Mr. Martin Horgan reports

CENTAMIN PLC ANNOUNCES POSITIVE DOROPO GOLD PROJECT PRE-FEASIBILITY STUDY

Centamin PLC has provided the outcomes of the prefeasibility study (PFS) at its Doropo gold project located in northeastern Ivory Coast, including a maiden mineral reserves estimate, detailed project parameters and economics, with identified upside opportunities for evaluation during the definitive feasibility study (DFS).

Martin Horgan, chief executive officer, commented: "The results from the Doropo PFS demonstrate an economically robust project that meets Centamin's hurdle rates to proceed with a definitive feasibility study. A life-of-mine average production rate of approximately 175,000 ozpa [ounces per annum] at $1,000 (U.S.)/oz AISC over 10 years delivering an IRR of 26 per cent at a gold price of $1,600 (U.S.)/oz in a well-established mining jurisdiction represents an excellent outcome. We have identified opportunities to further optimize the project which will be assessed as part of the DFS which is scheduled for completion in mid-2024. A substantial part of the DFS fieldwork has already been completed in 2023 which derisks the timeline to completion and further confirms our faith in the potential of Doropo to support a commercially viable project which will bring significant investment and job creation to northeastern Cote d'Ivoire."

Highlights:

• Maiden mineral reserve estimate of 1.87 million ounces (Moz) of probable mineral reserves, at an average grade of 1.44 grams per tonne of gold (g/t Au), supporting a 10-year life of mine (LOM);
• Average annual gold production of 173,000 oz over the LOM, with an average of 210,000 oz in the first five years;
• All-in sustaining costs (AISC) of $1,017 (U.S.) per ounce sold over the LOM, with an average AISC of $963 (U.S.)/oz for the first five years;
• The mine plan assumes conventional open-pit mining of a sequence of shallow pits;
• Mineral processing via a four-million-to-5.5-million-tonne-per-annum (Mtpa) semi-autogenous grinding (SAG) mill, ball mill and crusher (SABC) circuit, and conventional carbon-in-leach (CIL) circuit for an average LOM gold metallurgical recovery rate of 92 per cent;
• Total construction capital expenditure (capex) of $349-million (U.S.), inclusive of a 10-per-cent contingency, with a 2.3-year payback at a $1,600 (U.S.)/oz gold price;
• Robust economics with a posttax net present value of $330-million (U.S.) and internal rate of return (IRR) of 26 per cent, using a 5-per-cent discount rate and $1,600 (U.S.)/oz gold price;
• Definitive feasibility study (DFS) and environmental and social impact assessment (ESIA) completion expected in H1 2024 ahead of mining licence submission deadline;
• Upside opportunities identified for potential resource and reserve growth and improvements to capital and operating expenditure estimates;
• The company will host a webcast presentation of the Doropo project with the interim financial results on Wednesday, July 26, 2023, at 8:30 a.m. BST (United Kingdom time).

Webcast presentation

The company will host a webcast presentation with the interim results on Wednesday, July 26, 2023, at 8:30 a.m. BST to discuss the results and Doropo gold project, followed by an opportunity to ask questions.

Doropo gold project prefeasibility study

Overview

The Doropo gold project is in the northeast of Ivory Coast, situated in the northeastern Bounkani region between the Comoe National Park and the international border with Burkina Faso, 480 kilometres north of the capital Abidjan and 50 km north of the city of Bouna.

The licence holding is currently 1,847 square km and covers 13 gold deposits, named Souwa, Nokpa, Chegue Main, Chegue South, Tchouahinin, Kekeda, Han, Enioda, Hinda, Nare, Kilosegui, Attire and Vako. Approximately 85 per cent of the gold deposits are concentrated within a seven km radius (main resource cluster), with the Vako and Kilosegui deposits located within an approximate 15 km and 30 km radius, respectively.

Geologically, Doropo lies entirely within the tonalite-trondhjemite-granodiorite domain, bounded on the eastern side by the Boromo-Batie greenstone belt, in Burkina Faso, and by the Tehini-Hounde greenstone belt on the west.

