What changed in this filing

/stocks — the workspaceLOADING

Item 2. Properties

2022-08-23 compared with 2019-09-24 · 204 added, 694 removed, 4 unchanged (100% of the section changed)

classify our mineral property as an "Exploration Property".

We do not suggest that we have proven or probable reserves

at our property as defined by the SEC.

standards, as set forth in SEC Industry Guide 7, mineralization may not be classified

as a “reserve”

unless a determination has been made that the mineralization could be economically and legally produced

or extracted at the time the reserve determination is made.

The SJG Property as described in this Annual Report on Form 10-K is

without known reserves.

Mineral resources which are not classified as mineral reserves do not have “demonstrated economic

viability.”

The quantity of resources and the quality (grade) of resources reported as “Indicated”

and “Inferred”

mineral resources in the mineral resource estimate compiled for DynaMéxico, under and filed by the Company on SEDAR, are

not disclosed in this Form 10-K .

There has been insufficient exploration to define any mineral reserves on the SJG Property,

and it is not certain if further exploration will result in the definition of mineral reserves.

Jose de Gracia Mineral Property

Jose de Gracia Property (“SJG”) is a high-grade mineralized system which reports historical production of 1,000,000

gold (“Au”), from a series of underground workings and is located in the state of Sinaloa, México.

Company is focused on the exploration and future exploitation of this vein-hosted, near surface, and over 400 meters down dip

gold potential, that occurs within fault breccia veins;

and has been traced on surface and underground over a 15 Sq.

DynaMéxico

owns 100% of the mineral concessions at the SJG Property, and all mineral concessions are contiguous.

The SJG Property is currently

the only property in which DynaMéxico retains an interest.

The Company owns 80% of the outstanding capital shares of DynaMéxico.

DynaMéxico holds title to 33 concessions covering approximately 69,121 hectares (170,802 acres).

property is located in and around San Jose de Gracia, Sinaloa State, México which is approximately 100 km northeast of

Guamuchil, near the west coast of México.

It is located on the west side of the Sierra Madre mountain range in the Sierra

Madre Gold-Silver Belt.

The topography is generally rugged with elevations varying from 400 meters in the valley bottoms to over

1,600 meters in the higher Sierra.

Several roads on the property are accessible throughout the year, with the possible exception

of July through September when the rainy season sometimes causes flooding and runoff to make the roads difficult to navigate.

San José

de Gracia Project can be accessed by road, via a sealed highway from Culiacan, the capital city of the State of

Sinaloa (located to the south of the San José

de Gracia Project) or the city of Guamuchil (located to the southwest of

SJG), to the small town of Sinaloa de Leyva, then by gravel mountainous road to the village of San José

San José

de Gracia Project can also be accessed by air.

A gravel airstrip is located adjacent to the village of San José

de Gracia which is located at the southwestern portion of the property at the SJG Project, and the airstrip is suitable for light

and Operating Season

climate is semi-tropical with a rainy season dominating from late June through September.

Operations at the San José

Gracia Project are, in part, dependent on the weather and some activities may be suspended during the rainy season.

Infrastructure

and Local Resources

power line to the San José

de Gracia Project has been installed by the Comisión Federal de Electricidad, the only

authorized power producer in México.

The power line was installed in March 2012 from the municipality of Sinaloa de Leyva

(La Estancia area), a distance of approximately 75 kilometers.

power line is currently 220 volts maximum capacity, which supports domestic use only, including the office and camp facilities

at SJG, such as water pump, air conditioning, refrigeration, lights, internet, and fans, as well as local residential use.

the SJG Project produces its own diesel-generated power for industrial use.

water source for the SJG camp is from a well located close to the river which runs just west of the village of San José

DynaMéxico has obtained the water concession rights for this water source, which provide for usage of 1,000,000

cubic meters per year.

DynaMéxico estimates its current consumption of water to be approximately 10,000 liters per week.

The Company leases office space for its corporate headquarters in Irving, Texas.

In September 2017, the Company entered into a sixty-six-month extension of the lease through January 2023.

As part of the agreement the Company received six months free rent as a finish out allowance.

The Company capitalized the leasehold improvement costs and amortized them over the rent abatement period as rent expense.

The Company makes tiered lease payments on the 1 st of each month.

We classify our mineral property as an as an exploration property and our Company as being in the exploration stage.

The Registrant is an exploration stage company and the registrant has started extraction without determining mineral reserves.

SAN JOSE DE GRACIA - PROPERTY DESCRIPTION

The San Jose de Gracia mining project (“SJG Project”) is located on map sheet G13-A81 in the Culiacan mining district of Sinaloa State, Mexico, at Latitude 26 ̊ , 9’ N, Longitude 107 ̊, 53’ W, approximately 120 kilometers east northeast of the coastal city of Los Mochis.

The property on which the SJG Project resides, straddles the border separating the Mexican States of Sinaloa and Chihuahua.

The SJG Project is located in the south-western portion of the property, and is located entirely within the State of Sinaloa (see Figure 1).

The property is without known reserves.

The Company is an exploration stage company and the Company has started extraction without determining mineral reserves.

San Jose de Gracia, Location Map

DynaResource de Mexico S.A.

(“DynaMexico”), the Company’s 100% owned subsidiary, owns the San Jose de Gracia mineral concessions, which are comprised of 33 distinct concessions covering an aggregate of approximately 9,920 hectares.

The concessions are held 100% by DynaMexico with no royalty or other interests clouding them.

By way of further reference, the property on which the SJG Project resides is located in and around the village of San Jose de Gracia, approximately 100 km northeast of Guamuchil, on the west side of Mexico.

The village of San Jose de Gracia has a small airstrip and can be accessed by a small airplane, or alternatively, by a dirt mountain road.

There are roads providing access to the property on which the SJG Project resides.

These roads are accessible throughout the year, with the possible exception of June and July when the rainy season sometimes causes flooding and runoff to make the roads too muddy to navigate.

Local Resources and Infrastructure

Accommodations

mine site area camp maintains facilities which can accommodate 50 persons.

The village of San José

de Gracia maintains

few stores, which offer only minimal goods.

Camp Facilities

DynaMéxico

maintains an administrative and logistics office in Guamuchil, located 100 kilometers southwest of the SJG property.

The SJG Project

sources many of its supplies from Guamuchil, and from Los Mochis and Culiacan.

A satellite dish installed at the SJG Property

provides communications from the SJG Property to Guamuchil.

field laboratory is maintained within the camp facility.

The Company utilized the lab for assaying services during its production

activities in 2003-2006.

In the second half of 2016, the laboratory has been refurbished by DynaMineras and is currently utilized

by on site personnel to provide assays for mined material, feed material, gravity and flotation concentrates, and tailings.

anticipates utilizing the lab facility in the future for providing internal assays to support the exploration, test mining, and

pilot milling activities.

Geology & Mineral Deposits

de Gracia lies within the Sierra Madre Occidental (“SMO”) Gold-Silver Belt, in a second-order graben directly

east of the regional-scale Grete Graben.

The SMO is recognized as a highly prospective mineral belt for gold, silver and

poly-metallic deposits.

The basement to the Sierra Madre Occidental consists of deformed Paleozoic sedimentary strata, which are

non-conformably overlain by Tertiary mafic to felsic volcanic and volcanoclastic strata known as the Lower Volcanic Series (“LVS”).

Strata of the LVS are recognized as being spatially related to gold and silver mineralization in the region.

sedimentary strata are capped by a thick sequence of non-deformed Late Tertiary ignimbrites, known as the Upper Volcanic Series

(“UVS”).

oldest rocks exposed at San José

de Gracia are deformed Paleozoic shale, sandstone, conglomerate and minor limestone, which

are non-conformably overlain by andesite and rhyodacite flows and tuffs of the LVS.

Volcanic and sedimentary strata are

cut by quartz-feldspar porphyry, porphyritic diorite bodies and fine-grained mafic dykes, which may be co-temporal with the LVS.

Ignimbrites of the UVS are exposed at higher elevations on the property and are thought to act as a post mineralization

cap rock, thereby indicating an Early to Mid-Tertiary (Paleocene to Eocene) age for gold mineralization at San José

mapping within the project area has defined several stages of deformation, beginning with compression during the Laramide Orogeny

which affected the Paleozoic basement and formed flat-lying reverse faults, which have been reactivated as conduits for gold-bearing

fluids in the La Prieta trend.

