FVI.TO · 2020-12-31 12:00:00

Fortuna Updates Mineral Reserves and Mineral Resources

Resource Estimates

Vancouver, March 26, 20 21-- Fortuna Silver Mines, Inc. (NYSE: FSM ) ( TSX: FVI ) is pleased to report

updated Mineral Reserve and Mineral Resource estimates as of December 31, 2020 for its three mines in

Latin America, the San Jose Mine located in Mexico, the Caylloma Mine located in Peru, and the Lindero

Mine located in Argentina.

Jorge A. Ganoza, President and CEO, commented: “Reserves and resources at our mines were impacted

by a combination of production-related depletion and the suspension of our 2020 exploration programs

in response to COVID -19 constraints, which reduced the Company´s ability to replace mined material. ”

Mr. Ganoza continued, “Now that the capital -intensive phase at Lindero is over, we look forward to re-

energizing our Brownfields exploration program with a robust consolidated budget of US$16 million which

includes over 5 3,000 meters of diamond drilling aimed at expanding current resources at San Jose and

Caylloma.”

Highlights of Mineral Reserve and Mineral Resource Update

Silver Mines

• Combined Proven and Probable Mineral Reserves for the Caylloma and San Jose mines are

reported at 5.3 Mt containing 28.8 Moz silver and 170 koz gold, representing a year-over-year

decrease of 23 percent on both contained silver and gold ounces

• Combined Inferred Mineral Resources for the Caylloma and San Jose mines are reported at

7.2 Mt containing an estimated 28.5 Moz silver and 152 koz gold, reflecting a year-over-year

decrease of 8 and 10 percent in contained silver and gold ounces, respectively

Gold Mine

• Lindero Proven and Probable Mineral Reserves are reported at 82.7 Mt containing 1.6 Moz of

gold, reflecting a four percent decrease in contained gold ounces since March 31, 2019 .

Inferred Resources are reported at 30.4 Mt containing 412 koz of gold, reflecting an increase

of 289 percent in contained gold ounces

NYSE: FSM | TSX: FVI

www.fortunasilver.com NEWS RELEASE

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2020 Mineral Reserves and Mineral Resources

Mineral Reserves - Proven and Probable Contained Metal

Property Classification Tonnes

(000)

(g/t)

(%)

(Moz)

(koz)

Silver

Mines Caylloma,

Peru

Proven 131 150 0.56 2.27 2.28 0.6 2

Probable 1,532 105 0.26 2.67 3.65 5.2 13

Proven + Probable 1,662 108 0.28 2.64 3.54 5.8 15

San Jose,

Mexico

Proven 61 165 1.10 N/A N/A 0.3 2

Probable 3,528 200 1.35 N/A N/A 22.7 153

Proven + Probable 3,589 200 1.34 N/A N/A 23.0 155

Total Proven + Probable 5,251 171 1.01 N/A N/A 28.8 170

Gold

Mine Lindero,

Argentina

Proven 26,718 N/A 0.72 N/A N/A 0.0 622

Probable 55,940 N/A 0.57 N/A N/A 0.0 1,027

Proven + Probable 82,658 N/A 0.62 N/A N/A 0.0 1,649

Total Proven + Probable 28.8 1,819

Mineral Resources - Measured and Indicated Contained Metal

Property Classification Tonnes

(000)

(g/t)

(%)

(Moz)

(koz)

Silver

Mines Caylloma,

Peru

Measured 529 106 0.37 1.92 3.37 1.8 6

Indicated 1,611 96 0.26 1.74 3.36 5.0 14

Measured +

Indicated 2,140 99 0.29 1.78 3.36 6.8 20

San Jose,

Mexico

Measured 42 120 0.91 N/A N/A 0.2 1

Indicated 913 97 0.68 N/A N/A 2.8 20

Measured +

Indicated 955 98 0.69 N/A N/A 3.0 21

Total Measured +

Indicated 3,095 98 0.41 N/A N/A 9.8 41

Gold

Mine Lindero,

Argentina

Measured 2,520 N/A 0.55 N/A N/A 0.0 45

Indicated 33,070 N/A 0.46 N/A N/A 0.0 487

Measured +

Indicated 35,590 N/A 0.46 N/A N/A 0.0 532

Total Measured + Indicated 9.8 573

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Mineral Resources – Inferred Contained Metal

