122Moz Silver Resource Anchors Aftermath’s Berenguela Project | Mike Williams

0:00Hello and welcome to Kitko Mining with me Paul Harris at the 2026 PDAC in Toronto and Canada. Today we're talking about silver exploration in Peru and I have great pleasure to be joined by Mike Williams, founder and executive chair of Aftermath Silver which trades on the TSXB under the ticker AAG. Mike, welcome to Kitko. Thanks for having me on. Now you're exploring the Barangayla silver copper manganese project in Boonio in Peru. Let's start with a bit about the background of the project and how you came to acquire it. Well we had a project in Chile and we still do it called Chaya Coil. It's a very good project. Chaya Coil was 35 million ounces measured and indicated for their 10 million in inferred but the opportunity was presented itself to purchase the Barangayla project as you've mentioned in Puno. Peru from silver standard resources.

1:04There was a couple reasons why it was available. They were in the process of merging with the Turkish company Alessir and also they were looking at getting out of Peru. They wanted to focus on other jurisdictions but I think the third reason was and when you talk to them you mentioned the metal manganese. Now manganese is interesting in the sense that historically if you had manganese associated with an ore body deposit it made it difficult to get decent recoveries out which made it hard to demonstrate economics but the technology has changed over the last 20 years. We can use a process called hydro metallurgy so we were confident that we had a methodology to deal with the manganese which would allow us to get the silver out, get the copper out and then to produce an economic manganese product. The other thing that we quickly recognized was we were in a different

2:05environment for manganese in that there's a lot of it in the world. It's mostly feral manganese for the steel industry. We had a manganese at Veranguila that can be used for EV car batteries. So we had the idea we would spend the time and the money on metallurgy needed at Veranguila because the deposit was known about for over 100 years. Roughly 2% had been mined through our regional miners but we saw it as a great opportunity and the CEO and I Ralph Russian were big fans of silver and the fact that 65% of it was now used on an industrial side as well as the financial. So we saw the opportunity there and the other key thing at Veranguila for us was open pit. Well, we're doing a pre-visibility study. We'll demonstrate it's an open pit but it comes right to surface. There's very few open pit silver operations and our Chiacoyo coincidentally in Chile is also open pit. So that was our business model. Now once we got into it we realized how much

3:12potential it had to the point now where we've just updated the 43101. We're looking at 122 million ounces of silver measured and indicated with a further 20 million and inferred still open and close to a billion pounds of copper I think it's 870 million pounds in measured and indicated and there's 3 million tons of manganese which potentially could turn into 10 million tons of manganese, high-perity manganese for the EV battery. We could be one of the biggest manganese suppliers globally for that industry. So it kind of all made sense. It was just a case of timing. Now tell you a story. When we started negotiating with Silver Standard, Silver was $16 by the time we finished over only a period of 30 days, Silverhood moved up to $22. That was a large move back then. We were worried that maybe they're going to change their mind now that

4:14Silver's gone through 20. Silver most of my career was between 10 and 15. So our timing was impeccable. Well congratulations there. Several things to follow up on from your initial comments then, what's the difference between manganese that's used for steel additive and manganese that's suitable for EV batteries? Essentially what we call the ferro manganese used in the steel industry is hosted in silica and where for to work in an EV battery there's two key tenants. One you have to be able to get it to a 99.9 percent purity level. Number one and number two it can only come from an oxide or a carbonate rocks and our deposit is oxide. You need that chemistry to work with the battery chemistry in order to work. So you know just because you do have a carbonate or oxide doesn't mean it's going to work. Now we have demonstrated we've press released it on bench levels. We can get to

