Guanajuato Silver Company Ltd. announced that the Cata mill has commenced precious metals processing at the Company's wholly-owned Valenciana Mines Complex (VMC) in Guanajuato, Mexico. Commissioning of the Cata mill began during the last week of December 2022, with mineralized material coming from VMC and the San Ignacio mine. The Company intends to start processing at a run-rate of approximately 8,000 tonnes per month with the goal of ramping up to 20,000 tonnes per month by year end; full capacity at the Cata mill is 36,000 tonnes per month.

The Cata plant, which comprises three balls mills and a two-stage crushing system, is in excellent working order; no significant capex was required prior to restart. The Company plans to operate the Cata mill with production from both VMC and the San Ignacio mine and anticipates achieving initial metallurgical recoveries in the 83%-85% range for silver and gold. The Cata mill is located at approximately the mid-point of the 4.2-kilometre strike length that spans mineralization at VMC, and sits immediately adjacent to the Company's administrative offices, assay lab, and one of two primary access shafts.

In November 2021, the Cata mill was put on care and maintenance by the previous operator due to a lack of tailings capacity. In response, the Company intends to backfill tailings underground using a hydraulic fill system that will make use of select voids and open stopes that have been created at VMC over the past 450 years of underground mining. The hydraulic fill system will not only provide VMC with additional tailings capacity, but the process also represents a more environmentally benign approach to tailings management.