Silver Mountain Resources Secures $30M for Peruvian Mine Restart

November 18, 2025

Funding a Production Revival

Silver Mountain Resources Inc. has successfully completed a $29.9 million CAD ‘bought deal’ public offering, providing a significant financial injection to advance its Reliquias silver mine project in Peru. The financing, which included a full exercise of the over-allotment option, reflects strong investor appetite and confidence in the company's strategy to revive a previously producing asset. The funds are earmarked for operational improvements, ongoing exploration, and bolstering the company’s working capital. Velocity Capital Partners acted as the lead underwriter for the offering.

Reliquias Project: From Past Production to Future Potential

The Reliquias Project, located in the Castrovirreyna district of central Peru, represents a compelling opportunity for Silver Mountain. The mine previously operated at a 2,000 tonnes per day (tpd) capacity before being idled in 2017 due to challenging market conditions. Now, with a positive Preliminary Economic Assessment (PEA) completed in May 2024 indicating a strong NPV of C$85 million and a rapid payback period of 1.8 years, the project is poised for a resurgence. A key factor driving this renewed confidence is the completion of crucial land use agreements with local communities, securing the necessary approvals for operations.

“The agreements with the Salcca Santa Ana and Castrovirreyna communities were pivotal,” notes one industry observer. “Gaining local support is often the biggest hurdle for mining projects in Peru. Silver Mountain seems to have navigated that well, which de-risks the project considerably.” The PEA projects average annual production of 2.2 million ounces of silver equivalent over a nine-year mine life.

Recent drilling programs have expanded the resource base, demonstrating the project’s potential for long-term growth. Updated NI 43-101 compliant resource estimates, published in March 2025, reveal Measured and Indicated resources of 1.275 million tonnes grading 4.34 ounces of silver per tonne, in addition to significant Inferred resources. The mineralization remains open along strike and at depth, offering further exploration upside.

Insider Support and Market Dynamics

A notable aspect of the financing is the substantial participation from company insiders, who collectively purchased approximately 1.1385 million units. This demonstrates a strong commitment from the leadership team and aligns their interests with those of shareholders. While the company relied on exemptions under Multilateral Instrument 61-101 due to the expedited nature of the offering, the insider participation signals confidence in the company’s prospects.

“Insider buying is always a positive sign,” one analyst commented. “It shows that those closest to the project believe in its potential and are willing to put their own money on the line.”

The financing also arrives against a backdrop of increasing interest in the silver market. Rising industrial demand, coupled with silver’s role as a precious metal, is driving prices upward. This favorable market environment is creating a conducive atmosphere for silver mining companies to secure funding and advance their projects. The decision to move forward with the Reliquias project revival appears strategically timed, capitalizing on the positive market dynamics and the growing demand for silver.

Silver Mountain’s decision to prioritize operational improvements and exploration is a prudent one. The funds will be used to upgrade existing infrastructure, including the 2,000 tpd processing plant and tailings dam, and to ramp up drilling programs aimed at expanding the resource base. This approach will allow the company to maximize production capacity and unlock the full potential of the Reliquias project. While the company currently reports consistent net losses and faces financial challenges, the injection of capital represents a critical step toward achieving profitability and establishing a sustainable long-term business.