Xali completes Pico Machay due diligence site visits

Executive Summary

• Xali Gold Corp. has completed due diligence site visits for the Pico Machay gold project in Peru, confirming the integrity of historical data from Pan American Silver Corp. and Aquiline Resources Inc.
• The due diligence supports an upcoming acquisition via a share purchase agreement and validates the preparation of an updated NI 43-101 technical report.
• Significant exploration upside was identified, with the alteration footprint (533 hectares) being substantially larger than the current historic resource footprint (28 hectares).

Key Details

• Acquisition Status: Xali Gold is acquiring the Pico Machay project through a share purchase agreement (SPA) with Pan American Silver Corp. and its subsidiary, Aquiline Resources Inc., as per the Oct. 24, 2025 news release.
• Due Diligence Activities: Three site visits were conducted between June and November 2025. Participants included Xali Gold management, qualified person David Thomas (DKT Geosolutions), and local investors.
• Data Verification:
  • Qualified person David Thomas verified the historic geological model.
  • Drill collar locations were confirmed accurate via GPS coordinates.
  • Assay reliability was validated through independent check sampling of 26 rock-chip samples (9 surface, 17 pulp/coarse reject).
  • Check assays from pulp and coarse reject material confirmed strong assay reliability.
• Exploration Upside:
  • The alteration footprint spans approximately 4.1 km by 1.3 km (533 hectares).
  • The current historic resource occupies only ~800 m by 350 m (28 hectares), representing approximately 5% of the broader altered system.
  • Management highlights substantial exploration upside for resource expansion and new discoveries in undrilled areas.
• Historic Resource Estimates (Reference Only):
  • Measured & Indicated: 264,600 ounces of gold (10.6 million tonnes grading 0.78 g/t Au).
  • Inferred: 446,000 ounces of gold (23.9 million tonnes grading 0.58 g/t Au).
  • Note: These are historic estimates based on a long-term gold price of $700 USD/oz. They are not current resources and require significant data compilation, redrilling, and resampling to be classified as current resources under CIM standards.
• Technical Report: An updated NI 43-101 report is currently under way and expected to be completed in the coming months. This report will serve as the foundation for converting the historic mineral resource estimate to a current estimate.
• Sampling Methodology:
  • Samples collected using hammers and hand-held GPS.
  • Processed at ALS Chemex laboratory in Lima, Peru.
  • Analysis: Fire assay with AAS finish for gold (Au-AA23); four-acid digest with ICP-AAS for silver (Ag-ICP61).
  • QA/QC included certified reference materials and blanks at ~5% rate.

Notable Quotes

• "The project has delivered a major and highly encouraging surprise: The alteration footprint is substantially more extensive than we had understood, spanning about 4.1 kilometres by 1.3 kilometres (533 hectares)... which highlights the substantial exploration upside that remains open for discovery." — Joanne Freeze, President and CEO, Xali Gold.
• "Not only does Pico Machay offer immediate value potential, given that the original resource was based on a long-term gold price of only $700 (U.S.) per ounce, but the extensive undrilled areas within this large alteration system provide exceptional opportunity for both resource expansion and new discoveries." — Joanne Freeze, President and CEO, Xali Gold.