Mr. Graeme O'Neill reports

BAYHORSE SILVER SIGNS LETTER AGREEMENT TO EARN A 50% INTEREST IN THE HARRISON HIGH GRADE GOLD PROJECT, BRITISH COLUMBIA, CANADA

Bayhorse Silver Inc. has entered into an option agreement with Bear Mountain Gold Mines Ltd. (BMGM), a British Columbia private corporation, to earn a 50-per-cent interest in its Harrison gold project in Harrison, B.C., Canada.

The Harrison gold property is an advanced-stage gold exploration project focused on a seven-kilometre-long ridge called Bear Mountain located on the southeast side of Harrison Lake, 130 kilometres east of Vancouver. BMGM has an option to acquire a 100-per-cent interest in the property from TSX Venture Exchange-listed Omineca Mining and Metals Ltd.

Harrison gold project highlights:

• Historic gold resources of 220,300 ounces contained in 2,458,674 tons were reported by Norman (1989) for two of the known intrusions (referred to as the Jenner and Portal zones) with an average grade of 2.79 grams per tonne gold at a two-gram-per-tonne cut-off grade.
• The RN mine was intermittently mined from 1972 until 1982. Historic smelter reports indicate that a total of 642.82 tonnes (708.58 tons) of ore was shipped from the RN zone. This material contained 30,443 grams of gold (978.89 ounces) and 616 kilograms of copper. The average recovered grade is 47.4 grams of gold per tonne (1.38 ounces of gold per ton) (Allen, 1983).
• Ministry of Mines permits are approved for surface drilling and lateral development work at the former RN mine.
• Gold mineralization consists of free milling 0.2-millimetre-to-2.0-millimetre-size gold grains within quartz veins ranging from less than a centimetre to several tens of centimetres in width.
• Significant historic mineralized intercepts reported for the Jenner zone included: DDH 85-36 with 102 metres averaging 3.54 grams per tonne gold; DDH 86-48, which averaged 5.28 grams per tonne gold over 24 metres; and DDH 84-28, which averaged 4.12 grams per tonne gold over 63.2 metres.
• For the Portal zone, located 150 metres east of the RN mine, historic results included DDH 86-43, which averaged 9.78 grams per tonne gold over seven metres, and DDH 88-76, which averaged 21.4 grams per tonne gold over seven metres.

The company advises that the drill intersections, grades and estimates herein are of a historic nature. Historic drill intersections, grades and resource estimates reported have not been verified. A qualified person has not done sufficient work to verify the historical estimates nor classify the historic estimates as current mineral resources or mineral reserves, and the company is not treating the historical estimates as current mineral resources or mineral reserves. Resampling of underground workings and confirmation drilling by a qualified person will be required to designate a resource under National Instrument 43-101 requirements.

The property is located off paved roads at low elevations, with power, water and services locally available.

Immediate diamond drilling and underground exploration program

An initial 1,500-metre drilling program is planned to twin several of the historic drill holes at the Jenner and Portal zones, including the mineralization identified within the RN mine workings (proposed drill site DS-1), the intercept reported in DDH JNUG-121 (proposed drill site DS-2 -- referred to as the Jenner Deeps zone), the mineralization intersected by DDH PT 86-43 (proposed drill site DS-3) and the intercept reported in DDH PT 88-76 (proposed drill site DS-4 (referred to as the Easter Egg zone).

The company plans to rehabilitate and extend the historic RN mine workings, where historic smelter reports indicate that a total of 642.82 tonnes (708.58 tons) of ore were shipped from with an average reported grade of 47.4 grams per tonne gold. The company will also complete sufficient underground bulk sampling and offsite processing to confirm that waste rock from the known mineralized zones is not acid generating.

Follow-up drilling from both surface and underground locations is planned to extend the known mineralized zones.

Recent metallurgical work by BMGM to confirm historic gold recovery included five samples consisting of approximately 10 kilograms each of vein material collected from the RN adit, which were submitted to Metsolve Metallurgical Lab in Langley, B.C., Canada. A composite sample of 25.5 kilograms was made with a calculated head grade of 43.2 grams per tonne gold and an assayed head grade of 46.5 grams per tonne gold. The RN composite responded well to gravity concentration with a recovery of 90.7 per cent with a final concentrate grade of 1,088 grams per tonne gold from a calculated head grade of 43.2 grams per tonne gold (BMGM, 2020).

The Bayhorse/BMGM agreement

In order to exercise the option, Bayhorse shall: (i) assume all the outstanding obligations of BMGM due to Omineca; (ii) pay $50,000 in cash and issue 500,000 common shares in the capital of Bayhorse to BMGM; and (iii) incur, including the required expenditures under the Omineca option, not less than $1.1-million of expenditures on the property (subject to the receipt of drilling and exploration work permits for the property from the British Columbia Ministry of Energy, Mines and Petroleum Resources; or confirmation that surface drilling and underground development work can commence immediately).

