OVERVIEW

The La Cigarra silver project is located in the state of Chihuahua in the renowned Parral Mining district in north central Mexico. The project lies in close proximity and on trend to several of the district’s top silver producers, including; the close by San Francisco Del Oro and the Santa Barbara mines, that together have produced over 800 million ounces of silver to date. The project is close to power and has good road access, topography and infrastructure. To date, reconnaissance, sampling and drilling confirm numerous silver occurrences traced over a 9.0 kilometer trend of mineralization. This includes the recent discovery of a substantial new mineralized zone that management believes displays distinct geological characteristics of other major deposits in the region. La Cigarra is a rapidly maturing silver project that already contains a large potential whittle pit constrained mineral resource. La Cigarra’s current NI 43-101 Mineral Resource Estimate comprises 51.57 million ounces of silver in the Measured & Indicated categories grading 102 g/t silver and 11.0 million ounces of silver in the Inferred category grading 102 g/t silver. The La Cigarra silver deposit also contains appreciable gold, lead and zinc values.

LA CIGARRA RESOURCE ESTIMATE

"La Cigarra technical report dated November 29, 2023 authored by Allan Armitage can be located under the SEDAR profile of Kootenay Silver Inc. once filed.

Resource Statement for the La Cigarra silver project located in Chihuahua State, Mexico: SGS Geological Services, Effective Date November 29, 2023, Authored by Allan Armitage, PhD, P. Geo.

The 2024 Mineral Resource Estimate incorporates a significantly revised geological model compared to the previous resource and features a database of 201 surface diamond and RC drillholes totaling 36,988 meters and 26,419 assay intervals drilled along the open ended La Cigarra mineralized system which has a defined strike length of at least three (3) kilometres. The 156 holes included in the Property's resource estimate were positioned within a potentially surface minable area comprised of the San Gregorio and Las Carolinas mineralized zones, which combined form a total strike length of 2.4 kilometres. The base-case AgEq Cut-off grade of 50 g/t AgEq considers metal prices of $23.50/oz Ag, $1,800/oz Au, $1.00/lb Pb and $1.30/lb Zn, and considers variable metal recoveries for Ag, Au, Pb and Zn: for oxide mineralization - 85% for Ag, 40% for Au, 75% for Pb and 65% for Zn; for sulphide mineralization - 92% for Ag, 40% for Au, 91% for Pb and 85% for Zn.

Table 1-1 La Cigarra Deposit Mineral Resource Estimate at a Base Case Cut-off Grade of 50 g/t AgEq

1AgEq = Ag ppm + (((Au ppm x Au price/gram) + (Pb% x Pb price/t) + (Zn% x Zn price/t))/Ag price/gram). Metal price assumptions are $23.50/oz silver, $1,800/oz gold, $1.00/lb lead and $1.30/lb zinc.

La Cigarra Mineral Resource Estimate Notes:

