Mr. Andre van Niekerk reports

GATOS SILVER CONTINUES TO INTERCEPT HIGH GRADE MINERALIZATION IN SOUTH-EAST DEEPS ZONE AT CERRO LOS GATOS

Gatos Silver Inc. has provided a Q2 2023 update on the drilling and exploration programs in the Los Gatos district (LGD) in Mexico, including details of additional intercepts of high-grade mineralization in the Southeast Deeps (SE Deeps) zone of its 70-per-cent-owned Cerro Los Gatos (CLG) mine that could provide new mineral resources and reserves to extend the mine life.

"Our continued drilling success shows why we are so excited about the future for this district," said Dale Andres, chief executive officer of Gatos Silver. "Our next mineral resource and reserve update is nearing completion, and will be a first step in extending the mine life and showing the potential scale of SE Deeps. With six surface drill rigs primarily focused on defining the SE Deeps, we are continuing to intercept strong widths and grades of silver, zinc, lead, gold and copper as we infill that zone. In addition, the foundational work we are doing this year with our greenfields program is deepening our understanding of the district and enabling us to sharpen our focus on priority areas where we might find the next CLG."

Q2 2023 highlights continue to demonstrate excellent mine life extension potential at CLG:

• The company's 2023 mineral resource and reserve update, including a new life-of-mine plan, is progressing well and on track to be completed in the third quarter;
• Resource expansion drilling in the SE Deeps zone of CLG continued to intercept high-grade mineralization below and north of the existing mineral resource (see attached table for complete intercept details):
  • Drilling highlights include hole SE-531 that intercepted 4.0 metres (estimated 3.5 m true width) at 231 g/t silver, 4.86 per cent zinc, 3.98 per cent lead and 0.38 per cent copper; hole SE-520 that intercepted 3.0 m (estimated 2.7 m true width) at 212 g/t silver, 17.33 per cent zinc, 3.49 per cent lead, 0.45 g/t gold and 0.92 per cent copper; and hole SE-515 that intercepted 3.5 m (estimated 2.8 m true width) at 160 g/t silver, 11.26 per cent zinc, 6.04 per cent lead and 0.61 per cent copper;
• Greenfields exploration work in the LGD continues to identify additional new high priority targets:
  • Detailed mapping and rock geochemistry at Portigueno, Lince and San Luis continue to generate new targets for drill prioritization;
  • A detailed LiDAR (light detection and ranging) and air photo drone survey was completed over the Lince and Los Rieles targets, and is now being used to guide interpretation and mapping priorities;
  • The magnetotelluric geophysics survey has commenced on an area of the Rio Conchos basin near CLG, and results from the initial phase are expected during August, with the remainder of the survey being completed in the fourth quarter.

CLG mineral reserve and mineral resource update on track for completion in Q3 2023

Recent drill results from both surface drilling and underground drilling are expected to improve the confidence in the higher-grade inferred resources and confirmed the presence of additional material above the current reserve cut-off grade. The results of the resource definition drilling prior to the database cut-off at the end of the first quarter of 2023 will be reflected in the mineral reserve and mineral resource update which is on track to be completed in the third quarter.

CLG Southeast Deeps resource expansion drilling shows potential for a multiyear mine life extension

The drill intercepts to date show continuity of the SE Deeps mineralization extending approximately one kilometre laterally and 400 m vertically, which overlaps with the existing Southeast mineral resource and remains open along strike.

The company expects to report a maiden inferred resource for the SE Deeps zone in Q3 2023 and is targeting to further upgrade the classification to mineral reserve status in the second half of 2024.

Drilling during 2022 and early 2023 was completed at approximately 100 m to 200 m spacing for the purpose of establishing the larger-scale strike and dip of the SE Deeps zone. The current drilling program through the end of Q1 2024 will be focused on infilling the higher-grade areas of the zone to 50 m spacing. This tighter drill spacing is showing that variability within the zone exists, with higher grade in some areas and lower grade in other areas. On average, base metals including copper represent a higher proportion of the in situ value than in the Central and Northwest zones. Drill results continue to demonstrate excellent potential for a multiyear mine life extension.

