Mr. Lawrence Page reports

SOUTHERN SILVER EXPLORATION CORP.: 2016 DRILLING AT CERRO LAS MINITAS IDENTIFIES NEW MINERALIZED EXTENSION AND CONTINUITY OF CONTACT SKARN

Southern Silver Exploration Corp. has provided an update on 2016 drilling on its Cerro las Minitas project, which has successfully identified a new mineralized extension on the project and continues to demonstrate the continuity of contact skarn around the margin of the central intrusion, each of which could significantly expand the overall size of the project.

A total of 3,236 metres of core drilling were completed in the 2016 phase I program, consisting of three new holes, which tested the lateral and depth extensions of the Blind and El Sol deposits on the west side of the central intrusion, as well as an extension of hole CLM-001, which tested down dip and along strike of the Mina La Bocona zone located on the eastern side of the central intrusion.

Drill results identified a thick interval of continuous polymetallic semi-massive and massive sulphide mineralization in drill hole 16CLM-088 which forms part of a new, previously unrecognized, extension of the Blind and El Sol deposits. The mineralization occurs in skarn at the contact with the central intrusion, at depth and well outboard of the known deposits, and appears to flatten into a subhorizontal orientation in this area. Geological modelling has outlined a 450-metre-by-450-metre, gently dipping target area to the west of the main intrusive neck which is partially constrained by thick mineralized intercepts from previously reported holes, including:

• A 30.4-metre downhole interval averaging 107.4 grams per tonne silver, 0.40 per cent copper, 1.1 per cent lead and 2.3 per cent zinc (275 grams per tonne silver equivalent) in drill hole 16CLM-088 (see news release dated June 13, 2016);
• A 7.6-metre downhole interval averaging 43 grams per tonne silver, 1.1 grams per tonne gold, 0.3 per cent copper, 0.5 per cent lead and 2.8 per cent zinc (270 grams per tonne silver equivalent) in drill hole 15CLM-081 (see news release dated Dec. 1, 2015);
• A 55.2-metre downhole interval averaging 41 grams per tonne silver, 0.7 per cent lead and 5.3 per cent zinc (202 grams per tonne silver equivalent) in drill hole 13CLM-066 (see news release dated Oct. 24, 2013).

Delineation of this target area is a high priority for future drilling on the property, which, if successful, could have a significant positive impact on the cumulative mineral resources of the project. This target remains to be tested, and neither the lateral dimension nor thickness of mineralization has been confirmed at this time.

Select assay composites from the 2016 drill program are shown in the attached table.

            SELECT ASSAY COMPOSITES FROM THE 2016 DRILL PROGRAM
 
Hole No.             From        To  Interval   Estimated total        Ag         Au
                       (m)       (m)       (m)     thickness (m)     (g/t)      (g/t)

16CLM-087           529.1     532.0       2.9               2.3         5       0.21
including           531.4     532.0       0.6               0.4        21       0.63
16CLM-087           723.3     732.8       9.6               7.6        20       0.02
including           723.3     724.5       1.3               1.0        50       0.06
and including       728.6     729.4       0.8               0.6        96       0.04
16CLM-087           809.5     811.6       2.1               1.7        23       0.02
including           810.4     811.6       1.3               1.0        38       0.03
16CLM-088           134.1     135.0       1.0               0.5        26       0.03
16CLM-088           683.7     714.0      30.4              29.5       107       0.07
including           683.7     691.0       7.3               7.1       190       0.13
and including       702.3     714.0      11.8              11.4       100       0.04
including           712.7     714.0       1.3               1.3       178       0.01
16CLM-089           917.9     943.9      26.0                 -         1       0.32
16CLM-089           981.5    1052.0      70.5                 -        13       0.02
including          1014.7    1024.0       9.4                 -        30       0.06
including          1022.4    1024.0       1.6                 -        63       0.07
11CLM-001           751.1     759.6       8.6                 -        16       0.02
including           758.6     759.6       1.0                 -        80       0.02
11CLM-001           864.5     876.0      11.5                 -        12       0.15
including           865.7     867.0       1.3                 -        41       1.18
11CLM-001           887.7     897.4       9.8                 -        20       0.02
including           896.0     897.4       1.4                 -       112       0.04

Hole No.               Cu        Pb        Zn      AgEq
                       (%)       (%)       (%)     (g/t)

