dilational zones in faults at fl exures and splays.

• Alteration Minerals : Silicifi cation is extensive in ores as multiple generations of quartz and chalcedony are commonly accompanied by adularia and calcite. Pervasive silicifi cation in vein envelopes is fl anked by sericite-illite- kaolinite assemblages. Intermediate argillic alteration [kaolinite-illite- montmorillonite (smectite)] forms adjacent to some veins; advanced argillic alteration (kaolinite-alunite) may form along the tops of mineralized zones. Propylitic alteration dominates at depth and peripherally.

• Paragenesis and Zonation :

  • Deposits are commonly strongly vertically zoned over 250 to 350 m — mineralization passes from Au-Ag rich base metal poor (or silver dominant and base metal poor as in the case of Zacatecas), downwards to a silver-rich base metal zone, an underlying base metal-rich zone, which grades downwards into a sparse base metal-pyrite zone. Understanding the vertical position in the system, relative to the “tops” and “bottoms” of mineralization, is key to eff ective exploration targeting.

• 7.3 Intermediate Sulphidation Epithermal Deposit Type — Main Features Despite geographic variations, intermediate sulphidation epithermal deposits worldwide display the following main characteristics:

• Metal Signature : Most intermediate sulphidation epithermal veins show a metal signature comprising gold and silver, with lesser zinc, lead and copper. Mexican deposits are often extremely silver rich. Total sulphide content ranges from 5 to >20% (by volume) with pyrite > sphalerite > galena > chalcopyrite (if present). Sphalerite is vertically zoned from black, iron-rich (Fe>Zn), higher temperature species at depth, through brown and red, to yellow, ironpoor (Zn>Fe), low temperature species at shallower levels. Tellurides may be common in some systems — selenides are uncommon. Manganese is often present (usually in association with carbonate gangue). Tetrahedrite-tennantite may be present.

• Gangue Minerals : Quartz and carbonate are the dominant gangue minerals in intermediate sulphidation epithermal systems. Barite, gypsum, anhydrite and manganiferous silicates may be locally important. Pyrite is the dominant sulphide gangue.

Multiple episodes of quartz deposition is the norm, as evidenced by cross-cutting quartz phases and varied quartz textures. Vein-fi lling crustiform and comb textured quartz is common — refl ecting the higher temperature of formation as compared to low sulphidation quartz veins. Equant space-fi lling, saccharoidal, fi nely crystalline and open space quartz-fl ooding may be present — especially towards the top of the system. Colloform banded quartz (ginguro texture) and other boiling textures typical of low sulphidation epithermal systems are generally not present.

Vein-fi lling carbonate is the dominant gangue in the upper parts of intermediate sulphidation epithermal veins. Th e Ca/Mg carbonate end members (calcite, Mg-calcite and dolomite) form at deeper levels, whilst Fe/Mn carbonate end members (siderite and rhodocrosite) form at shallower levels under cooler conditions. Carbonates may form fi ne bands which alternate with quartz-rich carbonate bands, especially in the transition zone from quartz-dominant to carbonate-dominant phases. Blocky and massive vein-fi lling carbonate are common.

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Barite, if present, generally forms vein fi ll in the uppermost parts of the system. Gypsum and anhydrite may also be present as late phases in the uppermost parts of intermediate sulphidation epithermal systems.

• Deposit Morphology : Th e majority of intermediate sulphidation deposits form steeply dipping veins which may contain bonanza grade shoots (especially within quartz-base metal sulphide veins and breccias). Within a given district, multiple veins are common and typically form sub-parallel to anastomosing vein swarms, as is typical within the Zacatecas District.

Vein breccias and larger breccia bodies may also be developed — vein breccias especially may be of high grade metal tenor even within narrow vein deposits. Stockworks may occur in the hanging wall of deposits — they range from narrow selvedages that extend metres from veins and silicifi ed structures, to extensive stockworks that may be of suffi cient density and grade to justify an open pitable bulk tonnage mine. Extensive hanging wall stockworks are more likely to develop in low sulphidation epithermal systems that form closer to surface.

• Alteration Minerals : Alteration minerals in intermediate sulphidation epithermal systems are zoned in a similar manner to that of the gangue mineralogy. Proximal to mineralization, quartz-sericite dominates at depth whilst proximal carbonate dominates in the shallower parts of the system. Pyrite is ubiquitous. Further from mineralization, illite-smectite passes outwards to epidote-chorite (prophylitic).

• Paragenesis and Zonation : Intermediate sulphidation systems are distinctly zoned — but over a much larger vertical interval than low sulphidation systems. Ores tend to be dominated by quartz-pyrite-base metal sulphides at depth, and become more carbonate rich at the expense of these phases at progressively shallower levels. Carbonate deposition may also postdate and cross-cut earlier quartz sulphide phases as the fl uid system cools and collapses. Baryte, gypsum and anyhdrite, if present, are formed in the uppermost parts of the system and/or represent the latest depositional event.

• 7.4 Zacatecas Epithermal Deposit Type—Main Features

• Th e epithermal deposits within the Zacatecas District — and silver-gold-base metal mineralization on the Property — display intermediate and low sulfi dation styles. Albinson (Camprubi and Albinson, 2007) proposed a new empirical classifi cation scheme for Mexican epithermal deposits based on their depth of formation (with respect to the paleowater table) as determined by fl uid inclusion studies (Albinson et al., 2001). Th is scheme considers three types of epithermal deposit (A, B, and C).

In Mexico all three types are associated with development of calc-alkali volcanic arcs within an extensional back arc setting (Figure 17) — typical of the Mexican Altiplano. Intermediate and low sulphidation deposits are most likely to coexist when they form distal to (4-5 km) parental intrusives — hosted within andesites and rhyolites proximal to, and beneath, rhyolite dome complexes. Type A may also form lateral to, or above, shallow parental intrusives.

• Type A is characterized by exclusively polymetallic IS mineralization along the full vertical extent of the deposit (Figure 18) — such as Fresnillo and Sombrerete in Zacatecas. Type A forms at depths (>1000 m) from relatively high-salinity brines (>7.5 to <23 wt% NaCl eq.) at temperatures of 230-300°C.

• Type B is the most widespread in Mexico and exhibits extensive precious metal low sulphidation mineralization which passes downwards to an intermediate sulphidation type. Th e Veta Grande system is a variant characterized by dominantly intermediate sulphidation mineralization, with subordinate low sulphidation mineralisation, that is generally restricted to the uppermost parts of the deposit. Type B systems form at intermediate depths (400–1000 m).

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==> picture [483 x 436] intentionally omitted <==

----- Start of picture text -----

Rhyolite dome complex
Low sulphidation vein
0 km
Conglomerates
2 km
Low sulphidation vein /
intermediate sulphidation Tertiary andesites, andesitic
base volcanics and rhyolites
4 km Staked intermediate
sulphidation veins
Parental magma
Mesozoic/Palaeozoic
Basement
Mesozoic/Palaeozoic
6 km
Basement
8 km
----- End of picture text -----

Figure 17: Schematic showing the metallogenic setting of low sulphidation epithermal, hybrid low and intermediate sulphidation, and intermediate sulphidation veins at Zacatecas. Veins form distal (>5 km) above and lateral to the parent magma. Rhyolite dome complexes are locally important. Veins develop in extensional settings and may have combined vertical extent of 1000+ m.

Types A and B are characterized by (1) mineralization with abundant sulphides (total sulphide contents >5%); (2) the occurrence of sphalerite with compositions dominantly low in FeS; (3) variable amounts of galena, pyrite, chalcopyrite, tetrahedrite-tennantite, and silver sulfosalts; (4) mainly accompanied by crystalline varieties of quartz, Mn carbonates and silicates, fl uorite, and relatively scarce adularia as non-sulphide minerals; and (5) dominant alteration styles in which illite gives way to sericite with depth — propylitic alteration forms an outer halo.