Extension in Tertiary time led to the development of second order structures, trending south,

southwest and southeast;

which formed the major structural orientations for mineralization at San José

latest phase of deformation is characterized by late-stage extension and southwest tilting.

Mineralization

grade gold mineralization at San José

de Gracia is found in vein structures hosted within andesite and rhyodacite of the

Lower Volcanic Series (“LVS”) and underlying Paleozoic sediments as fault breccia veins and crackle breccias that

exhibit multiple stages of reactivation and fluid flow, as evidenced by crustiform/colloform textures and cross cutting veins.

Locally, veins exhibit sharp, clay gouge hanging wall and footwall contacts with slickensides, indicating reactivation of

structurally-hosted veins subsequent to mineralization.

Gold grades can also be carried within the mineralized halo adjacent

to the principal veins as quartz-chlorite stockwork.

In addition to vein-hosted mineralization, broad zones of un-mineralized

clay alteration, developed southwest of the main mineralized trends, may overlie lower-grade, disseminated gold mineralization

at San José

de Gracia is laterally and vertically zoned from discrete zones of silicification to broad zones of illite

to clay alteration with increasing elevation and/or distance from the main feeder structures.

Faulting and tilting of the

mineralization system have affected the surface distribution of alteration and in general has exposed deeper portions of the system

in the northeast and exposed shallower, more distal portions of the hydrothermal system in the southwest part of the property.

characterization of the mineralization at San Jose de Gracia can be described as low sulphidation polymetallic epithermal gold

Six principal mineralized trends have been identified at San José

de Gracia, from south to north.

These consist of

Purisima Ridge trend;

Chinos trend;

Parilla to Veta Tierra trend (Including San Pablo East);

Prieta trend, and

Hilos to Tres Amigos trend .

and Concessions

SJG District is comprised of 33 mining concessions covering 9,920 hectares (24,513 acres) and is located within the Sierra Madre

gold-silver belt, where the majority of hydrothermal deposits in México are located.

The Company’s mining concessions,

all of which are formally held by DynaMéxico, are granted by the Mexican government, or acquired from previous owners.

The Company’s concessions are comprised of a combination of exploration concessions and development concessions, are filed

in the Public Registry of Mining, and are scheduled to expire from 2028 through 2058.

The concessions can be renewed prior to

the expiry dates.

The table below contains a listing of the mineral concessions currently held by DynaMéxico.

amendments to the Mining Act of México that came into effect on December 2006, the classifications of Mining Exploration

Concessions and Mining Exploitation Concessions were replaced by a single classification of Mining Concessions valid for a renewable

term of 50 years, commencing from the initial issuance date.

To be converted into Mining Concessions at the time these amendments

came into force, former exploration and exploitation concessions had to be in good standing at the time of conversion.

the SJG concessions were converted to 50-year Mining Concessions at the time the amendments to the Mining Act came into effect.

To renew the 50-year term, Mining Concessions must be in good standing at the time application is filed.

An application for renewal

must be filed within 5 years prior to expiration of the term.

maintain Mining Concessions in good standing, the registered owner must (a) pay bi-annual mining duties (“assessment taxes”)

in advance, by January 31 and July 31 each year, (b) file assessment work reports by May 30 each year, for the preceding year

(some exception rules apply), and (c) file by January 31 each year, statistical reports on exploration / exploitation work conducted

for the preceding year.

Notice of Commencement of Production Activities and Annual Production Reports must be filed annually by January 31 each year for

those concessions where mineral ore extraction is taking place.

As a general provision, registered owners of Mining Concessions

must follow environmental and labor laws and regulations in order to maintain their Mining Concessions in good standing.

of the date of this Form 10-K, the 33 mining concessions comprising the SJG Property are in good standing with respect to the

payment of taxes and the filing of assessment work obligations imposed by the Mining Act of México and its Regulations.

Included among the 33 mining concessions are 32 currently registered in the sole name of DynaMéxico.

DynaMéxico

holds one mining concession (San Miguel t.183504) that in order to produce legal effects requires the consent or relinquishment

of first rights of refusal from registered owners to the 50% undivided title.

See the note following the table of mining concessions

below, describing the steps needed to be taken by DynaMéxico to obtain title to the San Miguel mining concession.

July 2018 in connection with settlement of prior years’

concessions, DynaMéxico’s reduced its Francisco Arturo

concession from 62,481 hectares to 3,274 hectors.

This reduced the total concessions holdings from 69,121 hectares (170,802 acres)

to 9,920 hectares (24,513 acres)

Mining Concessions - San José

NUEVA ESPERANZA

DE LUMBRE No.4

DE LUMBRE UNO

According to the records of the Mines Registry Office, the registered owners to 100% undivided title to the San Miguel (t.183504)

mining concession are:

Maria Trinidad Acosta Salazar (25%), Miguel López Medina (25%), Josefa González Castro (25%)

and Otilia Tracy Vizcarra (25%).

On October 17, 2000 and March 8, 2001, DynaMéxico signed with each of Miguel Lopez Medina

and Josefa Gonzalez Castro, respectively, agreements for the transfer to DynaMéxico of 50% undivided title to the San Miguel

(t.183504) mining concession (the “San Miguel Transfer Agreements”).

respect to the San Miguel Transfer Agreements, DynaMéxico has been advised that in order for the San Miguel Transfer Agreements

to produce legal effects and be eligible for registration before the Mines Registry Office, DynaMéxico is required to first

obtain the legal consent to such transfers, or the written relinquishment of first rights of refusal, from Maria Trinidad Acosta

Salazar and Otilia Tracy Vizcarra (or court-appointed estate executor).

In addition to the San Miguel Transfer Agreements,

DynaMéxico has entered into the following Promise to Sell and Purchase Agreements (the “San Miguel Promise to Sell

and Purchase Agreements”):

Promise to Sell and Purchase Agreement signed on March 8, 2001 among DynaMéxico and Maria Trinidad Acosta Salazar, the

registered owner to 25% undivided title to the San Miguel (t.183504) mining concession, and

Promise to Sell and Purchase Agreement signed on December 15, 2000 among DynaMéxico and Margarita Tracy Vizcarra, the sister

of the deceased Otilia Tracy Vizcarra.

respect to the San Miguel Promise to Sell and Purchase Agreements, DynaMéxico has been advised that:

with respect to the Promise to Sell and Purchase Agreement signed on March 8, 2001 among DynaMéxico and Maria Trinidad

Acosta Salazar, to contact Ms.

Maria Trinidad Acosta Salazar to demand compliance with such agreement by executing the definitive

transfer to DynaMéxico of the 25% undivided title to the San Miguel (t.183504) mining concession registered in her name,

with respect to the Promise to Sell and Purchase Agreement signed on December 15, 2000 among DynaMéxico and Margarita Tracy

Vizcarra, the sister of the deceased Otilia Tracy Vizcarra, the estate of Otilia Tracy Vizcarra requires the appointment

of a court-appointed executor that would be capable under Mexican law to formally grant the estate´s consent for the execution

of the San Miguel Transfer Agreements, to relinquish the estate´s first rights of refusal or to request court approval for

the transfer to DynaMéxico of the 25% undivided interest in the San Miguel (t.183504) mining concession registered in the

name of the deceased Otilia Tracy Vizcarra.

addition to the surface rights held by DynaMéxico pursuant to the Mining Act of México and its Regulations

( Ley Minera y su Reglamento ), DynaMineras maintains access and surface rights to the SJG Project pursuant to the 20-year

Land Lease Agreement (above).

The 20 Year Land Lease Agreement with the Santa Maria Ejido

Community surrounding San Jose de Gracia is dated January 6, 2014 and continues through 2033.

It covers an area of 4,399 hectares

surrounding the main mineral resource areas of SJG and provides for annual lease payments by DynaMineras of $1,359,443 Pesos (approx.

$74,000 USD as of April 10, 2018), commencing in 2014.

Additionally, under the description of the 20 Year Land Lease, DynaMineras

constructed a Medical Facility at SJG in year 2017.

Land Lease Agreement provides DynaMineras with surface access to the core resource areas of SJG (4,399 hectares), and allows for

all permitted mining, pilot production and exploration activities from the owners of the surface rights (Santa Maria Ejido community).

Company expects DynaMineras will be successful in expanding the size and scope of the resources at SJG through continued drilling

and development programs at San Pablo, Tres Amigos, La Ceceña, Palos Chinos, La Union, La Purisima, and La Prieta.

Company expects extensions to mineralization in all directions and down dip from the main target areas.

