Mithril Silver and Gold Hits High-Grade Gold at Copalquin

Mithril Strikes High-Grade Gold at Copalquin as Mexico District Continues to Impress

Mithril Silver and Gold Limited (ASX: MTH, TSXV: MSG, OTCQB: MTIRF) has delivered another round of impressive drill results from its expansive Copalquin District in Mexico. The announcement reveals high-grade intercepts that continue to validate the project's significant resource potential ahead of an updated mineral resource estimate.

The latest results from Target 1 drilling showcase exceptional gold and silver grades, including standout intercepts of 57.7 g/t gold and 924 g/t silver over 0.50 metres. Furthermore, the programme recorded 21.9 g/t gold with 357 g/t silver over 1.35 metres.

These results represent some of the highest grades encountered to date at the project, reinforcing the robust nature of the epithermal system. The drilling programme has successfully expanded the resource footprint whilst providing critical geological data for Target 1's upcoming mineral resource estimate update.

With approximately 3,000 metres of additional drilling planned for Q1 2026 to finalise the resource update, Mithril Silver and Gold hits high-grade gold consistently across multiple drilling campaigns.

Table 1: Key Drill Highlights from Recent Target 1 Programme

District-Scale Discovery Gains Momentum

The recent drilling has delivered compelling evidence of a large-scale hydrothermal system extending well beyond the current Target 1 resource area. On the western side of Target 1, drilling intercepted a 150-metre anomalous silver zone with extensive hydrothermal alteration.

This discovery indicates what appears to be a major feeder zone with significant implications for the broader district model. The east-west structure potentially extends an additional 600 metres west to the El Gallo workings, where previous drilling returned high-grade results.

This connection would substantially increase the scale of the mineralised system and provide multiple expansion opportunities. Moreover, the 300-metre down-dip extension of the Refugio 1 structure represents the deepest intercepts achieved in this area to date.

These results confirm vertical continuity of the system and provide clear vectors for future resource expansion beyond the current model. The findings demonstrate that Mithril Silver and Gold hits high-grade gold at multiple structural levels within the deposit.

Managing Director's Perspective

"The drilling on the western side of Target 1 intersected a broad anomalous silver zone with pervasive hydrothermal alteration associated with the district-scale east–west structure," commented John Skeet, Managing Director. "In low-sulphidation systems, this style of alteration and silver enrichment is indicative of a well-developed hydrothermal conduit or feeder zone."

Understanding Low-Sulphidation Epithermal Systems

Low-sulphidation epithermal deposits represent some of the world's most economically significant gold and silver deposits. These systems form when hot, mineral-rich fluids circulate through near-surface rock formations, typically in volcanic environments.

The presence of wide alteration halos combined with silver-rich mineralisation at Copalquin indicates a robust, long-lived hydrothermal system. This geological signature suggests extensive fluid circulation through permeable structures, increasing the likelihood of discovering multiple mineralised zones.

Silver mineralisation in these systems often occurs as electrum, native silver, or silver-bearing sulfides. It typically reflects boiling or fluid mixing processes that are also highly efficient at precipitating gold.

The elevated silver grades encountered at Copalquin provide valuable vectors toward potentially gold-rich feeder structures at depth or along strike. Additionally, these indicators suggest the system remains open for expansion across multiple dimensions.

Key Indicators of System Strength

• Broad alteration halos reflecting extensive hydrothermal fluid flow
• Silver-rich zones indicating boiling and fluid mixing processes
• Multiple structural orientations hosting mineralisation
• Extensive surface expressions across the 70km² district

Aggressive 2026 Exploration Campaign

Mithril has outlined an ambitious 25,000-metre drilling programme for the first half of 2026, representing one of the most significant exploration campaigns in the company's history. The programme will focus on expanding known mineralised zones at Target 1.

In addition, the campaign will test new high-priority targets across the district and integrate district-wide geophysical data. The recently added 20km² La Dura property will undergo LiDAR survey interpretation in February 2026.

This will be followed by aerial magnetic surveys upon completion of similar work at Copalquin. The systematic approach to district-wide exploration demonstrates Mithril's commitment to unlocking the full potential of the region.

