Guanajuato Silver Company Ltd. Begins Mineral Processing at El Cubo

James Anderson, Chairman and CEO of GSilver commented, "We have achieved yet another significant milestone - on track, on time and on budget - with the recommissioning of our El Cubo mill. I congratulate all of our team members on executing this noteworthy achievement so rapidly."

Mineral Processing Commences:

Guanajuato Silver Company Ltd. has commenced the processing of silver and gold bearing material at its El Cubo mill. The Company is producing a bulk silver and gold concentrate that will be sold to Ocean Partners UK Ltd., as announced in the Company's news release dated Sept. 23^rd. (Click Here.)

Crushing and grinding of mill feed from El Cubo commenced on October 8, 2021, after GSilver had accumulated over 20,000 tonnes of stockpiled material in the El Cubo storage yard. The Company expects to deliver its first shipment of concentrate by the end of the month and to receive initial payment shortly thereafter.

The Company has completed most of the US$3.5m in planned upgrades at its El Cubo floatation processing plant, which is capable of handling approximately 1500 tonnes per day, or over 500,000 tonnes per year. With initial mine production from El Cubo planned at ~ 750 tonnes per day, the Company's mill has ample capacity for expansion to handle material from the Company's nearby El Pinguico project and/or other sources of material from the greater Guanajuato Mining District.

Director and COO Hernan Dorado said: "Having completed the acquisition of El Cubo in April 2021, only six months ago, our mining and mineral processing teams have done an exceptional job in swiftly bringing the mill and related facilities back online. The start-up process is proceeding as envisioned, including short stoppages while all of the moving parts of the plant are tested, retested, and in some cases operated for the first time. This has been a relatively smooth process at El Cubo, and we anticipate a short timeline of ramping up to our planned initial monthly throughput of ~ 22,500 tonnes."

Mining:

Prior to commencing mill operations, GSilver mined and stockpiled approximately 20,000 tonnes of material from El Cubo. For the ramp up phase, we initially targeted somewhat lower-grade material than is described in the Company's preliminary economic assessment (the "PEA") dated May 6, 2021 (effective date: January 31, 2021) prepared by engineering firm Behre Dolbear & Company (USA) Inc. earlier in the year, a copy of which is available on the Company's website and SEDAR. The Company expects to move on to higher grade areas within the mine in the months ahead. The PEA discusses inferred resources outlined at El Cubo of 1,453,000 tonnes of 214 gpt Ag and 2.78 gpt Au (435 gpt AgEq) and indicated resources of 508,055 tonnes of 194 gpt Ag and 2.44 gpt Au (389 gpt AgEq).[1] Drilling is ongoing at El Cubo and is intended to provide better grade control data at the 2175, 1850, and Cebolletas stope areas.

Mineral resources that are not mineral reserves do not have demonstrated economic viability. There has been insufficient exploration to allow for the classification of the inferred resources at El Cubo as an indicated or measured mineral resource, however, it is reasonably expected that the majority of the inferred mineral resources could be upgraded to indicated or measured mineral resources with continued exploration. There is no guarantee that any part of the mineral resources at El Cubo will be converted into a mineral reserve in the future.

Hernan Dorado Smith, a director of GSilver and a "qualified person" as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects, has approved the scientific and technical information contained in this news release.

About Guanajuato Silver Co. Ltd.:

GSilver is a mining development company engaged in reactivating past producing silver and gold mines near the city of Guanajuato, Mexico. The Company is focused on the refurbishment and swift re-commencement of production from its El Cubo mine and mill and its nearby El Pinguico project, as well as the delineation of additional silver and gold resources through underground and surface drilling. Both projects are located within 11km of the city of Guanajuato, which has an established 480-year mining history.

ON BEHALF OF THE BOARD OF DIRECTORS
"James Anderson"
Chairman and CEO

For further information regarding Guanajuato Silver Co. Ltd, please contact:
James Anderson, Director, +1 (778) 989-5346
Email: james.anderson@GSilver.com
Continue to watch our progress at: www.GSilver.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

This news release contains certain forward-looking statements and information, which relate to future events or future performance including, but not limited to, the amount and timing of initially processed mineralized material and concentrate sales from El Cubo, the planned initial throughput at El Cubo and the expected total capacity of the El Cubo mill, estimates of mineral resources; the attractiveness of potential vein widths and the existence of higher grade areas within the mine; the opportunities for exploration, development and future production from El Cubo and El Pinguico and the proposed exploration and development programs therefor and the timing and costs thereof; the ability of the Company to successfully complete the refurbishment of the El Cubo mill, procure equipment, hire personnel and supply and process sufficient mineralized material and resources from El Cubo and El Pinguico through the mill to successfully begin commercial production of silver and gold in Q4 2021 at the projected amounts, grades, costs and revenues and the success related to any future exploration and/or development programs.