Mineral resources and reserves

The PFS is based on the 2022 mineral resource estimate for Doropo published in November, 2022. The maiden mineral reserve estimate has converted 74 per cent of mineral resource ounces to mineral reserves.

There is potential for additional resource conversion and further resource growth. Several exploration targets have been identified across the licence holding which have the potential to increase the resource and reserve base.

Mining:

• 11 years of mining operations, including precommercial works;
• LOM 4.1 times strip ratio (waste to ore);
• 24-million-tonne-per-annum (Mtpa) peak total material movement.

The relatively shallow deposits will be mined using a conventional drill, blast, load and haul open-pit operation. The basis for the PFS is a contract mining operation, delivering up to 5.4 Mtpa of ore to the run-of-mine (ROM) pad and stockpiles annually, with variation based on the location and the combination of oxide, transition and fresh ore mined. The project plans to mine 41 million tonnes (Mt) of ore to be fed into the process plant and 166 Mt of waste over the life of mine.

Processing:

• Free milling gold leads to conventional closed SAG/ball mill and CIL flowsheet;
• Mill capacity of 5.5 Mtpa (oxide/transition ore), four Mtpa (fresh ore);
• Averaging 92 per cent gold recovery over the LOM.

Flowsheet development has been supported by extensive metallurgical test work at the PFS stage. The results showed high gold extractions and low reagent consumption results in most fresh rock master composites tested and excellent gold extraction in oxide and transitional master composite samples. As a result the flowsheet has been simplified by removing the pyrite flotation, ultrafine grind circuit and subsequent flotation concentrate leaching circuits which were assumed in the 2021 preliminary economic assessment (PEA) flowsheet.

Processing at Doropo will involve primary crushing and grinding of the mined ore, using SAG and ball mills in closed circuits to a target grind size (P80) of 75 microns (micrometres) for fresh ore and 106 micrometres for oxide and transition ore. A gravity circuit will recover any native/free gold, before entering the carbon-in-leach (CIL) circuit, after which the gold will be recovered by an elution circuit, using electrowinning and gold smelting to recover gold from the loaded carbon to produce dore.

Infrastructure:

• Access to 90-kilovolt national grid for the Doropo project power provision;
• Tailings storage facility (TSF) will be fully geomembrane lined and the embankment will be built using the downstream construction method.

Knight Piesold Consulting, the global mining services specialists, carried out a PFS of the site infrastructure for Doropo including TSF, water storage/harvest dam, airstrip and haul access road.

The TSF was designed in accordance with Global Industry Standard on Tailings Management (GISTM) and Australian National Committee on Large Dams (ANCOLD) guidelines. The TSF will be fully lined with a geomembrane liner and constructed by the downstream construction method with annual raises to suit storage requirements. The TSF is designed to have a final capacity of 29 million cubic metres or 41 Mt of dry tails and will cover a total footprint area (including the basin area) of approximately 346 hectares for the final-stage facility.

The power supply for the project will use the Ivory Coast national grid, which offers a cost and potential carbon saving relative to other options, including self-generation as the tariff is based on a mix of hydro and thermal generation with a large portion of hydroelectric. The proposed power supply solution for the project is through the existing Bouna substation which is approximately 55 km southeast of Doropo.

Environmental and social

The company has established engagement forums with local communities and authorities at Doropo through the PFS phase and consulted with project-affected communities on impact management and mitigation measures.

The project baseline ESIA was prepared by Earth Systems and H&B Consulting working in conjunction with Centamin. Early development of the baseline ESIA information has allowed its incorporation into the PFS design and decision-making process. The baseline studies indicate 2,000 to 3,000 people may require physical resettlement and up to 5,000 hectares of agricultural land could be impacted by the project development. The PFS plans for a staged approach to project development, mining sequencing and therefore resettlement action plan (RAP), with progressive rehabilitation to help minimize community and physical impacts as resettlement and livelihood restoration outcomes are a key factor for project success.