Reserves / No Known Reserves

standards, as set forth in SEC Industry Guide 7, mineralization may not be classified as a “reserve”

determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve

determination is made.

The SJG property is without known reserves.

Mineral resources which are not classified as mineral reserves

do not have “demonstrated economic viability.”

The quantity of resources and the quality (grade) of resources reported

as “Indicated”

and “Inferred”

mineral resources in the mineral resource estimate compiled for DynaMéxico

is not disclosed in this Form 10-K .

There has been insufficient exploration to define any mineral reserves on the property,

and it is not certain if further exploration will result in the definition of mineral reserves.

Madre Gold-Silver Belt in México

Jose de Gracia - History

production records from San Jose de Gracia (“SJG”) reported 1,000,000 Oz gold production from a series of underground

The major areas report 471,000 Oz.

produced at the La Purisima area of SJG, at an average grade of 66.7 g/t.;

produced from the La Prieta area, at an average grade of 27.6 g/t.

Mineralization at SJG has been traced on surface and underground

DynaMéxico

was formed in March 2000, for the purpose of acquiring the concessions comprising the SJG District, and to consolidate all ownership

of SJG under DynaMéxico.

of Historical Surface Disturbance or Contamination

production at San Jose de Gracia occurred prior to the Mexican Revolution (pre-1910).

The Company is not aware of any surface

disturbance or contamination issues found on the surface or in the groundwater due to historical mining activities.

acquisition and consolidation of the project under DynaResource de Mexico SA de CV.

(“DynaMéxico”),

all activities conducted at San Jose de Gracia have been permitted in accordance with Mexico regulations, the specifics of which

are described below:

June 17, 2013, DynaResource de Mexico received from the Secretaria de Medio Ambiente Y Recursos Naturales (“Semarnat”),

the federal environmental authority in Mexico, the approval and permission which allows for the rehabilitation and operation of

the pilot mill facility at San Jose de Gracia (the “Semarnat Permit”).

Under the terms of the Semarnat Permit, DynaMéxico

is responsible for maintaining the San Jose de Gracia pilot mill facility, as well as the adjacent tailings pond area, in compliance

with Semarnat regulations.

September 30, 2013 DynaResource de Mexico also received from Semarnat, the approval and permission which allows for the exploitation

and mining activities at the San Pablo Area of San Jose de Gracia (the “Semarnat Exploitation Permit”).

terms of the Semarnat Exploitation Permit, DynaMéxico’s exploitation and mining activities are restricted to the

San Pablo Area of San Jose de Gracia.

Exploration Programs (1997 –

drill program was conducted at SJG in 1997 to 1998 by a prior majority owner.

Approximately 6,172 meters drilling was completed

in 63 core drill holes.

Significant intercepts, including bonanza grades, outlined the down dip potential of the Northeast section

(150 Meter NE to SW extent of the Drilling) of the Los Hilos to Tres Amigos Trend of SJG.

Surface and underground sampling in

1999 to 2000 confirmed high grades in historic workings and surface exposures throughout the project area.

These high grades outline

the presence of mineralization shoots developed within the veins.

The mineralized shoots appear to be controlled by dilational

jogs and/or vein intersections.

A total of 544 samples were collected in 1999 to 2000 and assayed an average 6.51 g/t gold.

Production Activities (2003 –

DynaMéxico,

conducting activities through its operating sister companies DynaMineras and DynaOperaciones, mined high-grade veins at the San

Pablo area of SJG from mid-2003 to June 2006.

gold was produced and sold from mill feed tonnage of 42,000 tonnes, at

an average grade of approximately 15-20 g/t.

Production costs were reported at approximately $175/Oz.

gold in this small scale,

pilot production operation.

The small-scale mining and production activities at SJG consisted of improvements to an existing mill,

including the installation of a gravity / flotation processing circuit, and initial test runs with tailings were completed in

Actual mining at the high-grade San Pablo area of the property commenced in March 2003.

and Milled Tonnage

Efficiency (Plant)

in Concentrate (Sales)

Cost (Average, 4 Years)

of Pilot Operations (2006)

Company initiated the test mining and pilot mill operations in 2003 and, at that time, gold prices were depressed.

funding opportunities, while available, were deemed to be too dilutive by Company management.

Subsequently, in 2006, commodities

prices were rising, and the Company was able to negotiate acceptable financing in order to fund exploration activities.

the Company suspended its test mining and pilot mill operations in 2006 in order to focus on the exploration of the vast SJG District.

While the test mining and pilot milling operations were considered successful (see results in the table above), small scale operations

were not expected to provide the necessary capital in order to fund exploration of a project the size of SJG.

earlier, limited-scope pilot operations provided significant benefits in terms of confirming production test mining and milling

grades, metallurgy and process, efficiency of recoveries, and operational costs –

all of which is valuable for larger scale

production plans.

In / Option Agreement –

Financing of Drilling –

Exploration Programs (2006 –

Company entered into an Earn In / Option Agreement with Goldgroup Resources Inc., a subsidiary of Goldgroup Mining Inc., Vancouver,

(“Goldgroup”), dated September 1, 2006 (the “Goldgroup Earn In”).

The terms of the Goldgroup Earn

In provided for Goldgroup to contribute $18,000,000 financing to DynaMéxico, in stages

over the 5-year period, for exploration expenditures at SJG, in exchange for 50% of the outstanding share capital of DynaMéxico.

The Goldgroup Earn In was completed March 15, 2011, and Goldgroup held 50% of outstanding capital of DynaMéxico at that

June 21, 2013, DynaResource acquired a Certificate for 300 Series “B”

Variable Capital Shares of DynaMéxico,

in exchange for the settlement of accounts receivable from DynaMéxico in the amount of $31,090,710 Mexican Pesos (approximately

After the issuance and receipt of the 300 Series B Shares, DynaUSA holds 80% of the total outstanding share capital

of DynaMéxico.

programs (2007 –

programs completed by the Company’s subsidiaries produced a total of 298 drill holes covering 68,741 meters of drilling

from 2007 through March 2011.

Results of the drilling activity, including the results of previous drilling in 1997-1998, appear

in an “SJG Drill Intercepts Summary File through 11-298”, as Exhibit 99.1 to our Form 10-Q for the period ended June

30, 2011 filed with the SEC on August 22, 2011, and available on EDGAR at:

http://sec.gov/Archives/edgar/data/1111741/000112178111000241/ex99one.htm.

Additionally,

the updated Drill Summary File is posted on the Company’s web site at www.dynaresource.com.

and IP Surveys (2009)

and IP (“Induced Polarization”) surveys were conducted throughout the SJG district in 2009, covering an area of approximately

IP is the primary geophysical target at SJG and is expected to identify pyrite-based mineralization hosting

Initial Survey Grid lines were located approximately perpendicular to inferred geologic strike.

The data response from these

grid lines indicate one or more IP sources that dip northwest.

Additional grid lines were crossed with the initial lines and appear

to identify two separate IP sources.

Grid lines to the South appear to indicate an IP source at > 250 Meters.

between ground magnetic and IP-- In general the correlation between the Magnetic and IP response and data was excellent.

with recent Drilling Programs and known Mineralization-- The data response of the surveys correlated to the recent drilling

programs and to the areas of known mineralization at SJG was excellent.

Considering this excellent correlation to known mineralization,

additional areas of SJG showing similar data response could be indicative of additional target areas.

Identification

of Additional Resource Target Areas-- Significant survey responses were reported for the following areas and are projected

for follow up drilling:

Pablo-Up Dip;

San Pablo-Displacement Zone;

Amigos-Down Dip and Northwest;

Tres Amigos-Extension Northeast;

Tree-Down Dip;

Ceceña, Los Hilos, and Tepehauje;

Down dip at Southeast end;

Report According to Canadian National Instrument 43-101 (2012 )

2012, DynaMéxico commissioned Servicios y Proyectos Mineros (“SPM”)

for the production of Technical Report 43-101 (“43-101”) at San Jose de Gracia.

Additionally, DynaMéxico commissioned

Robert Sandefur, a senior reserve analyst for Chlumsky, Armbrust & Meyer LLC, Lakewood, CO (“CAM”) to produce

a mineral resource estimate for the 4 main vein systems at the property.

Used to Estimate the Mineral Resource Estimate-- The data base for the San Jose de Gracia Project consists of 372 drill holes

of which 361 are diamond drill holes (“DDH”) and the remaining 11 were reverse circulation holes “(RC”),

with a total drilling of 75,878 meters.

