Amitsoq Update

GreenRoc Strategic Materials plc (AIM: GROC), a company focused on the development of critical mineral projects in Greenland, is pleased to announce significant improvements to its previously published Preliminary Feasibility Study (the "Feasibility Study") regarding the establishment of a downstream plant to produce graphite active anode material from graphite concentrate produced from the Company's planned graphite mine at Amitsoq, South Greenland.

In its RNS of 7 May 2024 announcing the results of the Feasibility Study, the Company flagged that further improvements to process design would be investigated in a second stage, commencing shortly. Those further investigations are now complete.

These updates to the existing Feasibility Study were carried out by SLR Consulting Ltd ("SLR"), an independent UK consulting firm with considerable global expertise in the field of mining and mineral processing and the original author of the Feasibility Study, and were completed with a cost accuracy to AACE Class 4 ("AACE Class 4 Estimate"). As previously announced, the Feasibility Study was supported by a ca. £250k grant from Innovate UK's Automotive Transformation Fund.

Highlights

• Improvements to process design, notably surrounding onsite production of nitrogen and de-ionised water, have resulted in:

o relatively modest (~6 per cent) overall increase in Capex from US$321M to US$340M (AACE Class 4 Estimate);

o significant (~18 per cent) decrease in Opex from US$2,211 to US$1,872 per tonne of coated spherical purified graphite ("CSPG"); and

o an overall ~14 per cent increase in after-tax NPV8 for anode plant from US$545M to US$621M and increase in IRR from 25.3% to 26.5%.

• Updated Feasibility Study has also assessed an alternative, alkaline purification method using sodium hydroxide (NaOH) instead of hydrofluoric acid ("HF") with the following preliminary results:

o Capex higher at US$395M (Cf. US$340M for HF method);

o However Opex lower at US$1,662 per tonne (Cf. US$1,872 per tonne for HF method).

o Further test work will be undertaken to further refine the NaOH method.

GreenRoc's CEO, Stefan Bernstein, commented:

"I am very pleased with the outcome of the updated Feasibility Study. The technical improvements made have not only resulted in a significant improvement in the after-tax NPV of some US$76M or ca 14% but some of the modifications made, in particular in respect of the onsite production of key consumables like nitrogen and de-ionised water, will also make our project more robust and self-sufficient.

"It is also good to see that a more environmentally friendly alkaline purification method can be used without compromising the existing and very positive business case for our future anode plant. Over the coming time, we will conduct further work in the lab to refine the alkaline purification method."

Preliminary Feasibility Study ("FS") Update - Comparison Table

¹ AACE Class 4 Estimate

The results set out above, both for the Feasibility Study announced on 7 May 2024 and for the updated Feasibility Study announced today, are based on the industry-standard hydrofluoric acid purification ("HF Method"). As mentioned above, an alternative purification methodology using sodium hydroxide ("NaOH Method") has also been assessed, however further test work is required.

While the overall concepts and processes set out in the initial Feasibility Study published by the Company on 7 May 2024 are unchanged, this updated study incorporates a series of improvements. The most important of these are the onsite production of de-ionised water and the construction of a plant for the production of nitrogen. While these modifications result in an overall increase in Capex from US$321M (May 2024) to US$340M (July 2024), they also result in a significant decrease in Opex from US$2,211 (May 2024) to US$1,872 (July 2024) per tonne of CSPG. Consequently, the after-tax NPV8 has increased from US$545M with an IRR of 25.3% (May 2024) to US$621M with an IRR of 26.5% (July 2024).

Nitrogen is used in the final stages of CSPG processing when the newly coated spherical purified graphite is baked at up to 1,300°C in an oxygen-free, inert atmosphere. The incorporation of onsite plants for both nitrogen generation and de-ionised water will not only provide considerable cost savings during production but will also serve to make the anode plant less reliant on price fluctuations and on the delivery of these key consumables.

The updated Feasibility Study also assesses the use of an alternative purification method using sodium hydroxide (NaOH) instead of the very efficient, but more hazardous and expensive, hydrofluoric acid. The NaOH purification technique employs a process involving a two-stage 'cold-baking' of the CSPG in NaOH at 250-300°C with subsequent leaching using hydrochloric and/or sulphuric acid. As the NaOH Method requires two stages, rather than the one stage required in the HF Method, the Capex required is higher at US$395M compared to US$340M for the HF Method. However, the Opex is significantly lower at US$1,662 per tonne compared to US$1,872 per tonne for the HF Method. The overall after-tax NPV8 for the NaOH Method is US$601M with an IRR of 23.7%. These figures are purely indicative at this stage and subject to further test work, which will be conducted in due course, to refine the alkaline purification method.

The next milestone with regard to the CSPG production plant is identifying the preferred site for the plant and setting up a pilot-scale processing plant in order to be able to commence the qualification process with potential customers, leading to the signing of off-take agreements with key participants in the global battery industry.

Key Points about Amitsoq, GreenRoc's Flagship Asset

• The Amitsoq Island Deposit has a total inferred, indicated and measured JORC Resource of 23.05 million tonnes (Mt) at an average grade of 20.41% Graphitic Carbon ("C(g)"), giving a total graphite content of 4.71 Mt. This makes Amitsoq one of the highest-grade graphite projects in the world.
• In GreenRoc's test work programmes:
• Amitsoq spheronised graphite has achieved higher than 99.95% purity with relatively little energy input and processing and using a milder alkaline purification method compared to the industry standard hydrofluoric acid, boding well for future production costs and sustainability commitments.
• The results of a Preliminary Economic Assessment (or PEA) for Amitsoq released on 31 October 2023 give a post-tax NPV8 for the Project of US$179M, an IRR of 26.7% and capex estimated at US$131M (including a 25% contingency). These figures solely relate to the economics of a mining and primary processing operation in South Greenland and do not take into account any potential upside from a downstream processing operation which GreenRoc intends to establish in Europe or the USA.
• In relation to that downstream business, GreenRoc has now completed a Feasibility Study (reported herein and in RNS of May 7, 2024) into the establishment of a graphite spheronisation processing plant to produce cSPG from graphite concentrate delivered from Amitsoq. This Feasibility Study, has been part-financed by a grant of approximately £250,000 from the UK's Automotive Transformation Fund.
• The Company recently received a Letter of Interest from the US EXIM Bank with an indication to finance up to US$ 3.5M of the Company's work program on the Amitsoq mine and the downstream cSPG plant (see RNS of April 15, 2024).