Discovery Completes Acquisition of Kidd Operations
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Discovery Completes Acquisition of Kidd Operations
• Acquisition supports Discovery’s vision to more than double gold production in Timmins to
over half a million ounces per year
• Study advancing for construction of new conventional gold processing circuit at Kidd Met
Site; Future production from Hoyle Pond, Pamour, Borden and TVZ expected to be processed
at the Met Site, with Dome Mill to be dedicated for processing material from Dome Mine
following an anticipated resumption of operations
• Surface access at Kidd Met Site to support planned future expansion of Hoyle Pond and
Pamour, and provide valuable locations for surface exploration
• Attractive potential synergies for Hoyle Pond and Pamour, including reduced haulage costs,
greater efficiency in waste rock deposition and the potential use of gold tailings at the Kidd
tailings management area (“Kidd TMA”)
• Provides exposure to critical minerals at Kidd Creek Mine, including copper, zinc and silver
(expected production for remainder of 2026 includes 10 – 15 thousand tonnes of zinc, 5 – 7
thousand tonnes of copper and approximately 0.4 million ounces of silver)
• Delivers large, high-potential exploration land position north of Timmins through acquisition
of Kidd Creek Timber Ltd.
June 1, 2026, Toronto, Ontario - Discovery Silver Corp. (TSX: DSV, OTCQX: DSVSF) (“Discovery”
or the “Company”) today reported the completion of the previously announced acquisition of Glencore
Canada Corporation’s (“Glencore”) 100% interest in the Kidd operations (“Kidd” or “Kidd Operations”)
in Timmins, Ontario (the “Transaction”). The Kidd Operations include the Kidd Metallurgical Site (“Kidd
Met Site” or the “Met Site”), the Kidd Creek copper, zinc and silver mine (“Kidd Creek Mine” or “Kidd
Creek”), and the Kidd Creek Timber Ltd. exploration land package. All amounts are in US dollars unless
otherwise specified.
Tony Makuch, Discovery’s President and CEO, commented: “The acquisition of the Kidd Operations is
a major development for Discovery as we work to advance our extensive growth plans, including more
than doubling gold production in the Timmins Camp to over half a million ounces per year. With the
completion of the Transaction, we have added extremely valuable processing and other infrastructure,
as well as a large land position that will support the planned future expansion Hoyle Pond and Pamour,
including the development of TVZ. We also have gained highly attract ive cost synergies, exposure to
critical minerals and substantial exploration upside . We have also retained an experienced, highly
skilled workforce.
“The Kidd Met Site is a large processing facility that will be a key component of our milling strategy
going forward. Through the construction of a new conventional gold circuit, as well as other
modifications and investments, we envision having an opportunity to process future tonnage from our
current operations, as well as the TVZ Zone, at the Met Site, while maintaining the capacity to continue
processing base metals from the Kidd Creek Min e. This approach would allow the Dome Mill to be
NEWS RELEASE
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dedicated to processing mineralization from the adjacent Dome Mine following an anticipated
resumption of mining operations.
“Also extremely valuable is the land position that we have acquired. The Kidd surface rights are a key
benefit of the Transaction, as they will allow for the optimal placement of potential new infrastructure
for Hoyle Pond and the development of the TVZ project , and provide valuable locations for surface
exploration around Hoyle Pond. We are currently evaluating the construction of new ventilation raises,
and possibly a new shaft, at Hoyle Pond, which would be located on the Kidd Met Site property (see
Figure 1.).
“In terms of anticipated synergies, our plans for the Kidd Met Site will result in lower haulage costs,
given that the Met Site is contiguous to both Hoyle Pond and Pamour. In addition, we will gain improved
options for waste rock deposition from the Pamour mine and have an opportunity to use our gold tailings
at the Kidd TMA.
“Turning to the Kidd Creek Mine, we will assess the potential for a longer-term future beyond the end
of this year through the completion of technical studies and a drill ing program. Based on the Kidd
Operations’ current business plan, p roduction over the remainder of 2026 is estimated at 10 – 15
thousand tonnes of zin c, 5 – 7 thousand tonnes of copper, and approximately 0.4 million ounces of
silver, with this production expected to generate positive cash flow and contribute favourably to our
cash position at year-end 2026.”
As c onsideration for the Transaction, the Company has paid to Glencore $10 million through the
issuance of 1,679,171 Discovery common shares. Additional consideration includes:
• The assumption of all financial assurances and environmental and rehabilitation obligations
associated with the Kidd Met Site and the Kidd Creek Mine, subject to terms and conditions of
the Agreement;
• Offtake arrangements related to concentrates produced from the Kidd Creek Mine;
• A 1.0% net smelter return royalty that would apply to any future mineral production from a large
exploration land package held by Kidd Creek Timber Ltd., that is located outside of the existing
operations; and
• The reimbursement of certain costs incurred by Glencore with respect to additional work
required at the Kidd TMA up to a maximum amount of $75 million, payable in cash or Discovery
common shares at the Company’s election on receipt of material permits and regulatory
approvals required to deposit gold tailings at the Kidd TMA.