The NI 43-101 Mineral Resource Estimate, prepared in 2012, concentrates on four main mineralized

vein systems at SJG:

Tres Amigos, San Pablo, La Union, and La Purisima.

Of the 372 drill holes, 368 were drilled to test these

four main vein systems and the remaining four holes tested the Argillic Zone.

Technical personnel of Minop S.A.

(“Minop”),

a subsidiary (or affiliate) of Goldgroup Mining Inc., built three dimensional solids to constrain estimation to the interpreted

veins in each swarm.

The 172 holes most recently drilled (2009-2011), were allocated as follows:

Tres Amigos (64 holes), San Pablo

(49 holes), La Union (24 holes), La Purisima (32 holes) and Argillic Zone (3 holes).

The data base also includes rock and chip

sampling, regional stream sediment sampling, and IP Surveys.

total of 5,540 pieces of core were measured for specific gravity using the weight in air vs.

weight in water method.

This represents

an additional 3,897 measurements taken in the 2009-11 drill seasons with density measurements taken from all mineral zones.

samples were coated with paraffin wax before being measured.

The results tabulated have been sorted by lithology and mineralized

The average specific gravity of 5,051 wall rock samples was 2.59 while the average specific gravity for 489 samples of

vein material is 2.68.

CAM and Servicios y Proyectos Mineros have reviewed the procedures and results and opine that the results

are suitable for use in mineral resource estimation.

Resource Estimate - Construction of Wireframes-- Mineral Resources were estimated by Mr.

Sandefur within wireframes constructed

by technical personnel of Minop.

Minop was contracted by Mineras de DynaResource S.A.

(“DynaMineras”).

Resource Estimate - Explanation of Resource Estimation-- Resource estimation was done in MineSight and MicroModel computer

systems with only those composites that were inside the wireframe used in the estimate.

Estimation was done using kriging with

the omni-directional variogram derived from all the data in each area for gold using the relative variogram derived from the log

High grades were restricted by capping the assays at a breakpoint based on the cumulative frequency curves.

was done using search radii of 100 x 100 x 50 m “blocks”

oriented subparallel to the general strike and dip of the

vein system in each area.

A sector search, corresponding to the faces of the search box with a maximum of two points per sector

was used in estimation.

A density of 2.68 based on within ‘vein density’

samples was used in the resource estimate.

Within each of the four areas there are approximately 20 to 40 veins in the vein swarm.

Resources were estimated by kriging using

data from all veins in the swarm.

In general, gold accounts for at least 80% of the value of contained metal at the project, so

the variograms for gold were used in estimation of the four other metals.

veins at San Jose de Gracia have been historically mined for many years and historic mined volumes are not available.

exception is the approximate 42,000 tonnes of ore processed by DynaMéxico during its pilot production activities in 2003-2006.

The resource table is not adjusted for any historic mining.

To validate that historic mining had not significantly reduced the

resource, CAM reviewed the database for all assays greater than 1 gram per ton gold that were next to missing values at the bottom

of drill holes.

Only four assays satisfying this criterion were found, and on the basis of this review, Mr.

Sandefur does not

believe that significant mining has occurred within the volumes defined by the wireframes.

y Proyectos Mineros performed a database review

and considers that a reasonable level of verification has been completed, and that no material issues have been left unidentified

from the drilling programs undertaken.

Resource Estimate and 43-101 Technical Report - Data Verification-- Mr.

Ramon Luna Espinoza (“Mr.

Luna”) initially

visited the San Jose de Gracia Project in November 2010 and conducted site inspections at SJG in November 2011 and January 2012.

Sandefur conducted a site inspection of the SJG Project in January 2012.

While at the Property in November 2011, Mr.

inspected the areas of Tres Amigos, La Prieta, Gossan Cap, San Pablo, La Union, and La Purisima, and historic mining sites.

January 2012, Mr.

Sandefur and Mr.

Luna inspected the areas of Tres Amigos, San Pablo, La Union, and La Purisima.

the areas were taken.

Many of the drill pads for the drilling programs of 2007 to 2011 were clearly located and identified.

Luna also inspected San José

de Gracia’s core logging and storage facilities, the geology offices, the meteorological

station, the plant nursery, and the mill.

Sandefur also inspected San José

de Gracia’s core logging and storage

Company received from DynaMéxico on February 14, 2012, a National Instrument 43-101 Mineral Resource Estimate for San Jose

The NI 43-101 Resource Estimate was prepared by Mr.

Robert Sandefur, BS, MSc, P.E., a Qualified Person as defined under

NI 43-101, and a senior reserve analyst for Chlumsky, Armbrust & Meyer LLC, Lakewood, CO (“CAM”).

Estimate concentrates on four separate main vein systems at SJG:

Tres Amigos, San Pablo, La Union, and La Purisima.

mineral resource estimates prepared by Mr.

Robert Sandefur for this Technical Report included Indicated Resources at Tres Amigos

and San Pablo.

Table summaries of Indicated and Inferred Resources are contained in the 2012 DynaMéxico-CAM Mineral Resource

The Resource Estimate has been filed, along with the Technical Report on SEDAR;

but is not disclosed in this Form

Drill Hole Intercepts by Target Area (Excerpt from The Updated 2012 DynaMéxico Luna-CAM SJG Technical Report)

Model Calculation in Surpac Software-- The Company has compiled its manual calculation and internal interpretation of the mineralization

at SJG defined by drilling and production to date.

The Company has also built the block model of mineralization at SJG using Surpac

(Gemcom) software.

The current block model at SJG confirms mineralization at San Pablo, Tres Amigos, La Union, Palos Chinos, and

La Purisima, with portions of the mineralization in a high-grade category, and including mineralization at San Pablo and Tres

Amigos, and is consistent with the CAM SJG Mineral Resource Estimate described above.

The Company will continue this Surpac modeling

work as additional drill programs are planned and completed.

and Mining Permit Requirements (México)

respect of permit requirements for mineral exploration and mining in México, the most relevant applicable laws, regulations

and official technical norms are the following:

The Federal Mining Act , and its Regulations, the Federal Environmental

Protection and Ecological Equilibrium Act , and its Regulations, the Federal Sustainable Forestry Development Act and

its Regulations, the Federal Explosives and Firearms Act , the National Waters Act and the Mexican Official Norm

carry out mineral exploration activities, holders of mining concessions in México are required to file at the offices of

the Secretaria de Medio Ambiente Y Recursos Naturales, the Federal Environmental Authority in México (“SEMARNAT”)

a “Notice of Commencement of Exploration Activities”

under the guidelines of the Mexican Official Norm 120

(“Norm 120”).

SEMARNAT is the office of the Federal Government of México responsible for the review and issuance

of a Change of Soil Use Permit (“CSUP”), the review of a Technical Justification Study (referenced below) and the

filing of Norm 120.

Norm 120 is a notice to SEMARNAT only and has no processing time.

contemplated mineral exploration activities fall outside of the parameters defined under Norm 120, a CSUP Application is required

to be filed at the SEMARNAT under the guidelines of the Federal Sustainable Forestry Development Act and its Regulations.

To meet the requirements for issuance of a CSUP, the applicant must also file a Technical Study (“Technical Justification

Study”) to justify the change of soil use from forestry to mining, to demonstrate that biodiversity will not be compromised,

and to demonstrate that there will be no soil erosion or water quality deterioration on completion of the mineral exploration

a pre-requisite for issuance of a CSUP, Article 118 of the Federal Sustainable Forestry Development Act provides for the

posting of a bond to the Mexican Forestry Fund for remediation, restoration and reforestation of the areas impacted by the mineral

exploration activities.

carry out mining activities in México, holders of mining concessions are also required to file an “Environmental

Impact Assessment Study”

(“Environmental Impact Study”) under the guidelines of the Federal Environmental

Protection and Ecological Equilibrium Act and its Regulations, in order to evaluate the environmental impact of the contemplated

mining activities.

a pre-requisite for approval of an Environmental Impact Study, the Federal Environmental Protection and Ecological Equilibrium

Act and its Regulations require the posting of a bond to guarantee remediation and rehabilitation of the areas impacted by

the mining activities.

the use of explosives materials is required for execution of mineral exploration or mining activities, an Application for General

Permit for Use, Consumption and Storage of Explosive (“Explosives Permit”) is required to be filed at the offices

of the Secretariat of National Defense (“SEDENA”) under the guidelines of the Federal Explosives and Firearms Act.

the Federal Mining Act, holders of mining concessions in México have the right to the use of the water coming from

the mining works.

