Giyani Announces the Results of its Feasibility Study for the K.Hill Battery-Grade Manganese Project

Post-tax NPV at 8% of US$481M, IRR of 28%

Highlights:

• Robust economic returns: a post-tax net present value (“NPV”), at an 8% discount rate, of US$481M (C$649M) and a post-tax internal rate of return (“IRR”) of 28%
• Low capital intensity for what will be one of the largest HPMSM projects in the world: estimated initial capital expenditure of US$281M (C$379M), including contingency of US$32M (C$43M), for a fully integrated battery raw materials project
• Strong free cash flow: net free cash flow over the life of the Project is estimated at US$1,093M (C$1,476M), equivalent to US$99M (C$134M) per year with first commercial production in 2025
• Significant geological upside offers potential to expand Project and extend mine life: exploration work to upgrade the 3.1 Mt of Inferred Resources in the K.Hill southerly extension is progressing and the addition of these resources and the Otse prospect provides the potential to expand the Project in future years and extend the mine life significantly
• Operational advantage of higher grade ore and conventional mining: Giyani’s Probable Reserve grade of 18.9% manganese oxide (“MnO”) is the highest among its listed battery-grade manganese peers and underpins a scalable operation with an initial throughput of 200 thousand tonnes (“kt”) ore production per annum, offering potential future production capacity expansion
• LI Battery demand expected to increase significantly: CPM Group LLC (“CPM”), an independent research and consultancy company, projects demand for HPMSM in LI Batteries to grow by nearly 30 times between 2021 and 2036
• Pathway to becoming a low-carbon producer: Giyani’s HPMSM production process directly from manganese oxide ore does not require power-intensive calcining or electrorefining and the planned integration of 4.5 MW of solar power contributes to a very competitive Scope 1 and 2 emissions footprint of only 1.4 kg of carbon dioxide equivalent per kilogram of HPMSM (see Giyani News Release of September 29, 2022)
• Strong environmental, social and governance (“ESG”) credentials: the Project’s development strategy has been formulated around the mitigation hierarchy of “avoid -minimize-mitigate” with initiatives such as renewable energy integration, water self-sufficiency and dry stack tailings management to be included in the Environmental and Social Impact Assessment (“ ESIA”), currently estimated to be completed and submitted to the authorities in Botswana in Q1 2023
• Optimization work opens opportunities for enhancing Project value: in addition to potential life of project (“LOP”) extensions through further exploration success, work is ongoing to lower operating costs, particularly related to certain consumables affected by supply chain disruption and global inflation