South American Silver Announces Amendment to Option Agreement

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jul 17, 2013) - South American Silver Corp. (TSX:SAC)(OTCQX:SOHAF) (the "Company") is pleased to announce that the Company has extended for 5 years the terms of its Option Agreement to acquire the remaining 4,689 hectares of the Escalones property located in Chile, which are not already 100% owned by the Company.

Under the revised terms the Company is required to make one payment of $600,000, which has already been made. This will be followed by four payments of $500,000 on each June 30, 2014, 2015, 2016 and 2017 and a final payment of $3 million on June 30, 2018 to complete the purchase of the property. The remaining terms of the agreement are unchanged. Details of the Escalones Option Agreement, prior to these amendments, can be found in the Company's most recently filed financial statements for the three-month period ended at March 31, 2013 available on www.sedar.com or on the Company's website www.soamsilver.com.

Phillip Brodie-Hall, President and CEO of South American Silver said, "The extension of the Escalones option agreement is very important as it allows us to preserve cash at a time when cash is such a precious resource. This new agreement will save us $2.4 million in the current year and adds to the substantial savings we have already made this year, including many millions that will be saved from the recently announced funding agreement for the Bolivian arbitration. We believe we are positioning the company very well for the future and will continue to work hard for our shareholders."

About South American Silver Corp.

South American Silver Corp. is a growth focused mineral exploration company creating value through the exploration and development of the large scale Escalones copper-gold project in Chile, the pursuit of new opportunities, and the realization of value from the Malku Khota project in Bolivia. The Company's approach to business combines the team's track record of discovery and advancement of large projects, key operational and process expertise, and a focus on community relations and sustainable development. Management has extensive experience in the global exploration and mining industry. The Company's shares are listed on the Toronto Stock Exchange under the symbol "SAC" and on the OTCQX as "SOHAF". Information related to South American Silver Corp. is available at www.soamsilver.com and on SEDAR at www.sedar.com.

Forward-looking statements

Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "continue", "will", and similar expressions. This release contains forward-looking statements. These forward-looking statements are based on current expectations and various estimates, factors and assumptions and involve known and unknown risks, uncertainties and other factors.

Readers are cautioned not to place undue reliance on these statements as the Company's actual results, performance or achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements if known or unknown risks, uncertainties or other factors affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. Therefore, the Company cannot provide any assurance that forward-looking statements will materialize. Factors that could cause results or events to differ materially from current expectations expressed or implied by the forward-looking statements, include, but are not limited to, the risks of the mineral exploration industry which may affect the advancement of the Escalones project including possible variations in mineral resources or grade, metal prices, timely receipt of required permits, availability of equipment and qualified personnel, failure of equipment or processes to operate as anticipated and changes in project parameters as plans continue to be refined; and other risks more fully described in the Company's Annual Information Form filed and publicly available on SEDAR at www.sedar.com. The assumptions made in developing the forward-looking statements include: the timely receipt of required permits for Escalones; the availability of equipment and qualified personnel to advance the Escalones project and execution of the Company's existing plans and further exploration and development programs for Escalones, which may change due to changes in the views of the Company or if new information arises which makes it prudent to change such plans or programs; the continuing support for mining by local governments in Chile; the availability of sufficient financing to fund planned or further required work in a timely manner and on acceptable terms to advance the Escalones property; the interest of potential joint venture partners for Escalones; the accuracy of current mineral resource estimates and interpretation of drill, metallurgical testing and other exploration results; and the availability of new attractive exploration targets at a cost acceptable to the Company. Subject to applicable laws, the Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason. Unless otherwise indicated, forward-looking statements in this release describe the Company's expectations as of July 17, 2013.