Conditions of closing, including the transfer of all associated property, claims, assets and the issued
and outstanding shares of Kidd Creek Timber Ltd., from Glencore to the Company have all been met.
Further, all regulatory approvals required, including the conditional approval of the Toronto Stock
Exchange for the issuance of the Discovery common shares to Glencore, the approval required under
the Competition Act (Canada) and all other customary closing conditions, have been received.
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KIDD OPERATIONS
Glencore’s Kidd Operations are located in Timmins, Ontario and include the Kidd Creek Mine and Kidd
Met Site. The Kidd Operations opened in 1966 and over the last 60 years have produced over 772
million pounds of copper, 2.1 billion pounds of zinc and 400 million ounces of silver. In 2025, Glencore
announced plans to close both the Kidd Met Site and Kidd Creek Mine at the end of 2026.
The Kidd Creek Mine is the world’s deepest base metal mine, with mining operations currently at the
9,800-foot level and the shaft extending to the 9,889 -foot level. All mining at the Kidd Creek Mine is
performed using the sublevel longhole mining method. Ore is hoisted up the shaft and transported by
rail 27 kilometres to the Kidd Met Site. Discovery plans to continue operating the Kidd Creek Mine and
will assess the potential for a longer-term future beyond the end of this year through the completion of
technical studies and a drilling program.
The Kidd Met Site is a large, fully permitted processing facility that provides key infrastructure, including
four independent processing circuits, significant tailings capacity, 90 MW of available power, a large
metallurgical lab, fresh water supply and treatment capabilities and rail access. The Met Site includes
a crushing plant and concentrator with four independent circuits (A, B, C and D Divisions) consisting of
rod mill, ball mill and flotation infrastructure. There are also five thickeners and gas fired concentrate
dryers. Currently, two circuits (B and C) are operating to process Kidd Creek Mine copper and zin c
ores, with an operating capacity of approximately 6,000 tonnes per day. The remaining two circuits (A
and D) are presently idled and were previously used for processing other ores, including nickel ores
from the Montcalm Mine in Timmins, as well as ores related to custom milling. The four -circuit
configuration of the Met Site provides both significant scale and flexibility.
Discovery is currently evaluating the construction of a new conventional gold circuit in the area around
the idled A Division. The new circuit is expected to have a capacity sufficient to process mine production
from Hoyle Pond and Pamour, and will include a primary crusher, SAG and ball mills, CIL circuit, a
thickener, an elution circuit and small refinery (see Figure 1). The Company also plans to assess each
of the flotation circuits at the Met Site (B, C and D Divisions) for processing gold material from Borden
and TVZ, while also continuing to process base metal mineralization from Kidd Creek Mine. Processing
Borden material at the Kidd Met Site is expected to have favourable implications for recoveries and
costs at Dome Mill and will provide the mill with approximately 2,000 tonnes per day of additional
throughput availability.
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FIGURE 1.
ABOUT DISCOVERY
Discovery is a growing precious metals company that is creating value for stakeholders through
exposure to both gold and silver. The Company’s silver exposure comes from its first asset, the 100%-
owned Cordero project, one of the world’s largest undevelope d silver deposits, which is located close
to infrastructure in a prolific mining belt in Chihuahua State, Mexico. In April 2025, Discovery acquired
the Porcupine Complex, transforming the Company into a new Canadian gold producer with multiple
operations, attractive growth projects and significant exploration upside in one of the world’s most
renowned gold camps in and near Timmins, Ontario. The acquisition of the Kidd Operations of Glencore
Canada in June 2026 further increased Discovery’s land position within the camp and provided valuable
infrastructure that will support the Company’s efforts to more than double annual gold production.
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On Behalf of the Board of Directors,
Tony Makuch, P. Eng
Chairman, President & CEO
For further information contact:
Mark Utting, CFA
SVP Investor Relations
Phone: 416-806-6298
Email: [email protected]
Website: www.discoverysilver.com
QUALIFIED PERSONS
The scientific and technical information included in this press release has been reviewed and approved
by Mr. Eric Archibald, P.Eng., the Company’s Technical Services Manager for the Kidd Operations and
Mr. Benoit Drolet, P.Geo., the Company’s Senior Resource Geologist for the Kidd Operations. Mr.
Archibald and Mr. Drolet are both a “Qualified Person” as such term is defined in National Instrument
43-101.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This press release contains “forward -looking information” within the meaning of applicable Canadian securities legislation. All information,
other than statements of historical facts, included in this press release that address activities, events or develo pments that the Company
expects or anticipates will or may occur in the future, including such things as future business strategy, competitive strengths, goals, expansion
and growth of the Company's businesses, operations, plans and other such matters are forward-looking information.
