Spanish Mountain starts ore sorting work at SMG project

Executive Summary

• Spanish Mountain Gold Ltd. has initiated two distinct ore sorting programs to improve project economics and derisk the Spanish Mountain Gold (SMG) project ahead of a potential construction decision in 2027.
• The company is partnering with ABH Engineering Inc. for particle ore sorting studies and OrePortal Technologies Ltd. for bulk ore sorting assessments to evaluate the amenability of mineralization from the Main and Phoenix deposits.
• These initiatives aim to increase process plant mill feed grades, reduce capital and operating expenditures, and potentially enhance gold production and overall project economics based on recent Preliminary Economic Assessment (PEA) results.

Key Details

• Particle Ore Sorting (ABH Engineering Inc.):
  • Building on positive X-ray transmission (XRT) amenability tests from January 21, 2025, ABH will conduct testwork to determine optimal sorting conditions.
  • The program involves sample collection from historical drill core at the project site, specifically from the Phoenix and Main deposits.
  • Objectives include creating multiple products and algorithms to maximize gold recovered per tonne milled, developing capital and operating expenditure estimates, and evaluating performance under economic assumptions.
  • Potential benefits cited include higher metal production, lower operating capital per tonne processed, higher metal recoveries, rejection of barren material, reduced fine tailings, and reduced infrastructure footprint.
• Bulk Ore Sorting (OrePortal Technologies Ltd.):
  • OrePortal will assess if run-of-mine mineralized material prior to crushing is suitable for sorting.
  • The study evaluates ore heterogeneity using the 3-D block model and assay geochemistry from the recent mineral resource estimate (MRE) associated with the July 3, 2025 PEA.
  • Sensor suitability will be reviewed, specifically examining XRF (X-ray Fluorescence) and PGNAA (Prompt Gamma Neutron Activation Analysis) sensors, potentially using bucket-mounted or belt-mounted systems.
  • OrePortal will provide estimates of capital and operating expenditures and analyze the impact on the project's net present value (NPV) relative to the recent PEA.
• Strategic Context:
  • These studies are part of a multipronged strategy to uplift lower-grade portions of the resource and improve gold production during the first 10 years of the proposed PEA life of mine.
  • Successful ore sorting could lead to a material reduction in the size of the proposed mill and initial capital expenditures (capex).
  • The company aims to complete these initiatives as it advances toward a feasibility study and a build decision by or in 2027.
• Qualified Person: Julian Manco, MSc, PGeo, Director of Exploration, has reviewed and approved the technical contents under National Instrument 43-101.

Notable Quotes

• Peter Mah, President and CEO: "The amenability of the SMG project gold mineralization to XRT ore sorting is an exciting new opportunity for the project. Ore sorting is anticipated to improve the project scale and economics while derisking portions of the resource, especially lower grade feed. Preconcentrating mineralization essentially moves more gold through the process plant, which could dramatically uplift processed grades, gold production and overall project economics."
• Peter Mah, President and CEO: "We see this as an important step to complete as we advance the project towards the feasibility study and ultimately a build decision by or in 2027."