Sovereign Metals: Successful Dry Mining Trial Confirms Kasiya's Efficient & Optimized Rutile-Graphite Production

• Successful completion of dry mining trial at Kasiya Rutile-Graphite Project
• Test pit excavated to 20 meters depth, demonstrating efficient mining with standard equipment
• No drilling, blasting, or crushing required, indicating potential for lower costs and carbon footprint
• Hydraulic mining trials to commence soon, with water storage pond nearly at capacity
• Pilot Phase advancing as part of ongoing Pre-Feasibility Study (PFS) Optimization Study

Sovereign Metals Limited (ASX:SVM) is an Australian-based mineral exploration and development company focused on advancing its flagship Kasiya Rutile-Graphite Project in Malawi. With a commitment to sustainable development and responsible mining practices, Sovereign Metals aims to become a significant player in the global rutile and graphite markets.

In a significant milestone for the company, Sovereign Metals has announced the successful completion of a dry mining trial at its Kasiya Rutile-Graphite Project in Malawi. This development marks a crucial step forward in the company's ongoing Pre-Feasibility Study (PFS) Optimization Study, providing valuable insights into the project's potential operational efficiency and economic viability.

Dry Mining Trial Success

The cornerstone of this announcement is the successful excavation of a test pit as part of the Pilot Mining and Land Rehabilitation Program. The test pit, measuring 120 meters by 110 meters and reaching a depth of 20 meters, has demonstrated that the Kasiya ore body can be efficiently mined using conventional dry-mining techniques and a simple mobile excavator fleet.

Key findings from the trial include:

1. Efficient Excavation: The trial confirmed that Kasiya's ore can be mined without the need for drilling, blasting, crushing, or grinding. This simplicity in extraction could translate to lower mining costs and a reduced carbon footprint compared to hard rock deposits.
2. Equipment Suitability: The mining operation utilized a fleet of four excavators, 20 trucks, and support equipment including two bulldozers and a motor grader. This standard equipment proved effective in handling the saprolite-hosted mineralization.
3. Material Volumes: Approximately 170,000 bench cubic meters of material were mined during the test pit program. This volume provides a substantial sample for further processing tests and analysis.
4. Accessibility: A 10-meter-wide ramp was constructed at appropriate geotechnical angles, ensuring easy access to the pit.

Managing Director Frank Eagar expressed enthusiasm about the trial's outcomes, stating,

"Completion of the test pit at this scale marks a significant achievement. The mining, hydrology and geotechnical data collected throughout is invaluable in our understanding of the orebody and the simplicity of a potential dry-mining operation at Kasiya."

Advancing Towards Hydraulic Mining Trials

With the dry mining trial completed, Sovereign Metals is now preparing for the next phase of its pilot program – hydraulic mining trials. A temporary water storage pond with a capacity of six million liters has been constructed and is currently at 80% capacity. This water will be crucial for the upcoming hydraulic mining stage, which is set to commence in the coming weeks.

The inclusion of both dry and hydraulic mining trials in the pilot phase demonstrates Sovereign's commitment to thoroughly evaluating all potential mining methods to determine the most efficient and cost-effective approach for the Kasiya project.

Environmental Considerations & Land Rehabilitation

Sovereign Metals has placed a strong emphasis on environmental stewardship and land rehabilitation throughout the pilot phase. The company's objective is to restore mined land to conditions that achieve the same or better agricultural yields than existing land uses. This commitment is reflected in several aspects of the pilot program:

• Minimal Environmental Impact: The ability to mine without drilling, blasting, or extensive crushing not only reduces operational costs but also minimizes the environmental impact of the mining process.
• Water Management: The water storage pond has been sealed using natural clay from excavated material, reducing the need for conventional plastic lining and demonstrating the company's innovative approach to resource management.
• Rehabilitation Demonstration: Eight small rehabilitation demonstration pits have been planned, covering a combined area of 100m by 130m. These will be used to showcase multiple rehabilitation approaches, providing tangible evidence of Sovereign's commitment to responsible mining practices.
• Stakeholder Engagement: The pilot phase is being leveraged as an educational opportunity for project stakeholders, with Sovereign planning a series of site visits and consultations to demonstrate their mining and rehabilitation processes.