Property Classification Tonnes

(000)

(g/t)

(%)

(Moz)

(koz)

Silver

Mines

Caylloma,

Peru Inferred 3,751 122 0.40 2.70 4.08 14.7 49

San Jose,

Mexico Inferred 3,452 124 0.93 N/A N/A 13.8 104

Total Inferred 7,203 123 0.66 N/A N/A 28.5 152

Gold

Mine

Lindero,

Argentina Inferred 30,400 N/A 0.42 N/A N/A 0.0 412

Total Inferred 28.5 564

Notes:

1. Mineral Reserves and Mineral Resources are as defined by the 2014 CIM Definition Standards for Mineral Resources and

Mineral Reserves

2. Mineral Resources are exclusive of Mineral Reserves

3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability

4. Factors that could materially affect the reported Mineral Resources or Mineral Reserves include; changes in metal price and

exchange rate assumptions; changes in local interpretations of mineralization; changes to assumed metallurgical recoveries,

mining dilution and recovery; and assumptions as to the continued ability to access the site, retain mineral and surface rights

titles, maintain environmental and other regulatory permits, and maintain the social license to operate

5. Mineral Resources and Reserves are estimated as of June 30, 2020 and reported as of December 31, 2020 taking into account

production-related depletion for the period through December 31, 2020

6. Mineral Reserves for the San Jose Mine are based on underground mining within optimized stope designs using an estimated

NSR break-even cut-off grade of US$69.47/t, equivalent to 120 g/t Ag Eq based on assumed metal prices of US$21/oz Ag and

US$1,600/oz Au; estimated metallurgical recovery rates of 91% for Ag and 90% for Au and mining costs of US$34.92/t;

processing costs of US$17.10/t; and other costs including distribution, management, community support and general service

costs of US$17.44/t based on actual operating costs. Mining recovery is estimated to average 93% and mining dilution 11%.

Mineral Resources are reported at a 100 g/t Ag Eq cut -off grade based on the same parameter s used for Mineral Reserves

and a 15% upside in metal prices. Proven + Probable Reserves include 1.9 Mt containing 14 Moz of silver and 83 koz of gold

reported at a 123 g/t Ag Eq cut -off grade and Inferred Resources totaling 2.5 Mt containing 9.7 Moz of si lver and 70 koz of

gold reported at a 100 g/t Ag Eq cut-off grade located in the Taviche Oeste concession and subject to a 2.5% royalty

7. Mineral Reserves for the Caylloma Mine are reported above NSR breakeven cut -off values based on underground mining

methods including; mechanized (breasting) at US$ 83.37/t; mechanized (enhanced) at US$ 81.66/t; semi -mechanized at

US$ 90.19/t; and a conventional method at US$173.74/t; using assumed metal prices of US$21/oz Ag, US$1,600/oz Au,

US$2,000/t Pb and US$2,270/ t Zn; metallurgical recovery rates of 83% for Ag, 42% for Au, 91% for Pb and 90% for Zn with

the exception of the Ramal Piso Carolina vein that uses a metallurgical recovery rate of 75% for Au. Mining, processing and

administrative costs used to determine NSR cut-off values were estimated based on actual operating costs incurred from July

2019 through June 2020. Mining recovery is estimated to average 95% with average mining dilution ranging from 13% to 32%

depending on the mining methodology. Mineral Resources are reported at an NSR cut-off grade of US$65/t for veins classified

as wide (Animas, Animas NE, Nancy, San Cristobal) and US$135/t for veins classified as narrow (all other veins) based on the

same parameters used for Mineral Reserves, and a 15% upside in metal prices

8. Mineral Reserves for Lindero are reported based on open pit mining within a designed pit shell based on variable gold cut-off

grades and gold recoveries by metallurgical type. Met type 1 cut-off 0.27 g/t Au, recovery 75.4%; Met type 2 cut-off 0.26 g/t

Au, recovery 78.2%; Met type 3 cut -off 0.26 g/t Au, recovery 78.5%; and Met type 4 cut -off 0.27 g/t Au, recovery 68.5%.

