Sovereign Metals' Half Year Results Shows Reports Strong Progress on Kasiya Project in Malawi

• Optimized Pre-Feasibility Study (OPFS) completed in Jan 2025 reaffirmed Kasiya as a potentially major critical minerals project with industry-leading economic returns and sustainability metrics.
• Pilot mining trials and subsequent land rehabilitation activities completed in Dec 2024 demonstrated Sovereign's proposed mining and rehabilitation approach.
• Rio Tinto increased its investment by A$19 million taking its shareholding to 19.9%.
• Positive test results for use of Kasiya graphite in lithium-ion battery anodes and traditional graphite applications as refractories, expandables, etc.
• Infill drilling program completed in Oct 2024 was done to upgrade Mineral Resource Estimate and convert Ore Reserves from Probable to Proven category.

Sovereign Metals Limited is an Australia-based mining company focused on the development of its flagship Kasiya rutile-graphite project in Malawi. The company aims to become a major producer of critical minerals, rutile (titanium dioxide) and natural flake graphite, through large-scale, low-cost, and sustainable operations. Sovereign is dual-listed on the Australian Securities Exchange (ASX:SVM) and London Stock Exchange AIM market (AIM:SVML).

Kasiya Project Overview

The Kasiya rutile-graphite project, located in central Malawi, is Sovereign's primary focus. The recently completed Optimized Pre-Feasibility Study (OPFS) confirmed Kasiya as a tier-one critical minerals project with potential to deliver industry-leading economic returns and sustainability metrics.

Under the Director's Report, the results of the OPFS reaffirm Kasiya's potential to become the largest and lowest-cost producer of natural rutile and natural flake graphite while generating exceptional economics."

The proposed operation envisions a 25-year initial mine life with a two-stage ramp up - 12 million tonnes per annum (Mtpa) plant throughput in years 1-4, expanding to 24 Mtpa from year 5 onwards. On average, Kasiya is projected to produce 222,000 tonnes of rutile and 233,000 tonnes of graphite per year.

Pilot Program & Land Rehabilitation

In December 2024, Sovereign achieved a key milestone with the completion of its pilot mining trials and commencement of land rehabilitation activities. Overburden and ore mined during the trials were successfully backfilled into the test pit, demonstrating the feasibility of Sovereign's proposed mining and rehabilitation approach.

On-site soil remediation and land rehabilitation activities are underway, testing Sovereign's proposed rehabilitation approach and demonstrating how mined land can support sustainable farming post-closure.

Rio Tinto Increases Investment

Global mining giant Rio Tinto demonstrated its confidence in the Kasiya project with an additional A$18.5 million investment in July 2024, increasing its shareholding in Sovereign to 19.9%. To date, Rio Tinto has invested a total of A$60 million, underscoring the strategic importance of Kasiya.

Positive Downstream Test Results

Test work conducted during the half year returned positive results for potential end-use of Kasiya graphite in both the lithium-ion battery supply chain and traditional graphite applications.

Very high quality Coated Spherical Purified Graphite (CSPG) was produced from Kasiya graphite concentrate, exhibiting performance characteristics comparable to top tier natural graphite anode material.

Additionally, tests confirmed that Kasiya graphite meets the prerequisite specifications for use in refractory materials, as well as in expandable graphite for fire retardant and other expanded graphite applications.

Resource Infill Drilling

An infill drilling program was completed in October 2024 to upgrade the confidence of the Mineral Resource Estimate. Results are expected to enable the conversion of Ore Reserves in the initial mining areas from Probable to Proven category. An updated Mineral Resource Estimate incorporating the infill results is anticipated in early 2025.

For Investors

Sovereign's near-term priorities include publishing the updated Mineral Resource Estimate, completing the Definitive Feasibility Study targeted for Q4 2025, progressing with offtake discussions supported by continuing downstream test work, and further advancing its community and social development programs in Malawi.

Financial Position

Sovereign maintained a strong balance sheet with A$34 million cash and no debt as of 31 December 2024. The additional investment from Rio Tinto offset spending on completion of the pilot program and OPFS during the half year.

For the six months ended 31 December 2024, the company recorded a net loss of A$19.5 million, largely attributable to A$16.5 million in exploration and evaluation expenses at Kasiya. As is standard for exploration companies, these costs are expensed until completion of feasibility studies.

Next Steps

The interim results demonstrate Sovereign Metals' continued progress in advancing its world-class Kasiya rutile-graphite project. With the OPFS now complete, focus shifts to the Definitive Feasibility Study as the next key milestone on the path to potential development.

The ongoing support of Rio Tinto and Sovereign's robust financial position provide a solid foundation for the next phase of the Kasiya project. Positive downstream test results, both for battery anodes and traditional graphite applications, highlight Kasiya's potential to become a strategic supplier of critical minerals into global supply chains.

While still in the evaluation stage, Sovereign appears well-placed to transition into a significant rutile and graphite producer if Kasiya continues to deliver as anticipated. With demand for both minerals forecast to grow strongly over the coming decade, Sovereign Metals presents an attractive exposure for investors seeking to gain leverage to the energy transition thematic.

As always, potential investors should consider their individual circumstances and seek professional advice before making any investment decisions.