Rio2 Designates Process Plant Construction and Civil Contractors for the Fenix Gold Project

Rio2 Designates Process Plant Construction and Civil Contractors for the Fenix
Gold Project

VANCOUVER, British Columbia, Sept. 28, 2020 (GLOBE NEWSWIRE) -- Rio2 Limited
(“Rio2” or “the Company”) (TSXV: RIO; OTCQX: RIOFF; BVL: RIO) today announces
that it has taken another key step towards the development of its Fenix Gold
Project (“the Project”) located in Chile by selecting the following lead
contractors:

  * Process plant / site infrastructure construction contractor - HLC
    Ingeniería y Construcción (“HLC”)
  * Leach pad and civil design contractor - Anddes Asociados S.A.C.
    (“ANDDES”) 
  * Civil earthmoving and construction contractor - STRACON S.A. (“STRACON”) 

Together  with  Rio2,  the  companies   have  executed  an  early   contractor
involvement agreement (“ECI  Agreement”) for early  works associated with  the
process plant / site  infrastructure, leach pad and  project civil design  and
construction. Prior to  the signing of  this ECI Agreement,  the parties  have
been working exclusively over  the past few months  in close cooperation  with
Rio2 management  to  detail  all  project engineering  items  related  to  the
construction of the Fenix Gold  Mine. Detailed engineering activities for  the
construction of the  Fenix Gold Mine  are scheduled to  be completed in  early
November in preparation for project financing.

The scope of works for each contractor includes the following:

HLC - design and construction of  the primary crushing and stockpile  circuit,
ADR plant and  water facilities, lime  dosing and leach  pad pumping  circuit,
workshop, warehousing,  onsite offices  and  dining facilities,  onsite  power
generation and distribution.

ANDDES - engineering design for all civil earthworks, including access  roads,
water controls, infrastructure platforms, leach pad and ponds, waste dump  and
stockpiles. ANDDES will also provide site-based supervision of all civil works
including quality control and assurance.

STRACON - responsible for all earthmoving and associated activities, all  road
maintenance and construction, building  and infrastructure platforms, pad  and
pond construction, waste dump and stockpile preparation, water controls, water
transport for construction purposes  and various support  services to HLC  and
ANDDES as required. These services will be  in addition to their role as  lead
mining contractor as announced and outlined in a previous press release  dated
July 7, 2020.

The commercial terms of the above mentioned contract services will utilize  an
alliancing-style commercial framework based on the project configuration, mine
plan, methodologies  and productivity  estimate assumptions  contained in  the
Fenix Gold Project Pre-Feasibility Study with an effective date of August  15,
2019 a  copy of  which document  is available  under Rio2’s  SEDAR profile  at
www.sedar.com.

The Fenix  Gold Project  continues  to advance  as  scheduled and  first  gold
production is estimated for late H2, 2022.

Rio2 is also pleased to report that  the Fenix Gold Project has been  recently
included in a selected list of 220 multi-sector projects to be prioritized  by
the Office  of Sustainable  Project Management  (GPS) -  part of  the  Chilean
Ministry of  Economy. This  governmental office  helps prioritize  development
projects that are perceived as environmentally responsible and sustainable and
also respectful of their surrounding communities.

MINE AND INFRASTRUCTURE CONSTRUCTION ALLIANCE

The basis  for  Rio2  establishing  a  mine  and  infrastructure  construction
alliance with HLC, ANDDES and STRACON at the Fenix Gold Project is a best  for
project business  strategy.  Together with  the  three contractors,  the  Rio2
management team collaborated, implemented and executed with this same approach
when they built the La  Arena and Shahuindo gold mines  in Peru with Rio  Alto
Mining Limited.

In the case  of the Fenix  Gold Project mine  and infrastructure  construction
alliance, Rio2, HLC, ANDDES  and STRACON will work  together as an  integrated
team, dedicated  to  exceeding goals,  controlling  budgets and  adding  value
through exceptional performance  while working in  a safe and  environmentally
sustainable manner focused on  every detail of  the construction process.  The
alliance will implement an inclusive social policy as a priority based on  the
hiring of local personnel and service  companies from Copiapó and the  Atacama
Region.