However, certification of water rights and/or issuance of water rights concessions are required from the National

Water Commission (“CONAGUA”) under the guidelines of the National Waters Act.

DynaMéxico

Permit Filings / Permits History (2003 –

February 10, 2003, SEDENA granted DynaMéxico an Explosives Permit for use and storage of explosives materials in SJG.

June 2006, DynaMéxico ceased use of explosives materials in its mining activities at SJG and requested suspension of

the Explosives Permit.

The Explosives Permit has been temporarily suspended by SEDENA and DynaMéxico will be required

to file a re-activation application to re-activate the Explosives Permit.

June 28, 2010, DynaMéxico filed a Preventive Exploration Notice at the office of SEMARNAT in connection with contemplated

mineral exploration activities at the La Prieta , San Pablo , La Purisima , La Unión , Tres

Amigos and La Ceceña areas of the San José

de Gracia Project.

July 21, 2010, SEMARNAT authorized DynaMéxico to conduct the mineral exploration activities referenced in the Preventive

Exploration Notice, for a term of 36 months, as SEMARNAT determined that such activities fall within the framework of Norm

SEMARNAT’s approval was subject to the following conditions:

(a) DynaMéxico’s filing of a CSUP Application

(referenced below) and approval thereof by SEMARNAT, and (b) posting of a bond in the amount of $134,487 Mexican Pesos to

guarantee remediation and rehabilitation measures following the conclusion of the mineral exploration activities referenced

in the Preventive Exploration Notice.

The bond was timely posted by DynaMéxico.

August 9, 2010, DynaMéxico filed a CSUP Application and a Technical Justification Study at the offices of SEMARNAT

to carry out certain mineral exploration activities at the La Prieta, San Pablo, La Purisima, La Unión, Tres Amigos

and La Ceceña areas of the San José

de Gracia Project.

December 20, 2010, SEMARNAT approved the CSUP Application and Technical Justification Study filed by DynaMéxico with

respect to the San José

de Gracia Project and authorized DynaMéxico to conduct mineral exploration activities

on 5.463 hectares of the San José

de Gracia Project for a term of 36 months.

March 8, 2012, the Director of Water Administration of CONAGUA certified in writing the rights of DynaMéxico to use

exploit and extract 1,000,000 cubic meters of water per year from the extraction infrastructure located in San José

CONAGUA determined that DynaMéxico’s water rights are not subject to any water rights concession or

any other water extraction restriction.

Water extracted by DynaMéxico will be subject to applicable levies imposed

by the Mexican tax authorities under applicable tax laws.

June 17, 2013, DynaMéxico received from SEMARNAT, the approval and permission which allows for the rehabilitation and

operation of the pilot mill facility at SJG ("the SEMARNAT-SJG Mill Permit,"

and, the "SEMARNAT Permit").

Under the terms of the SEMARNAT-SJG Mill Permit, DynaMéxico will be responsible to maintain the SJG pilot mill facility,

and including the adjacent tailings pond area, in compliance with the regulations described in la Norma Oficial Mexicana ("NOM-141-SEMARNAT-2003).

July 31, 2013, SEMARNAT authorized DynaMéxico to conduct the mineral exploration activities referenced in the Preventive

Exploration Notice, for a term of an additional 18 months, extending the initial term of 36 months as SEMARNAT had determined

on July 10, 2010.

SEMARNAT determined that such activities fall within the framework of Norm 120.

December 31, 2013, DynaMéxico received from SEMARNAT the approval and permission which allows for mining activities

and the exploitation of the San Pablo area of San Jose de Gracia.

January 6, 2014, DynaMineras entered into a 20 Year Land Lease Agreement with the Santa

Maria Ejido Community surrounding San Jose de Gracia.

The 20 Year Land Lease Agreement is dated January 6, 2014 and continues

through 2033.

It covers an area of 4,399 hectares surrounding the main mineral resource areas of SJG and provides for annual

lease payments by DynaMineras of $1,359,443 Pesos (approx.

$74,000 USD as of April 10, 2018), commencing in 2014.

Additionally,

under the description of the Land Lease Agreement, DynaMineras constructed a Medical Facility at SJG during 2017.

land lease agreement provides DynaMineras with surface access to the core resource areas of SJG (4,399 hectares), and allows

for all permitted test mining, pilot production and exploration activities from the owners of the surface rights (Santa Maria

Ejido community).

DynaMéxico

The Village of San Jose de Gracia maintains few stores which offer only minimal goods.

The camp site area maintains facilities of twelve rooms with additional lodging available in the town which can accommodate a total of about 225 persons.

A power line to the San José de Gracia Project has been installed by the Comisión Federal de Electricidad, the only authorized power producer in Mexico.

The power line was installed in March 2012 from the La Estancia area of the municipality of Sinaloa de Leyva, a distance of approximately 75 kilometers.

The power line is currently 220 volts maximum capacity, which supports domestic use only, including the office and camp facilities at SJG, such as water pump, air conditioning, refrigeration, lights, internet, and fans, as well as local residential use.

The SJG Project can produces its own diesel-generated power as a backup to the power grid.

Offices – Camp Facilities

DynaMexico maintains an administrative and logistics office in Guamuchil.

The SJG Project sources many of its supplies from Guamuchil, from Los Mochis and from Culiacan.

There is a satellite dish installed at the SJG Property, providing communications from the SJG Property to Guamuchil.

At the SJG Project, DynaMexico maintains a camp staff, including geologists, field helpers, consultants, security, cooks and cleaners.

Most of these employees come from outside of the local community.

Mining Concessions

The San José de Gracia Property consists of 33 contiguous mining concessions and covers an area of approximately 9,920 hectares (24,513 acres) as illustrated in Figure 2.

Current Mining Concessions - San José de Gracia

Taxes / ha (pesos)

FINISTERRE FRACC.

LA NUEVA AURORA

LA NUEVA ESPERANZA

LOS TRES AMIGOS

NUEVO ROSARIO

PIEDRAS DE LUMBRE 2

PIEDRAS DE LUMBRE 3

PIEDRAS DE LUMBRE No.4

PIEDRAS DE LUMBRE UNO

SAN SEBASTIAN

TRES AMIGOS 2

FRANCISCO ARTURO

Title to 32 of the 33 mining concessions is registered in the sole name of DynaMexico, The one exception is the San Miguel concession.

For the San Miguel concession, DynaMexico has entered into transfer agreements with the registered owners of 50% of the concession title, and DynaMexico has also entered into promise to sell and purchase agreements with registered owners of the balance of the concession title.

Under Mexican law, such agreements require the consent or relinquishment of first rights of refusal from the registered owners of 100% of the concession title, in order to have legal effect and be eligible for registration before the Mines Recorders’Office.

Under amendments to the Mining Act of Mexico that came into effect in December 2006, the classifications of Mining Exploration Concessions and Mining Exploitation Concessions were replaced by a single classification of Mining Concessions valid for a renewable term of 50 years, commencing from the initial issuance date.

To be converted into Mining Concessions at the time these amendments came into effect, former mining exploration and mining exploitation concessions had to be in good standing at the time of conversion.

All of the SJG concessions were in good standing and consequently were converted to 50-year Mining Concessions in December 2006, at the time the amendments to the Mining Act came into effect.

To renew the 50-year term, Mining Concessions must be in good standing at the time an application for renewal is filed, and an application for renewal must be filed within 5 years prior to expiration of the term.

To maintain Mining Concessions in good standing, the registered owner must (a) pay bi-annual mining duties in advance, by January 31 and July 31 each year, (b) file assessment work reports by May 30 each year, for the preceding year (some exceptions apply), and (c) by January 31 each year, file statistical reports on exploration / exploitation work conducted for the preceding year.

Notice of Commencement of Production Activities and Annual Production Reports must be filed annually by January 31 each year for those concessions where mineral ore extraction is taking place.

As a general provision, registered owners of Mining Concessions must follow environmental and labor laws and regulations in order to maintain their Mining Concessions in good standing.

Figure 2 – Claim location map

Surface Rights

In addition to the surface rights held by DynaMéxico pursuant to the Mining Act of México and its Regulations ( Ley Minera y su Reglamento ), the Company maintains access and surface rights for the SJG Project pursuant to a 20-year Land Lease Agreement.