Mining recovery is estimated to average 100% and mining dilution 0%. The cut -off grades and pit designs are considered

appropriate for long term gold prices of US$1,600/oz, estimated mining costs of US$1.11 per tonne of material, total

processing and process G&A costs of US$6.21 per tonne of ore, and refinery costs net of pay factor of US$6.50 per ounce

gold. Lindero Mineral Reserves are restricted to a maximum heap leach capacity of 84.2 Mt. Reported Proven Reserves include

2.6 Mt averaging 0.55 g/t Au of stockpiled material. Lindero Mineral Resources are reported within the same conceptual pit

shell above a 0.2 g/t Au cu t-off grade based on the same parameters used for Mineral Reserves and a 15% upside in metal

prices

9. Eric Chapman, P. Geo. (APEGBC #36328) is the Qualified Person for Mineral Resources and Amri Sinuhaji (APEGBC #48305) is

the Qualified Person for Mineral Reserves, both being employees of Fortuna Silver Mines Inc.

10. N/A = Not Applicable

11. Totals may not add due to rounding

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San Jose Mine, Mexico

As of December 31, 2020, the San Jose Mine has Proven and Probable Mineral Reserves of 3.6 Mt

containing 23.0 Moz of silver and 155 koz of gold, in addition to Inferred Resources of 3. 5 Mt containing

a further 13.8 Moz of silver and 104 koz of gold.

Year-over-year, Mineral Reserves decreased 9 percent in terms of tonnes, 25 percent in contained silver

and 24 percent in contained gold ounces after net changes resulting from production -related depletion

and updated mining costs ( -962 kt), adjustments to the geological model and mining recovery ( -84 kt),

change in long term precious metal prices (+678 kt) , and the upgrading and conversion of Inferred

Resources to Mineral Reserves due to a limited infill drill program (+22 kt) . Silver grade decreased

18 percent and gold grade decreased 17 percent to 200 g/t and 1.34 g/t, respectively due to a decrease

in the Mineral Reserve break-even cut-off grade from 138 g/t to 120 g/t Ag Eq in relation to an increase

in long term precious metal prices.

Measured and Indicated Resource tonnes exclusive of Mineral Reserves increased year -over-year from

0.5 Mt to 1.0 Mt due primarily to a change in the Mineral Resource break-even cut-off grade from 110 g/t

to 100 g/t Ag Eq.

Year-over-year, Inferred Resources decreased 11 percent in terms of tonnes , 15 percent in contained

silver ounces, and 13 percent in gold ounces. Silver and gold grades decreased by 5 percent and 3 percent

respectively. The net variation is due primarily to production-related depletion, reductions resulting from

the upgrading of high -grade Inferred Resources related to infill drilling , adjustments in the geological

interpretation, and a change in the Mineral Resource breakeven cut -off grade as described above .

Brownfields exploration drilling was suspended for 2020 resulting in no additional resources being added

to the inventory last year (Refer to Fortuna news rel ease dated March 17, 2020, “Fortuna provides an

update on the status of its operations in response to the worldwide spread of COVID-19”).

An aggressive brownfields exploration program budget of US$10.9 million, which includes 33,800 meters

of diamond drilling, aimed at discovering new resources and expanding current reserves, is planned to be

executed in 2021 (Refer to Fortuna news release dated January 19, 2021, “Fortuna reports 2020 full year

production of 11.3 million silver equivalent ounces and issues 2021 guidance“).

Caylloma Mine, Peru

As of December 31, 20 20, the Caylloma Mine has Proven and Probable Mineral Reserves of 1.7 Mt

containing 5.8 Moz of silver and 15 koz of gold, in addition to Inferred Resources of 3.8 Mt containing

14.7 Moz of silver and 49 koz of gold.

Year-over-year, Mineral Reserve tonnes decreased by 32 percent, while silver grade increased 33 percent

to 108 g/t, lead grade increased 1 0 percent to 2. 64%, and zinc grade decreased 8 percent to 3. 54%.