Such forward-looking statements and information reflect management's current beliefs and are based on information currently available to and assumptions made by the Company; which assumptions, while considered reasonable by the Company, are inherently subject to significant operational, business, economic and regulatory uncertainties and contingencies. These assumptions include: our mineral resource estimates at El Cubo and El Pinguico and the assumptions upon which they are based, including geotechnical and metallurgical characteristics of rock conforming to sampled results and metallurgical performance; tonnage of mineralized material to be mined and processed; resource grades and recoveries; assumptions and discount rates being appropriately applied to production estimates; success of the Company's combined El Cubo / El Pinguico operation; prices for silver and gold remaining as estimated; currency exchange rates remaining as estimated; availability of funds for the Company's projects; capital, decommissioning and reclamation estimates; prices for energy inputs, labour, materials, supplies and services (including transportation); no labour-related disruptions; no unplanned delays or interruptions in scheduled construction and production; all necessary permits, licenses and regulatory approvals are received in a timely manner; and the ability to comply with environmental, health and safety laws. The foregoing list of assumptions is not exhaustive.

Readers are cautioned that such forward-looking statements and information are neither promises nor guarantees, and are subject to risks and uncertainties that may cause future results to differ materially from those expected including, but not limited to, market conditions, availability of financing, currency rate fluctuations, actual results of exploration, development and production activities, actual resource grades and recoveries of silver and gold, unanticipated geological or structural formations and characteristics, environmental risks, future prices of gold, silver and other metals, operating risks, accidents, labor issues, equipment or personnel delays, delays in obtaining governmental or regulatory approvals and permits, inadequate insurance, and other risks in the mining industry. There are no assurances that GSilver will be able to successfully re-start the El Cubo mill to process mineralized materials to produce silver and gold in the amounts, grades, recoveries, costs and timetable anticipated. In addition, GSilver's decision to begin processing mineralized material from its estimated resources at El Cubo and its above and underground stockpiles at El Pinguico through the El Cubo mill is not based on a feasibility study of mineral reserves demonstrating economic and technical viability and therefore is subject to increased uncertainty and risk of failure, both economically and technically. Mineral resources that are not mineral reserves do not have demonstrated economic viability, are considered too speculative geologically to have the economic considerations applied to them, and may be materially affected by environmental, permitting, legal, title, socio-political, marketing, and other relevant issues. There are no assurances that the results of the Company's recently announced preliminary economic assessment and projected production of silver and gold will be realized. There is also uncertainty about the spread of COVID-19 and variants of concern and the impact they will have on the Company's operations, supply chains, ability to access El Cubo and/or El Pinguico or procure equipment, contractors and other personnel on a timely basis or at all and economic activity in general. All the forward-looking statements made in this news release are qualified by these cautionary statements and those in our continuous disclosure filings available on SEDAR at www.sedar.com. These forward-looking statements are made as of the date hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances save as required by law.

Cautionary Note for U.S. Investors regarding Reserve and Resource Estimates

Canadian public disclosure standards, including NI 43-101, differ from the requirements of United States securities laws. In particular, the terms "indicated mineral resources" and "inferred mineral resources" in this news release are defined in accordance with NI 43-101 under the guidelines set out in the Canadian Institute of Mining, Metallurgy, and Petroleum Definition Standards for Mineral Resources and Mineral Reserves 2014 ("CIM Definition Standards"). The United States Securities and Exchange Commission (the "SEC") has recently modernized and amended its mineral property disclosure requirements for issuers whose securities are registered with the SEC under the United States Securities Act of 1934 and now recognizes estimates of "measured mineral resources", "indicated mineral resources" and "inferred mineral resources" which are substantially similar to the corresponding CIM Definition Standards. The SEC has also amended its definition of "proven mineral reserves" and "probable mineral reserves" to be substantially similar to the corresponding CIM Definitions. However, U.S. investors are cautioned that while the foregoing terms adopted by the SEC are "substantially similar" to corresponding definitions under CIM Definition Standards, there are differences. As such, there is no assurance any mineral resources that the Company may report as "measured mineral resources", "indicated mineral resources" and "inferred mineral resources" under NI 43-101 would be the same had the Company prepared the resource estimates under the standards adopted by the SEC. United States investors are also cautioned that while the SEC will now recognize "measured mineral resources", "indicated mineral resources" and "inferred mineral resources", investors should not assume that all or any part of the mineral deposits in these categories would ever be converted into a higher category of mineral resources or into mineral reserves. Mineralization described by these terms has a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. Accordingly, U.S. investors are cautioned not to assume that any "measured mineral resources", "indicated mineral resources", or "inferred mineral resources" that the Company reports are or will be economically or legally mineable. Furthermore, it cannot be assumed that all or any part of "inferred mineral resources" exist, are economically or legally mineable or will ever be upgraded to a higher category. Under Canadian securities laws, estimated "inferred mineral resources" may not form the basis of feasibility or pre-feasibility studies except in rare cases. Disclosure of "contained ounces" in a mineral resource is permitted disclosure under Canadian securities laws. However, historically the SEC only permits issuers to report mineralization that does not constitute "reserves" as in place tonnage and grade, without reference to unit measures. Accordingly, information concerning mineral deposits set forth herein may not be comparable with information made public by companies that report in accordance with U.S. securities laws.

Guanajuato Silver Company Ltd.
PH: +1(778) 989-5346 E: info@GSilver.com W: GSilver.com
CA: Suite 578 - 999 Canada Place, Vancouver B.C. V6C 3E1

MX: Carretera - Guanajuato - Silao km 5.5, Int 4, Col. Marfil CP36250, Guanajuato, Gto., Mexico