• Type C consists solely of low sulphidation type mineralization — such deposit in Mexico tend to be relatively small with maximum tonnages between 1.0 and 3.5 Mt (such as Pinos in Zacatecas). Th ey are commonly genetically linked to rhyolitic hypabyssal igneous activity hosted within calc-alkaline or silicic volcanic piles. Mineralization forms at shallow depths (<500 m) from dilute fl uids (<3.5 wt% NaCl equivalent), at relatively cool temperatures (<240°C).

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----- Start of picture text -----

Intermediate Sulphidation Intermediate Sulphidation Low Sulphidation
“Deep Vein Type Non Boiling” “Deep Vein Type Boiling” “Shallow Boiling”
0 m
-500 m
-1000 m
-1500 m
Sinter
Ore Zone
Breccia
-2000 m Stockwork Veins
Advanced Argillic
Argillic
Propylitic
Pinos Au
g
A
SE
p
Colarado
Fresnill
Ag - Pb - Zn Pb - Zn - Cu
Fresnillp Proano
Pb - Zn - Cu - Ag
- Au - Pb - Zn
Sombrerete g
A
----- End of picture text -----

Figure 18: Schematic of typical low sulphidation epitheram, and boiling and non-boiling intermediate sulphidation deposits. Deposit models are highly implifi ed. Correctly modelling the type of system allows the “tops” and “bottoms” of the mineralizat to be modelled — critical to eff ective exploration as it allows surface outcrops and drill hole intercepts to be placed in the correct vertical context. Modifi ed after Albinson et al . (2001).

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Th e low sulphidation deposits of the Zacatecas district are characterized by (1) mineralization poor in sulphides (<2% total sulphide by volume); (2) with dominant pyrite, arsenopyrite, silver sulfosalts, acanthite, naumannite, and electrum; (3) gangue which includes varieties of amorphous silica, multi-banded cryptocrystalline, and crystalline quartz, adularia, and bladed calcite; (4) the occurrence of sphalerite with compositions high in FeS; and (5) weakly developed alteration styles, characterized by the occurrence of illite or chlorite, depending on the composition of the host rocks.

• 7.5 Zacatecas-Type Epithermals — Exploration Strategy

• From an exploration perspective it is essential to understand that epithermal systems — whether intermediate sulphidation, hybrid intermediate-low sulphidation, or low sulphidation — display a strong vertical zonation of mineralisation and geochemical signature, gangue mineralogy and alteration facies. Economic mineralisation, if present, is restricted to a discrete vertical interval of 200-300 m (for Type C low sulphidation systems) and 400-800+ m (for Type A intermediate sulphidation systems). Identifying the “tops” and “bottoms” of a mineralized system is essential with respect to understanding the level of erosion, or the location of a drill hole intercept within the broader context of a deposit’s vertical extent.

Th e long history of discovery and mining within the Zacatecas region would suggest that it is a mature exploration district that should be relatively well understood. However, recent advances in deposit modelling have demonstrated that many of the deposits within the Zacatecas Silver District are a broadly coeval mix of intermediate sulphidation, hybrid intermediate-low sulphidation, and low sulphidation systems.

Previous exploration considered low and intermediate sulphidation veins at Zacatecas to be mutually exclusive — such that exploration drill targeting was based on end-member characteristics. Hybrid intermediate-low sulphidation epithermal systems may display complex vertical zonation, overprinted precious and base metal mineralisation and gangue mineralogy, and vertically “telescoped” hydrothermal systems — making drill targeting diffi cult.

A detailed review and re-modelling of historic data, geological, structural and alteration re-mapping of surface geology, together with selected soil and rock-chip geochemical sampling, is recommended. Emphasis should be placed on:

• Structural Modelling including key controls on the development of high grade mineralization, the importance of vein fl exures, splays and intersections, and the implications of pre-, syn- and post-mineralization fault architecture.

• Lithological control with an emphasis on modelling the distribution of preferred host lithologies and the role of lithology with respect to dilational fault/vein development.

• Deposit Modelling focused on vertical changes in metal signature, vein textures, vein mineralogy, and alteration assemblages in order to pick “tops and bottoms” of precious and base metal intervals.

• Understanding Paragenesis — or the relative timing of mineralizing events — is critical to understanding if a system has been overprinted and thus in ascertaining the vertical position within the system.

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8 EXPLORATION

Zacatecas Silver has not yet undertaken fi eld-based exploration on the Property. In anticipation of future fi eld work, the Company has acquired high resolution satellite imagery which is currently being processed and interpreted. Specifi - cally:

• Worldview-3 High Resolution Satellite Imagery was acquired in November 2020 from archive imagery tasked on the 6[th] January 2019. A total of 315 km[2] was acquired from the image archive — covering Company licences, the areas between Company licences, and a 2 km wide edge buff er. Th is coverage ensured that geology, alteration, structure and mineralization, could be placed in a wider context and mapped between licences. Th e imagery provides 34 cm panchromatic and 1.36 m 8-band multi-spectral VNIR resolution.

• Th e TerraSAR-X satellite was tasked to acquire two areas — each of 25 km[2] — to provide 10 ground control points in each area (20 in total) at <20 cm accuracy in X, Y and Z. Th e providers have indicated they will acquire data six times in order to ensure the quoted accuracy.

• Th e TerraSAR-X satellite has also been tasked to provide 20 ground control points at <1 m accuracy in X/Y/Z covering 315 km[2] area of the Worldview-3 image. Th is will be completed over three acquisitions by TerraSAR-X.

• AW3D Enhanced 50 cm DTM and 1 m contours data has been generated from multiview Maxar archive imagery.

Using the <20 cm TerraSAR-X data, the <1 m TerraSAR-X data and the AW3D data — it should be possible to ensure the spatial accuracy of the Worldview 3 image of <1 m. Th e data also allows for 1 m topographic contours to be generated for the whole 315 km[2] area.

In addition to the use of satellite imagery for spatial control, the company will be using Worldview 3 imagery as a base for fi eld mapping.

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9 DRILLING

To date there has been no drilling by the Company on the Property. Historic drilling by Golden Minerals is discussed in Section 5.2 of this Report: Recent Property History.

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10 SAMPLE PREPARATION, ANALYSIS AND SECURITY

10.1 Golden Minerals

Given the time that has expired since Golden Minerals completed their work at the Property, the author has been unable to verify security, sample preparation and assay protocol.

10.1.1 Sample Security

Th e authors were unable to verify the security protocols implemented by Golden Minerals with respect to handling, transport and storage of core and rock samples. Sample rejects and core are currently stored within a secure compound at Santacruz Silver´s secure warehouse facility in Guadalupe.

Sample pulps are stored in boxes and boxes containing core samples are stacked on racks within the facility. Th e preserved core represents all the intervals that were sampled by Golden Minerals. Th e Authors are of the opinion that current security is appropriate.

10.1.2 Sample Preparation

Th e author was unable to verify the sample preparation protocol implemented by Golden Minerals — except to note that the following protocol was used.

Drill core sample intervals were chosen on the basis of combination of lithology, alteration and mineralization to ensure that samples did not cross mineralized boundaries. Sample lengths varied from 0.1 to 2.0 m with a median length of 0.63 m. Core was cut lengthwise into two equal halves — one half was sent for assay and the other half was returned to the core box. Examination of the core by the author suggest that core was sectioned in a representative manner.

Rock chip, trench and drill core samples were sent to the ALS-Chemex sample preparation facility in Zacatecas. Core and rock samples were prepared by crushing to a nominal 70% passing <2 mm (ALS code CRU-31). Crushed samples were passed through a single stage riffl e splitter and pulverized to 85 % passing <75 microns (ALS code PUL-31).

10.1.3 Sample Analysis

Th e authors were unable to verify the sample analysis protocol implemented by Golden Minerals — or the accuracy and precision of the assay results — except to note that the following protocol was used.

Pulps were analysed using a 33 element ICP-AES analysis package following a 4 acid digest of a 0.25 g sample (ALS code ME-ICP61) — those samples which assayed above 100 g/t Ag were then assayed by 30 g fi re assay with a gravimetric fi nish (ALS Code Ag-GRA21). Over-limit for copper, lead and zinc were re-assayed following aqua regia digest by ICP-AES fi nish (ALS code ME-OG62).