The principal characteristics of a successful alliance are;

  o collective responsibility;
  o collective sharing of risks and opportunities; and
  o no fault, no blame philosophy leading to no disputes between the owner and
    contractors.

The payment model of an alliance includes;

  o reimbursement of 100% of contractor’s project costs plus a fee  (corporate
    overheads and profit);
  o a KPI based regime that rewards for outstanding performance and  penalizes
    poor performance; and
  o unanimous, best  for  project,  management and  decision  making  and  the
    selection of  an integrated  owner/contractor team  on the  basis of  best
    person for each position and avoiding duplication of roles.

Benefits of an alliance;

Both owner and contractors work together to:

  o achieve project  objectives  by  aligning  the  commercial  framework  and
    objectives of the participants;
  o collectively manage project issues and risks;
  o collectively own the project risks, and outcomes;
  o encourage a  collaborative, flexible  approach to  the management  of  the
    project;
  o ensure a strong focus on collaboration to achieve win-win solutions;
  o manage the project with open book transparency of all costs providing  the
    owner confidence in the  robustness of both the  estimate and actual  cost
    outcomes;
  o focus on achieving  outcomes rather than  exchange of contractual  dispute
    letters; and
  o eliminate the duplication of resources.

Alex Black,  President  &  CEO of  Rio2,  stated,  “The signing  of  this  ECI
Agreement with  HLC, ANDDES  and  STRACON forms  another  key part  of  Rio2’s
strategy to  prepare for  next years’  construction phase  of our  Fenix  Gold
Project. The Rio2 management  team is pleased to  work again with HLC,  ANDDES
and STRACON, this time  in Chile, and look  forward to further optimizing  the
mining and  construction solution  for  the Project  in preparation  for  next
years’ construction program. With only a  handful of new gold mining  projects
entering into construction  next year,  Rio2’s Fenix  Gold Project  is set  to
become a notable and impactful Latin American gold producer in 2022.”

ABOUT HLC

HLC is  a  leading  company specializing  in  Engineering,  Manufacturing  and
Construction solutions with more than 20 years of industry leading  experience
having developed  projects  in  Peru  and  throughout  Latin  America  in  the
Mining-Metallurgical, Hydrocarbon and Industrial sectors. HLC prides itself in
its  multi-skilled   professional   team,  its   technical   excellence,   its
wide-ranging quality of service and commitment to its clients whilst  focusing
on safe work practices and respecting the environment.

ABOUT ANDDES

ANDDES is a company specializing in  advisory and consulting services for  the
development and  supervision of  environmental, engineering  and  construction
projects, mainly in the field of  mining. The company is led by  professionals
with many years of experience in  the development of mining projects in  Peru,
Chile, Argentina, Brazil, Mexico and  Colombia. The experience of the  company
and staff,  and  that  of its  strategic  alliances,  allow it  to  provide  a
high-quality standard  of services  with innovative  and efficient  solutions,
generating value for its clients and their stakeholders.

ABOUT STRACON

STRACON is a leading  provider of contract  mining and construction  services,
operating throughout the Americas. Headquartered in Peru, STRACON has built  a
sustainable business based on providing efficient and innovative services.  In
doing so, STRACON has developed  a reputation for successful project  delivery
in Latin  America, across  a  range of  commodities. STRACON’s  commitment  to
providing safe and efficient services, coupled with its experience in building
and operating greenfield projects, similar to that of the Fenix Gold  Project,
means it is well placed to meet Rio2’s construction and mining requirements.

ABOUT RIO2 LIMITED

Rio2 is a  mining company with  a focus on  development and mining  operations
with a team that has proven technical  skills as well as a successful  capital
markets track record.  Rio2 is  focused on taking  its Fenix  Gold Project  in
Chile to  production in  the shortest  possible timeframe  based on  a  staged
development strategy. In addition to the Fenix Gold Project in development  in
Chile, Rio2  Limited continues  to  pursue additional  strategic  acquisitions
where  it  can  deploy  its  operational  excellence  and  responsible  mining
practices to build a multi-asset, multi-jurisdiction, precious metals  company
focused in the Americas.