When used in this press release, the words “estimate”, “plan”, “continue”, “anticipate”, “might”, “expect”, “project”, “intend”, “may”, “will”, “shall”,
“should”, “could”, “would”, “predict”, “predict”, “forecast”, “pursue”, “potential”, “believe” and similar expressions are intended to identify forward-
looking information. This information involves known and unknown risks, uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or
implied by such forward-looking information.
Examples of such forward -looking information contained in this press release include, without limitation, statements with respect to: the
anticipated benefits of the Transaction, including anticipated synergies and the impact of the Transaction on the Comp any's operations,
financial condition, cash flows and overall strategy; the Company’s plans for and the potential success of future production and processing
activities, including expectations with respect to any permitting, development or other work that may be required; the proposed timing and
amount of estimated future production and the illustrative costs thereof; future exploration activities and the anticipated results thereof; plans
with respect to new infrastructure; the timing with respect to the construction of a new conventional gold circuit at the Kidd Met Site and
anticipated benefits thereof; the anticipated timing and benefits associated with the resumption of mining operations at the Dome mine; the
anticipated timing and benefits associated with a new vent raise or shaft at Hoyle Pond; other statements relating to the financial and business
prospects of the Company; information as to the Company's strategy, plans or future financial or operating performance; and other events or
conditions that may occur in the future.
Factors that could cause actual results to vary from results anticipated by such forward -looking statements include, among others: the
Company's ability to achieve the anticipated benefits from the Transaction; the accuracy of historical and forward -looking operational and
financial information and estimates provided by Glencore; the Company's ability to successfully integrate the Kidd Operations into the
Company's existing operations; the accuracy of financial and operational projections of the Company following completion of the Transaction,
including expected production from Kidd Creek Mine for the remainder of 2026 ; the ability of the Company to complete the necessary work
required with respect to the Kidd T MA and the anticipated benefits there of; the continuing accuracy of statements regarding the Kidd
Operations, including the results of technical studies and the anticipated capital and operations costs, sustaining costs, internal rate of return,
concession or claim renewal, permitting, economic a nd scoping-level parameters, mineral resource and/or reserve estimates, the cost of
development, mine plans and mining methods, dilution and mining recoveries, processing method and rates and production rates, projected
metallurgical recovery rates, infrastructure requirements, capital, operating and sustaining cost estimates, the projected life of mine and other
expected attributes of the properties, the net present value, the timing of any environmental assessment processes, changes to configuration
that may be requested as a result of stakeholder or government input to the environmental assessment processes, government re gulations
and permitting timelines, and reclamation obligations; the future price of gold and o ther metals; currency exchange rates and interest rates;
favourable operating conditions; political stability; timely receipt of governmental approvals, licenses, and permits (and re newals thereof);
access to necessary financing; stability of labour markets and in market conditions in general; availability of equipment; the accuracy of mineral
resource estimates, and of any metallurgical testing completed to date; the costs and expenditures to complete the Company’s programs and
goals; the speculative nature of mineral exploration and development and mining operations in general; there being no significant disruptions
affecting the development and operation of the Company's properties; the availability of certain consumables and services and the prices for
power and other key supplies being approximately consistent with assumptions; labour and materials costs being approximately c onsistent
with assumptions; assumptions made in mineral resource estimates, including, but not limited to, geological interpretation, grades, metal price
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assumptions, metallurgical and mining recovery rates, geotechnical and hydrogeological assumptions, capital and operating cost estimates,
and general marketing factors; requirements for additional capital; environmental risks; general business and economic conditions; delays in
obtaining, or the inability to obtain, third-party contracts, equipment, supplies and governmental or other approvals; changes in law, including
the enactment of mining law reforms; accidents; labour disputes; unavailability of appro priate land use permits; changes to land usage
agreements and other risks of the mining industry generally; the inability to obtain financing required for the completion of exploration and
development activities; changes in business and economic conditions ; international conflicts; other factors beyond the Company's control;
and those factors included herein and elsewhere in the Company's public disclosure.
Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other
factors that cause results not to be as anticipated, estimated, or intended. See the section entitled “Risk Factors” i n the Company's annual
information form dated as of February 19, 2026 for the financial year ended December 31, 2025, for additional risk factors th at could cause
results to differ materially from forward-looking statements.
There can be no assurance that such information will prove to be accurate as actual developments or events could cause result s to differ
materially from those anticipated. These include, among others, the factors described or referred to elsewhere herein a nd include
unanticipated and/or unusual events. Many of such factors are beyond the Company's ability to predict or control.
The forward-looking information included in this press release is expressly qualified by the foregoing cautionary statements. Readers of this
press release are cautioned not to put undue reliance on forward-looking information due to its inherent uncertainty. The Company disclaims
any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise,
unless required under applicable laws. This forward-looking information should not be relied upon as representing management's views as of
any date subsequent to the date of this press release.