Mr. Christopher Crupi reports

PARAMOUNT GOLD AND SILVER SUBSTANTIALLY EXPANDS SAN FRANCISCO BULK TONNAGE POTENTIAL

Paramount Gold and Silver Corp.'s new drilling at its 100-per-cent-owned San Miguel project in northern Mexico is likely expanding the bulk-minable resource in the San Francisco deposit. The first two holes have intersected wide zones of high silver values very close to surface.

The San Miguel preliminary economic assessment released on Aug. 25, 2014, proposed adding a heap leaching operation to what had previously been a mill-only development scenario, based on successful heap leach metallurgical tests. Adding a heap leach operation to the front end of the production scenario brought down initial capital costs while helping to finance underground mining and related mill construction from cash flow. The new PEA also featured a very substantial increase in resources compared with the 2013 PEA by including relatively lower-grade material from bulk-minable deposits like San Francisco.

Paramount therefore initiated new drilling at San Francisco to add resources which would likely not have been economic previously. Holes SF-14-057 and 058 were drilled into the eastern portion of the San Francisco area to see if discontinuous mineralized zones found in limited drilling in 2011 could be connected into a larger body which could be mined more efficiently. SF-14-057 intersected better-than-expected silver grades of up to 749 grams per tonne (24 ounces per ton silver) and 0.57 gram per tonne of gold within an outstanding intercept of 89.95 metres grading 66.8 grams per tonne of silver (two ounces per ton of silver) and 0.08 gram per tonne of gold (a gold equivalent grade of 1.2 grams per tonne) starting less than 12 metres below surface (see table). SF-14-058 intercepted grades up to 814 grams per tonne silver (26 ounces per ton of silver) with 1.8 grams per tonne of gold within a large intercept of 40 metres grading 56 grams per tonne of silver and 0.084 gram per tonne of gold.

                          SIGNIFICANT ASSAYS

                           Total                          True
Hole No.           Area   length    From      To  Width  width     Au     Ag 
                              (m)     (m)     (m)    (m)    (m)   g/t    g/t

SF-14-057 San Francisco   220.70   12.65  102.60  89.95         0.084  66.82
Including                  68.25   81.35   13.10         0.186 218.57
SF-14-058 San Francisco   250.65   37.30   49.00  11.70         0.039  38.42
                                   55.35   95.35  40.00         0.084  55.90
Including                          65.80   68.95  3.15          0.599 372.67
Including                          78.10   81.95  3.85          0.060  43.45
                                  213.15  216.55  3.40          0.038  39.27

These holes were drilled to intersect the mineralized zones at right angles. Additional drilling is required to model and confirm true width of mineralized zones.

The current drill program at San Miguel has three objectives (see news release of Sept. 2, 2014):

1. Test new, recently identified targets like Dana;
2. Convert inferred resources within the proposed underground mine plan to measured and indicated. About 18 per cent of the underground minable material in the company's PEA is inferred. The aim is to have 100 per cent of the resource as measured and indicated so that it will qualify as reserves in a preliminary feasibility study;
3. Acquire material for metallurgical testing and geotechnical studies.

Paramount is continuing its drill program with four core rigs on San Francisco, the new discovery on Dana (see news release of Oct. 15, 2014) and the Don Ese deposit.

We seek Safe Harbor.