Pinnacle Strengthens Mexican Management Team

0:04 Hello everyone and thank you for joining us for this live Pinnacle Silver and Gold event. Just a quick reminder that this event is being recorded and the replay will be made available shortly after we conclude here today. If you have any questions, please feel free to submit them in the chat box, which can be found in the bottom right corner of your screen. With the housekeeping out of the way, today we're joined by Robert Archer, President and CEO to discuss the latest news regarding the additions to the management team. Robert, you mentioned being excited to work with both Carlos and Jorge again, from your time at Great Panther Silver. Can you tell us more about what you learned working together previously

0:35 and why reuniting this team felt like the right move for El Potrero? Hi Kyle. Well, as you're well aware and most investors are, just to emphasize the fact that it's really the people that make the difference in any successful company and so super important to have the right management team in place and that goes not just at the corporate, the executive level but all the way down and particularly at the operations level. So, I mean, Carlos worked for me for, in 2 different stints, I would say, I think 7 or 8 years in Mexico. And, you know, I think I can confidently say he was the best mind manager that we had.

1:25 At that time Carlos was running a thousand ton per day gold silver operation in Central Mexico with many hundreds of people working for him.

1:36 And so he's certainly well experienced and competent enough to handle this project. And Jorge, similarly, as exploration manager for Great Panther, worked for the team down there for about 7 years as well.

1:57 And Jorge was, as a professional geologist, a PGO, he's certainly qualified to put together resources and that sort of thing. So as well as both individuals have strong leadership capabilities. So as we continue to build, there'll be building the team under them on an as needed basis. So it's great to have them on board. And again, it emphasizes just that 100% Mexican team that's super important as well in terms of building a corporate culture and being able to relate to local communities and government authorities and so on. So I think all in all, it's a great step forward.

2:46 Now, Carlos has an impressive track record, including building a 300 ton per day processing plant in just 7 months at Rochester Resources. How does his experience align with Pinnacle's vision to bring in El Potrero into production? Well, El Potrero is a relatively small operation. It's probably going to be about 100 tons per day to begin. And so, as I mentioned, Carlos is used to actually running plants and mines that are in the order of 1000 tons per day. And then the one that he did for Rochester, building that at 300 tons in a relatively short timeframe. So, to put together a hundred ton per day plant with an infrastructure that's already in place, you know, the foundations there, all the framework and everything, and we'll just have to replace the mechanical equipment and pumps and electrical and so on. So it's not even a complete build up from the ground up. You know, it's a rebuild.

3:50 And so it should be that much easier. So, you know, having that experience in the past, we'll certainly make sure that Carlos is certainly experienced enough to, you know, to handle El Pochero in the timeframe that we want to get it done. Jorge and the geological team have already collected over a thousand samples at the site. What are some of the early insights emerging about the mineralization controls and what has surprised you most about what the team is discovering? I think, yeah, most of those samples that we've taken have been underground from the existing workings, So it's been really important to put all that together and get a better understanding of the extent of the mineralization, the style of the mineralization and how it occurs.

4:43 So it's been really, really important to build that database and putting all that together in a three-dimensional model. So that will be critical when it comes to drilling, underground drilling, as well as from surface. So hopefully that will be able to start fairly soon. But I think in terms of surprises, something that we still need some more information, but just seeing that it appears that there's a bit of a vertical zonation where silver grades are increasing towards surface. Because of all the samples that we've taken and I think I said over 700 underground and over 300 on surface, the highest underground sample we've had in terms of solar values has been about 520 grams whereas on surface we've had several over a thousand grams in the highest, you know, 2,280.

5:38 So it's, there does potentially seem to be a vertical zonation with silver increasing towards surface. So that was a little bit of a surprise, although it's not totally uncommon in these types of systems, but certainly nice to see and something that we'll be watching for as we get into the drilling stage.

