Silver Bow Mining Has a Mill: President Doug Stiles and CFO Wade Black Discuss Jefferson County Metallurgical Complex Transaction

0:15Doug Stiles: This is going public in May. Silver Bow Mining has been added to the Russell 3000 and Russell Microcap Indices. Re-establish underground access at Rainbow Block, Silver Bow Mining's flagship silver zinc deposit in the Butte Mining District of Montana, and signed a definitive agreement to acquire a major metallurgical processing complex out of bankruptcy. Wade Black is chief financial officer and Doug Stiles as president. Gentlemen, welcome to Mining Stock Daily. Thank you, Michael.

0:47Wade Black: Thank you, Michael.

0:48Doug Stiles: Doug, I want to start with you and the news that you announced at Silver Bow. You're taking on roughly$28.6 million in cash obligations, plus contingent value rights and royalties to acquire the Jefferson County Metallurgical Complex through bankruptcy proceedings. Why was buying this mill your best option for developing your rainbow block resource?

1:14Wade Black: Thanks, Michael. That's a good question. You know, the Jefferson County Metallurgical Complex is a polymetallic flotation mill. The rainbow block ore is a polymetallic ore source. The capacity of that mill is about 16 ,000 tons per day. It's existing. It's got the infrastructure you need to operate. And assets like this simply don't grow on trees. And so When one pops up 55, 60 miles from your potential ore body, it's something you need to take advantage of. And that's what we did.

1:52Doug Stiles: How old is the metallurgical complex? What condition is it in?

1:56Wade Black: It is in good condition for its age. It hasn't been operated for about 18 years. It was constructed, I believe, in the late 1980s, which for a mill is not that uncommon. um you know a lot of just steel parts big steel parts um rehab will be required for sure things like electronics monitoring systems those types of things things you would see in a modern nail but the bones of the structure are there and they're they're solid they're sound

2:27Doug Stiles: uh no uh doug in the news release uh that was just uh yesterday that you announced on at it there's some environmental liabilities that you're going to be acquiring with a complex there's going to be$20.8 million going to the Montana Department of Environmental Quality.

2:43Wade Black: Yeah, so as with all brownfield mine sites, there are some cleanup reclamation obligations. This site in particular does not have some of the problematic liabilities associated with some. the money to DEQ to bring the bond up to current standards really has been missing. And that frankly is what part of what drove the company that owns it into bankruptcy is they have not been able to bring the bond up to current with DEQ for quite some time. So the payment to DEQ is really to bring the surety up to the current standards and the current requirements for the facility.

3:26Doug Stiles: Where does this put you just regarding your permits. The complex was in bankruptcy proceedings, but there's always those steps of permits that you have. What have you got and what do you have to acquire of this acquisition?

3:43Wade Black: So the good thing with this asset is that it was fully permitted. The permits, they have a mine operating permit at the site. It was suspended. It is suspended. DEQ suspended that permit when Montana Goldfields essentially couldn't bring their reclamation liability up to current standards. So they suspended that permit, that operating permit, and it is still suspended. We would anticipate that once we're able to bring it, once we're able to bring the bond up to current that we would start having conversations with DEQ and figure out if there was a path to get that permit out of suspension or if we needed to pursue some additional permits.

4:27Doug Stiles: How does it match up with the rainbow block that you're going to be focusing on right now in terms of capacity at Jefferson?

4:38Wade Black: It aligns very well. Another unique aspect of the complex is that it actually has two flotation circuits. There's a 1 ,000 ton per day small flotation circuit and grinding circuit as well, fully independent. So a 1 ,000 ton per day circuit. And then the big mill is 15 ,000 tons per day. So there's plenty of capacity to handle the ore that we would envision bringing out of the rainbow block.

5:12Doug Stiles: In your news, you said that you have to do an MPIT feasibility study. What is this and what are the contingencies depending upon the outcome of the study?

5:21Wade Black: So we committed in the purchase agreement to spend$5 million completing a feasibility study for the MPIT. The MPIT outline was permitted by DEQ. The surety for it is not in place, but it was at one time did have a permit for it. The work there hasn't been conducted for close to 20 years. In order to determine whether or not it makes sense to bring the MPIT into production, we've got to complete a feasibility study.

5:58Doug Stiles: Wade, let's talk about the IPO and let's talk about your inclusion into the Russell and micro-cap indices. It seemed to be a quick step. And also, can you just talk about the inclusion, and what that means in terms of your capital base and investors.

6:15Wade Black: Sure. So late April, early May, we IPO'd, listed on the NYSE American. We raised a little over$59 million gross, led by our underwriters at Cantor Fitzgerald and Research Capital at$11.50 a share U.S. the silver market and the gold market have underperformed a bit since then and so our stock price has not really performed very well since then but it's come back a bit the Russell 3000 and micro cap indexes are the first step I think in an evolution of our stock which will be included I believe in a number of different indices in the future including, I think, some of the precious metals in the seas and others as we become more recognized in the market.

