SRL.V · 2021-10-26 12:00:00

Adventus and Salazar Announce Feasibility Study Results and Updated Mineral Resources FOR the Curipamba Copper-GOLD Project

Economic Studies

Date:

News Release:

Ticker Symbols:

October 26, 2021

21-20

ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 1 of 20 –

ADVENTUS AND SALAZAR ANNOUNCE FEASIBILITY STUDY RESULTS

AND UPDATED MINERAL RESOURCES FOR THE CURIPAMBA COPPER-GOLD PROJECT

Highlights:

• The Curipamba feasibility study covers the first 10 years of mine life with an open-pit Mineral Reserve (“Feasibility

Study”). An updated preliminary economic assessment on the separate underground mine optionality envisioned

in years 10 to 14 is also outlined (“Underground PEA”)

• US$12M Feasibility Study resulted in an increase in the resource base, improved metallurgy leading to high quality

copper and zinc concentrates , grading 28% copper and 56% zinc respectively, and strong project definition with

detailed geotechnical and hydrogeological drilling programs completed

• Environmental, Social and Impact Assessment (“ESIA”) for open-pit mine and mill development shall be submitted

to the Ecuadorian Ministry of Environment in November 2021, which references the highest standards with

respect to tailings design, water and waste management, and discharge quality

• Adventus Mining has initiated a comprehensive review of all strategic development options, including concentrate

off-take and project finance packages, as well as potential options for strategic investment or corporate

transaction. Advanced discussions are underway for up to US$240M in non-equity financing

• Detailed engineering for Curipamba development is expected to begin in Q1 2022

• The tailings storage facility design has sufficient capacity for significant mineral reserve additions

• Adventus Mining will host a 2021 Feasibility Study Webinar on Wednesday, October 27, 2021, at 11 am ET. Please

Open Pit NI 43-101 Feasibility Study

• After-tax Feasibility Study IRR of 32% and NPV8% of US$259 million for initial open-pit development only

• 77% of life-of-mine revenues from payable copper and gold

• Production C1 cash cost of US$1.14/lb and AISC of US$1.26/lb copper equivalent

• Average annual production of 10,463 tpa copper and 21,390 tpa copper equivalent over the life-of-mine

• Proven and Probable Mineral Reserves of 6.5 M tonnes at 1.93% Cu, 2.49% Zn, 2.52 g/t Au, 45.7 g/t Ag, 0.25% Pb

Underground PEA Update (1)

• Underground mine plan based on Indicated and Inferred Resources, independent of those resources used in the

open pit Feasibility Study

• After-tax NPV8% of US$49 million, assuming underground production starts after the completion of the open-pit

mine plan in year 10, and discounted to the same time zero as the open-pit Feasibility Study (year -2)

• Additional Indicated and Inferred Mineral Resources of 1.9 million tonnes at 2.72% Cu, 2.38% Zn, 1.37 g/t Au, 31

g/t Ag, 0.14% Pb and 0.8 million tonnes at 2.31% Cu, 2.68% Zn, 1.74 g/t Au, 29 g/t Ag, 0.11% Pb, respectively

• Option to upgrade underground Mineral R esources to reserve s by an infill drilling, test -work program and

completion of a separate feasibility study estimated to cost approximately US$8M over 2.5 years

1 The preliminary economic assessment is preliminary in nature and includes inferred mineral resources that are

considered too speculative geologically to have the economic considerations applied to them that would enable them to

be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized.

Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Date:

News Release:

Ticker Symbols:

October 26, 2021

21-20

ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 2 of 20 –

Toronto, October 26, 2021 – Adventus Mining Corporation (“Adventus”) (TSX -V: ADZN , OTCQX: ADVZF ) and Salazar

Resources Limited (“Salazar ”) (TSX -V: SRL , OTCQB: SRLZF ) (collectively the “ Partners”) are pleased to announce the

feasibility study results, the first estimate of Mineral Re serves, and updated Mineral Resources for the El Domo

volcanogenic massive sulphide deposit , located within the 21,537-hectare Curipamba project in central Ecuador

(“Curipamba” or “El Domo”). The Feasibility Study was commissioned by Adventus and led by DRA Americas Inc. (“DRA”)

to further advance the engineering design and future construction of an open-pit mine and facilities to produce

concentrates of copper, zinc, and lead with significant gold and silver credits . This work has been completed as part of

Adventus’s option agreement with Salazar whereby Adventus may earn a 75% ownership interest in the Curipamba project

with a preferential 95% payback of future cash flows until its investment has been fully repaid. The Feasibility Study results

will be summarized in an independent National Instrument 43-101 Technical Report (“NI 43 -101”) and filed on the

companies’ SEDAR profiles within 45 days. After filing of the NI 43-101 Technical Report, Adventus will have then fulfilled

the company’s earn-in requirements under the Curipamba option agreement with Salazar, having also spent more than

the required US$25M (approximately US$38.9M up to June 30, 2021 since October 2017) . The Partners will then enter

into a joint venture agreement governed by a pre-agreed shareholders agreement.

President and CEO of Adventus, Christian Kargl-Simard stated:

“The completion of the Curipamba feasibility study is a major milestone for the Adventus Mining and Salazar partnership,

with the results highlighting the project’s attractive economics , improvements since the 2019 PEA , and benefits to many

stakeholders. Across valuation metrics and benchmarks – highlighted by its low capital intensity, lowest quartile production

costs and forecast free cash flows – Curipamba is an exceptional copper -gold investment proposition not only within the

Americas but also globally. The technical and economic results of the study also reinforce the viability of the Curipamba

project to stakeholders in Ecuador as the government seeks to support direct investment in its rapidly growing mining

sector. In addition to the formal completion of partnership earn- in requirements, we look forward to providing exciting

news updates prior to the initiation of detailed engineering at the start of 2022. We also see meaningful value creation

through expanding the underground resource and the potential of accelerating its development in earlier years with an

expansion funded through future cash flows.”

President and CEO of Salazar, Fredy Salazar stated:

“We want to thank our partner Adventus Mining for its leadership in advancing the Curipamba project, including the best-

practice engineering work completed by the international technical team that will benefit many stakeholders in our home

country of Ecuador. Salazar has been uniquely involved at Curipamba since the discovery of the El Domo deposit in 2007.

We are proud of today’s milestone with maiden Mineral Reserves and now look forward to the execution path towards

future construction and operations.”

Updated Mineral Resource Estimate

An update to the Mineral Resource estimate (Table 1a to 1c) for El Domo deposit at Curipamba has been completed as

part of the Feasibility Study to include all recent infill drilling completed in 2020 and 2021. The updated Mineral Resource

estimate has an effective date of October 26, 2021 and is disclosed in accordance with National Instrument 43 -101

Standards of Disclosure for Mineral Projects and prepared by SLR Consulting (Canada) Ltd. (“SLR”), formerly Roscoe Postle

Associates.

Date:

News Release:

Ticker Symbols:

October 26, 2021

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ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 3 of 20 –

The updated Mineral Resource estimate is supported by information provided from 391 core boreholes, totaling 74,992

metres, completed between 2007 and 2021 and possesses a similar footprint to the previous Mineral Resource estim ate

(see May 2, 2019 news release). The infill drilling in 2020 and 2021 resulted in the upgrading of portions of the Mineral

Resource from previously classified Indicated to Measured and Inferred to Indicated categories. Other highlights include

copper grades increasing by 9%.

