A: Good question! We will certainly consider doing that if the silver price when we complete the pre-feasibility study later this year is still below $18 per oz. However, our business model has been to start small and enjoy early cash flow in order to help fund exploration, make new discoveries, develop new mines and grow the business organically. This worked very well for us in the past and Terronera is conceptually no different from our first three mines so we will follow the same phased approach to development. Our intent is to start small by building a 1,000 tonne per day (tpd) operation within a 2,000 tpd footprint. By the time this phase 1 mine is built and producing, we will have almost two more years of drill results to potentially support a low-cost phase 2 expansion to 2,000 tpd.

While we think Terronera has excellent potential to expand the resources and production, any potential expansion will be based on further exploration success. Therefore, infill drilling of the inferred resource is now underway and step-out drilling is scheduled to commence in the second half of this year. At 1,000 tpd, Terronera would be our smallest mine, producing about 3 million silver equivalent (Ag Eq) oz per year, but at 2,000 tpd, it would become our largest mine, producing around 6 million Ag Eq oz. The low estimated PEA cash costs of US$3.93 per oz silver and all-in sustaining costs of $7.60 per oz, both net of gold credits, imply it could also become our most profitable mine.

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