This lease agreement with the Santa Maria Ejido Community (the owners of the surface rights) is dated January 6, 2014 and continues through 2033.

The lease agreement covers an area of 4,399 hectares surrounding the main mineral resource areas of SJG and provides for annual lease payments of $1,359,443 Pesos (adjusted for inflation).

The 2021 payment was $3,015,112 pesos (approx.

$149,000 USD).

Additionally, under the lease agreement, the Company met its obligation to construct a Medical Facility at SJG in year 2017.

The lease agreement provides the Company with surface access to the core resource areas of SJG (4,399 hectares), and allows for all permitted mining, pilot production and exploration activities.

Water Concession

The Company has secured the Water Rights Concession for the area surrounding SJG.

The Director of Water Administration of the National Water Commission of México (CONAGUA) formally certified in writing the rights of DynaMéxico to legally “use”, exploit and extract 1,000,000 cubic meters of water per year from the DynaMéxico extraction infrastructure located within the perimeter of the mining concessions.

CONAGUA determined that the DynaMéxico water rights are not subject to any water rights concession or any other water extraction restriction.

Water extracted by DynaMéxico will be subject to applicable levies imposed by the Mexican tax authorities in accordance with current Mexican tax laws.

The water concession provides sufficient water for current operations, and for the anticipated future needs of the project.

Royalties, Encumbrances and Environmental Liabilities

The SJG Property is not subject to any royalties, encumbrances or environmental liabilities.

Required Permits for Exploration, Drilling and Mining

In respect of permit requirements for mineral exploration and mining in Mexico, the most relevant applicable laws, regulations and official technical norms are the Federal Mining Act (plus its regulations), the Federal Environmental Protection and Ecological Equilibrium Act (plus its regulations), the Federal Sustainable Forestry Development Act (plus its regulations), the Federal Explosives and Firearms Act, the National Waters Act and the Mexican Official Norm 120.

To carry out mineral exploration activities, holders of mining concessions in Mexico are required to file at the offices of the Federal Secretariat of the Environment and Natural Resources (“SEMARNAT”) a “Notice of Commencement of Exploration Activities” or “Preventive Exploration Notice” in accordance with the guidelines of the Mexican Official Norm 120 (“NOM-120”).

If contemplated mineral exploration activities fall outside of the guidelines of the NOM-120 (e.g.

exploration activities on rain forest areas), a “Change of Soil Use Permit Application” (“CSUP”) is required to be filed at SEMARNAT under the guidelines of the Federal Sustainable Forestry Development Act and its Regulations.

To meet the requirements for issuance of a change of soil use permit, the applicant must file (together with the CSUP) a Technical Study (“Technical Justification Study”) to justify the change of soil use from forestry to mining, in order to demonstrate that biodiversity will not be compromised and that there will be no soil erosion or water quality deterioration on completion of the mineral exploration activities.

To carry out mining activities in Mexico, holders of mining concessions are required to file an “Environmental Impact Assessment Study” under the guidelines of the Federal Environmental Protection and Ecological Equilibrium Act and its Regulations, in order to evaluate the environmental impact of the contemplated mining activities.

If the use of explosives materials is required for execution of mineral exploration or mining activities, an Application for General Permit for Use, Consumption and Storage of Explosive (“GPCSE”) is required to be filed at the offices of the Secretariat of National Defense (“SEDENA”) under the guidelines of the Federal Explosives and Firearms Act.

Under the Federal Mining Act, holders of mining concessions in Mexico have the right to the use of the water coming from the mining works.

Certification of water rights and/or issuance of water rights concessions are required from the National Water Commission (“CONAGUA”) under the guidelines of the National Waters Act.

Fees or bonding requirements necessary to explore or mine.

As a pre-requisite for issuance of a CSUP, Article 118 of the Federal Sustainable Forestry Development Act provides the posting of a bond to the Mexican Forestry Fund for remediation, restoration and reforestation of the areas impacted by the mineral exploration activities.

As a pre-requisite for approval of Preventive Exploration Notice and Environmental Impact Assessment Study, the Federal Environmental Protection and Ecological Equilibrium Act and its Regulations require the posting of a bond to guarantee remediation and rehabilitation of the areas impacted by the mining activities.

Government agencies responsible for any applicable permits.

SEMARNAT is the office of the Federal Government of Mexico responsible for the review and issuance of a CSUP, the review of a Technical Justification Study and the filing of NOM-120.

The Federal Attorney’s Office for the protection of the Environment is the enforcement branch of SEMARNAT responsible for the monitoring and enforcement of environmental laws and regulations.

SEDENA is the office responsible for issuance of a GPCSE.

CONAGUA is the office responsible for certification of water rights and issuance of water rights concessions.

Time frame to obtain any permit or approval to explore or mine.

NOM-120 is a notice to SEMARNAT only and has no processing time.

Processing time for review and approval of a CSUP Application and Technical Justification Study varies depending on workload of SEMARNAT regional office where application is filed, but a processing time of Four (4) months is typical.

Processing time for review and approval of a Environmental Impact Assessment Study varies depending on workload of SEMARNAT regional office where application is filed, but a processing time of Six (6) months is typical.

Processing time for issuance of a GPCSE by SEDENA is approximately 6 months.

Processing time for issuance of a Water Rights Concession by CONAGUA is approximately 6 months.

DynaMexico Permits and Bonding Requirements.

Exploration Permit:

On June 28, 2010, DynaMexico filed an Preventive Exploration Notice (Preventive Exploration Notice) at the office of SEMARNAT in connection with contemplated mineral exploration activities at the La Prieta, San Pablo, La Purísima, La Unión, Tres Amigos and La Ceceña areas of the SJG Project.

On July 21, 2010, SEMARNAT approved, for a term of 36 months, the execution of the mineral exploration activities at SJG set out in the Preventive Exploration Notice, as it determined that such activities fall within the framework of the NOM-120, subject to the following conditions:

(a) filing and approval by SEMARNAT of a CSUP with respect to SJG (see below), and (b) posting of a bond in the amount of $134,487 Pesos to guarantee remediation and rehabilitation measures following the conclusion of the mineral exploration activities.

Change of Soil Use Permit

On August 9, 2010, DynaMexico filed at the offices of SEMARNAT a CSUP Application and Technical Justification Study to carry out certain mineral exploration activities set out in the Preventive Exploration Notice approved by SEMARNAT on July 21, 2010 (see above) at the La Prieta, San Pablo, La Purísima, La Unión, Tres Amigos and La Ceceña areas of SJG).

On December 20, 2010, SEMARNAT approved the CSUP Application filed by DynaMexico with respect to SJG and authorized DynaMexico the execution of mineral exploration activities on 5.463 hectares of SJG for a term of 36 months, and it is continually renewed as required.

Water Rights Certification

On March 8, 2012 the Director of Water Administration of CONAGUA certified in writing the rights of DynaMexico to use, exploit and extract 1,000,000 m3 of water per year from the company’s extraction infrastructure located in SJG.

CONAGUA determined that DynaMexico’s water rights are not subject to any other water rights concession or any other water extraction restriction.

Bonding Requirements

the Exploration Permit issued to DynaMéxico on July 21, 2010, SEMARNAT imposed upon DynaMéxico a bonding obligation

in the amount of $134,487 Mexican Pesos to guarantee remediation and rehabilitation measures following the conclusion of the

mineral exploration activities referenced in the Preventive Exploration Notice.

The bond was timely posted by DynaMéxico.

the CSUP issued to DynaMéxico on December 20, 2010, SEMARNAT imposed upon DynaMéxico a bonding obligation of

$116,911 Mexican Pesos for reforestation and remediation measures with respect to the San José

de Gracia Project.

bond was timely posted by DynaMéxico.

Company has secured the Water Rights Concession for the area surrounding SJG.

The Director of Water Administration of the National

Water Commission of México (CONAGUA) formally certified in writing the rights of DynaResource de México, S.A.

to legally “use”, exploit and extract 1,000,000 cubic meters of water per year from the DynaMéxico extraction

infrastructure located within the perimeter of the mining concessions comprising the San Jose de Gracia Mining Property in Sinaloa

State, México.

CONAGUA determined that the DynaMéxico water rights are not subject to any water rights concession

or any other water extraction restriction.

Water extracted by DynaMéxico will be subject to applicable levies imposed by

the Mexican tax authorities in accordance with current Mexican tax laws.

Underground Mining and Pilot Mill Operations

Investment Program (2015 and 2016 )

July 2015, the Company commenced a capital investment program designed to increase tonnage from the test mining operations and,

to increase volume and output through the pilot mill facility.

