Sulphide Project

Below the Camino Rojo oxide reserve is a large, 7.3 Moz M&I gold sulphide resource. While multiple development scenarios are being considered and directional drilling continues into the resource to determine if an underground mining option with a standalone processing facility is possible. The underground drilling programs have thus far shown the presence of higher-grade zones over bulk mineable widths. The Company also continues to complete metallurgical testwork to determine the optimal processing scenario. Besides an underground mining option, the base case scenario is open pit minng. Orla also retains a back-in option to process at Newmont's Penasquito facility 50 kilometres from Camino Rojo.

In 2023, the Company will complete another phase of closely-spaced oriented drilling to strengthen confidence of underground development approachm, to understand extent of potential underground resourc and toi nform Preliminary Economic Assessment (PEA).

Drill results at Camino Rojo Sulphides continue to support potential for underground development

Drilling continues to intercept wide zones of higher-grade gold mineralization, and in conjunction with metallurgical results from the 2021 drilling (see news release dated May 9, 2022), supports the potential for underground development and a standalone processing option for the Camino Rojo Sulphides.​ A large part of the 2022 program included infilling the sulphide deposit and improving the geological model to support potential underground mine development scenario. A total of 9,174 metres was completed in 15 holes, with 5 holes previously reported (see news release dated September 12, 2022 - Orla Mining Advances Exploration & Growth Pipeline). The 15 holes completed in 2022 returned 32 significant mineralized drill intercepts with grade-by-thickness factor greater than 50 g/t by metre Au (g/t * m), including 16 intercepts with grade-by-thickness factor greater than 100 g/t by metre Au. Full drill results are available in Appendix news release date January 31, 2023, and at www.orlamining.com.

The current mineral resource estimate for the Sulphide Project at Camino Rojo consists of 74 koz of measured resource (3.358 million tonnes at 0.69 g/t gold) and 7,221 koz of indicated resources (255.4 million tonnes at 0.88 g/t gold) and has an effective date of June 7, 2019.[1]

• Hole CRSX22-09B:   4.66 g/t Au over 64.0 m
• Hole CRSX22-09A:   2.76 g/t Au over 79.0 m, incl. 3.22 g/t Au over 55.0 m
• Hole CRSX22-08C:   2.81 g/t Au over 70.0 m
• Hole CRSX22-10A:   1.92 g/t Au over 87.0 m, incl. 3.14 g/t Au over 25.5 m and 1.74 g/t Au over 73.5 m, incl. 2.61 g/t Au over 24.0 m
• Hole CRSX22-09:     3.83 g/t Au over 40.5 m, incl. 9.28 g/t Au over 9.0 m and 6.94 g/t Au over 16.0 m
• Hole CRSX22-08B:   3.78 g/t Au over 37.0 m
• Hole CRSX22-10:     2.71 g/t Au over 49.5 m, incl. 6.80 g/t Au over 8.0 m

Vein domains constraining higher grade gold in sulphide deposit

The 2022 sulphide drill program has helped define areas of high vein concentrations (“vein domains”) which coincide with higher grade (>2 g/t) gold mineralization. The vein domains are important geological controls on gold mineralization, constraining the distribution and continuity of higher-grade gold mineralization within the sulphide deposit. Improved confidence in geological controls will strengthen future mineral resource estimations.

Vein domains have been defined by combining recent oriented diamond drill core data and approximately 70,000 m of historical vein density and orientation data within the main zone of potassic alteration (Kp). This work has resulted in the definition of three steep northwest and five shallow south-southwest dipping vein domains. High grade gold (>10 g/t Au) appears to be concentrated at the intersection of these steep and shallow dipping domains.

Deeper intersections suggest deep potential for extension of Camino Rojo Sulphides

Select holes from the recently completed 2022 sulphide drill program were extended to test the down plunge continuity of gold mineralization along the Dike Zone. These drill holes have returned encouraging and highly significant results, such as 4.02 g/t Au over 22.9 m. Compilation of historical drill data has also confirmed high-grade gold intercepts over significant widths with a similar style of mineralization elsewhere below the current extents of the Camino Rojo resource estimation model.

Most of the gold mineralization at Camino Rojo has been defined in the Caracol Formation where auriferous veins are mostly constrained to a broad envelope of potassic alteration (Kp). Recent and compiled historical drilling indicates gold mineralization extends deeper into the underlying Indidura and Cuesta del Cura formations (and potentially deeper into other underlying units) along the Dike Zone and Breccia Fault Zone, suggesting these faults may be feeder-like structures for the Camino Rojo deposit. This deeper gold mineralization is hosted by skarn and calc-silicate alteration associated with manto-type mineralization with semi-massive to massive sulphides replacing bedding.

