The Santa Elena deposits are typical of low sulphidation systems in the Sierra Madre Occidental of México.

Mineralization at Santa Elena consists of multiple banded quartz veins and stockwork with associated adularia, fluorite, calcite and minor sulphides. Bonanza ore shoots (greater than 500 grams per tonne of silver and 30 grams per tonne of gold) are locally present. Samples show a geochemical signature of gold, silver, antimony, lead, zinc, barium, calcium and manganese. Metal zonation appears to exist with higher grades and thicker mineralized widths near the epithermal boiling zone. Zonation also appears to correspond to northwest-trending cross-cutting structures that intersect the main zone and form high grade shoots that are themselves mineralized.

The Ermitaño vein, approximately 4 km southeast of the Santa Elena vein, has characteristics similar to Santa Elena including banded quartz, stockwork and sub parallel mineralized splays.

The Santa Elena mine is located in the northwest trending continental arc related Sierra Madre Occidental volcanic rocks that extend 1,200 kilometres from Guadalajara to the US-México border. The continental arc volcanism culminated with the Laramide orogeny in the early to late Eocene and was followed by E-W directed extension between late Eocene to the early Oligocene. By early to mid-Miocene, extension migrated west into Northern Sonora
and along the western flank of the Sierra Madre Occidental resulting in N-NW striking normal faults. Northwest trending shear and fault zones appear to be an important control on mineralization in the Sonora region. The heat source for the mineralizing fluids was likely from the plutonic rocks that commonly outcrop in Sonora. Many significant porphyry deposits of the Sierra Madre Occidental occur in the Lower Volcanics and are correlated with the various Middle Jurassic through to Tertiary aged intrusions. These include Cananea, Nacozari and La Caridad. Emplacement of these systems has been influenced by Eocene extension.

The primary rock types observed at Santa Elena are Tertiary andesite and rhyolite flows. The main mineralized zone is hosted within an east-west tending structure cross-cutting the volcanic units. The structure hosts an epithermal quartz calcite vein that has been mapped for approximately 1.2 kilometres in length with a width from one metre to 35 metres and averaging approximately 15 metres and narrowing with depth. The structure dips from 40 degrees to 60 degrees to the south and has been drill-tested to a down-dip depth of approximately 600 metres below surface. Splaying and cross-cutting northwest trending structures appear to influence mineralization at intersections with the main mineralized zone. Breccias are found locally at areas of fault intersections.

Avoca mining consists of an undercut level and an overcut level. The cross-cuts are in waste and connect the main transport drift to one end of the stope, after which ore development is completed along the length of the stope. The overcut level contains a backfill drift which goes to the opposite end of the stope. With Avoca Long Hole Stoping method, there is no limit to the length of the stope, and two tasks are occurring at once. First, ore is drilled by longhole and then drawn off in retreating vertical slices. Second, unconsolidated backfill is placed over the bench through the back of the stope from the drift in the footwall.

Where the mineralized zone is dipping at, or steeper than 55°, the stopes are designed at 25 metre vertical heights, with no sublevels. A sill pillar will beestablished on the 575 metre level. Long hole stoping has proceeded longitudinally and upwards along the defined mineralized zone. Stability within in the mining will be established during as-built development and stope by stope basis.

Where the dip of ore body results in stopes with a footwall inclination of less than 55°, long hole stoping will not be suitable due to the increased length of blastholes, potential blast hole inaccuracy and the potential for ore to hang up on the footwall. SilverCrest has thus considered mechanized cut and fill mining for these areas. The lower east portion of the reserve model has been assessed to have conditions conducive to cut and fill mining.

Once each cut is mined out, it will be filled with cemented rock fill, which can include tailings and waste rock from ongoing underground development. Dilution from hanging wall geotechnical failure will be minimal with cut and fill mining because there will be limited exposure to the hanging wall during mining. Support will be required for the exposed cut back (roof) of each cut during mining, for safety of personnel operating machinery and working in the stopes.

The ore will typically be mined in 5 m etre high cuts, with each cut silled out from hanging wall to footwall. Each cut will be accessed by attack ramps from the footwall development drifts. Once the cut has been filled all the way back into the attack ramp, the brow of the ramp is slashed into, and another cut can begin. This process will continue until the attack ramp grade becomes too steep for ore haulage. The orebody is then accessed from a higher footwall development.

Trucks will backhaul fill material from tailings and waste rock stockpiles on surface, when rock is not available from underground development. This material will be mixed with water and 5% cement to create a consolidated fill, and be placed in the stopes via scoop tram.

ROM ore is delivered to a dump pocket ahead of the crushing plant. Ore is reclaimed from the dump pocket by vibrating grizzly feeder and fed to a 30``x54`` jaw crusher (the one from the existing heap leach crushing plant). Product is screened and oversize fed to a XL400 secondary cone crusher. The cone crushed product is again screened and the oversize to a bin ahead of two XL 400 tertiary cone crushers, operated on close circuit with the same screen.

Crushed ore is placed on an open stockpile above a reclaim tunnel. Reclaimed heap leach material is collected and conveyed to a second stockpile located above the same reclaim tunnel. Each stockpile has two feeders under it (total 4). Open pit, underground and pad ore are blended by adjusting the feeder rates. There is a weightometer between the two piles on the reclaim conveyor and another after the reclaimed material has been combined (as well as a sampler) to allow for accounting of both the fresh ore and heap leach residue. The stacking belts feeding the stockpiles also have weightometers and cross belt samplers.

Ore is reclaimed from the stockpiles and fed to a 15’x21’ (4.62 m x 6.77 m) ball mill fitted with a 2200 kW motor. This mill is designed to produce a 100µm (P80) product and the mill circuit is closed by Hydrocyclones. The ore grinding takes place in barren solution and so significant amounts of gold and silver will dissolve in the grinding circuit. The cyclone overflow is thickened ahead of the leach circuit, and the supernatant solution advanced as pregnant solution or used elsewhere in the circuit depending on the grade.

Driven by significant improvements in metallurgical recoveries at Santa Elena following the installation of the 3,000 tpd HIG mill circuit in 2019.

The Santa Elena Mine is currently reprocessing of heap leaching material using a new fully commissioned Merrill Crowe/CCD processing facility. The Santa Elena Project involves combined processing of ore from the remaining reserves in the open pit, updated reserves from underground development and reprocessing of spent ore from the existing heap leach pad.

As detailed in the Santa Elena Report, extensive metallurgical test work including ongoing operations data show that all declared Mineral Reserves are amenable to conventional leaching by standard CCD milling with a Merrill-Crowe recovery system for doré bar production.

Santa Elena ore (Open Pit, Underground and Leach Pad) contains an estimated grade of 1.23 g/t Au and 78.4 g/t Ag and after crushing and grinding can be leached in cyanide to yield approximately 92% Au recovery and 67.5% Ag recovery. Because of the relatively high level of silver in the ore (and hence solutions) there are advantages and benefits to ........