16CLM-087             0.0       0.1       0.0        25
including             0.0       0.5       0.2        89
16CLM-087             0.3       0.1       1.0        87
including             0.1       0.3       2.2       145
and including         2.8       0.5       4.9       585
16CLM-087             0.4       0.0       0.1        72
including             0.7       0.0       0.1       115
16CLM-088             0.0       0.8       0.3        66
16CLM-088             0.4       1.1       2.3       275
including             0.4       3.4       5.5       552
and including         0.5       0.6       1.9       242
including             0.9       2.0       3.3       453
16CLM-089             0.0       0.0       0.0        25
16CLM-089             0.2       0.1       0.1        45
including             0.7       0.1       0.2       118
including             1.9       0.1       0.3       281
11CLM-001             0.1       0.2       0.2        36
including             0.1       0.8       0.9       153
11CLM-001             0.2       0.0       1.6       105
including             1.1       0.0       7.7       506
11CLM-001             0.2       0.2       0.1        55
including             1.0       1.1       0.8       291

Analyzed by FA/AA for gold and ICP-AES by ALS Laboratories in North Vancouver, B.C. Silver (greater than 100 parts per million), copper, lead and zinc (greater than 1 per cent) overlimits are assayed by ore-grade ICP analysis; high silver overlimits (greater than 1,500 grams per tonne silver) and gold overlimits (greater than 10 grams per tonne gold) are reassayed with FA-Grav. High lead overlimits (greater than 20 per cent) are assayed by titration. Silver equivalent was calculated using the approximate two-year trailing average metal prices of: $18.20 (U.S.) per ounce silver, $1,240 (U.S.) per ounce gold, $2.80 (U.S.) per pound copper, 90 U.S. cents per pound lead and 90 U.S. cents per pound zinc. Silver-equivalent calculations did not account for relative metallurgical recoveries of the metals. Ore-grade composites calculated using an 80-gram-per-tonne-silver-equivalent cut-off and less-than-20-per-cent internal dilution, except where noted; anomalous intercepts are calculated using a 10-per-tonne-silver-equivalent cut-off.

New drill results from the western and eastern margins of the central intrusion continue to highlight the exploration potential of the contact skarn style of mineralization.

Hole 16CLM-089 tested three mineralized zones, including two within the main contact skarn of the central intrusion about 200 metres to the southeast of the Blind and El Sol deposits. Drilling identified a plus-100-metre-thick interval of skarn at depths of over 800 metres below surface. Two zones of interest were identified within the contact skarn, including a 26-metre interval (down hole) averaging 0.32 gram per tonne gold and 1.2 grams per tonne silver starting at 917.9 metres depth and a deeper 70.5-metre zone (down hole) of anomalous silver-enriched mineralization averaging 44.7 grams per tonne silver, which includes a 9.4-metre copper-enriched interval averaging 30.5 grams per tonne silver and 0.7 per cent copper.

The extension of hole CLM-001 intersected over 100 metres of variably mineralized contact skarn on the eastern side of the central intrusion and targeted an area over 200 metres along strike from the Mina La Bocana zone and at depths of over 650 metres below surface. Drilling intersected several zones of anomalous polymetallic and base metal mineralization, including a 1.3-metre interval (down hole) averaging 1.18 grams per tonne gold, 41 grams per tonne silver, 1.1 per cent copper and 7.7 per cent zinc (506 grams per tonne silver equivalent) within a broader 11-metre silver and copper-enriched, anomalous zone averaging 105 grams per tonne silver equivalent.

Results from drill holes CLM-001 and CLM089 confirm the continuity of mineralized skarn around the central intrusion and to depths of over 650 metres, which remain open for further target development.

The company's blue-sky exploration of the gravel-covered portions of this plus-130-square-kilometre property continues with soil sampling, prospecting and ground VLF (very low frequency) identifying multiple anomalous areas for follow-up work in the coming months to refine drill targeting. The property is highly prospective and is on trend with the Avino gold and silver mine to the west and to Hecla's San Sebastian gold and silver mine to the east, which recently reopened in January, 2016.

Cerro Las Minitas project

Exploration on the company's flagship Cerro Las Minitas property in Durango, Mexico, is financed by Electrum Global Holdings LP, which is financing a broad range of exploration activities to earn a 60-per-cent interest in the project through a $5-million (U.S.) earn-in option on the property, with Southern Silver acting as operator.

The Cerro Las Minitas project contains an estimated inferred resource of 17.5 million ounces of silver, 237 million pounds of lead and 626 million pounds of zinc (77.3 million ounces of silver equivalent) and an estimated indicated resource of 10.8 million ounces of silver, 189 million pounds of lead and 207 million pounds of zinc (36.5 million ounces of silver equivalent).

A total of 91 drill holes for 35,955 metres have now been completed on the Cerro Las Minitas project, with exploration expenditures of approximately $8.35-million (U.S.) spent on the property to date.

We seek Safe Harbor.