The project provides a valuable opportunity to boost local social development and regional infrastructure with a commitment to invest 0.5 per cent of project revenues into a social development fund, and through local job creation.

The outer extent of the Doropo project is 7.5 km from the Comoe National Park, which is a UNESCO World Heritage Site. Doropois being designed to avoid adverse impacts to the park and its biodiversity, including assessing the opportunity to create a buffer zone to further safeguard the natural area.

The full ESIA work program is now under way to support a formal mining licence application in 2024 and the inform the DFS work programs.

Costs

Operating costs

Operating cost estimates for mining have been prepared by the consultant Orelogy, through a competitive bid process. Contract mining has been selected as the basis for all the open-pit mining activities managed by Centamin's operation team. Cost estimates for processing and general and administration (G&A) costs were prepared by Lycopodium with input from Centamin. Key input costs used are a delivered diesel price of $1 per litre, and power costs of 11.3 cents/kilowatt-hour, down from the PEA cost of 15.9 cents/kwh due to the ability to utilize grid power versus on-site power generation.

Capital costs:

• Total upfront construction capital costs of $349-million (U.S.), including $34-million (U.S.) in contingency;
• LOM sustaining capital costs of $110-million (U.S.), including closure costs.

The attached table is an estimate of the initial construction capex prepared by Lycopodium and Knight Piesold. Centamin provided the owner project cost.

The attached table is an estimate of continuing capital commitments to sustain operations over the LOM, as well as closure and rehabilitation costs. It uses input from Knight Piesold as well as closure estimates based on similar operations.

Ownership, permitting, taxes and royalties:

• Financial modelling based on current Ivorian mining code and tax regime;
• Sliding scale royalties between 3 per cent and 6 per cent depending on the gold price;
• Social development fund royalty of 0.5 per cent.

The Doropo project is contained within the current exploration permits that were granted to Centamin's 100-per-cent-owned subsidiaries, Ampella Mining Cote d'Ivoire and Ampella Mining Exploration Cote d'Ivoire.

Under the current Ivorian mining code, mining permits are subject to a 10-per-cent government free-carry ownership interest. However, for the purpose of the PFS project evaluation and disclosures included within this document, the cash flow model is reflected on a 100-per-cent project basis.

The financial model has assumed the corporate tax (CIT) rate of 25 per cent for the LOM, adjusted for a 75-per-cent rebate on CIT for the first commercial year of production and 50-per-cent rebate on CIT for the second year of commercial production, as per the mining code. The full 25-per-cent CIT rate is applied thereafter. The project benefits from a value-added tax (VAT) and import duties exemption during the construction phase and until first production.

Royalties are applied to gross sales revenue, after deductions for transport and refining costs and penalties on a sliding scale depending on gold price.

The project will support local development through the payment of a social fund royalty of 0.5 per cent of gross sales revenue.

Project timeline:

• Submit mining licence application by the middle of 2024;
• Final commissioning two years from final investment decision.

Next steps

The company completed a high level of detailed work during the PFS stage, to derisk and expedite the delivery of the DFS and meet the mining licence application deadline.

The 2023 Doropo budget remains unchanged and on track at $23-million (U.S.), of which $13.2-million (U.S.) has been spent year to May 31, 2023, primarily on drilling and ESIA baseline study work.

DFS work programs are under way:

• Drilling: To take advantage of the favourable drilling conditions during the dry season, the DFS drilling program was prioritized and is 94 per cent complete. To date 64,922 metres have been drilled, costing $6.1-million (U.S.):
  • 39,649 metres of reverse circulation (RC) resource infill drilling;
  • 4,096 metres of diamond drill (DD) resource infill drilling;
  • 14,708 metres of RC grade control drilling;
  • 5,650 metres of DD metallurgical drilling;
  • 818 metres of DD geotechnical drilling;
  • The remaining 4,000 to 4,500 metres of drilling to do will be split between some geotechnical drilling, and infill and twin hole drilling at the Vako and Sanboyoro deposits.
• ESIA: Data collection for the ESIA and RAP is under way, including and not limited to extensive public consultation with Centamin's local stakeholders. Completion of the draft report is targeted by the end of 2023 for submission to the Ivorian authorities for approval and permitting.
• Desktop and laboratory work programs, including but not limited to, metallurgical test work to establish grade recovery curves and optimize reagent consumption. Continued geological and hydrological work such as structural interpretation and domaining, refining lithology models, groundwater modelling, and geotechnical testing of the main lithologies.