The Copalquin District features over 100 historic underground workings including several notable producing multi-level mines and 200 surface workings. This extensive historical activity validates the geological potential whilst providing numerous targets for modern exploration techniques.

The density of historical workings suggests that Mithril Silver and Gold hits high-grade gold in areas where early miners identified surface mineralisation. Consequently, these zones offer excellent starting points for systematic exploration programmes.

Solid Foundation: Current Resource Base

Mithril's Target 1 hosts a robust maiden JORC resource that provides a strong foundation for expansion. The current resource demonstrates both the quality and scale of mineralisation present within the district.

Target 1 Mineral Resource (2.0 g/t AuEq cut-off):

Importantly, 28.6% of the resource tonnage is classified as Indicated, demonstrating good geological confidence. The average vein width of approximately 4.5 metres supports conventional underground mining methods.

Furthermore, preliminary metallurgical test work shows high recovery rates of 96% for gold and 91% for silver. These results indicate excellent potential for economic extraction and processing.

The company holds an exclusive option to purchase 100% interest in the Copalquin mining concessions for US$10 million on or before 7 August 2028. This arrangement provides excellent optionality as the resource base expands.

Strategic Position in Mexico's Sierra Madre

The Copalquin District sits within Mexico's prolific Sierra Madre Gold Silver Trend, which hosts numerous world-class gold and silver districts along Mexico's western margin. This geological setting has proven highly favourable for epithermal mineralisation.

Multiple mining operations have successfully extracted precious metals from similar deposits throughout the region. Mexico's stable mining jurisdiction, established infrastructure, and proximity to processing facilities provide significant operational advantages.

The project's location in Durango State offers access to skilled mining personnel and established supply chains. These factors will become increasingly important as Mithril advances toward development decisions.

Key Location Advantages

• Established mining region with skilled workforce
• Favourable geological setting within proven metal province
• Access to infrastructure and processing facilities
• Stable jurisdiction with clear mining regulations

Investment Thesis: District-Scale Opportunity

Mithril presents investors with exposure to a genuine district-scale epithermal discovery in one of Mexico's premier mining regions. The combination of high-grade intercepts, expanding geological understanding, and systematic exploration approach positions the company for substantial resource growth.

The recent drilling success demonstrates that Target 1 represents just the beginning of what appears to be a much larger mineralised system. With over 100 historic workings across the 70km² district and evidence of extensive hydrothermal alteration, the company is methodically unlocking potential.

The consistency with which Mithril Silver and Gold hits high-grade gold across multiple drilling campaigns demonstrates the robustness of the geological system. The company's aggressive 2026 exploration programme, combined with the upcoming Target 1 resource update, should provide multiple catalysts.

Key Investment Highlights

• High-grade epithermal system with district-scale potential
• Expanding resource base with 28.6% in Indicated category
• Strategic location within Mexico's proven Sierra Madre trend
• Aggressive exploration programme driving near-term catalysts
• Option structure providing excellent leverage to success

Why Should Investors Follow Mithril?

Mithril Silver and Gold represents a compelling opportunity to gain exposure to a high-quality epithermal discovery with genuine district-scale potential. The company's systematic approach to exploration, combined with consistently impressive drill results, demonstrates the strength of the underlying geological system.

The upcoming resource update at Target 1, aggressive 2026 drilling campaign, and expanding district model provide multiple catalysts for value appreciation. With high-grade intercepts continuing to emerge from drilling and evidence of a much larger system becoming apparent, Mithril appears well-positioned.

For investors seeking exposure to high-grade precious metals discovery with substantial expansion potential, Mithril offers an attractive risk-reward proposition. This opportunity is backed by solid geological fundamentals and experienced management execution.

"Mithril has established itself as a major player in Mexico's epithermal gold-silver space, with recent drilling confirming district-scale potential at Copalquin," represents the key takeaway from recent developments. The combination of high-grade results, expanding geological model, and aggressive exploration programme positions the company for substantial resource growth throughout 2026.

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