Implications for the Pre-Feasibility Study Optimization

The data gathered from the pilot phase, including the dry mining trial, will play a crucial role in Sovereign's ongoing Pre-Feasibility Study Optimization. This empirical data will inform decisions on: optimal excavation methods, material handling processes, processing techniques, backfilling strategies, and rehabilitation approaches.

By conducting these trials at a significant scale, Sovereign is positioning itself to make well-informed decisions that could potentially enhance the project's economic viability and operational efficiency.

Kasiya Project Overview & Resource Estimate

The Kasiya Rutile-Graphite Project represents a significant opportunity in the global rutile and graphite markets. The most recent Mineral Resource Estimate, announced on April 5, 2023, highlights the project's potential:

• Total Indicated and Inferred Resource: 1,809 million tonnes
• Average Rutile Grade: 1.0%
• Contained Rutile: 17.9 million tonnes
• Average Graphite Grade (TGC): 1.4%
• Contained Graphite: 24.4 million tonnes

These figures position Kasiya as a potentially world-class deposit, with the capacity to become a significant supplier of both rutile and graphite to global markets.

Market Implications & Future Outlook

The successful completion of the dry mining trial and the progress of the overall pilot phase have several implications for Sovereign Metals and potential investors:

• De-risking the Project: By demonstrating the effectiveness of conventional mining techniques and gathering crucial operational data, Sovereign is systematically de-risking the Kasiya project. This could potentially lead to increased investor confidence and easier access to project financing in the future.
• Cost Efficiency: The simplicity of the mining process, with no need for drilling, blasting, or extensive crushing, suggests potential for lower operational costs. This could significantly enhance the project's economic viability and competitiveness in the global market.
• Environmental, Social, and Governance (ESG) Credentials: Sovereign's focus on efficient mining techniques, coupled with its commitment to land rehabilitation and stakeholder engagement, aligns well with increasing investor focus on ESG factors.
• Market Positioning: As the global demand for both rutile and graphite continues to grow, driven by industries such as pigments, welding, electric vehicles, and energy storage, Kasiya's large resource base positions Sovereign Metals to potentially become a significant player in these markets.
• Advancement Towards Production: The successful completion of these trials brings Sovereign one step closer to potential production, with each milestone potentially increasing the company's valuation.
• Technical Committee Oversight: It's worth noting that the pilot phase is progressing under the oversight of the Sovereign-Rio Tinto Technical Committee. This collaboration with Rio Tinto, a major player in the global mining industry, adds an additional layer of credibility to the project and suggests potential for future strategic partnerships.

Conclusion

For investors considering Sovereign Metals Limited, the successful completion of the dry mining trial at the Kasiya project represents a significant milestone. It demonstrates the company's ability to execute on its plans and provides tangible evidence of the project's potential viability.

Key points for investors to consider include:

• Project Advancement: Sovereign is systematically progressing the Kasiya project, with each step potentially de-risking the investment and moving closer to production.
• Resource Quality: The large, high-grade resource at Kasiya positions Sovereign to potentially become a significant player in both the rutile and graphite markets.
• Operational Efficiency: The simplicity of the mining process suggests potential for cost-effective operations, which could translate to robust project economics.
• ESG Considerations: Sovereign's focus on responsible mining practices and land rehabilitation aligns with growing investor emphasis on sustainability.
• Market Opportunity: With increasing demand for rutile and graphite in various industries, Sovereign is well-positioned to potentially capitalize on these market trends.
• Strategic Oversight: The involvement of the Sovereign-Rio Tinto Technical Committee adds credibility and expertise to the project's development.

While all mining projects carry inherent risks, the progress at Kasiya suggests that Sovereign Metals is taking a methodical and responsible approach to project development. As the company continues to advance through its Pre-Feasibility Study Optimization and towards potential production, it may present an interesting opportunity for investors looking to gain exposure to the rutile and graphite markets.