Through DynaMineras, the Company was engaged in the implementation

of this capital investment program from July through December 2015.

And, in 2016, the Company was carrying out operations utilizing

the improvements and increased outputs from test mining and pilot milling activities.

capital investment program consisted of a net total of $3,565,000 USD as generally described below:

including $250,000 Deposit (advance for services), and $513,000 in direct

mining costs, explosives, and payments to contractor;

Mine related Costs:

including mine plan development, permits, assays, consulting, mine supplies,

and equipment items;

Mill and Camp:

Improvements to the Mill and Camp, including pre-operation expenses;

Personnel Costs:

including payroll and consulting expenses;

long term equipment purchases including transportation, mine loading and hauling,

generators, compressors and pumps;

including legal expenses, consulting, and administration;

Value added taxes paid, and refundable;

Land Use and Rental:

Improvements, Expansion and Increased Output (2017 AND 2018)

Company continues its business plan of operations at San Jose de Gracia, which is to improve, increase and expand test mining

and pilot milling operations and generally, to increase production output.

Since 2015 startup of the test mining and milling activities,

the Company has increased daily output from an initial 75 tons per day, to a current 200 tons per day, and during fiscal year

2019 the Company expects to achieve production output of 250 tons per day.

(Note the Summary of Test Mining and Pilot Mill Operations

for 2015, 2016, 2017, and 2018 below).

January 2017, the Company has expended over $7.9 million USD in non-operating costs, generally classified as project improvements

and expansion costs which have been expensed in the company’s financial statements.

These funds have been provided primarily

by cash flows from operations.

An itemized list of these non-operating costs is described below:

Pond Expansion

Under the CSUP issued to DynaMexico on December 20, 2010, SEMARNAT imposed upon DynaMexico the obligation to post a bond in the amount of $116,911 Pesos for reforestation and remediation measures in SJG.

The Bond was timely posted by DynaMexico.

Under Preventive Exploration Notice (Preventive Exploration Notice) approved by SEMARNAT on July 21, 2010, SEMARNAT imposed upon DynaMexico the obligation to post a bond in the amount of $134,487 Pesos, to guarantee remediation and rehabilitation measures following the conclusion of the mineral exploration activities.

The Bond was timely posted by DynaMexico.

DynaMexico has sought and obtained all required environmental permits, temporary land occupation rights and consent letters from the regulatory agencies, local municipalities and the State of Sinaloa, in order to conduct its mining, production, exploration and drilling activities on the four main deposit areas at SJG.

DynaMexico will be required to obtain further permits in order to conduct drilling in these four areas and the other areas, and in order to carry out future mining, milling, and production activities, and will timely obtain such permits, as and when required.

HISTORY OF SAN JOSE DE GRACIA

Production at San José de Gracia dates from the 1800’s and totals approximately one million ounces of gold mined from high-grade quartz veins.

Large-scale mining in the camp began in 1870 and ended in 1910 with the onset of the Mexican Revolution.

The majority of the production came from the Anglo, Rosario and La Cruz Mines on the Purisima Ridge trend, and from the La Prieta Mine on the La Prieta trend (reference Fig.

The remainder of the production was derived from as many as 60 smaller mines throughout the 12 square kilometer area, including the Palos Chinos, San Pablo, Tres Amigos, La Ceceña, Los Hilos, Santa Rosa, Veta Tierra, La Union, Santa Eduwiges, Mochemara and La Parilla Mines.

Table 3 – Historic gold production – San Jose de Gracia – pre 1970’s

Production (oz)

Purisma Ridge Trend (includes the Anglo, Rosario, Jesus Maria and Laz Cruz Mines)

La Prieta Trend (La Prieta Mine)

It was not until the 1970’s when mining could resume at San José de Gracia, when the first road to SJG was opened, allowing Compaňia Rosarito to begin producing gold from the Palos Chinos, San Pablo, Tres Amigos and La Union mines.

Recent Ownership of the Property

By 1977 the underlying owners of the mining concessions and subsequent vendors to Minera Finisterre SA de CV.

(“Finesterre”) succeeded in acquiring control of most of the district, and installed a 70 ton per day flotation concentrator.

Finisterre subsequently acquired the property through option agreements with the underlying vendors and continued some exploration work, although most of its financial resources were expended in erecting a larger, 200 ton per day concentrator.

Golden Hemlock Explorations Ltd., a Canadian company, obtained an option to acquire majority control of Finisterre and commenced work on the property in 1997.

The actual exploration and development work was performed for by Perforaciónes Quest de Mexico (“PQM”), which was under contract to Finesterre, and whose efforts consisted primarily of core drilling, trenching and mapping.

PQM completed a 63-hole, 6,000-meter core drilling program in 1997.

In 1998-1999, Pamicon Developments Ltd., a Canadian company, examined the results of the 1997 drilling program, including PQM’s technical work, in order to calculate possible mineral reserves, and to review the general status of the property.

Results of this examination were presented in a report dated September 1999.

During the first half of 1999, DynaResource, Inc.

and its agents arranged to collect samples for metallurgical testing.

In June of 2000, DynaResource formed its subsidiary DynaMexico, in order to acquire and consolidate ownership of the San Jose de Gracia Project.

By December 2003, DynaMexico had completed the acquisition of and consolidation of 100% of the San Jose de Gracia Project from Golden Hemlock and Finisterre -- with the sole exception of the San Miguel mining concession.

Test Mining Operations

The property is without known reserves and the test mining program is exploratory in nature and the Company has started extraction without determining mineral reserves.

All mines are underground and the ore is hard rock that needs to be crushed and ground before gold concentrate can be extracted.

The Company is an exploration stage company and has a test mining facility and produces precious metal concentrates for sale to third parties.

Summary of Test Mining and Pilot Mill Operations for 2018 to 2021:

Reported Mill

Feed Grade (g/t

Gross Gold Concentrates Recovered

Test pilot operations in 2021 yielded 97,088 Tons of material, mined and processed from underground test mining activity and pilot milling operations.

These test pilot operations also yielded approximately 26,728 gross ounces of gold, and net of dry weight adjustments at the buyer’s facilities, the approximately 22,566 ounces of gold.

Infrastructure Improvements, Expansion and Increased Output (2017 To 2021)

The Registrant is an exploration stage company and the registrant has started extraction without determining mineral reserves.

As part of the Company’s test mining operations, it continues to upgrade the camp facilities and the mill.

Significant improvements have been made such that the condition of the equipment is new, relatively new or in good condition.

The Company has three mills running which can process approximately 350 tons of mined material per day.

Additionally, the Company has a new mill ordered which can process up to 500 tons per day.

To support these mills, the Company has ordered or is installing additional crushing and grinding equipment.

The Company continues its exploration at San Jose de Gracía, in order to increase production of gold ounces.

Since January 2015 startup of the test mining and milling activities, the Company has increased daily output from an initial 75 tons per 24-hour operating day, to a current 300 tons per 24-hour operating day, and during second quarter 2022 the Company expects to achieve production output of 500 tons per 24-hour operating day.

Since January 2017, the Company has expended funds to improve the mine, the mill and the facilities in order to increase the production at San Jose de Gracia.as follows:

Mill Expansion

Tailings Pond Expansion

Machinery and Equipment

Mining Camp Expansion

Medical Facility

Mine Development -

Mine Expansion - San

SJG Mining Concessions

Surface Rights and

Deb Retirement

Company is currently reporting all costs of mine operations, improvements, and expansion as expenses in accordance with United

States General Accepted Accounting Principal (GAAP) requirements.

The results of expensing all costs is that the Company has accumulated

a net loss carry forward from Mexico operations of $28 million USD which is available to offset future taxable earnings.

of Test Mining and Pilot Mill Operations for 2015, 2016, 2017 and 2018:

Mill Feed Grade

Gold Concentrates Produced

Gold Concentrates Sold

expects to continue to increase its test underground mining activity and pilot milling operations in 2019;

and projects the increased

output to 250 tons/day from the mine(s) and mill during 2019.

Test Mining and Mill Operations Disclosure

flow sheet for obtaining and processing mineralized material is described below:

Mineralize material is mined from San Pablo mine by the contract miner, and according to the formal mine plan developed

by the Company.

Freshly mined mineralized material is transported by the contract miner outside the San Pablo Mine to the mine patio;

Mill Facility –

General Description and Flow Sheet;

Mineralized material is transported by Company dump trucks and articulated dump truck to the mill patio.

