Mr. Andrew Dinning reports

FORMAL COMMENCEMENT OF INTERNATIONAL ARBITRATION PROCEEDINGS FOR SIGNIFICANT DAMAGES CLAIM

Sarama Resources Ltd. has formally commenced arbitration proceedings against the State of Burkina Faso in relation to a dispute concerning the expropriation of the company's Sanutura project (refer to news release dated Sept. 5, 2023).

The company will seek full compensation for the loss and damages the company has suffered as a result of certain acts and omissions by the government of Burkina Faso. Based on a preliminary estimate, the company will be seeking damages of no less than $180-million (Australian) and as the arbitration proceeds, the company expects to appoint a quantum expert who will prepare a professional damages assessment for review by the arbitration tribunal.

Following the establishment of a non-recourse litigation financing facility of $6.7-million (Australian) (refer to news release dated Oct. 24, 2024), the company has submitted a request for arbitration (RFA) to the International Centre for Investment Disputes (ICSID), a division of the World Bank Group. The submission of the RFA setting out the preliminary details of the case and addressing certain procedural matters marks the formal commencement of the arbitration process.

The company's arbitration claim will be pursued according to the established and enforceable legal framework of ICSID which has heard numerous investor-state disputes, including recent proceedings brought by Indiana Resources (ASX: IDA) and GreenX Metals (ASX:GRX) which resulted in awards in favour of the claimants of $180-million (Australian) and $490-million (Australian), respectively.

The submission of the RFA follows the prior issuance of a notice of intent to submit claims to arbitration to the government of Burkina Faso (refer to news release dated Nov. 30, 2024), which initiated a 60-day consultation period between the parties to amicably resolve the dispute. Despite the company's best efforts, the government of Burkina Faso neglected to respond and no settlement was reached, leaving Sarama with no alternative but to initiate international arbitration proceedings.

The company has engaged Boies Schiller Flexner (UK) LLP (BSF), a leading international law firm, to assist with legal matters pertaining to the dispute (refer to news release dated Oct. 17, 2023). BSF is an internationally recognized dispute resolution law firm with extensive experience representing investors in international investment arbitrations in the mining and natural resources sectors worldwide.

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