Ms. Joanne Freeze reports

XALI GOLD ADVANCES PEA TEAM AND UPDATED RESOURCE AND DEVELOPMENT PROGRAMS AT PICO MACHAY IN PERU

Xali Gold Corp. has advanced environmental, metallurgical and exploration programs at its Pico Machay gold project in Peru, together with the planned commencement of work on an updated mineral resource estimate and preliminary economic assessment (PEA). These co-ordinated programs are designed to support the continued evaluation of Pico Machay and prepare the project for future engineering, permitting and development.

Highlights:

• An experienced multidisciplinary engineering team has been assembled, with work now under way to simultaneously commence both an updated mineral resource estimate and a PEA.
• The ficha tecnica ambiental (FTA) approval process for the planned drilling program continues to advance following two technical meetings with Peru's Ministry of Energy and Mines (MINEM), while preparations are under way for a public workshop with the local community.
• Three drilling contractors have submitted bids for the planned 3,000-metre (m) diamond drill program, which includes approximately 2,000 m of resource confirmation drilling; the company is reviewing the bids and narrowing the field ahead of contractor selection.
• As part of initiating the EIA-d (detailed environmental impact assessment), a research-grade meteorological station has been purchased and installation is under way. This will support engineering and environmental studies and provide long-term monitoring through potential construction, operations and postclosure.
• A phase 1 metallurgical program is planned to commence shortly, representing the first stage of a broader program designed to build on previous met work to support an updated feasibility study and potential development.
• Fieldwork has resumed to follow up on high-grade gold results and priority exploration targets identified during the company's earlier 2026 sampling program.

"These programs demonstrate that we are moving Pico Machay forward with a clear focus on potential development," stated Joanne Freeze, president and chief executive officer of Xali Gold. "Our field team is launching a detailed mapping program to follow up on the encouraging high-grade results and new exploration targets generated earlier this year. The team has also recently completed the relogging of all previous reverse circulation drill chips and is now building a 3-D model of the mineralization. PEA work will advance in tandem with the resource confirmation drilling, allowing the new results and updated mineral resource estimate to be incorporated into the study as soon as they become available. The PEA will draw on the feasibility study released by Aquiline Resources in 2008, updated with the results of the company's current technical programs."

Xali Gold has assembled a multidisciplinary team to advance the PEA and support subsequent engineering work through feasibility, potential development, construction and production. Team members each bring more than 25 years of experience in mine development or operations in Latin America, including Peru. Their expertise spans mineral resource estimation, mining, metallurgy and processing, project economics, project finance, environmental studies, and environmental, social and governance (ESG) considerations. This approach allows key components of the PEA to advance before and during the planned drilling program.

The multidisciplinary team already working on the project includes: Adam Johnston, FAusIMM, CP (Met), a metallurgist with Transmin Metallurgical Consultants; David Thomas, PGeo, a mineral resource geologist; and Aran Gough, RPBio, a registered professional biologist.

Xali Gold has also recently engaged Brent Cochrane, MA, ICD.D, and Gordon Zurowski, PEng. Mr. Cochrane brings more than 40 years of international mining finance experience and has worked in Peru's mining industry since 2001, including as vice-president, finance and administration, of Compania Minera Antamina S.A. His project financing experience in Peru includes the Antamina and Mina Justa copper projects.

Mr. Zurowski, principal mine engineer with AGP Mining Consultants, has more than 30 years of mine operations and consulting experience focused on open-pit mine planning, financial evaluation and economic studies. His project experience includes Cuajone, Canariaco Norte, Cerro Lindo, Magistral and Marcona in Peru, as well as Los Azules, Filo del Sol and Aurizona elsewhere in South America.

"By assembling the full team now, we can advance much of the mining, metallurgical, environmental and economic work before and during the resource confirmation drilling," continues Ms. Freeze. "The updated resource will form the basis for the PEA and doing the studies in parallel should shorten the timeline to complete the PEA. The long-term meteorological monitoring station and planned staged metallurgical program are also important steps in preparing the project for its next phases of evaluation and advancement."

Updated mineral resource estimate and PEA

Approximately 2,000 m of the company's planned 3,000 m diamond drill program will twin selected historical reverse circulation holes within the historical resource area. The drill hole twinning, together with the completed historical data compilation, drill chip relogging and sampling, is intended to provide the additional information required to prepare an updated mineral resource estimate.