Los Gatos district exploration update: current near-mine focus plus district-scale potential

The LGD comprises a large land package covering over 103,000 hectares with an established pipeline of prospects with over 50 targets identified to date. Work is advancing on detailed mapping and drill testing of the highest-priority known targets, as well as on district mapping and geophysics to identify additional targets.

During the quarter, drill hole MAM-02 was completed in the Mamba area. The drill hole intercepted both the Cascabel and Mamba structures showing alteration and quartz-calcite veining; however, no intercepts with economic potential were found. The scale of the system, style of alteration and proximity to the current operation are all encouraging, and these structures remain promising exploration targets. Drill testing further along and down dip from MAM-02 is planned.

Detailed mapping across the property is advancing well. During the second quarter of 2023, mapping was progressed at Portigueno, Lince, Santa Ana, San Luis and La Palma.

The Portigueno area is located approximately 2.5 km southeast of CLG. Detailed mapping has shown that this area of the basin is more complex than previously thought. New surface mapping and relogging of historic drill holes in the area have identified a series of northwest-southeast-trending faults with veining and alteration associated with them.

Drone capture of LiDAR and detailed air photos were completed for Lince, 22 km northwest of CLG, and is now being used for interpretation and to guide reconnaissance mapping of this large area. Surface mapping has identified a number of different veins for drill testing that is expected to occur in the fourth quarter of 2023.

The Santa Ana area is located approximately one km north of the NW zone at CLG. Calcite and manganese veining were identified within the epiclastic basin during the first quarter. A deep drill hole into this area started recently with the objective of defining the vein in bedrock, the depth of the epiclastics, and depth to the main Los Gatos fault and underlying andesite.

The Los Gatos joint venture (LGJV) is in the process of completing a magnetotelluric geophysical survey from the basin west of CLG across to the Esther deposit. The first stage of this survey is being completed prior to the rainy season in the third quarter, and the second stage is expected to be completed in the fourth quarter this year.

New surface mapping and historic drill hole relogging are under way in the San Luis area, approximately five kilometres northwest of CLG along the Los Gatos fault. A large width of quartz-calcite veining exists in the area with indications of multiple pulses of fluid flow, similar to what is observed in the Southeast zone at CLG. Further mapping work is being completed to better understand the structural framework of the area before drilling is planned.

About Gatos Silver Inc.

Gatos Silver is a silver-dominant exploration, development and production company that discovered a new silver- and zinc-rich mineral district in southern Chihuahua state, Mexico. As a 70-per-cent owner of the Los Gatos joint venture, the company is primarily focused on operating the Cerro Los Gatos mine, and on growth and development of the Los Gatos district. The LGJV consists of approximately 103,000 hectares of mineral rights, representing a highly prospective and underexplored district with numerous silver-zinc-lead epithermal mineralized zones identified as priority targets.

Quality assurance/quality control

The half-core samples from the LGJV's surface exploration drill holes are shipped directly in sealed bags to the ALS Ltd. preparation facilities in Chihuahua City, Mexico. After sample preparation in Chihuahua, sample pulps are shipped to ALS in North Vancouver, Canada, for analysis. The remaining half core is retained on site. Samples sent for analysis are sawn half-core NQ or HQ in diameter and normally two m in length but varied based on geological contacts. Samples are prepared using a method whereby the entire sample is crushed and a subset is pulverized. Samples are analyzed for base metals and silver using inductively coupled plasma methods. Gold and overlimit silver are assayed using fire assay techniques. Sample batches include intermittent blanks, duplicates and certified standards. The results of the assaying of the QA/QC material included in each batch are tracked to ensure the integrity of the assay data. ALS is a third party independent laboratory.

Qualified person

Scientific and technical disclosure in this press release was approved by Anthony (Tony) Scott, PGeo, senior vice-president of corporate development and technical services of Gatos Silver, who is a qualified person as defined in S-K 1300 and National Instrument 43-101.

Qualification regarding exploration and drilling results

Any statements herein regarding ranges of potential tonnage and grade or quality of any exploration target are conceptual in nature; there has been insufficient exploration of the relevant properties to estimate a mineral resource; it is uncertain whether further exploration will result in the estimation of a mineral resource; and any exploration target therefore does not represent, and should not be construed to be, an estimate of a mineral resource or mineral reserve (mineral resource and mineral reserve estimates are stated exclusively in the Los Gatos technical report).

We seek Safe Harbor.