Peruvian's San Maurizo, community enter Mercedes deal

Executive Summary

• Peruvian Metals Corp. secured a six-year agreement with the local community (Comunidad Campesina de Pomamanta) for the Mercedes Project, allowing for exploration, mineral exploitation, and bulk sample extraction.
• The company expects to complete the full permitting process by year-end to enable extraction of up to 350 tonnes per day, with initial work focused on the Victor II vein.
• Concurrently, the company amended the terms of a previously announced financing, reducing the warrant exercise price from 20 cents to 15 cents and shortening the term from two years to one year.

Key Details

• Community Agreement:
  • Agreement signed between San Maurizo Mines Ltd. (50% owned by Peruvian Metals) and Comunidades Campesinas y Nativas Comunidad Campesina de Pomamanta.
  • Registered with Sunarp Peru's public registry.
  • Valid for six years; allows local access for exploration and exploitation.
  • Development and exploration costs to be equally shared with Hudson Heartland Ltd.
• Operational Status & Permitting:
  • Provisional permits are in place, allowing the company to commence extraction of mineral for sale and/or processing.
  • Full permitting process expected to be completed by year-end.
  • Target extraction capacity: up to 350 tonnes per day.
  • Initial work starting on the Victor II vein.
  • Historic underground workings restored with new timber for safe working conditions.
• Metallurgical Results (Victor II Vein):
  • Concentrate grading: 33.03 ounces per metric tonne silver and 12.23 grams per metric tonne gold.
  • Silver recovery: 97.85%.
  • Gold recovery: 92.19%.
  • Assaying performed by Procesmin Ingenieros SRL (fire assay for Au-Ag).
  • Metallurgical work performed by Ing Jose Orlando Moncada Rejas at the Aguila Norte plant.
• Financing Amendment:
  • Amended terms for financing announced on Jan. 29.
  • New warrant terms: Exercisable at 15 cents for one year.
  • Previous terms: Exercisable at 20 cents for two years.
  • All other financing terms remain unchanged.
• Management & Personnel:
  • Mercedes project managed by Eric Hinton, PEng, and Jeff Reeder, PGeo.
  • Eric Hinton: Sole shareholder of Hudson Heartland, 35+ years mining experience, designated Qualified Person (NI 43-101).
  • Jeffrey Reeder: CEO, designated Qualified Person (NI 43-101).
• Economic Context:
  • CEO notes significant improvement in economics due to price increases: Gold rose from $2,175/oz to ~$5,100/oz; Silver rose from $23/oz to ~$90/oz.
  • Company expects to produce commercially marketable Au-Ag concentrates.

Notable Quotes

• "Our company is excited to work with the local community at Mercedes. Current permitting allows the company to commence the extraction of bulk samples. The company is continuing the process to receive full permits, and, with the support of the local community, the company expects to complete the process by year-end. When Peruvian Metals acquired an interest in the property, gold was trading at $2,175 (U.S.) per ounce and silver trading at $23 (U.S.) per ounce. Now that gold is in the $5,100 (U.S.) and silver in the $90 (U.S.) per ounce range, the economics has greatly improved. The company will be able to produce commercially marketable Au-Ag concentrates." — Jeffrey Reeder, CEO