Development of an initial three-dimensional geological model using Leapfrog software is currently under way and is expected to be completed by the end of September, 2026. The model will integrate the historical drilling, geological, analytical and topographic information with the team's relogging work and approximately 40 interpretive cross-sections. Detailed mapping will help refine the interpretation of the controls on mineralization and guide the upcoming resource confirmation drill program. The model will subsequently be updated as new drilling results become available and will support the preparation of the updated mineral resource estimate and PEA.

Exploration permitting and community engagement

The FTA approval process for the planned drilling program at Pico Machay continues to advance. The company has participated in two technical meetings with the mining environmental directorate of MINEM, which provided additional guidance regarding recent modifications to the FTA process. These modifications include more deliverables from the company, implemented to speed up the evaluation process.

Following those meetings, Xali Gold engaged Embellie Advisory LLC to assess considerations relating to indigenous or native members of the Santa Ana community, including any potential impacts of the planned drilling program on collective rights. Embellie will assist the company to incorporate those findings into its FTA submission.

In parallel, the company is organizing a MINEM-facilitated public workshop for the local community regarding the planned exploration program. The workshop is planned for early October, and will provide an opportunity to explain and discuss the proposed work, and laws and practices in place to protect community interests. This fits well with Xali Gold's continuing transparent engagement with the community surrounding Pico Machay. The company plans to submit its FTA application approximately one week after the workshop is completed and, based on current guidance, expects a review and approval period of approximately 10 days following submission.

Initiation of EIA-d

Xali Gold is beginning environmental data collection to support the preparation of the EIA-d, the longest-lead-time component of the permitting process for mining operations in Peru. As an initial step, the company has purchased and is installing a new wireless Vantage Pro2 Plus meteorological station at Pico Machay. The research-grade station will collect site-specific information on wind speed, temperature, humidity, barometric pressure, rainfall, solar radiation and ultraviolet radiation, as well as related meteorological measurements.

The data will be used to validate and supplement regional information available from Peru's National Service of Meteorology and Hydrology (SENAMHI). Correlating site-specific observations with the longer-term regional record will also help the company estimate historical meteorological conditions at Pico Machay for the years preceding installation of the station.

The station is intended to form part of the project's long-term environmental monitoring infrastructure, supporting detailed environmental assessment and engineering design, and, subject to the project advancing, continuing through construction, operations, closure and postclosure monitoring.

Exploration follow-up under way

Ground exploration has resumed at Pico Machay, with the field team conducting detailed mapping and additional sampling to follow up on high-grade gold results and priority exploration targets identified during the company's surface and underground sampling program completed earlier in 2026.

Results from that program included 2.92 grams per tonne (g/t) gold (Au) over 31.5 m from surface channel 1, including 13.76 g/t Au over 4.5 m, within the historical resource area. In addition, 67 of 119 surface samples returned more than 0.50 g/t Au, helping the company define and refine multiple exploration targets. Gold mineralization and alteration characteristic of a high-sulphidation epithermal system were also identified in underground workings across an area measuring approximately 1.35 kilometres by 0.83 kilometre. Refer to the Xali Gold news release, dated July 28, 2026, and titled "Xali Gold Continues to Demonstrate the Scale and Grade of Gold Mineralization at Pico Machay," for further details.

The current work is focused on further evaluating selected high-priority areas and improving the company's understanding of the distribution and controls of higher-grade mineralization. Results will be incorporated into the evolving geological model and used to support planning for the next phase of work at Pico Machay.

About Pico Machay

Located within the southern Peru epithermal gold-silver belt, Pico Machay sits in a historically productive mining district in the Western Cordillera of the Andes. The project benefits from existing infrastructure and a mining-friendly community eager to partner on sustainable development.

Xali Gold remains confident in the significant upside potential at Pico Machay, which hosts a historical resource and several untested exploration targets on the project. Various historical engineering studies at Pico Machay were completed through 2009 and evaluated the potential for a low-cost, low-strip-ratio, open-pit heap-leach operation. Given that those studies were based on a long-term gold price of $700 per ounce (oz) and several exploration targets remain untested, Xali Gold considers the upside potential to be very strong.

About Xali Gold Corp.

Xali Gold is a gold and silver exploration company focused on advancing opportunities in the Americas. The company is focused on the exploration and development of Pico Machay, an advanced-exploration-stage gold project in Peru with a near-term production goal.

The company's approach to community engagement and responsible development is guided by strong governance principles and board oversight that support long-term stakeholder relationships.

Joanne C. Freeze, PGeo, is a qualified person as defined by National Instrument 43-101, and has reviewed and approved the contents of this news release.

We seek Safe Harbor.