2022 notable results hosted in Indidura or Cuesta del Cura formations:

• Hole CRSX22-07:          4.02 g/t Au over 22.9 m, incl. 9.30 g/t Au over 6.1 m
• Hole CRSX22-08B:       1.28 g/t Au over 24.6 m
• Hole CRSX22-08B:       1.33 g/t Au over 17.2 m
• Hole CRSX22-08C:       2.50 g/t Au over 9.1 m
• Hole CRSX22-08C:       1.81 g/t Au over 19.4 m, incl. 2.51 g/t Au over 9.0 m

Selected historical[2] results below Caracol Formation in Indidura or Cuesta del Cura Formations:

• Hole CR12-366D:          4.04 g/t Au over 46.5 m, incl. 6.26 g/t Au over 27.0 m
• Hole CR13-507DB:        3.08 g/t Au over 55.5 m, incl 5.67 g/t Au over 22.5 m
• Hole CR13-455D:          6.12 g/t Au over 21.0 m, incl 18.75 g/t Au over 6.0 m
• Hole CR13-454D:          2.11 g/t Au over 51.0 m, incl 6.72 g/t Au over 4.5 m   
• Hole CR13-453D:          3.62 g/t Au over 27.0 m
• Hole CR14-597DG:       3.68 g/t Au over 25.5 m incl 11.49 g/t Au over 6.0 m

On May 9, 2022, the Company provided a summary of Phase 1 metallurgical test results on its Camino Rojo sulphide deposit (the “Sulphide Project” or “Camino Rojo Sulphides”), located in Zacatecas, Mexico1. The Phase 1 metallurgical program has greatly increased Orla’s understanding of metallurgical characteristics of Camino Rojo Sulphides, and appears to open up multiple processing options for the Camino Rojo Sulphides relative to what was suggested by previous work. The Phase 1 metallurgical program included tests on grinding characteristics, amenability to cyanidation, selective flotation, and pressure oxidation. In addition to the Phase 1 tests, a geometallurgical model was developed using new and historical metallurgical test results. Geometallurgical modelling integrates geological, geochemical, mineralogical, and recovery data to characterize zones of metallurgical response. It supports mine planning, flowsheet design, and connects mine and process planning as part of the optimization of mine-to-mill production and economic analysis. Highlights of Phase 1 metallurgical program include the following:

• The geometallurgical model recognized five, spatially distinct, physically continuous geometallurgical zones within the 7.3-million-ounce sulphide gold deposit (measured and indicated mineral resource estimate of 259 million tonnes at 0.88 g/t Au, 7.4 g/t Ag, 0.07% Pb,0 0.26% Zn)2 .
• Two geometallurgical zones of the Camino Rojo Sulphide mineralization appear to be amenable to conventional carbon-in-leach (“CIL”) processing.
• Selective flotation may be used to produce a gold concentrate. • Selective flotation may be used to produce a concentrate that can be treated using pressure oxidation.
• There is potential to produce a zinc concentrate.

1. See the Company’s press release dated May 9, 2022 titled “Orla Mining Announces Positive Initial Metallurgical Results on Camino Rojo Sulphide Project”.

Orla is the operator of the Camino Rojo Project and has full rights to explore, evaluate, and exploit the property. If a sulphide project is defined through a positive pre-feasibility study outlining one of the development scenarios: A or B below, Newmont may, at its option, enter into a joint venture for the purpose of future exploration, advancement, construction, and exploitation of the sulphide project.

Scenario A:    A sulphide project where material from the Camino Rojo Project is processed using the existing infrastructure of the Peñasquito mine, mill, and concentrator facilities. In such a circumstance, the sulphide project would be operated by Newmont, who would earn a 70% interest in the sulphide project, with Orla owning 30%.

Scenario B:     A standalone sulphide project with a mine plan containing at least 500 million tonnes of proven and probable mineral reserves using standalone facilities not associated with the Peñasquito mine. Under this scenario, the sulphide project would be operated by Newmont, who would earn a 60% interest in the sulphide project, with Orla owning 40%. Following the exercise of its option, if Newmont elects to sell its portion of the sulphide project, in whole or in part, then Orla would retain a right of first refusal on the sale of the sulphide project.