Kieshöhe Project Update

Kendrick Resources PLC the mineral exploration and development company which via its Bonya rare earths project has a 70% interest in both EPL 6691 ("Teufelskuppe" or "TK")) and EPL 4458 (" Kieshöhe" or "KH") is pleased to provide an exploration and resource development update for the Kieshöhe project, located in southern Namibia, approximately 40km west of the settlement of Aus and 60km east of the major coastal port of Lüderitz.

The drilling programme planned for the two carbonatite complexes of Kieshöhe and Teufelskuppe has commenced. A second drill rig is being sourced to facilitate drilling at both sites simultaneously. At Kieshöhe, extensive trenching of more than 2,500m combined length is being sampled. Evidence of mineralised breccia between high-grade carbonatite cone sheets is under investigation at Kieshöhe and will be trenched, channel and bulk sampled for both grade assessment and ore sorting sighter test work. The Kieshöhe programme has been designed to provide sufficient information to facilitate a mineral resource estimate.

Kieshöhe samples have been submitted to an independent international specialist facility for detailed petrological studies with an emphasis on the provision of data and guidance to support the next phase of metallurgical test work optimisation and inform further exploration.

Highlights

• Assay results derived from 14 diamond drill holes (Phase I) together with channel sampling generated an average TREE grade of 1.6 wt%
• TREE abundance for whole-rock channel samples from dolomitic ferrocarbonatite outcrop and xenolith-free core sections shows an average grade of 2.0 wt %.
• High-value, super magnet rare earths neodymium (Nd) and praseodymium (Pr) provide an average contribution of 27 wt% to the rare earth pool.
• Three open pits have already been identified as potential satellite sources of ore supply to complement the high-grade expected resource from Teufelskuppe, the flagship REE project for Kendrick

Chairman, Colin Bird said: "The Kieshöhe work programme will assess the potential for the project to serve as a supporting venture to our flagship Teufelskuppe project. The extensive and diverse historical exploration at Kieshöhe has broadly defined a large REE resource at very good grades at a time when REE resources have been identified are a priority for society globally. We will now progress a detailed work programme that is centred on confirming the lateral and depth continuity of the surface geology, grade and mineral assemblage leading to a JORC (2012) Mineral Resource Estimate supported by comprehensive metallurgical test work."

Kieshöhe Project Backdrop & Exploration - Resource Development Rationale

Local Geology and Structures

The exposed portions of the Kieshöhe carbonatite complex are limited in surface expression, visible mostly as brown or yellow outcropping cone sheets, dykes and sills that intruded into the basement gneiss host rock. The outcrop covers an area of 1.3km x 0.9km and lie approximately 30km NNE of the Company's flagship REE project at Teufelskuppe. Mineralisation is like that at Teufelskuppe with the fluorcarbonates, synchysite and parisite, hosting the valuable REE resources.

Outcrop of (mostly) dolomitic and calcitic ferrocarbonatite at Kieshöhe is configured in three proximal groupings oriented SW to NE in a 2km wide corridor. They lie prominently above the surrounding sand and calcrete covered plains in the form of semi-circular arcs surrounded by carbonatite-bearing breccias. The KH geology shows three distinct structural units of sub-vertical, dipping carbonatite dykes, sills and cone sheets.

Channel and Core Sampling and Analytical Methodology

Assay results derived from fence lines of channel sampling completed across KH provided the motivation for subsequent diamond drilling.

Historical Exploration Results

The mean TREE abundance varies across the licence with peak grades of up to 10 wt% total REE. The significance of this is described in detail elsewhere (Walter et al., 2022) and is summarised below.

TREE across all whole-rock channel samples and the drill core has been reported in a scientific journal by Walter et al., 2022 (Annexes 1-3), under the three categories of: dolomitic carbonatites (#22) (1.9 wt%), calcitic carbonatites (#11) (2.1 wt%) and ankerite carbonatites (#4) (0.5 wt%) with no clear grade separation between the NE, Central and SW zones of outcrop. Overall, the combined KH carbonatite samples (channel/drill core) contained 1.6 wt% TREEs, with a peak value of 10.1 wt%, including 5 wt% cerium (Ce), 3.5 wt% lanthanum (La) and over 1.0 wt% neodymium (Nd). A notable feature of the Kieshöhe carbonatites is that the uranium concentrations are low compared to carbonatites elsewhere.

The abundances of the high commercial value super magnet metals, neodymium and praseodymium, is typically 20-35% (mean 27%) of the 1.6 wt% REE head grade but with notable outliers of 1.55 wt% Nd and 0.55 wt% Pr (both expressed as the oxides, Nd2O3 +Pr6O11) (LREO). Heavy rare earths (HREO) including those from samarium (Sm) to lutetium Lu) in the HREO sequence, but also including yttrium (Y), contribute an average 0.13 wt% across the three categories of carbonatite.

Prospects and Market Demand

The dominant rare earths in the KH complex at Kieshöhe are light elements in the order Ce>La>>Nd>Pr. The relative enrichment between the lighter cerium (Ce) and lanthanum (La), and neodymium (Nd) and praseodymium (Pr) is encouraging, especially as the principal REE-bearing structures conveniently form three adjacent groupings. These could serve as satellite sources of open-pit derived material for a central processing unit within the Teufelskuppe project area, some 30km distant and easily accessible.

Increasing global demand for specific REEs in defence systems, medical imaging, telecommunications and advanced visual displays supports the prospective value of the Kieshöhe project. A new Namibian supply of scarce rare earth elements is strategically significant, especially when aligned with the nearby Teufelskuppe initiative. REE product demand is going to increase globally and new supply streams that reduce reliance on China, the major producer and exporter of REEs, and which are located in stable, mining-friendly jurisdictions, is a recognised security target for all industrialised nations as exemplified by the EU Critical Raw Materials Act (2023).

Near Term Kieshöhe Project Advancement

Further, laboratory-scale mineral processing trials have been initiated to verify the recoverability of the key rare earths using processing technologies customary to the industry. These will recognise the specific mineralogy of the surface rocks and minerals comprising the Kieshöhe asset to ensure compatibility with that required to develop the Teufelskuppe resources.

Reference Citation

Walter, B.F., Giebel., J, Marlow, A.G., Siegfried, P.R., Marks, M., Markl, G. Palmer, M. & Kolb, J. 2022. The Kieshöhe carbonatites of southwestern Namibia - the post-magmatic role of silicate xenoliths on REE mobilisation. Communications of the Geological Survey of Namibia, 25, 1-BBBB.

Wt % = Weight Percentage