JERVOIS PROJECT OVERVIEW | DEVELOPMENT & PERMITTING | OTHER PROSPECTS

Studies

• November 2022 Feasibility Study (FS) demonstrates a technically robust project with average annual copper in concentrate production of 24.7 ktpa over an initial 11+ year mine life.

• The outcome of the FS provides the Board of KGL with the confidence to progress to a Financial Investment Decision in early 2023.

Key Highlights

Ore Reserve

• JORC Proven Reserve 1.40 Mt @ 2.07% copper, 0.12g/t gold, and 12.3 g/t silver, and a JORC Probable Reserve of 10.3 Mt at 2.10% copper, 0.31 g/t gold, and 32.1 g/t silver.

Financial Returns

• Post-tax NPV(8%) of A$241m and Post-tax IRR of 20.7% based on an initial 11.75-year mining period, based on 2025 Bloomberg consensus pricing of US$4.23Cu/lb (30 Sep 2022)

• Capital payback of 4.2 years.

Capex and Operation Costs

• Pre-production capital of A$298m

• Steady State unit direct cash costs of operations of US$2.22/lb Cu.

• Steady State AISC of US$3.13/lb Cu.

Physical Parameters

• Processing 1.6 Mtpa.

• Average annual production of 24.7 kt Cu, 835,000 oz Ag and 6,009 oz Au.

• Mining inventory comprises 70.4% Probable Ore Reserves and 29.6% Inferred Mineral Resources.

• Initial life of 11.75 years (mining); 11.25 years (processing).

Value improvement opportunities

• Mine plan based currently on 16.67 Mt of Mineralised Material representing only 70% of Total Resource of 23.8 Mt.

• Competitive Tendering of major contracts

• Unit cost improvement via optimising underground mining thickness

• Offsite transport cost reductions

• Capital efficiency improvement via exploration to extend mineral resources

• Margin improvement via polymetallic recovery of lead and zinc

Next Steps

Prior to FID, the KGL Board will prioritise the following work programs:-

• Undertake competitive tender for key contracts including open cut and underground mining, EPC, and ongoing operations for the processing plant;

• Continue to identify opportunities to improve the project value and to reduce financing and operational risks in collaboration with the preferred tenderers; and

• Continue exploration to grow the high-grade resource focusing on resources and reserves within the known mineral deposits and in prospective parts of the Jervois tenements with the goal of increasing the mine life and upgrading the existing Mineral Resources and Reserves. The potential to add considerable value by extending the mine life justifies a focused exploration program.

KGL intends to move toward a Final Investment Decision (FID) on the basis that project finance and shareholder equity can be secured to underpin the Project during early 2023, subject to market conditions.

Click here to view the full FS announcement and Executive Summary.