Freshly mined mineralized material is loaded from the mill patio into the crushing circuit, comprised of a jaw crusher

and cone crusher;

and 1/2”

crushed material is fed by conveyor belt to the fine mineralized material bin.

The mineralized

material is then sent by conveyor belt to the primary ball mill, which is a Hardinge conical mill.

The mineralized material is then ground to -100 mesh particle size;

and then fed to a holding tank;

The mineralized material is pumped from the holding tank to the cyclone;

The course material plus (-100 Mesh) is fed to the Ball Mill #2, the Denver Mill;

and fine material less (-100 Mesh) is fed

to another holding tank.

Screening System (Sweco Screen):

The fine mineralized material is fed from the holding tank to the Sweco Screen;

mineralized material less (-200 Mesh) is fed to the spirals;

the oversized material is fed to Ball Mill# 2.

All mineralized material reground in the Denver Mill, is then fed to the holding tank prior to the Cyclone.

Gravity Concentration :

Approximately 25% of the mineralized material is fed from the spirals to the Wifley table.

Approximately

75% of the mineralized material is fed from the spiral concentration to the flotation conditioning tank.

Shaking Table:

The concentrate from the spirals feed the Wifley shaking table, producing a high-grade gravity concentrate.

The high-grade gravity concentrate is bagged and shipped for sale.

(There are no chemicals present in the gravity concentrate.)

It is estimated that the gravity concentrate produced is approx.

40% of the total recovered gold;

and estimated that a 300-400

g/t Au would be the final gravity concentrate grade.

Conditioning Tank:

The tailings from spirals and from the Wifley table are fed to the flotation conditioning tank.

A low calculation

of chemicals is added, with metered feeder, directly to the flotation feed tank.

Sodium sulfide, a granular solid, is added also

to the agitated flotation feed tank.

The following chemicals are added to the flotation feed tank:

Na2S (Sodium Sulfide), 400 g/mt (solid);

Xanthate Collector 40-80 g/mt (liquid);

Cytec 7249 conditioner 50 g/mt (liquid);

Cytec 4037 Conditioner 20–40 g/mt (liquid);

and Aerofroth 70 or 73 Frother 30 g/mt (liquid).

The Rougher flotation consists of a bank of 8 flotation cells (or Hybrid float cell), which is fed by the conditioning

The rougher concentrate recovered from the rougher float cells or the first hybrid cell is bagged for shipment and sale.

A very low percentage of chemicals remains in the rougher concentrate.

and Cleaner Concentrate:

The tailings of the rougher concentrate could be fed to the scavenger and cleaner float cells (or,

a second hybrid cell).

The cleaner concentrate would then be bagged and shipped for sale.

A very low percentage of chemicals remains

in the cleaner concentrate.

The tailings from the flotation area are fed to the tailings impoundment area.

Less than 10% of chemicals added

at the conditioning tank remain in the tailings slurry.

Chemicals do not appear in the water of the tailings;

as confirmed by

A 45 KW efficient diesel generator will supply power to the camp, mill lights and to the laboratory.

Two 50 KW back-up diesel

generators (Selmec, Kamag) are also available for camp use.

mill primary generator is a 310 KW Cat Diesel and there is a 455 KW Cat Diesel mill back-up generator.

fuel is stored in a 10,000-liter storage tank that feeds the two large generators by gravity flow to a common 500-liter head tank.

The fuel storage tank is contained within a secondary cement impoundment with controlled and oil-trapped drainage.

The Company is in process of connecting electrical power sufficient to supply electrical power for the camp and mill.

The Company is currently in the middle of exploration drilling to further define mineralization and in 2021 expended 522,000 for this drilling.

The Company is currently an exploration stage company and is reporting all costs of mine operations, improvements, and expansion as expenses in accordance with section 1300 of Regulation S-K and United States General Accepted Accounting Principal (GAAP) requirements, and therefore the above costs are not reflected as capitalized expenses (assets) on the Company’s balance sheet.

ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY

Topography, Physiography, and Vegetation

The topography of the San José de Gracia district is generally rugged with elevations varying from 400 meters in the valley bottoms to over 1600 meters in the higher Sierra.

A network of small roads and tracks winds around areas nearer the old workings at San José de Gracia.

Access to the remainder of the large property at the current stage of development is difficult without the use of horse or helicopter.

The SJG Project can be accessed by road, from either the City of Culiacan) or the City of Guamuchil.

Either route goes through the small town of Sinaloa de Leyva, then from Sinaloa de Leyva by gravel mountainous road to the village of San José de Gracia (population 250), which covers approximately 90 kilometers and is roughly a five hour trip.

The SJG Project can also be accessed by air.

A gravel airstrip is located adjacent to the San Jose de Gracia Village.

The airstrip is suitable for light aircraft and charter flights of 45 minutes duration are available from the cities of Los Mochis or Culiacan.

Much of the labor for the recent mining and production activities of DynaMexico was provided by the village residents.

Although the village provided approximately 75 employees to DynaMexico, it currently has limited services.

Climate and Operating Season

The climate is semi-tropical with a rainy season dominating from late June / early July through September.

For some activities on the SDJ project, operations may be suspended during the rainy season.

MINERAL PROCESSING AND METALLURGICAL TESTING

Bulk Sample, Hazen Process Development Metallurgical Report

Ore and existing mill tailings samples were collected under the supervision of Mr.

Henderson prior to DynaMexico’s acquisition and consolidation of San Jose de Gracia.

The ore samples consisted of a bulk (about 500 kg) of stockpiled ore from the lower adit of the Tres Amigos mine (intercept of the Tres Amigos and Orange Tree veins).

In addition, approximately 100 kg of ore as a bulk sample was taken from the surface at the Gossan Cap area.

Three additional ore samples (approximately 5-15 kg each) were assembled from splits of the cores from several of the 1997 drilling program core holes to develop samples representing different ore types for testing.

These included:

1) composite drill cores from Palos Chinos, 2) massive sulphide from the Tres Amigos vein and 3) disseminated, non-sulphide mineralized zones at the bottom of several Tres Amigos core holes.

The logic was that major exploratory test work to define a metallurgical process would be done on the bulk sample from the adit at Tres Amigos and the other samples would have limited testing done at the selected metallurgical process conditions to verify the performance of the selected metallurgical process circuit on other types of San José mineralization.

Finally, several bulk samples (50-100 kg) of existing tailings from the Rosarito mill and the old Rosarito mill were collected and used to conduct flotation, gravity, and limited leachability test work on the tailings.” Samples were shipped to the laboratory of Carbonyx Carbon Technologies in Plano, Texas where in 2000 and 2001 two separate preliminary test programs were conducted, one for the tailings, and the other for a portion of the bulk Tres Amigos ore.

He developed a concept for the metallurgical processing to produce both gravity and flotation concentrates (rougher and cleaner).

The tests confirmed a metallurgical flow sheet to be utilized at San José to recover up to 90% of the feed gold into the concentrates.

The above “in-house” testing established a preliminary flowsheet for a mill circuit for processing either primary ore or for reprocessing the existing tailings.

Subsequently Hazen Research Laboratories of Golden, Colorado (“Hazen”) was engaged to provide independent verification of the in-house work, and carry out additional optimization test work.

Lockwood Greene/ Mr.

Henderson prepared and verified completion of the scope of work.

In summary, various interim reports and the final metallurgical report, the "Official Hazen Test Report, (“Hazen Report”)” provided results as follows:

(a) The initial gravity beneficiation/flotation test work on the Tres Amigos and Gossan Cap bulk ore samples were very encouraging with up to 80 % recovery of the feed gold into the gravity concentrates while maintaining a minimum concentrate grade of 100 g Au/t ;

(b) The existing tailings samples (feed grades of 3 -8 g Au/t) returned similar recovery results, but had to be cleaned to produce a final concentrate with > 100 g Au/t ;

(d) Flotation tests on primary ore samples resulted in recoveries of 85 - 90 % of the feed gold into the rougher concentrates, however, recoveries after cleaning (to get > 100 g Au/t grade) dropped to the 65-75 % range;

(e) A combination circuit of a gravity pre-concentration stage with flotation on the gravity tailings indicated the potential to recover > 90% of the feed gold into the gravity concentrate, the rougher flotation and the cleaner flotation concentrates while maintaining a 100 g Au/t grade in all of the concentrates.”

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K/A

Item 2. Properties