5:1499.9. We're currently expanding that up right now. Okay now you mentioned that you acquired the project from silver sanded. Still was sanded obviously a big name perhaps one of the biggest names in the silver industry historically. I imagine that came with quite a lot of work done and work done to a relatively high scale. There was a lot of drill holes in it and we knew the geological model. We just had to expand on it. There's now I think there's close to 42 kilometers of drilling, 40,000 meters of drilling. So a lot of the drilling's done. We've done a lot ourselves but yeah and I should just back up a second. I think silver standard wanted to become a gold company and not just focus on silver. So there was the real opportunity and you know as they say Paul nature abores a vacuum and we saw a bit of a vacuum in the silver space because a lot of the previous silver companies were becoming gold companies and you know as they say you know timing

6:19is everything and with silver now trading where it is we look very smart but I never would have believed silver was going to trade at these prices when we we picked it up but our largest shareholder Eric Sprott who has 25% of the company you know was a lot more bullish to look silver is going to go north of 100. He said I am still at the opinion one day it could hit 200 and he still thinks that I believe. So I'm more in Eric's camp now than I was when I started where you know Ralph and I would be doing cartwheels if silver went over 30. Well I think Eric Sprott said relatively recently these still sees a $200 per ounce silver price out there. Now you mentioned PFS for an open pit. You have a resource of let's say 145 million ounces in all categories. What are you looking at in terms of the open pit on the potential production scenario for the project? That's being worked on right now. What we are looking at though is I think given the

7:19current metals environment we want to focus on extracting as much silver in the first five years as possible. So our goal is to end up between producing 4 to 5 million ounces of silver annually and then we're just at another six months I'll be able to tell you what production rate that will be and then we will also be producing copper and then what we'll do with the manganese will put it aside and when the manganese market starts to really take off we'll start doing our offtake agreements there. But we can produce silver and copper in Peru and we'll either have the manganese going to China or it will be processed in the United States if we're building a processing facility there. I'm not sure we're allowed to say the seawood anymore given what's happening in the critical minimum space but aside from me being pedantic let's talk about silver pricing. We're spoken a lot during our conversation Mike about how how how the silver prices move. Ended 2025 hitting three digits it's pulled back since then we're about 80 to 90 dollars per

8:24ounce at the moment. As you're doing a PFS where do you pitch the silver price in that to reflect a viable base case that perhaps doesn't have such a wide delta with where the spot prices but obviously showing that you have a sustainable business. It's a good question. We would actually stress tests below 30 to make sure it would work. Do I think it's going below 30? No I don't. What we're doing we're looking at internally though is 50 dollar silver I think I don't expect silver to return to those levels but it has to be something that a the bankers view as reasonable and feasible and I think 50 dollar silver you know by the end of this year I think a lot of people will be using it in their financial models. Now you can show through the sensitivities what happens at 7580 you know we talked off air about the leverage that silver affords at these prices it's fantastic and I think if you can maintain a reasonable all-in sustaining cost call it 20 dollars

9:2922 and if silver is trading at north of 75 companies like us with large resources should be able to deliver tech late returns and we've never seen that in the commodity space. Well honest we'll press you on that a little bit Mike if I may because one of the reasons people invest in silver companies in silver stocks is because of that leverage you mentioned whereby a 10% increase in the silver price camina 20 30 40 50% improvement in performance. Do you have a sense yet of what that potentially could be for you? Well we're I would say if we we've got a 400 million dollar market cap right now and 80% of it is probably silver so whenever silver moves we move significantly I think we're one of the largest silver development stories globally so we're kind of known as as a bit of a canary in the coal mine for silver so I think it's very significant for us but

10:31what's interesting because we have copper because we have manganese they can offset our silver costs if if we look at it like that so you know you're going to have a very low silver all-in sustaining because of the polymetallic nature of the deposit that's going to be special and that's what we're looking forward to is getting our pre feasibility out and I can demonstrate those economics you know we're we're hosted in infrastructure as well I you know the railway I joke is a seven iron away it's three kilometers it's no seven iron for anybody but but you can go pop my own the head up it's a seven iron away but it it's close enough that you know it helps we're close to power we we've got a mining town close by that you can see potentially from our from our head frame so it's got a lot going for it and it's in a mining region in Peru it's at 42,000 meters which