Changes are primarily due to mining related depletion (-460 kt), upgrading and conversion of Infe rred

Resources to Mineral Reserves due to a limited infill drill program focused on the Animas/Animas NE vein

(+100 kt), and changes in base metal prices and commercial terms (-486 kt).

Measured and Indicated Resource tonnes, exclusive of Mineral Reserve s, decreased by 9 percent year -

over-year to 2.1 Mt.

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Inferred Resources tonnes decreased by 0.3 Mt or 8 percent year-over-year. Silver, lead, and zinc grades

increased 9 percent, 5 percent, and 2 percent, respectively. The decrease in Inferred Mineral Resources

is primarily due to a successful infill drill program of the Animas/Animas NE vein resulting in the upgrading

of Inferred Mineral Resources to Mineral Reserves coupled with adjustments in the NSR value based on

updated metal prices and commercial terms . Brownfields exploration drilling was suspended for 2020

resulting in no additional resources being added to the inventory last year (Refer to Fortuna news release

dated March 17, 2020, “Fortuna provides an update on the status of its operations in response to the

worldwide spread of COVID-19”).

An exploration program budget of US$4.7 million, which includes 19,000 meters of diamond drilling, is

planned to be executed in 2021 with a focus on expanding previously defined silver and base metal rich

Mineral Resources located to the north and south of the mine (Refer to Fortuna news release dated

January 19, 2021, “Fortuna reports 2020 full year production of 11.3 million silver equivalent ounces and

issues 2021 guidance“).

Lindero Mine, Argentina

As of December 31, 20 20, the Lindero Mine has Proven and Probable Mineral Reserves of 82.7 Mt

containing 1.6 Moz of gold, in addition to Measured and Indicated Resources , exclusive of Mineral

Reserves, of 35.6 Mt containing 0.5 Moz of gold, and Inferred Resources of 30.4 Mt containing 0.41 Moz

of gold.

Since March 31, 2019, Mineral Reserve tonnes decreased by 2 percent, while gold grade also decreased

2 percent to 0.62 g/t. Changes are due solely to mining related depletion of material delivered to the heap

leach pad (-1.5 Mt).

Measured and Indicated Resource tonnes, exclusive of Mineral Reserves, increased by 16.7 Mt or

89 percent since March 31, 2019 to 35.6 Mt, due to an increase in the size of the pit shell associated with

higher long term gold prices and the constraint on Mineral Reserves based on the heap leach capacity of

84.2 Mt.

Inferred Resources tonnes increased by 21.8 Mt or 253 percent, to 30.4 Mt since March 31, 2019 with the

gold grade increas ing 11 percent to 0.42 g/t . The increase in Inferred Resources is due to the

aforementioned larger pit shell modeled as a result of a higher long term gold price.

Qualified Person

Eric Chapman, Vice President of Technical Services, is a Professional Geoscientist of the Association of

Professional Engineers and Geoscientists of the Province of British Columbia (Registration Number 36328)

and a Qualified Person as defined by National Instrument 43 -101- Standards of Disclosure for Mineral

Projects. Mr. Chapman has reviewed and approved the scientific and technical information contained in

this news release and has verified the underlying data.

About Fortuna Silver Mines Inc.

Fortuna Silver Mines Inc. is a Canadian precious metals mining company with operations in Peru, Mexico

and Argentina. Sustainability is integral to all our operations and relationships. We produce silver and gold

and generate shared value over the long -term for our shareholders and stakeholders through efficient

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production, environmental protection and social responsibility. For more information, please visit our

website at www.fortunasilver.com.

ON BEHALF OF THE BOARD

Jorge A. Ganoza

President, CEO, and Director

Fortuna Silver Mines Inc.

