Mr. Bruce McLeod reports

SABINA GOLD & SILVER PROVIDES UPDATE ON PERMITTING FOR THE BACK RIVER GOLD PROJECT, NUNAVUT, CANADA

Sabina Gold & Silver Corp. has provided an update today on the permitting process for the Back River gold project in Nunavut, Canada.

Background

On June 16, 2016, Sabina announced that the Nunavut Impact Review Board, in a report, recommended to the Minister of Indigenous and Northern Affairs Canada that the Back River project not proceed to the next phase of permitting at this time.

The report follows an environmental assessment process during which the NIRB co-ordinated and reviewed Sabina's draft and final environmental impact statements, including numerous technical studies and reports, and during which time, Sabina had hundreds of engagements with all northern stakeholders on the project.

Sabina's engagement and consultation have been extensive, and have included community members, hunters and trappers organizations, hamlets councils, advisory committees, the Kitikmeot Inuit Association (KIA), territorial governments, and federal regulatory agencies. These engagements enabled Sabina to incorporate socio-economic information and traditional knowledge with scientific data to determine the best approaches to the project.

The process culminated in a six-day public hearing in Cambridge Bay, Nunavut, which was attended by representatives of all interested parties. At the end of the hearings, there was strong Inuit support expressed for the project. Additionally, all agency subject matter experts were satisfied with Sabina's plans and proposals for the project, and recommended to the NIRB that the project move to the next phase of permitting.

"As we worked through the NIRB process, we came to know and respect the people and the environment of the Kitikmeot region and Nunavut. We have also developed a positive working relationship with the KIA, who we have found to be transparent and business-minded while also protecting the best interests of their constituents. Throughout this process we have been focused on responsible mining in the Kitikmeot and appreciate all the input that we have received to assist us in our planning," said Bruce McLeod, president and chief executive officer. "We believed we understood the issues we had to address in the final hearings and had come to resolution on these issues. Unfortunately, Sabina believes that the NIRB recommendation does not reflect this support, nor the evidence presented during this process."

The NIRB report is currently with the minister to make a decision on how to proceed. The minister has three main options available to her regarding the NIRB recommendation:

1. Reject NIRB recommendation -- NIRB would issue a project certificate with terms and conditions. The project would advance to the water licence application process;
2. Refer the report back to NIRB for further review -- Sabina would further engage with NIRB and intervening agencies, and submit additional information to address specific areas of concern;
3. Accept NIRB recommendation -- Sabina would submit an updated environmental impact statement to NIRB, following which new technical and public hearings would occur.

Response to the NIRB report by Sabina

Sabina has submitted a response to the minister. The document can be found on-line. Sabina believes that there are strong grounds for the minister to reject the NIRB recommendation and refers it back to NIRB to consider terms and conditions for a project certificate.

In the company's view, the NIRB report does not fully consider support of the project by the local communities and Inuit representatives in the region. Following the NIRB report, Sabina held numerous meetings within the communities and found that there continues to be broad support for the project as evidenced by letters that have been sent to minister (and posted on the NIRB website) recommending that the project proceed.

The report does not fully recognize the socio-economic benefits the project stands to offer. Back River will generate significant employment and training opportunities, business opportunities in contracting, consulting and services, along with mining royalties and taxes to the region, the territory and the federal government. Sabina and the KIA are working to advance agreements for land tenure rights and Inuit benefits, which would address these initiatives and commitments.

The company believes that the NIRB report makes errors by reaching conclusions that are not consistent with the evidence submitted by experts, responsible government agencies and the KIA on the monitoring and mitigation measures. Relative to other mining and development projects in Nunavut and Northwest Territories, Sabina has committed to some of the most protective measures for caribou and the environment in its monitoring and mitigation plans. The appropriate regulatory agencies have completed detailed reviews of these monitoring and mitigation plans, and have indicated that they were satisfied that the project could proceed to the permitting phase on that basis.

The company has asked the minister to reject the NIRB recommendation. Whatever the minister's decision may be, the company is confident that it can address the concerns raised in the report.

We seek Safe Harbor.