11:31isn't you know it's not high by andian standards but it's still high but because we have the rail it's it's easier to deal with now you mentioned that the manganese and the copper could mean you you get some very good byproduct credits there to you know reduce the all-in sustaining cost of the silver ounce will that manganese and copper potentially open up the possibility of off-take financing to really help with the financing of the project 100 percent that that's one of the things we'll be we'll be looking at we've already had you know several copper guys looking at what we have now the it's it's a carbonate replacement system so there is an engine or the volcanic activity has come from somewhere to form this deposit and usually it's not too far away now as we've moved east on the project our zinc grade has dropped and our copper grades increased in fact the the last hole that we put out in the east on copper 150 meters of 1.2 percent copper 289 grams

12:33of silver with 7 percent manganese that's the equivalent of a 5 percent copper hole but it had intrusive rocks as well as carbonate replacement that tells the geologists that okay maybe we're getting closer to the source so we're going to follow up on that and then we've got scorn mineralization at a different area the deposit four kilometers away that's drill test at this year and we're seeing well you know one to two percent at surface we'll follow up with drilling on that so we we we do have a lot of expiration to come but at the at the end of the day we've got enough copper and silver and manganese to we think to be exceedingly robust but once again I will say that our pre feasibility should be out later this year or Q1 of of 27 okay I want to sort take a step back more looking at some some let's say environmental factors silver developers outside Mexico I think have received a notice will bump at the start of this year due to the violent

13:34incidents happening in Mexico and what investors telling you are they repositioning into stories such as it in Peru well we've always been one of the biggest traders you know and any commodity on the TSX venture we trade anywhere from 1.5 to 2.5 million shares I think over the last six months where I think we're a top five trader on that exchange so we've seen a bum we're trading some days three million shares so I think the answer is yes I don't know if they're coming out of Mexico and going to us our our issue has always been I think if you were de-risk geologically in my opinion based on the amount of ounces in our 43101 and tons I think from an engineering point being that you can see the deposit when you're on site comes right to surface so from an engineering point it should be relatively easy to open pit we'll know the strip ratio once a PFS is done but you've got to think it's going to be very favorable so I think we've got a lot of things going

14:38for us I think with us we've got to demonstrate we can make them the manganese work through through the metallurgy so far we're at 99.9 as I mentioned on the purity level and our recoveries with hydromate are going to be in the high 80s you know low 90s so we've crossed that Rubicon so it's just a case of coming out with a more conclusive test work in the PFS that everything works and we have a more importantly we have a strategy to monetize but a mistake about it the focus is going to be on silver copper then we can deal with the manganese when it comes on stream I always say it's like this holding our company aftermath is like holding a unit of a financing the silver is the share the warrant is the copper and the manganese and they will they will give you tremendous leverage and you're basically getting them for in my opinion next to nothing I know we all say we're undervalued we'll talk about valuation later on now in in addition to what's happening in Mexico potentially

15:42being good for silver developers in Peru I would argue that in the highlander silver buying the bear creek silver for the carini project which isn't too far from you I imagine that's been a big positive as well Peru hasn't had the security incidents but it has had presidential rotation and the country's got a new interim president following the removal from office recently of Jose Harry by congress there's going to be presidential elections later this year the political situation in Peru I think to be fair is a little bit messy does that have any impact on the mining sector or not that's a good question it did when Castillo was elected was a four years ago four and a half years ago Castillo was viewed hard left Peru doesn't normally go hard left and they did in this case and I either if you read the tea leaves I think it was largely because a lot of Latin American countries including Peru were coming out of the covid era and it was a it was very hard

