Kuya Silver Reports Record Underground Development at Bethania in Q3 2026

Q3 saw record mine development, higher recoveries, and $1.3M revenue at Bethania.

What the company is saying

Kuya Silver Corporation (CSE:KUYA, OTCQB:KUYAF, FSE:6MR1) frames the Q3 2026 update as a strategic pivot, emphasizing a deliberate shift from near-term production to mine development at the Bethania silver project in Peru. The company highlights record underground development of 575 metres and excavation of 4,713 tonnes of development material, presenting these as groundwork for a planned throughput expansion. Management underscores operational improvements: silver recoveries rose to 83.3% from 79.7% in Q2, despite lower grade material, and a 20% headcount increase since June 30, 2026, is credited with boosting productivity. The narrative stresses infrastructure upgrades, notably a higher-horsepower winch system set for commissioning in the coming weeks and a redesigned ramp project, both positioned as enablers for a 350 tpd mining rate and future expansion. The company also spotlights exploration progress, with a 20,000-metre drill program underway and a new surface rights agreement for the Carmelitas vein system. CEO David Stein is quoted attributing operational momentum to team growth and cash strength, projecting confidence in scaling the project. The announcement clarifies a correction to the exercise price of 525,000 stock options to $0.52. The overall tone is optimistic, with forward-looking statements about production growth and resource potential.

What the data suggests

The disclosed figures show that in Q3 2026, Kuya Silver mined 3,401 tonnes of mineralized material and processed 12,179 ounces of silver (16,055 silver-equivalent ounces), generating approximately US$1.3 million in revenue. Underground development reached a record 575 metres, with 4,713 tonnes of development material excavated, indicating a focus on preparing new mining areas. Silver recoveries improved to 83.3% from 79.7% in Q2, even as average silver grade in development material dropped to 5.4 oz/t. An initial 372-tonne batch from the Española vein processed in October averaged 10 oz/t silver with a high 91% recovery, suggesting upside in certain zones. The company’s production guidance remains unchanged, and the 20,000-metre drill program is underway, with completion targeted for Q2 2027. The infrastructure upgrades (winch and ramp) are described as imminent or in-progress, but their quantitative impact on throughput is not specified. The data supports a narrative of operational improvement and groundwork for expansion, but future production increases remain unquantified.

Analysis

The announcement provides a detailed operational update with specific, realised metrics for Q3 2026, including underground development (575 metres), tonnes mined (3,401), silver processed (12,179 oz), and revenue (US$1.3 million). These facts support a positive operational trajectory. However, the tone is somewhat inflated regarding future infrastructure upgrades: the commissioning of a higher-horsepower winch system and a redesigned ramp project are described as enabling significant throughput increases and future expansion, but no quantitative details or timelines are provided for these upgrades. The capital intensity flag is triggered by the mention of significant infrastructure projects (winch, ramp, 20,000-metre drill program) whose benefits are not immediate. While the majority of claims are realised, the most optimistic language is reserved for forward-looking infrastructure and expansion, which remain unquantified and long-dated. The gap between narrative and evidence is moderate: realised operational improvements are clear, but future growth is described aspirationally without supporting detail.

Risk flags

• ●Execution risk is elevated as the company shifts focus from immediate production to mine development and infrastructure upgrades; delays or technical challenges in commissioning the winch system or ramp could postpone throughput gains.
• ●The ramp project and winch system are described in aspirational terms without detailed engineering, cost, or timeline disclosures, making it difficult to independently assess the likelihood or speed of achieving targeted mining rates.
• ●Revenue for Q3 2026 was $1.3 million, but production of mineralized material was lower than Q2, and ongoing reliance on lower-grade development material could limit near-term cash flow until higher-grade zones are accessed.
• ●The 20,000-metre drill program is capital intensive and will not yield resource or economic results until at least mid-2027, exposing the company to exploration risk and potential dilution if additional funding is required.
• ●While the company reports a 20% increase in headcount and improved productivity, rapid workforce expansion can introduce operational inefficiencies or cost overruns if not managed carefully.

