Verkhuba Joint Venture Update

In brief · summary, not quotable

East Star Resources Plc has provided an update on its Verkhuba project, confirming the establishment of Verkhuba Limited as the joint venture company and the initial receipt of A$500,000 from Hong Kong Xinhai Mining Services Ltd, with the licence transfer underway. Xinhai is committed to an estimated US$65 million investment to develop the Verkhuba Copper Deposit, which holds a JORC Inferred Resource of 20.3Mt @ 1.16% copper, 1.54% zinc, and 0.27% lead, with East Star fully carried to production and retaining 30% ownership. Drilling is set to commence in June 2026, with approximately 5,000 metres planned to support resource definition and feasibility studies.

Full announcement

Select text to share a quote on X · sign in to keep highlights & notes in your EST notes

East Star Resources Plc (LSE: EST), the Kazakhstan-focused gold and copper exploration and development company, is pleased to provide an update on the Verkhuba project and Joint Venture Agreement ("JVA") with Hong Kong Xinhai Mining Services Ltd ("Xinhai").

As announced on 19 March 2026, a JVA was formalised (in Yantai, China), pursuant to which Xinhai will farm into the Verkhuba Copper Deposit ("Verkhuba") to accelerate the development of Verkhuba into production. Xinhai's estimated investment is approximately US$65 million, with East Star fully carried to production, at which point it will hold 30% of the producing mine with a current JORC Inferred Resource of 20.3Mt @ 1.16% copper, 1.54% zinc and 0.27% lead.

The operations and administration of the Joint Venture ("JV") are progressing well as both companies work towards preparing for feasibility studies and the mining licence application.

Highlights

Verkhuba Limited has been established at the Astana International Financial Centre ("AIFC") as the JV company responsible for the development of Verkhuba
Xinhai has completed part of the first funding milestone under the JVA, transferring A$500,000 to Verkhuba Limited
The transfer of Licence 1795, which incorporates the Verkhuba Copper Deposit, into Verkhuba Limited is underway
A drilling contract has been executed and drilling rigs have been mobilised to site
Initial site works are underway including drill pad preparation, expanding the core logging facilities and submitting designs for an on-site assay lab
Approximately 5,000 metres of drilling is planned to support resource definition, mine planning and feasibility studies, and is expected to commence in June 2026
Discussions regarding land acquisition and long-term project infrastructure requirements have begun

Alex Walker, CEO of East Star, commented:

"We are pleased with the speed at which the project has progressed following execution of the Joint Venture Agreement. The establishment of Verkhuba Limited, transfer of the initial funding and mobilisation of drilling contractors represent important milestones as we move from transaction execution into project delivery.

The commencement of drilling will mark the first major technical work programme under the joint venture and is expected to provide valuable data for resource optimisation, mine design and future feasibility studies."

Joint Venture Progress

Following the execution of the JVA, East Star established Verkhuba Limited at the AIFC in accordance with the terms of the agreement.

The first funding milestone under the agreement has been partially satisfied, with Xinhai transferring A$500,000 to Verkhuba Limited to commence the planned resource definition and development work programme. It is expected that the remainder of the funds will be transferred as required by the budget and completing after Licence 1795 has been transferred to Verkhuba Limited.

Operational activities have also commenced. A drilling contract has been executed, and drilling equipment has been mobilised to site. Site preparation works are underway, and drilling is expected to commence in June 2026, estimated to comprise approximately 5,000 metres of diamond drilling. The drilling programme is intended to support resource conversion, geological modelling, mine planning and feasibility study activities.

In parallel with the drilling programme, the JV parties continue to advance discussions relating to land acquisition and other infrastructure requirements necessary to support the future development of the project.

Further updates will be provided as additional milestones are achieved.

To watch a video of Alex Walker discussing this announcement, visit: https://eaststarplc.com/link/yEvNGe

LinkedIn: https://www.linkedin.com/company/east-star-resources/

X: https://x.com/EastStar_PLC

Engage with us by asking questions, watching video summaries and seeing what other shareholders have to say. Navigate to our interactive Investor Hub here: https://eaststarplc.com/link/yEvNGe

Subscribe to our news alert service: https://eaststarplc.com/regulatory-news

About Hong Kong Xinhai Mining Services Limited

The person who arranged for the release of this announcement was Alex Walker, CEO of the Company.

Cleaned text: letterheads, contacts and legal notices removed. View the original announcement ↗ · Company filings. Not investment advice.