5:59 Now, El Potrero has been in private hands for nearly 40 years without systematic modern exploration. Can you walk us through what this means for Pinnacle's opportunity here? What potential do you see that others may have missed? Well, the opportunity I think is just the fact that the mineralization has never been drilled off. When it was in production before, it was just, I guess, artisanal in scale, really. They were just basically following the vein. There was no real understanding of the grade distribution or what they were actually mining. What we're doing now is getting a better understanding of the overall system.

6:51 And because it goes far beyond just a single vein and just a few small underground workings. So, we're putting together the whole package

7:01 and laying out a mine plan where we can be producing on a consistent basis. So I think there's lots of upside here. The fact that we've delineated the main vein for about 1,600m long strike so far. We have the underground workings to work from. And with all of that and the plant that we can rebuild quickly, we can really fast track this towards production. And with today's metal prices, that's really what we're focused on doing and trying to get to a cash flow situation as quickly as we possibly can. So, I think that's, you know, and in all fairness, you know, that situation with the high metal prices is something that just didn't exist in previous years. So it's not so much as a missed opportunity, but the fact that no one has been able to take advantage of that until now certainly creates an opportunity for us that didn't exist before.

8:02 And what's the timeline you're envisioning from where you are today to actual production?

8:08 Well much of that is out of our control unfortunately because it comes back to permitting, you know, but we are already engaged with the authorities on that. And we can move forward in parallel on certain fronts with different ministries and so on. So for example, we're talking to the environmental authorities regarding surface work and rebuilding the camp and the plant, surface drilling, those kinds of things. That's all with the group called Semarnat. But at the same time, we can be moving forward with the water authorities to get a water license and then with the federal electrical commission on extending the power line. So these are all things that are working in parallel right now, but to a large degree out of our control time-wise, but based on the experience of our environmental team and lawyers and so on, and then knowing that we should be able to put the plant back in shape in, let's just say less than a year. If we can do it in 6, 7 months, that would be great. But so overall, I'm conservatively looking at a two-year timeframe, and which would put us towards the end of 2027.

9:37 Now, El Patrero sits within 35 kilometers of 4 operating mines in the Sierra Madre Occidental. How does the proximity influence your development strategy, whether in terms of infrastructure, talent or operational insights? Well, I think it influences all of those things. You know, we fly into Topia, which is a mining town in its own right. And you know, the Topia mine is right there. And so that's, we just drive, it's an hour and a half drive from there around to, around to El Potrero. So, we have that as infrastructure. Topia is a great source of mining contractors, skilled labor, equipment, supplies, all of that sort of thing. So it's great to have Topia there for that.

10:28 And then just in terms of the infrastructure, our project is road accessible. We have a power line within 3 kilometers that we'll be extending through to the project eventually. And knowing that it is a high grade district with 4 other operating mines around us speaks to the geology and the geological potential. So as a geologist myself, that's something that I'm looking at on a regional scale and knowing that there are other projects within the district that we might be able to strap on as satellites or additional projects. So, looking at that aspect of it as well, and if those other projects could have some synergies with El Patrero, then that's obviously going to be a bonus going forward. So that's something that we're looking at on the regional scale as well.

11:25 Now, also looking at the bigger picture, you have both El Patrero projects in Mexico and their Golzi Gold Mine in Ontario's Red Lake District. Gold has been on it quite a run. How do you see these 2 projects complementing each other in Pinnacle's overall growth strategy? Well, I mean, they sort of complement each other in the sense that Argosy was a past producing mine as well. And there's a lot of potential to build that resource out and ultimately get that back in production. But you're not gonna do that within a 2 year timeframe in Ontario. And so we're very focused on Mexico right now to try and get that up and running. And I would like to get back into the other projects in the Red Lake area.

12:13 And I think they do have potential to improve those and build those up. But it's not something that'll be done in the immediate term. I'm hoping that we might be able to get in there and do some drilling next year sometime in 2026. But for now, the focus is definitely on Alcatraz. Robert, thank you for the update. We always appreciate it until next time, but thank you for taking the time out of your day. Likewise, thanks Kyle. Www.mytrendyphone.co.uk