Bottom line

Kuya Silver’s Q3 2026 update demonstrates tangible operational progress at Bethania, with record underground development, improved silver recoveries, and $1.3 million in revenue. The company is prioritizing mine development and infrastructure upgrades over short-term production, aiming to set up for a future throughput increase to 350 tpd and beyond. While the near-term commissioning of a higher-horsepower winch system is a concrete step, the impact of the redesigned ramp and full-scale expansion remains unquantified and subject to execution risk. The ongoing 20,000-metre drill program and new surface rights agreement expand exploration potential, but resource and economic outcomes will take time to materialize. Investors should watch for evidence that the infrastructure upgrades deliver the promised capacity gains and for assay results from the drill program. The most important takeaway is that Kuya Silver is laying the groundwork for future growth, but the timeline and scale of production upside are not yet defined.

Announcement summary

(CSE:KUYA) (OTCQB:KUYAF) (FSE:6MR1) Kuya Silver Corporation provided an operational update for the third quarter of 2026 at the Bethania silver project. The company prioritized mine development over near-term production to prepare for planned expansion of underground throughput. A higher-horsepower winch system is scheduled for commissioning in the coming weeks and is expected to increase underground haulage capacity and support the targeted mining rate of 350 tonnes per day (tpd) without requiring completion of the previously announced ramp project. A redesigned ramp project is expected to improve access to additional mineralized material and support potential future expansion beyond 350 tpd. During Q3 2026, Kuya Silver advanced 575 metres underground and excavated 4,713 tonnes of development material, establishing additional working areas to support increased mining rates. The company mined 3,401 tonnes of mineralized material while prioritizing underground development and processed 12,179 ounces of silver (16,055 silver-equivalent ounces), generating approximately US$1.3 million in revenue. In the Española vein, a new mineralized zone up to 1.1 metres wide was encountered, and an initial 372-tonne blended processing batch from this zone processed in October averaged 10 oz/t silver and achieved 91% silver recovery. Exploration drilling restarted in late September as part of a 20,000-metre exploration program. Kuya Silver signed a surface rights agreement with the Poroche community for exploration of the Carmelitas vein system. Since June 30, 2026, head count at Bethania operations increased by approximately 20%. Silver recoveries improved to 83.3% during Q3 2026, up from 79.7% in Q2 2026, despite processing lower grade material averaging 5.4 oz/t silver (168 g/t Ag) and 8.5 oz/t silver equivalent (265 g/t AgEq). The company has previously achieved silver recoveries exceeding 90% when processing higher-grade batches. Production of mineralized material at Bethania totaled 3,401 metric tonnes in Q3 2026, a reduction from Q2 2026 but slightly higher than Q1 2026. The company's production guidance remains unchanged. Prices for silver equivalent calculations were: Sept. 30, 2026, $61/oz silver, $1,847/tonne lead, $3,818/tonne zinc; June 30, 2026, $61/oz silver, $1,877/tonne lead, $3,552/tonne zinc; Mar. 31, 2026, $74/oz silver, $1,909/tonne lead, $3,230/tonne zinc; Sept. 30, 2025, $46/oz silver, $1,964/tonne lead, $2,938/tonne zinc; June 30, 2025, $36/oz silver, $2,205/tonne lead, $2,764/tonne zinc; Mar. 31, 2025, $34/oz silver, $3,122.80/oz gold, $2,002/tonne lead, $2,829/tonne zinc. The company achieved record underground development of 575 metres and extracted 4,713 tonnes of development material in Q3 2026. Development on Level 640 in the eastern portion of the Española vein exposed a segment measuring 93 metres in length, with an average true width of 0.82 metres and up to 1.1 metres. An initial batch of 372 dry tonnes from this shoot and the 12 de Mayo vein processed in October averaged 10 oz/t (311 g/t) silver and achieved 91% silver recovery. A north-south crosscut on the 640 level accessed multiple working fronts associated with the 12 de Mayo vein and provided first-ever underground access to the Carmen vein, discovered in 2022. The first drill rig for the 20,000-metre diamond drilling program has been operating underground since late September, with two additional rigs to be mobilized in the next month before commencing surface drilling. The program is expected to be completed by Q2 2027. The company clarified that the exercise price of the 525,000 stock options granted on October 19, 2026, is $0.52, rather than the previously disclosed $0.50, with all other terms unchanged. The geological interpretations and exploration program information were reviewed and approved by Osbaldo Zamora, P.Geo., Vice President of Exploration, and the technical information concerning mining operations, production, and metallurgy was reviewed and approved by Kevin J. O'Connell, P.E., a consultant to Kuya Silver.

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