Samples were assayed for gold by 50 g fi re assay with an AA fi nish (ALS code Au-AA24) — samples which assayed >10 g/t Au were analysed by 50 g fi re assay with a gravimetric fi nish (ALS code Au-GRA22).

10.1.4 QA/QC

Th e Authors were unable to locate documentation with respect to the QA/QC protocol used by Golden Minerals, although review of the Panuco, Muleros, El Cristo and San Manuel-San Gil drill hole database confi rmed the use of fi eld blanks and four diff erent CRM’s that were routinely inserted into sample runs.

10.2 Santacruz

Santacruz only collected 49 surface rock chip channel samples at Panuco — sample lengths of 0.25 m to 1.9 m assayed between <0.01 to 305.46 g/t Ag.

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10.3 Verifi cation Sampling by the Authors

During a visit to the Property between 12[th] and 18[th] of October 2020, Morales-Ramirez collected 27 samples of drill core representing the complete remaining second half of the core — 21 samples from Panuco, one sample of Muleros core, four samples of El Cristo core ,and one sample of San Miguel-San Gill core. Eleven surface rock-chip grab samples were collected from a variety of veins. Assays are pending.

During a visit to the property between the 10[th] and 19[th] of December 2020, the Authors collected 157 drill core samples from historic Panuco drillholes — samples were the complete remaining second half of the core. In addition — the Authors collected 22 half-cut drill core samples from El Cristo and eight from San Manuel-San Gil. Whilst these samples were not used in the historic Panuco resource calculation — the authors believe that verifi cation of the broader database of Golden Minerals is important.

Sample security, sample preparation and sample assay protocol employed by the Authors is outlined below. All assays are currently pending. Industry standard Best Practice and QAQC was implemented.

10.3.1 Sample Security

Rock chip and drill core samples collected by the Authors were placed in individually numbered plastic sample bags, sealed with a single use clip-lock seal, and personally delivered to the ALS Laboratory in Zacatecas. Chain of custody was maintained by the Authors at all times — ensuring the validity and integrity of samples submitted for assay.

10.3.2 Sample Preparation

Samples were prepared by ALS Zacatecas (ALS code PREP-31b). Samples were dried to 110°C, weighed and crushed to a nominal 70% passing 2 mm in a single pass jaw-crusher. Approximately 1 kg was sub-sampled using a Jones-style riffl e splitter and then pulverised in a single-pass “bowl and puck” to a nominal 85% passing 75 microns.

As the samples submitted by the Author were for verifi cation purposes — the crusher and pulveriser was washed with a barren wash (ALS codes WSH-21 and WSH-22) between each sample.

Th e Authors are satisfi ed that the sample preparation and sub-sampling protocol is appropriate for the style of mineralization, the stage of exploration and the possibility that sample assay results will be used in future resourse calculations. Th e Authors requested that ALS take one crush and one pulp duplicate in each batch of 18 samples — this will allow precision of sub-sampling protocol to be monitored.

10.3.3 Sample Analysis

Samples were analysed by ALS Loughrea (Ireland). Gold was analysed by fi re assay with atomic absorption fi nish using a 50 g sample charge (ALS code Au-AA26) — with a reportable range of 0.01-100 ppm Au.

Silver was assayed by fi re assay with a gravimetric fi nish (ALS code Ag-GRA21) using a 30 g nominal sample weight — with reportable range of 5-10,000 ppm Ag. Th e relatively high lower detection limit is not considered material — given samples submitted by the Author were verifi cation purposes of assays used in a resource calculation.

Samples were also submitted for 33 element analysis by ICP-AES following a 4 acid digest — with reportable ranges silver (0.5 to 100 ppm), lead (2 to 10,000 ppm), zinc (2-10,000 ppm) and copper (1-10,000 ppm Cu). Over-range samples were resubmitted for analysis using a four acid digest and ICP-AES fi nish with the following ranges: Ag 1-1500 ppm (Ag-OG62), lead 0.001-20% (Pb-OG62), zinc 0.001-30% (Zn-OG62) and Cu 0.001-40% (Cu-OG62).

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Th e Author is of the opinion that the analytical protocol is appropriate for the style and grade of mineralization, and the type of samples submitted for verifi cation analysis.

10.3.4 QA/QC & Laboratory Performance

Th e Authors implemented a QA/QC program comprising the routine insertion of fi eld blanks, certifi ed reference materials (CRMs), and staged crush and pulp duplicates. Th e protocols follow industry-recognized standards of best practice. Assay results are currently pending.

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11 DATA VERIFICATION

Given that the Company is yet to commence fi eld-based exploration, the Authors have conducted extensive verifi cation of all facets of the historic dataset. Specifi cally:

• 11.1 Verifi cation Re-sampling of Drill Core

Th e Authors resampled the complete remaining second half of critical drill core intervals from Panuco, El Cristo and San Manuel-San Gill. A total of 184 samples were taken from drill core intervals used in the Panuco resource estimation — representing approximately 8% of the resource drill core dataset. Th e Authors also collected 22 half-cut drill core samples from El Cristo and eight from San Manuel-San Gil to provide verifi cation of the exploration assay database of Golden Minerals, which is deemed to be important. Th e Authors are of the opinion that a suffi cient number of drill core samples were taken to verify the drill assay database used in the Panuco historical resource estimation. Assay results are currently pending.

• 11.2 Verifi cation Re-sampling of Panuco Trenches

Th e trenches excavated by Golden Minerals are largely revegetated — some are infi lled. Morales-Ramirez collected 11 channel samples from trenches used in the Panuco resource estimation. Th e Authors are of the opinion that the channel samples collected by Morales-Ramirez will provide an appropriate check of historic surface channel sample assays used for the resource estimate at Panuco.

11.3 Chain of Custody

All samples submitted for assay by the Authors were assigned a sequential number and placed in a clearly labelled plastic bag. Bags were sealed with a single use clip-lock seal. Th e Authors delivered the samples direct to the ALS sample preparation facility in Zacatecas and are satisfi ed that appropriate chain of custody was maintained at all times. at Panuco.

11.4 Sample Preparation Protocol

Sample preparation was completed by ALS Zacatecas using standard industry protocol. Core and channel samples were crushed in a single stage jaw crusher, sub-samples using a Jones-style riffl e splitter, and pulverized in a standard LM2. Th e Authors requested that the crusher and pulveriser be cleaned with a barren wash between each sample. Th e insertion of a fi eld blank into each sample batch provided an appropriate check for potential contamination. Th e Authors are of the opinion that the sample preparation and sub-sampling protocol conform to industry-recognized standards of best practice.

11.5 Assay Technique & Laboratory

ALS Loughrea (Ireland) is an internationally-recognised, ISO-rated (ISO 17025) laboratory, that employs stringent internal checks and QA/QC protocols, and meets the standards required for the analysis of drill core and surface channel samples taken to verify an historic assay dataset.

Th e Authors dispatched samples in batches of 18 — comprising 16 samples, one Geostats CRM (Certifi ed Reference Material) of appropriate grade and matrix type, and one fi eld blank. ALS will take one duplicate from the coarse reject at the crusher (as indicated by the Authors) and insert this duplicate into the batch. ALS have also been instructed to take one duplicate from the pulp reject of a nominated sample.

Th e Authors are of the opinion that the choice of laboratory, analytical methods used, and implemented QAQC protocol, are appropriate for the type of sample and stage of project (see Section 10.2 of this report).

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11.6 Drill Collar Location

Th e company has engaged an Independent consultant to re-survey 20 drill holes collars at Panuco and 10 at El Cristo and San Manuel-San Gil. Th is work is ongoing. Th e Authors are of the option that a suffi cient number of drill holes are being re-surveyed to provide eff ective verifi cation of the collar location database.

11.7 Historic Assay Database

Th e Authors cross-checked approximately 20% of the Panuco assay database against the original ALS assay certifi - cates — there were no indications of mismatched or incorrect assays. Th e Authors are of the opinion that the validity and integrity of the Panuco drill core assay database is demonstrated.

