Mr. Benoit La Salle reports

AYA GOLD & SILVER COMPLETES THIRD DRAWDOWN ON ZGOUNDER MINE EXPANSION LOAN

Aya Gold & Silver Inc. has completed the third drawdown, totalling $25-million, on its $100-million project financing facility for the expansion of the Zgounder silver mine in the Kingdom of Morocco. The facility is jointly provided by the European Bank for Reconstruction and Development (EBRD) and by the Climate Investment Funds through its Clean Technology Fund (CTF). All figures are in U.S. dollars unless otherwise noted.

Expansion highlights (as of Jan. 31, 2024, unless otherwise specified):

• Overall construction approximately 83 per cent complete and on budget;
• The Zgounder expansion is fully financed and on track for commissioning in Q2 2024;
• Third facility drawdown of $25-million completed in February, 2024, with $85-million disbursed to date;
• Tailings and water storage facilities complete;
• Installation of ball mill scheduled for completion at the end of March;
• Processing plant approximately 77 per cent complete;
• Electrical infrastructure is 85 per cent completed;
• Underground development of 8,712 metres (m) completed, 92 per cent of the initial lateral development program;
• Approximately 80 per cent of vertical development completed;
• Mining at the open pit continuing with more than 110,000 tonnes (t) stockpiled.

"With construction well advanced and operation activities ramping up to peak activity levels, we are extremely proud of Zgounder's disciplined transformation to date. Our recent drawdown speaks to our ability to systematically meet extensive obligations and derisk the development and construction of our expansion, which remains on track and on budget for commercial production by Q4 2024. We also delivered on our initial TCFD disclosure requirement, which reduces our cost of capital by 25 per cent on our CTF tranche. Expansion of Zgounder is fully funded, on budget and on schedule to deliver value to all stakeholders for many years," said Benoit La Salle, president and chief executive officer.

Mining and mine development

In 2023, the underground mine access infrastructure was successfully advanced in accordance with plan.

The underground access ramp has advanced several kilometres from the portal, and now connects all the historical levels of the mine with the newly developed levels (1,950 m and 1,925 m levels). The underground contractors have been advancing both lateral and vertical development at rates in line with the projected plan. Ground conditions are as expected and water inflow, to date, has been negligible.

Construction of both surface and underground mine infrastructures, including workshops, warehouses, backfill station and the electrical substation, remains on schedule.

Mining production has continued to ramp up as planned, averaging 1,964 tonnes per day in Q4 2023. A total of 291,000 t had been stockpiled at the end of January, 2024, for commissioning of the new mill.

Processing plant

Plant civil and concrete works are 97 per cent complete with only minor work remaining.

The cyanidation tanks have been erected. The assembly of structural steel is progressing well. The steel structure for the silver refinery has been fully assembled, and installation of the Merrill Crowe equipment is continuing. Assembly of the conveyors is continuing, and most plant equipment has been placed into position. The ball mill installation is continuing under the manufacturer's supervision, for expected completion in March.

The engineering, procurement and construction (EPC) contractor has completed all necessary procurement, and all outstanding items are in transit. The last mechanical equipment and electrical and piping material are expected to be delivered to site in Q1 2024, and installation to be completed by early Q2 2024.

Infrastructure

Construction of the new assay laboratory is 61 per cent complete, and its commissioning is planned in Q2 2024. Construction of the electrical power substation, pylons and 60-kilovolt power line is advancing toward planned operationalization by the end of Q1 2024.

The region's yearly rainfall has begun. Water captured by the mine's dams is being pumped to the recently completed water storage basins for commissioning. Over 300,000 cubic m of water storage capacity has been built, sufficient to sustain operations during the dry season.

Operational readiness

The operations team continues to advance preparations to begin planned commissioning in Q2 2024. The recruitment of senior technical and operational personnel has commenced.

Intensive training of Zgounder's mine rescue teams is continuing, and they are expected to be fully operational in H2 2024. Furthermore, the environmental and community teams are maintaining the corporation's commitments to local authorities, community members and external stakeholders through increased engagement and reporting.

Financing update

The corporation has drawn an additional $25-million of its facility for a total of $85-million. This follows a January technical site visit by the lenders and their technical adviser, including a specific visit of Zgounder tailings facilities. Proceeds of the third drawdown will be used to further advance the Zgounder mine expansion project. A final drawdown of the facility is expected in H1 2024 as the project progresses.

At year-end 2023, the corporation successfully completed milestone 1 of the CTF tranche of the loan, resulting in a 25-per-cent reduction in the interest rate of the CTF tranche. The remaining two milestones are expected to be reached during 2024.

About Aya Gold & Silver Inc.

Aya Gold & Silver is a rapidly growing, Canada-based silver producer with operations in the Kingdom of Morocco.

The only Toronto Stock Exchange-listed pure silver mining company, Aya operates the high-grade Zgounder silver mine and is exploring its properties along the prospective South-Atlas fault, several of which have hosted past-producing mines and historical resources. Aya's Moroccan mining assets are complemented by its Tijirit gold project in Mauritania, which is being advanced to feasibility.

Aya's management team maximizes shareholder value by anchoring sustainability at the heart of its production, resource, governance and financial growth plans.

We seek Safe Harbor.