Table 1a. Total Mineral Resource for El Domo, Curipamba Project – October 26, 2021 (sum of table 1b and 1c)

Resource

Category

Tonnes (Mt)

Grade Contained Metal

(%)

(g/t)

(kt)

(koz)

Indicated 1.9 2.72 0.14 2.38 1.37 31 51.9 2.6 45.4 84 1,895

Inferred 0.8 2.31 0.11 2.68 1.74 29 17.3 0.8 20.1 42 688

Notes:

1. CIM Definition Standards (2014) definitions were followed for Mineral Resources.

2. Mineral Resources are reported above a cut-off NSR value of US$29/t for Mineral Resources amenable to open-pit mining and the

underground portion of the 2021 Mineral Resources are reported with mining shapes which were generated using a $105/t NSR cut-

off value.

3. The NSR value is based on estimated metallurgical recoveries, assumed metal prices, and smelter terms, which include payable

factors treatment charges, penalties, and refining charges.

4. Mineral Resources are estimated using the metal price assumptions: US$4.00/lb Cu, US$1.05/lb Pb, US$1.30/lb Zn, US$1,800/oz Au,

and US$24/oz Ag.

5. Metallurgical recovery assumptions were based on three mineral types defined by the metal ratio Cu/(Pb+Zn):

a. Zinc Mineral (Cu/(Pb+Zn) <0.33): 86% Cu, 90% Pb, 97% Zn, 68% Au and 78% Ag

b. Mixed Cu/Zn Mineral (0.33≤ Cu/(Pb+Zn) ≤3.0): 86% Cu, 82% Pb, 95% Zn, 55% Au and 67% Ag

c. Copper Mineral (Cu/(Pb+Zn) >3.0): 80% Cu, 37% Pb, 36% Zn, 14% Au and 29% Ag

6. NSR factors were also based on the metal ratio Cu/(Pb+Zn):

a. Zinc Mineral (Cu/(Pb+Zn) <0.33): 53.41 US$/% Cu, 7.99 US$/% Pb, 13.47 US$/% Zn, 30.91 US$/g Au and 0.39 US$/g Ag

b. Mixed Cu/Zn Mineral (0.33≤ Cu/(Pb+Zn) ≤3.0): 58.99 US$/% Cu, 7.05 US$/% Pb ,13.41 US$/% Zn, 25.12 US$/g Au and 0.34

US$/g Ag

c. Copper Mineral (Cu/(Pb+Zn) >3.0): 57.83 US$/% Cu, 6.84 US$/g Au and 0.19 US$/g Ag

7. Bulk density interpolated on a block per block basis using assayed value, the correlation between measured density values and iron

content, and base metal grade. The bulk densities range between 2.1 t/m3 and 4.6 t/m3

8. Mineral Resources are inclusive of Mineral Reserves.

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

10. The underground portion of the Mineral Resources are reported within underground reporting shapes and include low grade blocks

falling within the shapes.

11. QP is not aware of any environmental, permitting, legal, title, taxation, socio-economic, marketing, political, or other relevant

factors that could materially affect the Mineral Resource estimate

12. Numbers may not add due to rounding.

Date:

News Release:

Ticker Symbols:

October 26, 2021

21-20

ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 5 of 20 –

Feasibility Study Mineral Reserves

The basis of the Curipamba Feasibility Study is on the maiden open-pit Mineral Reserves that were estimated from the

updated open-pit Mineral Resources and on the mine design by DRA (Table 2).

Table 2: Open-Pit Mineral Reserves Statement

Classification

Grade Contained Metal

Tonnage

(kt)

(%)

(g/t)

(kt)

(koz)

Proven Reserves 3,136 2.50 0.2 2.30 2.83 41 78.4 6.7 72.0 285 4175

Probable Reserves 3,343 1.39 0.3 2.67 2.23 50 46.4 9.4 89.4 240 5342

Proven + Probable 6,478 1.93 0.2 2.49 2.52 46 124.9 16.2 161.4 525 9517

Notes:

1. Waste: Ore Strip Ratio 6.02 : 1 not including pre-strip waste and 8.59 : 1 including pre-strip waste

2. The effective date of the Mineral Reserve Estimate is October 22, 2021.

3. Mineral Reserves are reported in accordance with CIM Definition Standards (2014) and best practice guidelines (2019).

4. An NSR cut-off grade of US$32.99 was used for all material.

5. Mineral reserves were estimated at a gold price of $1,630/oz, a silver price of $21.00/oz, a lead price of $0.92/lb, a zinc price of $1.16/lb, and a

copper price of $3.31/lb; they include modifying factors related to mining cost, dilution, mine recovery, process recoveries and costs, G&A, royalties,

and rehabilitation costs.