11.8 Historic Geological Database

Th e Authors reviewed the graphic drill core logs for a number of Panuco drill holes. Logs were checked against remaining core — overall the drill core logs provide an accurate representation of the geological and geotechnical characteristics of the drill core. Graphic logs and logging codes were then cross-checked against the geological database. Th e Authors are satisfi ed that rock descriptions and meterage intervals are consistent with database entries.

11.9 Downhole Survey Data

Th e Authors were unable to verify the downhole survey data. However, plots of drill hole traces and drill hole cross sections show hole deviation typical of that expected. Th e Authors have no reason to doubt the validity of the downhole survey database.

11.10 Specifi c Gravity

Th e Authors collected the majority of the mineralised intervals from the Panuco drill core for verifi cation re-assay. As such, there was very little material left for analysis of specifi c gravity using standard paraffi n-coat/immersion methodology. Th e Authors have instructed ALS Zacatecas to submit the coarse reject from 40 samples for specifi c gravity analysis at ALS Loughrea (Ireland) by gas pycnometry.

Th e Authors also note that the average of the specifi c gravity measurements used in the Panuco resource estimation are consistent with the specifi c gravity of mineralized material and host rock of peer group mines within the Zacatecas region.

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• 12 MINERAL PROCESSING AND METALLURGICAL TESTING

Th ere has been no metalurigical testing of samples from the Panuco Deposit or other prospect areas on the Zacatecas Property.

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13 MINERAL RESOURCE ESTIMATES

Th ere are no current resource estimates for the Property. An historic resource is discussed in Section 5 (History) of this report — sub-section 5.3 (Work By Santacruz).

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14 ADJACENT PROPERTIES

Several producing mines and advanced exploration properties adjoin the Zacatecas Property (Figure 19). Th e Veta Grande Mine and San Acacio Deposit are part of the Veta Grande Vein System. Th e nearby Cozamin Mine is hosted by the Noche Mala structure. Th e El Compas Mine is hosted within the Orito Vein System.

Th e information in this section has been sourced from publicly available data. Th e authors have not independently verifi ed the information within the reports referenced.

• 14.1 Veta Grande Mine (Santacruz Silver Mining Ltd)

Santacruz Silver Mining Limited — under an option agreement with Minera Contracuña I SA de CV — is operator of, and has the option to purchase, the Veta Grande properties. Th e Veta Grande Properties consists of 31 mining concessions covering an area of approximately 1019 ha. Th e Zacatecas Property bounds the Veta Grande property to the north, west and south (Figure 19).

Th e Veta Grande is a northwest-southeast striking, nested fault/vein system consisting of fi ve veins that splay to the northwest. Mineralization varies in thickness from two to 30 m and veins dip between 60° to 90° to the southwest. Th e veins consist of quartz, chalcedony and calcite with colliform to crustiform texture and euhedral quartz in open space cavities. Th e dominant sulphide mineralization consists of pyrite, sphalerite, and galena with rare chalcopyrite.

Th ere is no published reserves or resources for the Veta Grande Mine. Production form the Veta Grande Mine in 2019 was 237,715 oz of silver, 457 oz of gold, 1082 tonnes of lead and 1949 tonnes of zinc from 149,891 tonnes of rock milled. Burk (1994) cited historic production from the Veta Grande mines as >200 Moz silver since its discovery in 1546.

Th e information with respect to the Veta Grande Mine was taken from a “Technical Report Veta Grande project, Zacatecas Mexico, as prepared for Santacruz Silver Mining Ltd by Bui, V. P and O’Brien, M. F., with eff ective date 20th August 2019. Th e report was fi led by Santacruz Silver Mining Ltd on SEDAR.

Th e author of this technical report has been unable to verify the information in either report and notes that the information is not necessarily indicative of the mineralization on the Zacatecas Property .

14.2 San Acacio Deposit (Defi ance Silver Corp.)

Defi ance Silver holds 24 mineral concessions to the southeast of the Veta Grande property of Santa Cruz Silver Mining Ltd. Th e Veta Grande vein system extends to a vertical depth of at least 335 meters and extends approximately 5.6 km along the strike of the San Acacio property. Th e San Acacio Mine controls approximately 50% of the historic workings on the Veta Grande system.

Defi ance Silver Corp cite a resource of 17.9 Moz Ag Eq. based on 2.9 Mt at 192 ppm Ag eq. (0.16 ppm Au and 182 ppm Ag) using a 100 g/t Ag eq. cut-off .

Th e information with respect to the San Acacio Deposit was taken from a “A Technical Report and Resource Estimate, San Acacio Silver Deposit, Zacatecas State, Mexico, as prepared by Giroux, G. and Cuttle, J., with an eff ective date 1st April 2014. Th e report is fi led on the website of Defi ance Silver (https://www.defi ancesilver.com/projects/zacatecas-projects/ resource).

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----- Start of picture text -----

750,000 mE
N
5 km
Muleros Panuco
El Cristo
Veta Grande
San Manuel
-San Gil San
Acacio
Cozamin
El Orito
Zacatecas Silver Corp.
Santa Cruz Silver
El Compass Mine
Defi ance Silver
Capstone-Opco
Capstone-Endeavour
Capstone
Endeavour Silver
750,000 mE
2,530,000 mN 2,530,000 mN
2,520,000 mN 2,520,000 mN
----- End of picture text -----

Figure 19 : Map showing properties immeditely adjacent to Zacatecas Silver Properties. Operating (red) and non-operating mines/ signifi ant deposits (blue) shown.

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Th e author of this technical report has been unable to verify the information with respect to the Acacio Deposit and notes that the information is not necessarily indicative of the mineralization on the Zacatecas Property .

14.3 Cozamin Mine (Capstone Mining Corp.)

Th e property consists of 93 mining concessions covering an area of approximately 4260 ha. Th e Cozamin property is located south of San Manuel-San Gil Target area on the Zacatecas Property (Figure 19).

Mineralization at Cozamin occurs in veins, and fracture-controlled systems of veinlets and includes a portion of the Mala Noche Vein beneath the historical San Roberto mine. Th e vein itself varies in strike from east-west to northwest-southeast and dips on average 60°to the north. Th e vein consists of several anastomosing veins forming sigmoidal structures and the best mineralised shoots are associated with zones where these structures coalesce into a single structure. Chalcopyrite, sphalerite and galena are the dominant economic sulphide minerals (up to 15% of the vein) — pyrite and pyrrhotite increase down dip.

Mineralization is of an intermediate sulphidation type. Th e copper-rich mineralisation is an early phase that is enveloped, overprinted and/or brecciated by zinc-rich mineralization. Th e copper veins are inferred to represent a higher temperature pragenesis, having signifi cantly fewer vughs and can be massive pyrrhotite-pyrite-chalcopyrite with little gangue. Zinc-rich veins also tend to be sulphide-rich but with slightly more gangue. Th is transition from copperdominant to zinc-dominant mineralization is likely the result of an evolving, telescoped hydrothermal system — associated with a number of rhyolite fl ow domes which may be the shallow expression of an inferred buried felsic stock.

Well-banded quartz, or quartz-carbonate veins, are inferred to be of a lower temperature style — they are most likely of low sulphidation epithermal type.

In 2006, the Cozamin Mine began commercial production at a rate of 1,000 tonnes per day of ore milled. As of April 30, 2020 the proven and probable reserve estimate for the Cozamin property was reported as 10.178 Mt at 1.79% Cu, 0.36% Zn, 0.05% Pb, and 41 g/t Ag. Th e combined measured and indicated mineral resource estimate was reported as 27.459 Mt at 1.57% Cu, 1.14% Zn, 0.32% Pb, and 44 g/t Ag, with an additional inferred mineral resource of 16.558 Mt @ 0.64% Cu, 2.26% Zn, 0.61% Pb, and 36 g/t Ag.

Th e information with respect to the Cozamin Mine was taken from a “NI43-101 Technical Report on the Cozamin, Zacatecas State, Mexico, as prepared by Buss, G. et al., with an eff ective date 30th April 2020. Th e report is available from the companies website (https://capstonemining.com/operations/cozamin/default.aspx).

