Xali Gold Outlines Plans for Pico Machay Gold Project in Peru

Executive Summary

• Xali Gold Corp. announced the acquisition of the Pico Machay Gold Project in Central Peru through a Share Purchase Agreement with Pan American Silver Corp. and its subsidiary Aquiline Resources Inc.
• The transaction involves $17.5 M of deferred cash payments over up to five years, plus an additional $2.5 M contingent on achieving a minimum of 1.25 M oz Au in measured‑and‑indicated resources or proven‑probable reserves.
• Trading halt imposed by the TSX Venture Exchange is lifted; Xali Gold will resume trading on October 29, 2025 and plans immediate field work, bulk sampling, and metallurgical testing to advance the project toward near‑term production.

Key Details

• Historic Resources: Measured & Indicated – 264,600 oz Au (10.6 Mt @ 0.78 g/t); Inferred – 446,000 oz Au (23.9 Mt @ 0.58 g/t).
• Qualified Person Site Visit: David Thomas, P.Geo., visited Oct 21‑24, 2025; collected 26 samples (9 on‑site, 17 pulp/reject) and reviewed 154 pre‑2009 RC holes supporting historic resource.
• Deferred Payment Schedule (USD):
• Closing: $0.5 M
• 1st Year Anniversary: $1.5 M
• 2nd Year Anniversary: $1.5 M
• 3rd Year Anniversary: $4.0 M
• 4th Year Anniversary: $3.0 M
• Earlier of 5th Year Anniversary or commercial production start: $4.5 M
• Contingent on ≥1.25 M oz Au in NI‑43‑101 compliant resource/reserve: $2.5 M
• Total Consideration: $17.5 M (deferred) + up to $2.5 M contingent = $20 M maximum.
• Security Package: First‑priority share pledge over 100 % of Calipuy shares and first‑priority mortgage on Pico Machay and Las Brujas II properties.
• Project Size & Location: 4,700 ha across 17 claims; situated in the Southern Peru Epithermal Gold‑Silver Belt, ~63 km south of Minera IRL’s Corihuarmi Mine and within a 45 km radius of several operating mines (Lalira, San Genoro, etc.).
• Planned Immediate Activities:
• Advance nine untested high‑potential targets.
• Initiate bulk sampling to verify historic grades and identify higher‑grade zones.
• Conduct additional metallurgical testing to improve recovery estimates.
• All work can proceed without new permits while drilling permits are being obtained.
• Regulatory Status: TSX‑V has confirmed that the requirements of Policy 5.3 Section 5.6(d) are satisfied; trading halt lifted.
• Contingent Indemnity: Unlimited, indefinite Purchaser’s Special Indemnity covering all existing and future liabilities (environmental, tax, labour, etc.).

Notable Quotes

“Pico Machay offers Xali Gold both immediate value and substantial upside… Over the next six months, our goal is to update the historic resource estimate using currently accepted long‑term gold prices…” – Joanne Freeze, President & CEO, Xali Gold.