6. Figures have been rounded to an appropriate level of precision for the reporting of Mineral Reserves.

7. Due to rounding, some columns or rows may not compute exactly as shown.

8. The Mineral Reserves are stated as dry tonnes processed at the crusher.

9. Tonnages are presented in metric tonnes

Open-Pit Feasibility Study

The Feasibility Study is based only on open-pit Mineral Reserves, whereas the 2019 preliminary economic assessment

included both the open pit and potential underground M ineral Resources (“2019 PEA”). Table 3 and Figure 1 provide a

summary of the key Feasibility Study results and cash flows respectively, with sensitivity scenarios for higher and lower

metal prices also shown.

Date:

News Release:

Ticker Symbols:

October 26, 2021

21-20

ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 6 of 20 –

Table 3: Open Pit Feasibility Study Results

Open Pit Feasibility Study Results Feasibility Study

Base Case -15% Price Deck Spot Prices as of

October 19, 2021

After-Tax NPV (US$ million, 8% discount rate) (1) $259 $159 $423

After-Tax IRR (%) (2) 32% 23% 44%

Cumulative First 6 Years of After-Tax Cashflow

(US$ million undiscounted) $495 $391 $664

Initial Capital Cost (US$ M, incl. refundable VAT) (3) $248

Total Life of Mine Capital Cost including Closure (US$ M) (4) $316

AISC (US$/lb CuEq Basis) (5) $1.26 $1.23 $1.41

Payback Period (years) 2.6 3.2 2.1

Nominal processing capacity (tpd) 1,850

Average annual payable production (Years 1 - 9) (6)

Cu = 11 kt

Au = 26 koz

Zn = 12 kt

Ag = 488 koz

Pb = 0.5 kt

CuEq= 23 kt CuEq= 22 kt CuEq= 21 kt

Metal prices assumed

$1,700/oz Au $1,445/oz Au $1,766/oz Au

$23.00 /oz Ag $19.55 /oz Ag $23.29 /oz Ag

$3.50 /lb Cu $2.98 /lb Cu $4.72 /lb Cu

$0.95 /lb Pb $0.81 /lb Pb $1.10 /lb Pb

$1.20 /lb Zn $0.98 /lb Zn $1.70 /lb Zn

Notes:

1) Unless otherwise noted in this news release, all currencies are reported in US dollars on a 100% project basis

2) Assumes an 18-month construction period as the basis for the internal rate of return (“IRR”) and net present value (“NPV”) calculations

3) Capital cost estimates are to AACE class 3, are based primarily on contractor quotes and vendor equipment pricing, and includes 12% VAT (~$25M total)

on the applicable work/materials , as well as an approximate 10% contingency. A developmental capital package (~$25M) for the progression of early

works and project design is assumed to be sunk and not included in the capital cost shown here. It is envisioned to be spent prior to a construction decision.

4) Includes credit for $10M salvage at end of mine life

5) All-in sustaining cost per pound copper, cash cost per pound and cash cost per pound are not measures recognized under IFRS and are referred to as non-

GAAP measures. These measures have no standardized meaning under IFRS and may not be comparable to similar measures presented by other

companies. Refer to the “Non -GAAP Financial Measures” section of the Management’s Discussion and Analysis for the three and twelve months ended

December 31, 2021 for more information about non- GAAP measures. All-in sustaining cost per pound copper represents mining, processing, site general

and administrative costs, royalties, refining, penalties, concentrate transport, and sustaining capital dividend by payable copper equivalent pounds.