Th e author of this technical report has been unable to verify the information with respect to the Cozamin Deposit and Mine, and notes that the information is not necessarily indicative of the mineralization on the Zacatecas Property .

14.2 El Compas Mine (Endeavour Silver Corp.)

Th e El Compas Mine is owned by Endeavour Silver Corp and covers an area of approximately 4200 ha, located on the southern outskirts of the city of Zacatecas. Th e El Compas property concessions surround the El Orito concessions of Zacatecas Silver. Endeavour Silver state on their website (https://www.edrsilver.com/English/mining-assets/ operations/el-compas/overview/default.aspx) that production began in the fi rst quarter of 2019 at an initial rate of 250 tpd from an underground, long-hole, mechanized cut and fi ll operation.

Th e veins at El Compas strike predominantly north-south and northwest-southeast, and are hosted partly in volcanic and sedimentary rocks of the Chilitos formation and partly in overlying volcanic rocks of the La Virgen formation. Veins are quartz-dominant, fi nely colloform and crustiform banded, retaining open space fi ll textures, and display

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bladed quartz after calcite — typical boiling textures of low sulphidation epithermal systems. Pyrite and pyrrhotite are the most common sulphides.

Within the context of the district the veins at El Compass are unusual — they strike predominantly north-south, are gold-rich and silver-poor, and have a low total sulphide content with very low base-metal content. In contrast — the more typical northwest-southeast oriented veins in the Zacatecas region are silver-dominant with signifi cant total sulphide and base metal sulphide content, displaying characteristics more typical of intermediate sulphidation epithermal vein systems.

Endeavour Silver Corp. cite a 2017 indicated mineral resources of 148,400 tonnes at 7.31 g/t Au and 104 g/t Ag and an inferred mineral resource of 216,800 tonnes at 5.38 g/t Au and 76 g/t Ag (Smith et al., 2017). A cut-off grade of 150 g/t Ag eq. was used based on a US $18/oz silver and US $1225/oz gold price, with recoveries of 83.5% gold and 73% silver. Th ere are no base metal credits.

Th e current Life of Mine (LOM) contemplates mining 300,000 tonnes containing 829,000 oz silver and 61,000 oz gold for 5,099,000 oz Ag eq.

Th e information with respect to the El Compass Mine was taken from a “NI43-101 Technical Report and Preliminary Economic Assessment for the El Compass Project, Zacatecas State, Mexico, as prepared by Smith, P. J. et al., with an eff ective date 27th March 2017. Th e report is available from the companies website (https://www.edrsilver.com/English/miningassets/operations/el-compas/overview/default.aspx).

Th e author of this technical report has been unable to verify the information with respect to the El Compass Mine and Deposit, and notes that the information is not necessarily indicative of the mineralization on the Zacatecas Property .

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• 15 OTHER RELEVANT DATA AND INFORMATION

Th e Author is not aware of any other information or data that may be relevant to this report — other than that already disclosed in previous sections of this report.

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16 INTERPRETATIONS AND CONCLUSIONS

Th e Company entered into a purchase agreement on August 31, 2020 with a wholly owned subsidiary of Santacruz Silver Mining Ltd — whereby the Company can acquire a 100% interest in 149 mining concessions (7826.3 hectares) within the prolifi cally mineralized areas of the Zacatecas mining district. Under the terms of the Agreement, the company issued 5 million common shares of the Company and is required to make a cash payment totalling US $1,500,000 on the date the Company lists its common shares on the TSX Venture Exchange. Th e Company will also pay outstanding taxes due on the Property which amount to approximately USD $200,000.

Th e Property is located close to the cities of Zacatecas and Guadalupe which can provide a skilled workforce and required infrastructure. All prospects are easily accessed by unpaved roads off paved public highways. Topography is generally subdued (2300 to 2600 masl) and climate allows year-round operation. Th e Authors are not aware of any existing environmental liabilities.

Mineralization on the Property shares many similarities to other silver-dominant epithermal systems within Zacatecas mining district, and the epithermal deposits of the ca. 1500 km long Mexican Silver Belt. Th is provides a foundational understanding of deposits type and a framework on which to develop targets.

Th e portfolio includes the Panuco Deposit — with an historical inferred resource estimate — and multiple earlier stage targets. Silver-gold-base metal mineralization is of low sulphidation, hybrid intermediate-low sulphidation and intermediate sulphidation type. Structure provides fl uid pathways and traps for mineralization — in this respect structure exerts the fundamental control on mineralization.

Economic mineralisation in epithermal vein deposits, if present, is restricted to a discrete vertical interval — approximately 200-300 m for low sulphidation systems and 400-800+ m for intermediate sulphidation systems. Identifying the “tops” and “bottoms” of the mineralization with respect to level of erosion, or vertical position of a drill hole intercept, is essential for eff ective drill targeting.

Historically the low sulphidation and intermediate sulphidation epithermal systems within the Zacatecas District, and the Property, have been modelled as mutually exclusive — exploration drill targeting was based on end-member characteristics. More recently authors such as Camprubi and Albinson (2007) argue that the formation of low and intermediate sulphidation deposits at Zacatecas was broadly coeval and the result of a single prolonged hydrothermal system — which evolved from an intermediate-sulfi dation state into a low-sulfi dation state. Th is has signifi cant implications for deposit modelling and exploration drill targeting.

16.1 General Exploration

Given the presence of intermediate sulphidation, hybrid intermediate-low sulphidation, and low sulphidation styles of epithermal mineralization at the property — there is obvious merit in remodelling the historic dataset to provide a clearer understanding of key controls on mineralization, and better defi ne system the “tops” and “bottoms” (and thus vertical extent) of mineralization.

Work should focus on 1) deposit modelling using metal signatures, vein textures, vein mineralogy, and alteration assemblages; 2) detailed paragenetic study to better understand the relative timing of mineralization; and 3) structural remodelling to include key controls on mineralization, overall structural architecture, and implications of pre-, syn- and post-mineralization faulting.

Th e number of historical drill holes completed by Golden Minerals is relatively small given the number of mineralized systems (Panuco, Muleros, El Cristo, San Manuel-San Gil, and others) at the property. Th e down dip potential

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of veins is good — especially those of intermediate sulphidation style. Remodelling of historical data should provide several additional targets and allow focused drill targeting of the highest value targets.

16.2 Panuco

Th e Panuco vein system consists of three prominent northwest-southeast trending, southwest dipping veins and vein breccias, that have been collectively traced over a 4 km strike length. Additional vein splays and jogs are present.

Golden Minerals drilled 75 inclined diamond drill holes at Panuco for 23,444 m — which were used by Santacruz Silver Mining Ltd to calculate an inferred historical resource estimate. Th e three veins that were drilled — Panuco NW, Panuco Central and Tres Cruces — remain open at depth and along strike. A number is sub-parallel veins of shorter strike length, splays and dilational jogs also require drill testing. Th e potential strike extension of Panuco Central and Panuco NW under Quaternary cover to the northwest requires further investigation (Figure 20).

Th ere has been no metallurgical work at Panuco. As such Santacruz assumed operational recoveries similar to the Veta Grande System being gold (52.2%), silver (62.1%), lead (87.9%) and zinc (78.6%). Given the low tenor of the precious metal recoveries — there is signifi cat merit in implementing optimised bench-scale metallurgical tests.

==> picture [483 x 380] intentionally omitted <==

----- Start of picture text -----

751,000 mE 752,000 mE 753,000 mE
Zacatecas Silver Corp. N
500 m
Third Party Licence
Historic Shaft
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
751,000 mE 752,000 mE 753,000 mE
Panuco NW Vein
Panuco Central Vein
Tres Cruces Vein
Panuco Central Vein
2,534,000 mN 2,534,000 mN
2,533,000 mN 2,533,000 mN
2,532,000 mN 2,532,000 mN
----- End of picture text -----

Figure 20: Geological map of the Panuco vein system, Zacatecas Silver Corp. licence boundaries, historic shafts and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Exploration targets shown Blue.