1. The Mineral Resource Estimate was estimated by Allan Armitage, Ph.D., P. Geo. of SGS Geological Services and is an independent Qualified Person as defined by NI 43-101. Dr Armitage conducted a recent site visit to the La Cigarra Property on November 28 and 29, 2023.
2. The classification of the current Mineral Resource Estimate into Measured, Indicated and Inferred mineral resources is consistent with current 2014 CIM Definition Standards - For Mineral Resources and Mineral Reserves. The effective date for the Updated Mineral Resource Estimate is November 29, 2023.
3. All figures are rounded to reflect the relative accuracy of the estimate and numbers may not add due to rounding.
4. The mineral resource is presented undiluted and in situ, constrained by continuous 3D wireframe models, and are considered to have reasonable prospects for eventual economic extraction.
5. Mineral resources which are not mineral reserves do not have demonstrated economic viability. An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that most Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.
6. The La Cigarra mineral resource estimate is based on a validated database which includes data 201 surface diamond and RC drill holes totalling 36,988 m. The resource database totals 26,419 assay intervals representing 34,447 m of drilling. The average assay sample length is 1.30 m.
7. The mineral resource estimate is based on 9 three-dimensional ("3D") resource models, constructed in Leapfrog. Grades for Ag, Au, Pb and Zn were estimated for each mineralization domain using 1.5 metre capped composites assigned to that domain. To generate grade within the blocks, the inverse distance squared (ID2) interpolation method was used for all domains. Each domain was then subdivided into oxide and sulphide domains.
8. Average density values were assigned to oxide and sulphide domains and a waste domain based on based on a database of 1,412 samples.
9. It is envisioned that the La Cigarra deposit may be mined using open-pit mining methods. Mineral resources are reported at a base case cut-off grade of 50 g/t AgEq. The in-pit Mineral Resource grade blocks are quantified above the base case cut-off grade, above the constraining pit shell, below topography and within the constraining mineralized domains (the constraining volumes).
10. The results from the pit optimization are used solely for the purpose of testing the "reasonable prospects for economic extraction" by an open pit and do not represent an attempt to estimate mineral reserves. There are no mineral reserves on the Property. The results are used as a guide to assist in the preparation of a Mineral Resource statement and to select an appropriate resource reporting cut-off grade.
11. The base-case AgEq Cut-off grade considers metal prices of $23.50/oz Ag, $1,800/oz Au, $1.00/lb Pb and $1.30/lb Zn, and considers variable metal recoveries for Ag, Au, Pb and Zn: for oxide mineralization - 85% for Ag, 40% for Au, 75% for Pb and 65% for Zn; for sulphide mineralization - 92% for Ag, 40% for Au, 91% for Pb and 85% for Zn.
12. The pit optimization and base case cut-off grade of 50 g/t AgEq considers a mining cost of US$2.50/t mined, and processing, treatment, refining, G&A and transportation cost of USD$22.40/t of mineralized material.
13. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.

The La Cigarra mineral resource is sensitive to cut-off grade. To illustrate this, the block model quantities and grade estimates within the conceptual pit are presented in the following table at different cut-off grades utilizing a $23.50/oz silver price.

Table 1-2 La Cigarra Oxide and Sulphide MRE at a Base Case Cut-off Grade of 50 g/t AgEq

Oxide MRE

Sulphide MRE

Table 1-3 In-Pit Mineral Resource Estimate at Various AgEq Cut-off Grades

Note:

Values in these tables reported above and below the base-case cut-off 50 g/t AgEq for in-pit Mineral Resources should not be misconstrued with a Mineral Resource Statement. The values are only presented to show the sensitivity of the block model estimates to the selection of the base case cut-off grade. All values are rounded to reflect the relative accuracy of the estimate and numbers may not add due to rounding.

The comparison table below shows the 2024 Resource estimate compared to the previous resource. Of note Measured and Indicated (M+I) categories include a total of 51.57 Moz of silver, a modest increase from 51.47 Moz. The combined M+I grade, however increased from 86.3 g/t Ag to 102 g/t Ag, (an 18% increase). Similarly, in the Indicated category total contained silver decreased from 11.46 Moz to 11 Moz, though overall grade increased from 80 g/t Ag to 102 g/t Ag, (a 27% increase).

Mineralization at La Cigarra is open along both strike directions and down-dip. The La Cigarra is a key project in Kootenay's portfolio and is currently on care and maintenance as the company focusses on advancing the flagship Columba Silver Project, also in Chihuahua State, Mexico.

Table 1-4 Comparison of 2015 and 2024 Resources

2024 Resource ($23.50 silver, 50 g/t silver equivalent cut-off grade)

2015 Resource ($22 silver, 35 g/t silver cut off grade)

1 AgEq Calculation for the comparison above = Ag ppm + (((Au ppm x Au price/gram) + (Pb% x Pb price/t) + (Zn% x Zn price/t))/Ag price/gram). Metal price assumptions are $23.50/oz silver, $1,800/oz gold, $1.00/lb lead and $1.30/t zinc

2 Original 2015 MRE did not include a calculation for AqEq,

The development of the comparative tables above has relied on the work of experts. The following factors should also be noted:

The complete La Cigarra drill hole database includes 173 drill holes (15 RC and 158 core) for a total of 30,443 metres and 22,064 assays. This includes 17 drill holes (4,817 m) completed in 2014 in the Las Chinas, Las Venadas, San Gregorio, Las Carolinas and La Borracha zones. Of the 173 drill holes, 156 drill holes (11 RC and 145 core) were used in the preparation of the resource models and resource estimate.

