Mr. Fiore Aliperti reports

METALLIS RESOURCES ENTERS OPTION TO ACQUIRE PAST-PRODUCING GREYHOUND SILVER/GOLD MINE IN IDAHO, USA

Metallis Resources Inc. has entered into an option agreement with Greyhound Mining & Milling Inc. (the optionor) to acquire a 100-per-cent interest in the Greyhound property, located in the mining-friendly state of Idaho, United States. The property encompasses the past-producin Greyhound and Bulldog high-grade silver/gold mines along with multiple historic workings. The agreement is subject to customary regulatory approvals.

Fiore Aliperti, president and chief executive officer of Metallis, stated: "Although we are seeing an overall change for the better in investor sentiment, it's important to recognize the current market conditions and understand the cost and dilution implications of large-scale exploration in the Golden Triangle at this time. As the market continues to find its feet, it's critical for Metallis to add value in alternative ways, despite the fact that our principal project remains the Kirkham property. With that in mind, we started the process in 2023 to look at possible acquisitions and the group that owned the Greyhound stood out. It is important that if we are to add a second project to the MTS portfolio, not only does the project need to show economic potential, the optionor needs to hold the same values as us. These include putting the project, the company and the investors first."

He went on to add: "This option agreement demonstrates the confidence both parties have in this high-quality resource asset as it favours long-term success with low upfront costs. Metallis can efficiently put funds into the ground, with resources and services more accessible than operating in a remote access location. The agreement for staged compensation over a 10-year period is structured to reward both parties as the project advances through the stages of exploration and development."

About the property

The 124-hectare Greyhound property encompasses two past-producing silver/gold mines (Greyhound and Bulldog) in central Idaho. The claims outlined in the agreement comprise 12 patented mining claims and three patented mill site claims with one patented pending mining claim and eight patented pending mill site claims. The property is road-accessible via paved and gravel road and is located 41 kilometres from Stanley and 225 km from Boise, the state capital.

The property is hosted in granites and granodiorites of the Idaho batholith and contains a 3.6 km long mineralized shear zone highlighted by two past-producing mines as well as multiple historic surface workings. This shear zone, measuring up to 12 metres across, contains multiple quartz-sulphide veins. Other parallel mineralized shears have been identified on the property, but sill require evaluation.

Continuing compilation of historic assays by the Metallis geological team has suggested a robust system that demonstrates consistent mineralization at multiple historic workings, including the two most developed underground operations at the Greyhound and the Bulldog mine.

• In 1979, a 2,663-kilogram bulk sample was taken from the lower Rufus adit at the Greyhound mine. This sample returned a grade* of: 2.39 grams per tonne gold, 1953 g/t silver, 3 per cent lead and 2 per cent zinc and exemplifies the high-grade nature of this target.
• In 1991, channel sampling across the mineralized vein in the Rufus adit, taken at systematic intervals, returned an arithmetic average grade* for ore shoot 1350 of: 1.85 g/t Au, 785 g/t Ag over a length of 36.88 m.
• In 1999, a grade summary was prepared by Robert Longe to assess grade potential along the Greyhound shear. His work on the Rufus adit demonstrated average grades* for well-documented ore shoots to be 684 g/t Ag and 0.85 g/t Au, including 3 per cent Zn and 1 per cent Pb.

*The reader is cautioned that all measurements and metal grades are derived from previous reports and the company has not independently confirmed the results. The similarity of values and conservative approach does lend confidence to these values. They are presented for completeness.

Property history

Initial exploration in the late 1800s led to multiple claims being staked along the Greyhound shear as prospectors and miners discovered the high-grade silver mineralization at surface on Greyhound Ridge. Five adits were driven into the mountain from 1896 to 1910 as local miners commenced small-scale mining at the Greyhound and the Bulldog with multiple other pits and shafts being sunk across the Republican, the Buckhorn and the Idaho prospects. These prospects, along with the Greyhound and the Bulldog, provided high-grade silver/gold/lead mineralization to a smelter built on site, until mining ceased with the decline of metal prices in 1910.

Since then, the property has been privately owned with patented mining claims dating back to 1921. It has seen little activity except for a period of minor production on a trial basis in 1979 when the lower Rufus adit (Greyhound mine) was driven 309 m along the mineralized shear zone. It was further extended to 458 m in 1991. Several minor underground and surface sampling programs have been completed, although the property has never been explored by any modern techniques. Good-quality concentrates are reported to have been produced from the Greyhound mine.

Next steps

The Greyhound property provides large upside potential due to a lack of modern exploration being performed over the property's entire history. In the last 45 years, the property has been held by a family-owned business as part of a larger asset portfolio. This has left a well-endowed property off the market, during a period where geological methodologies and approaches have changed, and exploration technologies have evolved. This allows Metallis to leverage its exploration experience to unlock the mineralized potential through geological mapping, drone aerial surveys, geophysical surveys and diamond drilling.

Continued compilation of historic reports will help the team determine the true grade and tonnage potential outside of the historic workings. To date, approximately 600 m of horizontal workings have been documented across the 3,600 m shear zone, leaving significant underexplored strike length left for further testing. The last ore shoot encountered in the lower Rufus adit returned some of the best grades on the property that are comparable with many of the operating mines in the state. A further 3,000 metres of untested ground remains across multiple high-grade silver/gold surface showings and pits. The system also remains open to depth as mineralization has been demonstrated over 500 vertical metres from the Rufus adit to mineralization on top of Greyhound Ridge.

This region has recently seen exploration success where historic silver camps have been able to outline sources at depth and this will be factored into the team's exploration programs. During initial exploration, the team will be assessing the property for source intrusions or disseminated mineralization. The property's location within the Great Falls tectonic zone and the Central Idaho batholith also lends itself to the potential for porphyry mineralization due to mapped Tertiary-aged intrusions on the property.

Agreement terms

The agreement requires staged payments of $670,000 (U.S.), which commence on the date of signing the agreement, being Feb. 26, 2024, and exploration expenditures of $10-million (U.S.) over a 10-year period. At any time during the option period, the company may exercise the option to acquire a 100-per-cent interest in the property by paying $7.5-million (U.S.), plus the balance remaining of the $670,000 (U.S.) at the time of exercise. In addition, the company will issue a share purchase warrant to the optionor for the purchase of up to one million common shares of Metallis at a price of 34 cents per share for a three-year period. The attached table specifies the above noted obligations.

Any reference to the term anniversary in the attached schedule or anywhere in this news release refers to the anniversary of the effective date for paying by the company of balance of the staged payments of $670,000 (U.S.) and exploration expenditures of $10-million (U.S.).

The optionor retains a 2-per-cent net smelter return royalty, which may be reduced to 1 per cent by the payment of $5-million (U.S.) during the term of the agreement.

Qualified person

David Dupre, PGeo, vice-president, exploration, and the qualified person, as defined by National Instrument 43-101, has reviewed and approved the technical information contained in this release.

Historic assays cannot be verified by Metallis as they are historical in nature, although there is no reason to believe they are inaccurate.

About Metallis Resources Inc.

Metallis Resources is a Vancouver-based company focused on the exploration of gold, copper, nickel and silver at its 100-per-cent-owned flagship Kirkham Property situated in northwest British Columbia's Golden Triangle. Metallis trades under the symbols MTS on the TSX Venture Exchange, MTLFF on the OTCQB Exchange and 0CVM on the Frankfurt Stock Exchange. The company has 60,544,312 common shares outstanding.

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