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16.3 Muleros Area

Th e Muleros vein system is defi ned by three principal vein structures — the South Vein, the North Vein (Sabino Vein) and the El Rosario Vein (Figure 21). Th e South and North Veins dip between 55-80° to the southwest and the Rosario Vein dips 70-80° to the northeast. Veins vary from <1 to 5 m in true thickness. Th e system has a strike length of at least 2.5 km before veins dip under cover the northwest.

In 2007 and 2008 Golden Minerals completed 37 HQ diamond drill holes totalling approximately 6704 m. Holes were generally drilled at -60° inclination and the longest hole was 562.6 m in length — but overall, the drill program was designed to test veins to a vertical depth to about 100 meters. Th e depth potential of all veins is eff ectively untested.

Several of the Golden Minerals drill holes intercepted gold grades signifi cantly above that of Panuco and other deposits in the area. For example — hole MU07-07 intercepted a downhole interval of 2.30 m at 1.56 g/t Au and 286 g/t Ag and hole MU08-35 intercepted a downhole interval of 1.61 m at 1.75 g/t Au and 56 g/t Ag. Signifi cant further drilling is required to test the down dip potential of these veins — especially in areas of higher gold grade.

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----- Start of picture text -----

751,000 mE 752,000 mE 753,000 mE
N
Zacatecas Silver Corp. 500 m
Third Party
Alluvium
Regolith
Andesite Tuff / Volcano- Third Party
clastics
Andesite Tuff / lavas
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
751,000 mE 752,000 mE 753,000 mE
North Vein
South Vein
El Rosario Vein
2,534,000 mN 2,534,000 mN
2,534,000 mN 2,534,000 mN
2,533,000 mN 2,533,000 mN
2,532,000 mN 2,532,000 mN
----- End of picture text -----

Figure 21: Geology of the Muleros vein system. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012). New drill targets dark blue. Depth extension drill targets in light blue.

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Th e El Rosario Vein and vein splays at the northwest extension of the North Vein also require drill testing. Extensive Quaternary cover may mask strike extensions of veins to the northwest — these areas should initially be tested by soil geochemistry.

A series of historical shafts extend to the southeast of the south vein in an area of Quaternary cover. Th ese shafts may defi ne the southeast extension of the South Vein — scout drilling is required.

16.4 El Cristo Area

Th e El Cristo vein system comprises several northwest-southeast trending, subparallel veins which defi ne a sigmoidal complex that is up to 600 m wide and which coalesces to the northwest and southeast. Veins extend over a strike length of at least 2.5 km. Dip varies from vertical to 60° to both northeast to southwest. El Cristo is most likely the northwest extension of he Veta Grande vein system.

Silver and base metal mineralization is hosted in brecciated veins, and crustiform and colloform banded quartz-carbonate veins, that vary in thickness from 10 cm to 7 m.

Golden Minerals completed 8 HQ diamond drill holes for 2854 m — most holes targeted a 300 m strike extension where several veins coalesce in an area with historical shafts. Silver and gold assays were of moderate tenor whilst lead (up to 2.64% Pb) and zinc (up to 6.28 % Zn) were elevated. For this reason, the veins at El Cristo were modelled as the basal part of a low sulphidtion epithermal system, implying that the precious metal interval had been eroded.

Th e Authors note that 8 drill holes do not provide an eff ective test of an epithermal vein system that has a strike length of over 2.5 km, comprises multiple veins over a width of at least 600 m, is associated with a sigmoidal dilational zone, and is the likely northwest strike extension of the Veta Grande vein system. Moreover, given the presence of hybrid intermediate-low sulphidation deposit types at Zacatecas, base metal signatures — are not on their own — a reliable indicator of depth in the system. El Cristo requires signifi cant further work and drilling.

16.5 San Manuel-San Gill Area

Th e San Manuel-San Gill target is relatively unexplored. Quartz-carbonate-sulphide veins of between 10 cm to >7 m wide, trend northwest-southeast over a strike length of at least 2 km. Individual veins are between 400 to 1400 m long and splay to the southeast where they intersect a north-south trending hematitic breccia (Figure 23). Th e breccia is has a strike length of approximately 800 m, is up to 40 m wide, and is most likely vertical.

Th e north-south orientation of the breccia suggest is highly signifi cant as gold rich epithermal veins within the district are generally oriented north-south. Signifi cant further work is required in the San Manuel-San Gill area.

16.6 Other Target Area

Th e Property includes a number of satellite concessions. Th ese include El Oro, El Orito, La Cantera, Monserrat, El Peñón, San Judas and San Juan — all are relatively unexplored and require reconnaissance review.

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----- Start of picture text -----

747,000 mE 748,000 mE 749,000 mE 750,000 mE
N
500 m
Third Party
Quatrenary
Volcanoclastics
Andesite /
Andesitic Tuff s
Drill Hole
Historic Shaft
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
747,000 mE 748,000 mE 749,000 mE 750,000 mE
2,530,000 mN 2,530,000 mN
2,529,000 mN 2,529,000 mN
----- End of picture text -----

Figure 22: Geology map of El Cristo. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012). New drill targets dark blue.

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----- Start of picture text -----

747,000 mE 748,000 mE 749,000 mE 750,000 mE
Third Party
N
500 m
Quaternary
Jasperoid
Andesite /
AndesiteTuff s
Volcanoclastics
Third Party
Drill Hole
Vein Outcrop
Third Party
Licence
Zacatecas Silver
Corp. Licence
747,000 mE 748,000 mE 749,000 mE 750,000 mE
2,528,000 mN 2,528,000 mN
2,527,000 mN 2,527,000 mN
2,526,000 mN 2,526,000 mN
----- End of picture text -----

Figure 23: Geology map of the San Manuel-San Gill vein system. Licence boundaries and Golden Minerals diamond drill locations and drill hole traces (projected to surface). Modifi ed after Golden Minerals (2012). Principal drill focus should be the hematic breccia circled light blue.

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17 RECOMMENDATIONS

Th e Zacatecas Project comprises a large number of intermediate to low sulphidation vein systems which defi ne several distinct prospects — namely Panuco, Muleros, El Cristo and San Manuel-San Gil.

• Panuco is the most advanced project that previously reported a historical resource estimate as set out in the History section of this Technical Report. Th e Authors and the Company is carrying out a verifi cation and re-sampling of historical drilling results.

• Th e Muleros, El Cristo and San Manuel-San Gill vein systems have been explored by surface mapping, trench geological sampling and limited angled diamond drilling. Th ey are large and high prospective systems that require signifi cant further work.

• Th ere are a number of other targets including Orito, Cantera, Monserrat, San Juan, El Peñón and San Judas — all early stage and requiring signifi cant further work.

A 2021 exploration budget of USD 4,545,000 is proposed for general Property exploration; metallurgy and step-out, step-back and infi ll drilling at Panuco; exploration drilling at EL Cristo and San Manuel-San Gill; and reconnaissance fi eld work at Orito, Cantera, Monserrat, San Juan, El Peñón and San Judas.

17.1 General Explorations

Recent advances in deposit modelling suggest that many of the deposits within the Zacatecas Silver District are a broadly coeval mix of intermediate sulphidation, hybrid intermediate-low sulphidation, and low sulphidation epithermal types. Previous exploration modelled the various vein systems at the Property as either of low or intermediate sulphidation epithermal type. As such the vertical relationship of precious and base metal mineralization, gangue mineralogy and alteration assemblage — relative to the current land surface or a drill hole intercept — may be poorly understood. A more detailed understanding of key controls on mineralization is also required.

• Structural Modelling : Remodelling of structural controls on mineralization is required — with a focus on better understanding of key controls on the development of higher grade mineralization. A better understanding of the importance of vein fl exures, splays and intersections is required with respect to metal deposition. An understanding of pre-, syn- and post-mineralization fault architecture, and the importance of lithology, is critical.

• Deposit Modelling : Correctly modelling the vertical characteristics of an epithermal system — based on metal signature, vein textures, vein mineralogy, and alteration assemblages — is essential for accurate drill targeting. Defi ning the “tops and bottoms” of precious and base metal intervals forms the basis of all exploration targeting — but may be complex in hybrid, telescoped or over-printed systems. Remodelling of all geochemical data, including trace element signatures, mineralogical data, and alteration mineralogy is strongly recommended.