The database used to construct the San Gregorio/Las Carolinas resource models utilized 27,617 metres and 20,022 sample assays. Subsequent to the previous resource estimate, an additional 13 drill holes totalling 3,975 metres were completed. Of this drilling, 7 holes were positioned in the San Gregorio zone and 6 holes in the Las Carolinas zone. The resource estimate was constrained by a Whittle(tm) pit shell and is reported at an economic cut-off grade of 35 g/t of silver.

Grade control models (a high grade and a low grade silver model) of the San Gregorio/Las Carolinas deposit were constructed which involved outlining the limits of mineralization on 50 metre spaced cross sections based on histograms of silver, gold, lead and zinc values. Polygons of mineral intersections were made on each cross section and were wire framed together to create a contiguous resource model in Gemcom GEMS 6.6.0.1 software.

The grade control models were constructed to define silver mineralization, as controlled by interpreted geology and structure. A high grade core silver model was created to capture mineralization generally above a grade of 15 to 20 g/t silver. In addition a low grade envelope, which encompasses the high grade core model was defined to capture mineralization above a grade of 5 to 10 g/t silver. The modeling exercise incorporated predicted controls of the deposits dominant geology and geologic limits. The resource model extends for approximately 2.4 kilometres on a 320° trend with an average dip of 45° to the northeast. Mineralization extends from surface to depths of up to 380 metres.

For the resource estimate a block model with dimensions of 10 x 10 x 10 metres was utilized as were composite samples of 1.5 metres in length. Grades for silver, gold, lead and zinc were interpolated into resource blocks by the Ordinary Kriging ("OK") interpolation method.

Mineral resources were estimated in conformance with the CIM Mineral Resources definitions. The confidence classification of the resource is based on an understanding of geological controls of the mineralization, and the drill hole pierce point spacing in the resource area. Three passes were used to interpolate grade into all of the blocks in the wireframe. Mineral resources were classified as Measured if at least two drill holes were found within a 35 x 35 x 20 metre search radius. Blocks were classified as Indicated if two drill holes were found within a 60x60x30 metre radius and blocks were classified as Inferred if at least one drill hole was found within a 120x120x60 metre search radius. The Principal azimuth of the search ellipse is oriented at 059º, the Principal dip is oriented at -44° and the Intermediate azimuth is oriented at 325°.

Due to the lack of specific gravity data, average specific gravity ("SG") values were used for the resource estimation. Values used include: 2.45 for oxide mineralization, 2.55 for sulphide mineralization and 2.57 for waste. The average SG values are based on limited SG testing (406 samples from within the mineralized zones) of representative mineralized core that intersect the resource model.

The updated Measured, Indicated and Inferred mineral resource estimate was prepared by GeoVector and is disclosed in compliance with NI 43-101 and was estimated in conformity with generally accepted CIM "Estimation of Mineral Resource and Mineral Reserves Best practices" guidelines, including the critical requirement that all mineral resources "have reasonable prospects for economic extraction".

The "reasonable prospects for economic extraction" requirement generally implies that the quantity and grade estimates meet certain economic thresholds and that the mineral resources are reported at an appropriate cut-off grade taking into account extraction scenarios and processing recoveries. In order to meet this requirement, GeoVector considers that major portions of La Cigarra mineralization are amenable for open pit extraction.

In order to determine the quantities of material offering "reasonable prospects for economic extraction" by an open pit, GeoVector used Whittle(tm) pit optimization software and reasonable mining assumptions to evaluate the proportions of the block model (Measured, Indicated and Inferred blocks) that could be "reasonably expected" to be mined from an open pit.

The optimization parameters, found in the table below, were selected based on benchmarking against similar projects. Two phases of scoping level metallurgical testing were conducted in 2011 and 2012. These results are summarized in the table below and are discussed in detail in the 2013 Resource Estimate report.

