Rio2 Signs Water Supply Agreements for Fenix Gold Mine Expansion

• Water Supply Agreements: Signed MOUs with two desalinated water providers to conduct feasibility studies for mine expansion water requirements
• Production Target: Expansion plans target 80,000 tonnes of ore daily processing capacity to produce 300,000 oz gold annually for 10 years
• Development Timeline: Pre-feasibility study scheduled Q1 2026, feasibility study H2 2027, production ramp-up H2 2030
• Initial Production: First gold production scheduled January 2026 from current mine development
• Resource Base: Project contains 4.8 million ounces measured and indicated gold resources

Rio2 Limited (TSX: RIO) is a mining development company focused on gold projects in Chile. The company operates through Chilean subsidiary Fenix Gold Limitada and is advancing the Fenix Gold Project in the Atacama Region. Rio2 plans approximately US$235 million in initial and sustaining capital investment for the project, which will employ 1,200 people during construction and 800 during operations.

Desalinated Water Supply Agreements

Fenix Gold has signed memorandums of understanding with two companies operating desalination facilities in the Copiapo area. The agreements establish a process for evaluating water supply options for the planned mine expansion. Both providers will complete four-month conceptual studies examining facility expansion requirements and pipeline infrastructure from Copiapo to the mine site.

Following study completion, Fenix Gold will select one provider to develop a detailed feasibility study. The selected company will then enter exclusive negotiations for a Joint Development Agreement, with Rio2 retaining rights to include additional mining partners in the arrangement.

Andrew Cox, President and CEO, stated: 

"This is a significant milestone for the planned future expansion of the Fenix Gold Mine, and we are very pleased to have got to this position with the two potential water providers."

Mine Expansion Timeline and Production Targets

The expansion project follows a structured development schedule through 2030. Key milestones include pre-feasibility study completion in Q1 2026, mineral resource updates in Q4 2026, and feasibility study completion in H2 2027. Capital expenditure approvals are targeted for Q1 2029, with infrastructure completion scheduled for H2 2030.

The expanded operation will process 80,000 tonnes of ore daily, targeting annual production of 300,000 ounces of gold for approximately 10 years. This represents a substantial increase from the initial mine configuration planned for January 2026 startup.

Executive Chairman Alex Black noted:

"With first gold production guided for January 2026, the next five years of our activities at Fenix Gold will be both exciting and transformational for the Company."

The Fenix Gold Project utilises heap leach processing technology and contains 4.8 million ounces of measured and indicated mineral resources. The operation will not require crushing facilities or tailings storage, which reduces the project's physical footprint.

A feasibility study completed in October 2023 provides the technical foundation for development. The project will create employment for 1,200 people during construction and 800 during the 17-year operational period.

Initial gold production is scheduled for January 2026, providing operational experience and cash flow generation prior to the expansion phase. The current development represents the first phase of a larger production plan utilising the project's resource base.

Development Milestones and Timeline

Rio2 will focus on completing water supply studies and selecting a desalination partner over the next four months. The pre-feasibility study for mine expansion, scheduled for Q1 2026, will coincide with initial production startup.

Key upcoming milestones include resource updates in Q4 2026 and feasibility study completion in H2 2027. These studies will provide capital cost estimates and final production parameters for the expansion phase. The structured timeline extends through 2030 when expanded production operations are scheduled to commence.

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