Great Panther Silver began actively exploring the San Ignacio Project in 2010 and initiated a diamond drilling program in October of that year, discovering new silver-gold zones with the first drill hole. The Company released an updated Mineral Resource estimate to March 31, 2012 for the San Ignacio Project on May 9, 2012 (refer to May 9, 2012 news release and the corresponding technical report filed on SEDAR dated June 26, 2012). This updated Mineral Resource estimate at San Ignacio supersedes the original estimate. The new Inferred Mineral Resource is estimated to contain 6,894,000 Ag Eq Oz in 826,000 tonnes averaging 121g/t Ag and 2.28g/t Au (using a 125g/t Ag Eq cut-off). This updated estimate both fills in and expands the strike length of the mineralized zones to 650 metres. This estimate increases the tonnage by 35%, the silver content by 29%, the gold content by 51% and the Ag Eq Oz by 53% over the previous estimate. It should be noted that this estimate used only four of the seven previously identified zones, leaving three zones to be more thoroughly tested at a later date.

Due to the proximity of San Ignacio to the Guanajuato Mine Complex (20 kilometres by road), any mineral extracted from it will be processed at the Company's Cata Plant .

In August 2012, the Company announced it had signed a definitive agreement for the purchase of a 100% interest in certain surface rights at San Ignacio. A total of 19.4 hectares has been purchased, allowing sufficient space for access to and construction of a portal for the development of a ramp, for waste dumps and for auxiliary infrastructure.

With the acquisition of the surface rights, the Company proceeded with the application for the permits required for the underground development, which it expects to be in place by the end of the second quarter of 2013. New portal and ramp construction is anticipated to begin shortly after the receipt of permits.