The reader is cautioned that the results from the pit optimization are used solely for the purpose of testing the "reasonable prospects for economic extraction" by an open pit and do not represent an attempt to estimate mineral reserves. There are no mineral reserves on the La Cigarra Project. The results are used as a guide to assist in the preparation of a mineral resource statement and to select an appropriate resource reporting cut-off grade.

Sensitivity Analysis for the La Cigarra Mineral Resource Estimate

A +/- 30% price sensitivity analysis was prepared using a downside scenario silver price of $17/oz reflective of today's spot price as well as an upside scenario at $29/oz silver price, with the latter also serving as a comparison to the 2013 Resource Estimate.

The following table summarises a Whittle^(tm) pit constrained resource calculated at a $17/oz silver price and reported at a 35 g/t silver cut-off grade:

For the purpose of comparison, a Whittle(tm) pit optimization was also prepared for the current resource utilizing a silver price of $29/oz and a cut-off grade of 35 g/t. The results are as follows:

The above sensitivity analysis illustrates the robust nature of the deposit particularly at today's spot price of $17/oz demonstrating a 20% increase in the average M&I grade to that reported in the 2013 Resource Estimate with no loss in total ounces. Additionally there is an overall increase of approximately 30% in total contained silver ounces at the upside scenario of $29/oz. The 2015 figures presented in the context of this sensitivity analysis should not and are not intended to be interpreted as a current resource.

RESOURCE EXPANSION POTENTIAL

Kootenay’s Management sees three parts to further drill testing of the project leading to a Resource Estimate and Preliminary Economic Assessment:

• testing of the strike extension of the La Cigarra Resource starting outside the northern end of the current Resource boundary (La Borracha Zone) as well as outside the southern end (known as the Las Carolinas extension);
• testing of separate mineralized trends starting at the RAM Zone extending south towards Nogalera; and
• drilling to test the strike extension of the current Resource with particular focus on grade.

METALLURGICAL INFORMATION

Three phases of metallurgical testing between 2011 and 2015 to investigate the recovery of silver from the La Cigarra silver project.

The Phase 3 test program completed in June 2015 was designed to a Preliminary Economic Assessment level and initiated to study the metallurgy of the entire resource comprising both the San Gregorio and Las Carolinas Zones. The test program culminated in significant improvements to the flow sheet and metallurgical performance developed in Phase 2. Positive findings from the Phase 3 test program include the following:

• A significant increase to 88% overall silver recovery (concentrates and leaching) compared with 82% in the 2012 Phase 2 program; producing a high grade lead-silver concentrate of 34% lead and 23,000g/t silver;
• An increase in the primary grind size to 80% passing106 microns (up from a grind size of 80% passing 75 microns in 2012);
• A more streamlined flow sheet with the elimination of the previous pre-flotation circuit for organic carbon removal;
• The reduction in the number of lead cleaner flotation stages from 3 to 2;
• The option of adding a zinc recovery circuit to produce a zinc-silver concentrate of up to 58% zinc and 2,500 g/t silver (referred to as Flow Sheet Option 2 - see Northair Silver news release dated June 29, 2015).

Tests on the oxide material were completed on a composite covering 9 drill holes in San Gregorio and 11 drill holes in Las Carolinas. The silver in oxide is more amenable to whole ore leaching than flotation. Approximately 88% of the silver was extracted from material containing 78 g/t silver in 96 hours of whole ore cyanidation at a grind size of 55 microns.

In comparison, the 2012 whole ore leach on the oxide extracted approximately 90% of the silver in 48 hours at 60 micron grind size from a head grade of 59 g/t silver.

GEOLOGY

The La Cigarra mineralized system is hosted within sedimentary rocks and can be traced in outcrop for upwards of 6.5 kilometres on strike. The mineral system strikes northwest and dips moderately northeast and mirrors the strike and dip of the host sediments. Mineralization is spatially associated with narrow diorite to granodiorite sills. Silver and base metals occur in sulfides hosted within quartz-vein stockwork zones and silicified breccias containing disseminated sulphides. The recognition of disseminated style of mineralization strongly enhances the economic potential of the Project.

WORKED PLANNED