7:08Wade Black: So I think this acquisition, I think, is going to certainly give us a lot more exposure to the institutional market. I just think our story hasn't really gotten out there very far. And as we were involved in this transaction, honestly, we had to be quiet about it. We've spent the last two months sort of sticking to our knitting with this transaction and having to be very quiet in our outreach. So I'm very happy to be able to talk about it now and able to promote the company a little more forcefully.

7:46Doug Stiles: And now, Wade, how is that deal structure just in terms of what your cash position is now and what are you kind of looking ahead for?

7:55Wade Black: So one of the nice things about raising that much money in the IPO is we were in a position to write this check on month pay into escrow for the bankruptcy procedure process. And so we did have the financial flexibility to make this deal. And we were small and nimble enough to be able to do the due diligence in a compressed timeline, you know, to be able to cut this deal with the seller and act quickly. It was an opportunistic acquisition, and I think it really behooves us to recognize that our team was instrumental in getting this done. And it really is transformative to Silver Bow to have this great leap forward, really, in our evolution to acquire this metallurgical complex.

8:51Doug Stiles: Doug, let's just turn to the resource as well, too. I believe it's an Inverd resource. Can you talk about what it is and where you are right now in terms of defining it out further?

9:00Wade Black: Yeah, so we continue to focus on the resource here in Butte on the Rainbow Block, and this acquisition doesn't change that. It really provides us some good flexibility on the back end if we can get to a point of turning it into a reserve and processing. So we're continuing the efforts to drill out the inferred resource, both from surface and underground. We anticipate folding this information into an update sometime next year. And we continue to really press that forward and we continue to see good results from our drilling and fantastic results in some cases, I think, that we've released. Um, so we, we're going to continue that work essentially unabated as we planned, um, through the rest of this year and into next year.

9:55Doug Stiles: Sorry, when you say update, you're going to be updating a which? Pardon? Sorry, Doug, you said you're going to be doing an update. Is that going to be a new MRE or what?

10:04Wade Black: Yeah, we'll see. You know, we, we just need to kind of see what the data tells us and what, what, um, what that will allow us to, to do there. But, you know, we're going to take the information that we have, the information that we get from drilling and kind of let it guide us as to what we're able to, um, what we're able to, to publish.

10:23Doug Stiles: Uh, what, uh, where are you with your drill program? How, how much, uh, are you, uh, actually drilling right now?

10:29Wade Black: So we're, you know, I think we, I think we reported that we were, we were planning 25 ,000 feet, uh, of surface drilling in 2026 through the, through 2026. We're on target to, to hit dot. We have several drill rigs on site right now drilling from surface and we're continuing to rehab some underground drifts and drive some new drifts so that we can get in underground and do some underground drilling next year.

11:01Doug Stiles: Now, Doug, you are telling a critical mineral story. You did mention that you have silver as well as lead and zinc. You also did mention on your deck that there's mentions a geranium, gallium, and antimony. Any data on that? Are those recoverable?

11:21Wade Black: So we're, you know, we're still doing the work on that, to be honest with you, Michael. We are, you know, through our testing programs, we are analyzing for all of those. We know historically those critical minerals were produced in the Butte ores. We're testing for them in our updated drilling and, you know, we'll fold those in as the data comes back for us. But we know they've been mined here historically. We just need to do the work to make sure we can get a handle on what they look like.

11:55Doug Stiles: What's the community like around your project?

12:00Wade Black: Butte, arguably the mining capital of North America. I would say we work pretty hard to communicate with the stakeholders, with the local community. obviously an old mining area still mining going on here I'm looking out of my office here at probably no less than six head frames up on the Butte Hill side some mining's in the blood in Butte been very supportive local community has been very supportive thus far our team has done a really good job of engaging with the local community and those local stakeholders make sure we continue to maintain that positive relationship with them

12:40Doug Stiles: uh lastly doug uh milestones now i i know that the announcement was just yesterday on the acquisition but uh looking ahead uh milestones out for next to 2026 as you march this forward

12:54Wade Black: so we you know we we uh we still have to close have the final close you know we we have to get a shareholder approval um that'll probably happen i don't know kick maybe way too far somewhere in that range for sure. In the meantime, we will begin our planning process for turning over some of the technical work and starting that work early in 2027 at the complex. We're continuing here in Butte, executing our plan, our strategy. So I would anticipate that once the final close, We will, in earnest in 2027, begin the feasibility study, begin some permitting at the metallurgical complex that we want to get done.

13:41Doug Stiles: Doug Stiles, Wade Black, thanks for speaking with Mining Stock Daily. Thank you.

13:47Wade Black: Thank you, Michael. Much appreciated. The information presented should not be considered investment advice. Mining Stock Daily and its affiliates are not responsible for any loss arising from any investment decision in connection with the material presented herein. Please do your own research or speak with a licensed financial representative before making any investment decisions.