• Paragenesis : A better understanding of paragenesis — the relative timing of mineral deposition — will require detailed thin and polished section microscopy, X-ray diff raction and select XRF studies.

Item	Cost / USD
Structural mapping/modelling	50,000
Sample assay 750 samples @ CAD 100	75,000
Detailed f eld mapping and sampling	55,000
Data integration, database and GIS	25,000
Logistic costs - International Fares, Accommodation and Messing	25,000
Table X: Total General Exploration: USD 230,000

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17.2 Panuco Exploration

Th e Panuco system is defi ned by three prominent vein structures — Panuco NW, Panuco Central and Tres Cruces which can be traced over a strike length of approximately 4 km. To date 75 angled diamond holes have been drilled at Panuco for a total of 23,444 m — most holes have been drilled into the Panuco Central and Panuco NW veins. A total of 183 trenches have been excavated across all veins for a total of 4540 metres.

Resource modelling indicates that the Panuco Central vein is open at depth to the SE and NW — both veins are open to the NW. Only a small number of holes have been drilled in the Tres Cruces vein — mineralization is open at depth. A total of 10,000 metres of angled diamond step-out and step-back drilling is recommended for all veins. An initial 2500 m of infi ll drilling is warranted at Panuco Central.

A bench-scale metallurgical study of Panuco mineralization is required. Th is should include sub-sampling and testing of the uppermost variably oxidized parts of the vein, silver-rich base metal poor mineralization, and silver and base metal rich mineralization.

Item	Cost / USD
10,000 m of diamond drilling at USD 250/m	2,500,000
Drill sample assay — 3000 samples at USD 50/sample	150,000
Bench scale metallurgical test work	200,000
Contract Geology	190,000
Logistic costs - International Fares, Accommodation and Messing	60,000

Table X: Total Panuco Exploration: USD 3,100,000

17.3 Muleros, El Cristo, and San Manuel-San Gil Exploration

Th e Muleros, El Cristo and San Manuel-San Gill systems are highly prospective. El Cristo is characterized by multiple, sub-parallel veins, which represent the NW strike extension of the Veta Grande vein system. Veins at El Cristo have a strike length of at least four kilometres — yet have only been drill tested by eight angled diamond holes. Signifi cant further drilling is required.

Two major structural trends are present at San Manuel-San Gill: a NS oriented hematitic breccia and NW oriented quartz-carbonate-sulphide veins. Th e hematitic breccia has a NS-trending strike of approximately 800 m, is up to 40 m wide, and is most likely vertical — veins with NS orientation throughout the Zacatecas District are late stage and often gold rich. Further angled diamond drilling is required to target this structure.

Item	Cost / USD
El Cristo - 2500 m of diamond drilling at USD 250/m	625,000
San Manuel - 1500 m of diamond drilling at USD 250/m	375,000
Drill sample assay — 1300 samples at USD 50/sample	65,000
Logistic costs - International Fares, Accommodation and Messing	50,000

Table X: Total El Cristo and San Manuel Exploration: USD 1,115,000

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17.4 Exploration Other Concessions

Th e Orito, Cantera, Monserrat, San Juan, El Peñón and San Judas concessions have been largely under-explored — despite hosting vein extensions of known deposits. Field mapping and rock-chip grab sampling of all concessions is recommended — in order to better understand vein distribution and style, metal tenor and deposit type.

Item	Cost / USD
Geological, structural and alteration and alteration mapping	80,000
Sample Assay — 100 samples at USD 50/sample	5,000
Logistic costs - International Fares, Accommodation and Messing	15,000
Table X: Total Other Concession Exploration: USD 100,000

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18 REFERENCES

• Albinson T (2009): Fluid Inclusion and Petrographic Study of Samples from the Panuco, El Cristo and San Pedro Hercules Veins, Northern Zacatecas. MAGSA (internal report prepared for Golden Miner-als 2009-07-28).

• Albinson T (2011) Petrographic Study and Fluid Inclusion Study of Deep Drill Holes from the Panuco (PA-11-68, PA-11-70, & PA-11-51) and Adriana Veins (AD-11-09 & AD-11-10) Northern Zacatecas. MAGSA (internal report prepared for Golden Minerals 2011-12-11).

• Bui V.P. and Giroux G.H. (2016) 2016 Mineral Resource Estimate, Panuco Deposit, Zacatecas State, Mexico.For Santacruz Silver Mining Limited. 3 November 2016.

• Bui V.P. and O´Brien M. F. (2019) Technical Report: Veta Grande Project, Zacatecas State, Mexico. For Santacruz Silver Mining Limited. August 20, 2019.

Burk, R. (1994) Summary of Property Evaluation Veta Grande, San Acacio for Minera Teck S.A. de C. V.

• Caballero-Martínez J. A. (1999) Informe fi nal complementario a la cartografía geológico minera y geo-química, escala 1: 50 000, carta Zacatecas, clave F13-B58, Estado de Zacatecas.

• Caballero-Martínez J.A. (1999) Informe fi nal complementario a la cartografía geológico minera y geo-química, escala 1: 50 000, carta Guadalupe clave F13-B68, Estado de Zacatecas.

• Camprubí, A., & Albinson, T. (2007). Epithermal deposits in México—Update of current knowledge, and an empirical reclassification. Geology of Mexico: Celebrating the centenary of the Geological Society of Mexico, 422, 377.

• Bush, G., Hardy, J., Jensen, T., et al. (2020) Cozamin Mine Estimated Mineral Reserves and Resources as at April 30, 2020. Retrieved online September 1, 2020. https://capstonemining.com/operations/cozamin/default.aspx.

Colin-Manilla (2012) Proyecto Zacatecas. Zacatecas, Mexico (Internal Report Golden Minerals 2012-01-24).

• Collins, J.M., et al (2016). NI 43-101 Technical Report for the El Compas Project, Zacatecas State, Mexi-co. Prepared for Canarc Resource Corp. February, 4, 2016.

• Enedeavor Silver (2020) Management´s Discussion and Analysis for the Period Ending March 31, 2019. Retrieved From SEDAR.com September 1 2020.

• Escalona-Alcázar, F., Delgado-Argote, L. A., Weber, B., Núñez-Peña, E. P., Valencia, V. A., & Ortiz-Acevedo, O. (2009). Kinematics and U-Pb dating of detrital zircons from the Sierra de Zacatecas, Mexico. Revista Mexicana de Ciencias Geológicas, 26(1), 48-64.

• Giroux, G. and Cuttle, J., 2014. Technical Report and Resource Estimate, San Acacio Silver Deposit, Zacatecas State Mexico. Prepared for Defi ance Silver Corp., September 26, 2014.

Golden Minerals., (2012) ArcGIS datasets for the Zacatecas Properties, Zacatecas. February 2012.

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• Manilla AC (2012) Proyecto Zacatecas, Zacatecas, Mexico. (internal report prepared for Golden Miner-als 201201-13).

• Mann A.W. (2010) Short MMI Report San Manuel - San Gil B. (MMI Interp Services for Golden Minerals 201001).

Nieto-Samaniego, A. F., Alaniz-Álvarez, S. A., & Camprubí, A. (2007). Mesa Central of México: Stratig-raphy, structure, and Cenozoic tectonic evolution. SPECIAL PAPERS-GEOLOGICAL SOCIETY OF AMERICA, 422, 41.

Ortega-Flores, B., Solari, L. A., & Escalona-Alcázar, F. D. J. (2016). Th e Mesozoic successions of western Sierra de Zacatecas, Central Mexico: provenance and tectonic implications. Geological Magazine, 153(4), 696-717.

Ponce S BF, Clark KF, Salas P (1988) Th e Zacatecas mining district; a Tertiary caldera complex associated with precious and base metal mineralization; A special issue devoted to the geology and mineral deposits of Mexico. Economic Geology and the Bulletin of the Society of Economic Geologists 83:1668–1682

Reyes-Reyes, N. A. (2006) Reporte del Levantamiento y Mapeo de Vetas de Vetas del Distrito Minero de Zacatecas. (Minera Largo S de RL de CV Internal Report 2006-12-19).