Forward-Looking Statements

This news  release  contains forward-looking  statements  and  forward-looking
information (collectively “forward-looking information”) within the meaning of
applicable securities laws relating to Rio2’s planned development of its Fenix
Gold Project and  other aspects  of Rio2’s anticipated  future operations  and
plans. In addition,  without limiting  the generality of  the foregoing,  this
news release contains forward-looking information pertaining to the following:
the potential development of a mine  at the Fenix Gold Project, the  potential
characteristics and benefits  of a  Fenix Gold  Project construction  alliance
with HLC, ANDDES and STRACON, the potential to enter into contracts with  HLC,
ANDDES and STRACON and their respective scope and terms, the potential  number
of jobs created through the construction and operation of a mine at the  Fenix
Gold Project, the  potential timing  of the commencement  of construction  and
production at the Fenix Gold Project, certain anticipated economic benefits of
a mine at the Fenix  Gold Project to the local  region, the potential for  the
Fenix Gold Project to  receive benefits associated  with being prioritized  by
the Office of Sustainable  Project Management and  other matters ancillary  or
incidental to the foregoing.

All statements included herein, other than statements of historical fact,  may
be forward-looking information and such information involves various risks and
uncertainties.  Forward-looking  information   is  often,   but  not   always,
identified  by  the  use  of  words  such  as  “seek”,  “anticipate”,  “plan”,
“continue”,  “estimate”,  “expect”,   “may”,  “will”,  “project”,   “predict”,
“potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, and
similar expressions. The forward-looking information  is based on certain  key
expectations and  assumptions made  by Rio2’s  management, including  but  not
limited to:  expectations  concerning prevailing  commodity  prices,  exchange
rates,  interest  rates,  applicable  royalty  rates  and  tax  laws;  capital
efficiencies;  legislative  and  regulatory   environment  of  Chile;   future
production rates and estimates  of capital and  operating costs; estimates  of
reserves  and   resources;  anticipated   timing   and  results   of   capital
expenditures; the sufficiency of capital expenditures in carrying out  planned
activities; performance; the  availability and  cost of  financing, labor  and
services; and Rio2’s ability to access capital on satisfactory terms.

Rio2 believes the expectations  reflected in these forward-looking  statements
are reasonable, but  no assurance can  be given that  these expectations  will
prove to be correct and such  forward-looking statements in this news  release
should not be unduly relied upon. A description of assumptions used to develop
such forward-looking information and  a description of  risk factors that  may
cause actual results to differ materially from forward-looking information can
be found in Rio2's disclosure documents on the SEDAR website at www.sedar.com.
Forward-looking statements included in  this news release are  made as of  the
date of this news release  and such information should  not be relied upon  as
representing its views  as of any  date subsequent  to the date  of this  news
release. Rio2 has  attempted to  identify important factors  that could  cause
actual results,  performance  or  achievements  to  vary  from  those  current
expectations  or  estimates  expressed  or  implied  by  the   forward-looking
information.  However,  there  may  be  other  factors  that  cause   results,
performance or achievements not to be as expected or estimated and that  could
cause actual results,  performance or achievements  to differ materially  from
current expectations. Rio2 disclaims any intention or obligation to update  or
revise any forward-looking statements, whether as a result of new information,
future events  or  otherwise,  except  as  expressly  required  by  applicable
securities legislation.

To learn more about Rio2 Limited,  please visit: www.rio2.com or Rio2's  SEDAR
profile at www.sedar.com.

ON BEHALF OF THE BOARD OF RIO2 LIMITED

Alex Black
President, CEO & Director
Email: [email protected]
Tel: 1 (604) 260-2696

Neither TSX Venture  Exchange nor  its Regulation Services  Provider (as  that
term is  defined in  the policies  of the  TSX Venture  Exchange) accepts  the
responsibility for the adequacy or accuracy of this release.

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