Investor Relations:

Carlos Baca | T (Peru): +51.1.616.6060, ext. 0

Forward-looking Statements

This news release contains forward -looking statements which constitute “forward-looking information”

within the meaning of applicable Canadian securities legislation and “forward-looking statements” within

the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995

(collectively, “Forward -looking Statements”). All statements included herein, other than statements of

historical fact, are Forward-looking Statements and are subject to a variety of known and unknown risks

and uncertainties which could cause actual events or results to differ materially from those reflected in the

Forward-looking Statements. The Forward-looking Statements in this news release may include, without

limitation, statements about the Company’s plans for its mines and mineral properties; the Company’s

business strategy, plans and outlook; the merit of the Company’s mines and mineral properties; mineral

resource and reserve estimates; the Company’s ability to convert inferred mineral resources to indicated

mineral resources and to convert mineral resources to mineral reserves; timelines; production at the mines;

the future financial or operating performance of the Company; the effects of laws, regulations and

government policies affecting our operations or potential future operatio ns; future successful

development of our projects; the estimates of expected or anticipated economic returns from the

Company’s mining operations including future sales of metals, doré and concentrate or other products

produced by the Company and the Company’s ability to achieve its production and cost guidance; capital

expenditures at the Company’s operations; estimated brownfields expenditures in 2021; the success of the

Company’s exploration activities at its mines and development projects; the duration and impacts of

COVID-19 on the Company’s production, workforce, business, operations and financial condition; metal

price estimates, estimated metal grades in 2021; approvals and other matters. Often, but not always,

these Forward-looking Statements can be identified by the use of words such as “estimated”, “potential”,

“open”, “future”, “assumed”, “projected”, “used”, “detailed”, “has been”, “gain”, “planned”, “reflecting”,

“will”, “anticipated”, “estimated” “containing”, “remaining”, “to be”, or statements that events, “could”

or “should” occur or be achieved and similar expressions, including negative variations.

Forward-looking Statements involve 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

results, performance or achievements expressed or implied by the Forward -looking Statements. Such

uncertainties and factors include, among others, changes in general economic conditions and financial

markets; the impact of the COVID -19 pandemic on the Company’s mining operations and construction

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activities; the duration and impacts of COVID -19 on the Company’s production, workforce, business,

operations and financial condition, and the risks relating to a global pandemic, which unless contained

could cause a slowdown in global economic growth; uncertainties related to the impacts of COVID -19

which may include: changing market conditions, changing restrictions on the mining industry in the

countries in which the Co mpany operates, the ability to operate as a result of government imposed

restrictions, including restrictions on travel, the transportation of concentrates and doré, access to

refineries, the impact of additional waves of the pandemic or increases of incid ents of COVID -19 in the

countries in which we operate; the duration of any suspension of operations at the Company’s mines as a

result of COVID -19 which may affect production and the Company’ business operations and financial

condition; changes in prices f or gold, silver and other metals; changes in the prices of key supplies;

technological and operational hazards in Fortuna’s mining and mine development activities; risks inherent

in mineral exploration; uncertainties inherent in the estimation of mineral reserves, mineral resources, and

metal recoveries; changes to current estimates of mineral reserves and resources; changes to production

and cost estimates; governmental and other approvals; changes in government, political unrest or

instability in countrie s where Fortuna is active; fluctuations in currencies and exchange rates; the

imposition of capital control in countries in which the Company operates; labor relations issues; as well as

those factors discussed under “Risk Factors” in the Company's Annual Information Form. Although the

Company has attempted to identify important factors that could cause actual actions, events or results to

differ materially from those described in Forward -looking Statements, there may be other factors that

cause actions, events or results to differ from those anticipated, estimated or intended.

Forward-looking Statements contained herein are based on the assumptions, beliefs, expectations and

opinions of management, including but not limited to the accuracy of the Company’s current mineral

resource and reserve estimates and the assumptions upon which they are based; ore grades and

recoveries; prices for silver, gold and base metals remaining as estimated; currency exchange rates

remaining as estimated; capital, decommissioni ng and reclamation estimates ; prices for energy, labour,

materials and supplies, transport and services; that the Company’s activities will be in accordance with the

Company’s public statements and stated goals; that there will be no material adverse chang e affecting

the Company or its properties ; the duration and impacts of COVID -19 on the Company’s production,

workforce, business, operations and financial condition, and the risks relating to a global pandemic, which

unless contained could cause a slowdown in global economic growth; government mandates in Peru,