Reyes-Reyes, N. A. (2009) Informe sobre Actividades Realizadas Proyecto Panuco. (Minera Largo S de RL de CV Internal Report 2009-06-08).

Rodrigues-Cisneros O. (2012) Polygonal Resources Estimation of Panuco Vein. (La Compania Siver Re-sources de Mexico S de RL de CV for Minera Largo S de RL de CV Internal report 2012-02-11).

• Salinas-Prieto (2009) Analisis Estructural Regional del Districto Minero Zacatecas para Minera Largo, S de RL de CV. (internal report 2009-05).

SERVICIO METEOROLÓGICO NACIONAL - NORMALES CLIMATOLÓGICAS 1951-2010, Servicio Meteoro-lógico Nacional. Retrieved August 30, 2012.

SGM (2018). Monografía geológico minera del Estado de Zacatecas. Servicio Geoleológico Mexicano. Pachuca Hidalgo.

Simpson M.P. (2010) Short wavelength infrared and XRD mineral determinations for 63 drill core sam-ples from Mexico. (Microtermometris Y Accessoria Geologica Minera, SA de CV report for Gold-en Minerals 2010-0927).

Simpson M.P. (2011) Short wavelength infrared and XRD mineral determinations for 10 drill core sam-ples from Mexico. (Microtermometris Y Accessoria Geologica Minera, SA de CV report for Gold-en Minerals 2011-1102).

Smith, P., et al., 2017. NI 43-101 Technical Report, Preliminary Economic Assessment for the El Compas Project, Zacatecas State, Mexico. Prepared for Endeavor Silver Corp. May 11, 2017.

Tristán-González, M., Torres Hernández, J. R., Labarthe-Hernández, G., Aguillón-Robles, A., & Yza-Guzmán, R. (2012). Control estructural para el emplazamiento de vetas y domos félsicos en el distrito minero de Zacatecas, México. Boletín de la Sociedad Geológica Mexicana, 64(3), 353-367.

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Yta M, Barbanson L, Touray JC (1988) Veta San Ramon, El Orito, Zacatecas, México: Calcitization, Silicifi -cacion, Electrumaguilarita. Importancia de la Microtextura de la Sílice en el Control de la Minerali-zación.

Zamora-Vega, O. (2018) Multiple mineralization events in the Zacatecas Ag-Pb-Zn-Cu-Au District, and their relationship to the tectonomagmatic evolution of the Mesa Central, Mexico.. PhD Th esis.

Zamora-Vega, O., Richards, J. P., Spell, T., Dufrane, S. A., & Williamson, J. (2018). Multiple mineralization events in the Zacatecas Ag-Pb-Zn-Cu-Au district, and their relationship to the tectonomag-matic evolution of the Mesa Central, Mexico. Ore Geology Reviews, 102, 519-561.

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19 DATE AND SIGNATURE PAGE

For and on behalf of the Authors to accompany the report dated 24[th] of December 2020 entitled ‘Independent Technical Report on the Zacatecas Properties, Zacatecas State, Mexico’.

"Dr Paul Pearson"

Dr Paul Pearson, BSc (Hons), PhD, FAusIMM Independent Consultant 24[th] of December 2020

"Juan-Manuel Morales-Ramirez"

Juan-Manuel Morales-Ramirez, BSc, MSc, P. Geo Independent Consultant

24[th] of December 2020

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20 CERTIFICATE OF QUALIFICATION

To accompany the report dated 24[th ] of December 2020 entitled, ‘Independent Technical Report on the Zacatecas Properties, Zacatecas State, Mexico’

I, Juan-Manuel Morales-Ramirez, BSc, MSc, P. Geo, from Hermosillo, Sonora, Mexico, do hereby certify that:

• 1 I am an independent consultant geologist; my address is Calle Paseo del Norte #47, Colonia Paseo del Sol, Hermosillo, Sonora, Mexico, 83246.

• 2 I graduated with a Bachelor’s degree in Geology (Geological Engineering) from Instituto Politécnico Nacional, Mexico City, Mexico in 1976, and MSc (Geology) form Universidad de Sonora in Hermosillo, Sonora, Mexico (thesis pending).

• 3 I am a Certifi ed Professional Geologist (CPG #11234) in good standing with the American Institute of Professional Geologists in Arizona, USA since 2008.

• 4 I have practiced my profession continuously for over 40 years since my graduation in 1976. My exploration experience has been acquired with a variety of companies including: Consejo de Recursos Minerales (SGM); the US Geological Survey; VITRO; US Borax, USMX, Cambior (1992-1997), Noranda and X-Ore (20052013) and Silver Pursuit Resources Ltd.

• 5 I have read the defi nition of ‘qualifi ed person’ set out in National Instrument 43-101 (NI 43-101) and certify that by reason of my education, affi liation with a professional association (as defi ned in NI 43-101) and past relevant work experience, I fulfi l the requirements to be a ‘qualifi ed person’ for the purposes of NI 43-101.

• 6 As a co-author with Dr Pearson, I am responsible for all sections of this report titled ‘Independent Technical Report on the Zacatecas Properties, Zacatecas State, Mexico’.

• 7 As of the date of this Certifi cate, to the best of my knowledge, information and belief, this Report contains all scientifi c and technical information that is required to be disclosed, to make the Technical Report not misleading.

• 8 I am independent of Zacatecas Silver Corp., the property and property vendor, applying all of the tests in section 1.5 of National Instrument 43-101.

• 9 I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has been prepared in compliance with that instrument and form.

• 10 I consent to the fi ling of the Technical Report with any stock exchange and other regulatory authority and any publication by them for regulatory purposes, including electronic publication in the public company fi les on their websites accessible by the public, of the Technical Report.

"Juan-Manuel Morales-Ramirez"

Mr Morales-Ramirez, BSc, MSc, P. Geo 24[th] of December 2020

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To accompany the report dated 24[th ] of December 2020 entitled, ‘Independent Technical Report on the Zacatecas Properties, Zacatecas State, Mexico’

I, Paul J. Pearson, PhD, BSc(Hons), FAusIMM, do hereby certify that:

• 1 I am a Principal Consultant with Latin Global Structural Geology (Inversiones Leoval S.A.C.), with a business address of Av. Larco 724, Piso 9, Mirafl ores, Lima 18, Peru. Email: paul@latinglobal.com.au.

• 2 I am a graduate of the University of Queensland, Australia with a BSc (Hons. First Class) degree in Geology and Mineralogy (1982) and a Doctor of Philosophy (PhD) in Structural Geology (1989).

• 3 I am a registered member in good standing as a Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM - Member No. 220639) since 1998.

• 4 I have practiced my profession continuously since 1982 in the capacity of an exploration geologist, economic geologist and a manager of geoscience in various mining companies throughout Australasia and Latin America (including Mexico).

• 5 I have read the defi nition of ‘qualifi ed person’ set out in National Instrument 43-101 (NI 43-101) and certify that by reason of my education, affi liation with a professional association (as defi ned in NI 43-101) and past relevant work experience, I fulfi l the requirements to be a ‘qualifi ed person’ for the purposes of NI 43-101.

• 6 As a co-author with Mr Morales-Ramirez, I am responsible for all sections of this report titled ‘Independent Technical Report on the Zacatecas Properties, Zacatecas State, Mexico’.

• 7 As of the date of this Certifi cate, to the best of my knowledge, information and belief, this Report contains all scientifi c and technical information that is required to be disclosed, to make the Technical Report not misleading.

• 8 I am independent of Zacatecas Silver Corp., the property and property vendor, applying all of the tests in section 1.5 of National Instrument 43-101.

• 9 I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has been prepared in compliance with that instrument and form.

• 10 I consent to the fi ling of the Technical Report with any stock exchange and other regulatory authority and any publication by them for regulatory purposes, including electronic publication in the public company fi les on their websites accessible by the public, of the Technical Report

"Dr Paul J. Pearson"

Dr Paul J. Pearson PhD, BSc (Hons), FAusIMM 24[th] of December 2020

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