16:44on them a lot more than it was on the west so there was a backlash against the whoever was in power they went the opposite way Castillo took advantage of it and and we lost I would say 40 to 50 million in valuation over six months as capital fled Peru but then Castillo was replaced to your point there's been a lot of presidents and mining ministers and mining ministers but I will say if you if you look at the Peruvian electoral system a lot more power is given to their congress their congress tends to be very centrist Castillo didn't do anything to damage the Peruvian mining industry but what was going on there was a lot of roadblocks a key mining operations Las Bombos so when Castillo was praised the the woman that replaced him in that party who since been replaced had said enough we need to guarantee the miners access to the ports and to their properties the the army was in and cleaned up the roadblock so I think that situation is behind as

17:49that where we are at Baranguila we haven't had one issue and we have the road pretty well goes right through our project fortunately but we deal with a stable congress but you know Paul one of the keys is in this environment in the last 20 years you can't just deal with in our case Lima you've got to have the local people on side and you know the person heading our community relations is an indigenous Peruvian has people speaking the local language there and that helps because if you don't have the local people on side you are going to have permitting issues and and I've been consistent saying this pretty well my whole career if if someone tells you they don't have permitting issues I think they're lying or being disingenuous we all have permitting issues it's how you manage them and the key thing in my opinion especially in Latin America dealing with the local people make sure they're happy because they will push back against the NGOs

18:50that don't like mining and try stop projects so Peru has actually been pretty good for us we'd like to see the permitting time drop from 12 months for drill permits to something like six and the government keeps promising us that's going to happen but we can live with 12 prefer six and I think our construction permits you know as we ask in the mining industry we want to see consistency uncertainty if we do everything properly we'll be able to permit and that's what we do see in Peru and you know I think it's 13% of Peruvian GDP comes from mining and they say look mining is imperative to our economy so it's a different environment than say some of these other areas for instance Mexico that's that's an outlier on the negative but Peru chili are my type two regions in Latin America well what would you say would be the key permitting issue for the communities where you're operating you mentioned those indigenous people there that to me suggests it's

19:51probably going to be largely an agricultural sector so therefore water's perhaps going to be the hot topic for them yeah I think if you if you I were to show you a map of bearing gala you would see that the river runs through the property which they allow us to draw on from drilling when we get the permits but I think the the issue there if I'm looking at a crystal ball is water extrusion if and we'll be processed you know potentially processing at altitude elevation people could push back on that and say well if something were ever to happen to a tailings facility at baranguila the watershed and I believe it's 250 kilometers away in that region would drain into Lake Titicaca and in practice we would over-engineer and I think it would be fine but you don't want anyone to think well what if it's not fine we've had people living on on that lake families for thousands of years fishing so it's it's sacrosanct to Peru and Bolivia they share the lake so

20:59I mentioned the railway earlier we'll be putting our or looks like on the rail or the road and going down to lower elevation to the port that's where we process so we get away from the environmental issues there and I think that helps us a lot like I'm very lucky to have the rail in the road there it makes a huge difference you know the the capex isn't going to be small here you know it's probably anywhere on the low side 400 million maybe up to 750 million depending on how we structure the silver processing copper and manganese okay we've covered a little of the ground during our conversation my what are some of the key catalysts for our viewers to watch out for this year from the company there'll be a drilling I mentioned those key targets that will be drilling both following up on that high high grade copper hole we'll be doing some infill silver drilling focusing on a silver zone that we we are potentially looking at bringing

22:01on stream first those drill results should be out 30 45 days PFS is out later this year the end that's the engineers tell me so that's Q1 in my book you know how engineers as long as it's good work and fine with Q1 and then we're going to drill test the scarring zone so lot of drilling and also some more metallurgical work will be we'll be pressurised excellent I look forward to hearing about that as and when these things come out Mike Williams thank you very much for joining me today thanks for having me on and we have a lot more to come for the 2026 PDAC in Toronto Canada so stay tuned and hit that subscribe button and don't forget after-marsilver trades on the TSXB under the ticker AAG I'm Paul Harris and this is Kiko Mining