Mexico and Argentina with respect to mining operations generally or auxiliary businesses or services

required for the Company’s operations; government and the Company’s attempts to reduce the spread of

COVID-19 which may affect may aspects of the Company’s operations, including transportation of

personnel to and from site, contractor and supplier availability and the ability to sell or deliver concentrate

and doré; the expected trends in mineral prices and currency exchange rates; that the Company’s activities

will be in accordance with the Company’s public statements and stated goals; that there will be no material

adverse change affecting the Company or its properties; that all required approvals wil l be obtained for

the Company’s business and operations; that there will be no significant disruptions affecting operations

and such other assumptions as set out herein. Forward-looking Statements are made as of the date hereof

and the Company disclaims any obligation to update any Forward-looking Statements, whether as a result

of new information, future events or results or otherwise, except as required by law. There can be no

assurance that these Forward-looking Statements will prove to be accurate, as a ctual results and future

events could differ materially from those anticipated in such statements. Accordingly, investors should not

place undue reliance on Forward-looking Statements.

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Cautionary Note to United States Investors Concerning Estimates of Reserves and Resources

Reserve and resource estimates included in this news release have been prepared in accordance with

National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43 -101") and the Canadian

Institute of Mining, Metallurgy, and Petroleum Definition Standards on Mineral Resources and Mineral

Reserves. NI 43 -101 is a rule developed by the Canadian Securities Administrators that establishes

standards for public disclosure by a Canadian company of scientific and technical information concerning

mineral projects. Equivalent U.S. reporting requirements are currently governed by the United States

Securities and Exchange Commission ("SEC") Industry Guide 7 (“Industry Guide 7”) under the U.S. Securities

Act of 1933, as amended. Canadian standards, including NI 43 -101, differ significantly from the

requirements of the SEC currently in effect under Industry Guide 7, and reserve and resource information

contained in this news release may not be comparable to similar information disclosed by U.S. companies.

In particular, the term "resource" does not equate to the term "reserves". Under the SEC's disclosure

standards currently in effect under Industry Guide 7, mineralization may not be classified as a "reserv e"

unless the determination has been made that the mineralization could be economically and legally

produced or extracted at the time the reserve determination is made. While the SEC recognizes the

reporting of mineral deposits which do not meet the Indust ry Standard Guide 7 definition of “reserve” as

of February 25, 2019, the effective adoption of the Modernization of Property Disclosures for Mining

Registrants, such rules are not required to be compiled with until the first fiscal year beginning on or after

January 1, 2021. As a result, the SEC's disclosure standards currently in effect normally do not permit the

inclusion of information concerning "measured mineral resources", "indicated mineral resources" or

"inferred mineral resources" or other descriptions of the amount of mineralization in mineral deposits that

do not constitute "reserves" by U.S. standards in documents filed with the SEC. You are cautioned not to

assume that resources will ever be converted into reserves. You should also understand th at "inferred

mineral resources" have a great amount of uncertainty as to their existence and great uncertainty as to

their economic and legal feasibility. You should also not assume that all or any part of an "inferred mineral

resource" will ever be upgraded to a higher category. Under Canadian rules, estimated "inferred mineral

resources" may not form the basis of feasibility or pre -feasibility studies except in rare cases. You are

cautioned not to assume that all or any part of an "inferred mineral resource" exists or is economically or

legally mineable. Disclosure of "contained ounces" in a resource is permitted disclosure under Canadian

regulations; however, the SEC's disclosure standards currently in effect under Industry Guide 7 normally

only permit issuers to report mineralization that does not constitute "reserves" by such standards as in -

place tonnage and grade without reference to unit measures. The requirements of NI 43 -101 for

identification of "reserves" are also not the same as those of the SEC' s disclosure standards currently in

effect under Industry Guide 7, and reserves reported in compliance with NI 43 -101 may not qualify as

"reserves" under such SEC standards. Accordingly, information concerning mineral deposits set forth in this

news releas e may not be comparable with information made public by companies that report in

accordance with U.S. standards.

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