The terms of the BMGM option agreement with Omineca require that BMGM incur $2-million in exploration expenditures ($900,000 of which has been incurred to date), pay $500,000 in cash or shares ($100,000 of which has been paid), and issue 3,166,000 shares on or before Dec. 31, 2020 (1,166,000 of which have been issued). In addition, Omineca is entitled to a 2-per-cent net smelter return royalty (50 per cent of which can be purchased for $1-million) and up to $500,000 in annual $100,000 special royalty payments on the occurrence of certain trigger events.

In recognition that Omineca is entitled to an underlying 2-per-cent net smelter return royalty on the property, the parties agree that the Omineca net smelter return royalty, including the purchase of 1 per cent of the net smelter return royalty for $1-million, shall be apportioned according to each party's interest in the property.

Property history

Local prospectors discovered gold on Bear Mountain in the early 1970s, then explored and mined a high-grade quartz vein (the RN mine). Between 1982 and 1990, Bema International and Kerr Addison completed extensive drill testing on the property (16,000 metres) and constructed 350 metres of underground drifts and raises. Historic drilling identified widespread, subhorizontal quartz veins associated with finger like diorite intrusions 100 metres to 500 metres in diameter. Additional multiple intrusions and several potentially economic mineralized zones were also discovered.

A bulk sampling program was conducted approximately 50 metres below the surface outcrop of the Jenner zone (referred to as the Jenner 187 level); and possible mining options for the Jenner zone were assessed.

Based on surface and underground drilling completed by Bema above the 50-metre ASL (above sea level) level, Norman (1989), using a one-gram cut-off grade for the Jenner zone and a two-gram cut-off grade for the Portal zone, estimated that the Jenner and Portal zones contain 2,458,674 tonnes at an average grade of 2.79 grams per tonne gold for 220,300 ounces.

Zone                       Category       Resource tonnes      Grade        Grams     Ounces 
                                                             (g/t Au)

Jenner zone   Probable and possible             1,801,134       2.71    4,876,635    156,710
Portal zone   Probable and possible               657,753       3.02    1,984,324     63,766 

The company advises that the resource estimate by Norman (1989) herein is of a historic nature. Historic drill holes, resource estimates and grades reported have not been verified. A qualified person has not done sufficient work to verify the historical estimates or classify the historic estimates as current mineral resources or mineral reserves, and the company is not treating the historical estimates as current mineral resources or mineral reserves. Additional resampling and drilling by a qualified person will be required to designate a current resource under National Instrument 43-101 standards.

In 2010, Omineca compiled available technical data for the property (Price, 2010) and reported that previous mining companies spent more than $7-million exploring the northern part of Bear Mountain after local prospectors mined a high-grade quartz vein during the 1970s in the RN mine.

Exploration work by BMGM has confirmed the presence of multiple diorite stocks that exhibit similar styles of gold mineralization and demonstrated that the central and southern parts of Bear Mountain exhibit gold-in-soil anomalies along a structural corridor that extends for over six kilometres through the property.

The five samples collected from the RN mine by BMGM for gravity recovery test work were also tested for metallic gold, which essentially involves comparing conventional fire assay results with total gold content results. The results of this metallic gold assay test showed that all five regular fire assays underreport the amount of gold contained in the submitted samples. Total gold values were underreported by 19 per cent to 41 per cent. It is important to note that Norman (1989) reported that the results of muck sampling from three underground raises driven along drill holes to assess the accuracy of drill hole assays showed that the reported drill hole assays appear to underreport gold contents. Rigorous metallic gold assay procedures will be utilized as part of the planned Bayhorse program to ensure accurate determination of gold values.

Bayhorse chief executive officer Graeme O'Neill commented: "Now that the Bayhorse silver mine in Oregon has started producing silver concentrate, the acquisition of a 50-per-cent interest in Bear Mountain, a known historic producer of free milling gold, is a step forward in precious metals involvement and development by Bayhorse. We look forward to working with Bear Mountain to verify the historic drilling results and extend the existing RN adit to confirm the historic mined grades. A ZTEM airborne survey is planned at an early date to delineate and evaluate the multiple potentially mineralized diorite stocks along the structural belt that runs the length of the property."

This news release has been prepared on behalf of the Bayhorse Silver board of directors, which accepts full responsibility for its content. Dr. Stewart Jackson, PGeo, a qualified person and consultant to the company, has prepared, supervised the preparation of and approved the technical content of this press release.

About Bayhorse Silver Inc.

Bayhorse Silver is an exploration and production company with a 100-per-cent interest in the historic Bayhorse silver mine located in Oregon, United States, and an option on the precious-metal-rich Brandywine volcanogenic massive sulphide property located in British Columbia, Canada. The company has an experienced management and technical team with extensive mining expertise surrounding exploration and building mines.