Project upside opportunities:

• Resource upgrade: There are inferred mineral resources situated both outside and within the current pit shells. With additional drilling and metallurgical test work, these resources could support conversion of some of the material into indicated mineral resources which can then be converted into reserves for evaluation and inclusion in the DFS:
  • Potential extensions to mineralization at the Han, Kekeda and Atirre deposits within the main resource cluster;
  • Potential at depth where the Souwa mineralized structure (which dips northwest) intersects the trending Nokpa mineralized zone.
• Additional mineralization from target areas, systematic surface exploration work has identified multiple exploration targets (gold-in-soil/auger anomalies) across the project footprint. Some targets have been drill tested and warrant further development work, whilst others remain untested. These have the potential to provide resource growth which could be supported by a mineral resource estimation and provide upside potential to the current mine life. Some of the drilling results could be incorporated in the DFS resource update; otherwise, further brownfields exploration will be undertaken during the life of mine:
  • At Kilosegui, mineralization remains open along strike in both directions from the mineral resource area, indicated by gold-in-soil and sample auger geochemical anomalies. In addition, there is a second short parallel structure evident from soil and auger sampling on the south side of the Kilosegui resource area;
  • Untested soil anomalies in the Vako-Sanboyoro area 10 to 15 km west of the main resource cluster;
  • Untested soil anomalies to the north and to the south of the main resource cluster.
• Operational cost-saving opportunities:
  • Further pit optimization and evaluation of owner-mining, instead of contract-mining, given the company's extensive operating experience at the Sukari gold mine in Egypt;
  • Further processing optimization, including evaluation of the comminution parameters and reagent consumption.
• Construction cost-saving opportunities by increasing in-house project execution versus the use of engineering, procurement and construction management contractors.
• Environmental and social opportunities to minimize the requirement for physical community resettlement through the DFS and ESIA workstreams.

Qualified persons

A qualified person is as defined by the National Instrument 43-101 of the Canadian Securities Administrators. The named qualified person(s) have verified the data disclosed, including sampling, analytical and test data underlying the information or opinions contained in this announcement in accordance with standards appropriate to their qualifications. Each qualified person consents to the inclusion of the information in this document in the form and context in which it appears.

Information of a scientific or technical nature in this document, including but not limited to the mineral resource estimates, was prepared by and under the supervision of the Centamin qualified persons, Howard Bills, Centamin group exploration manager, and Craig Barker, Centamin group mineral resource manager, in addition to the independent qualified persons noted herein.

The attached table includes the respective independent qualified persons, who have the sign-off responsibilities of the final NI 43-101 technical report. All are experts in their relevant disciplines who fulfill the requirements of being a qualified person under the CIM definition standards.

Independent technical consultants

The attached table includes the consultant companies that contributed to the Centamin PFS report.

About Centamin PLC

Centamin is an established gold producer, with premium listings on the London Stock Exchange and Toronto Stock Exchange. The company's flagship asset is the Sukari gold mine, Egypt's largest and first modern gold mine, as well as one of the world's largest producing mines. Since production began in 2009 Sukari has produced over five million ounces of gold, and today has six Moz in gold mineral reserves. Through its large portfolio of exploration assets in Egypt and Ivory Coast, Centamin is advancing an active pipeline of future growth prospects, including the Doropo project in Ivory Coast, and has over 3,000 square km of highly prospective exploration ground in Egypt's Nubian Shield.

We seek Safe Harbor.