Copper Equivalent Calculation:(Payable Metals NSR Ag,Zn,Pb,Au, Ag)/(Payable Metals NSR Cu)* (Payable Copper t)

6) Year 10 excluded from the average as it is a partial year of production.

Date:

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October 26, 2021

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ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 7 of 20 –

Figure 1: Curipamba Open-Pit Feasibility Study – After-Tax Cash Flow Profile

Major changes in the 2021 Feasibility Study vs. the 2019 PEA

• Open-pit only – Due to the underground resource hav ing significant inferred material, and insufficient

geotechnical drilling, the Partners decided to base the Feasibility Study on the open-pit only, and completed

a separate updated PEA on the underground resources, whereas the 2019 PEA was on a combined open -pit

and underground scenario

• Infill drilling – 44-hole infill and step-out drill program was completed and allowed for significant conversion

to Measured category of Mineral Resource, bringing the total number of core boreholes drilled to 391

• Process optimization – Addition of a lead concentrate circuit provides a third saleable product and allows for

the production of higher value copper and zinc concentrates with minimal lead penalties. Process optimization

work introduced new chemical reagents, a 125-micron primary grind size, and allowed improvement on

concentrate grades and recoveries

• Mine optimization and mill throughput – Nameplate mill throughput was increased from 1,750 to 1,850 tpd,

supported by an optimized mine plan that minimizes stockpiling. Significantly more rock waste was moved

forward into preproduction from later in the mine life to provide sufficient materials to start the tailings

storage facility construction (“TSF”)

• Site investigations – A LIDAR survey as well as g eotechnical and hydrogeological drilling programs were

completed which provide more accurate definition of surface and subsurface conditions, which were

considered in the Feasibility Study designs

• Commodity prices – Notably much higher at present than they were in 2019, which provides a positive

economic benefit to the project financials, but using the same long-term consensus price methodology

• Water usage – The project is now completely self -sufficient with respect to water requirements through the

collection and use of rainfall/surface water on site. Water pumping from external river sources is no longer

required

Date:

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October 26, 2021

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ADZN (TSXV), ADVZF (OTCQX), SRL (TSXV) SRLZF (OTCQB)

– 8 of 20 –

Open-Pit Mining

The open-pit will be mined using a traditional truck and shovel operation with a contractor mining fleet consisting of drills,

shovels, front end loaders, and 40-ton haul trucks . The open -pit will be developed in four phases and operate for

approximately 10 years of production, with total material movement of 61.8 Mt (6.5 Mt ore and 55.3 Mt waste) at a strip

ratio of 8.6 (including pre-stripping) and 6.02 without pre-stripping included. The open-pit mine design consists of a single

pit with a mining sequence to maximize grade, but also provides suitable construction material for the project

infrastructure and waste management facilities during construction. Mining of ore is expected to begin within 18 months

of the start of pre-production waste movement.

Figure 2: Curipamba Open-Pit Mine Production Profile

Open-Pit Processing

Previously conducted metallurgical test-work programs in 2014 and 2019 were supplemented with further comminution,

flotation, locked cycle, solid/liquid separation test-work programs and associated minerology and assays during 2020 and

2021. Samples consisted of remaining material from the 2019 test-work campaign and new composite samples taken from

representative drill cores in 2020 and 2021. Results corresponded well with previously completed test -work with

improvements in recoveries and grades incorporated in the Feasibility Study.

Net recoveries to copper, zinc, and lead conc entrates total 87.5% for copper, 84.7% for zinc, 51.8% for gold, 63.6% for

silver, and 30.3% for lead. The net recoveries only include metals that are payable in their respective concentrates.

The process plant is expected to ramp-up production over a three-month period following completion of construction to

a steady state throughput rate of 666, 000 tonnes/year (1,850 tpd). The processing plant design includes a comminution

circuit consisting of a two-stage crushing circuit followed by ball milling, and sequential flotation circuits producing copper,

zinc, and lead concentrates.

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