Q2 2024 Production Results and Operational Highlights

Serabi Gold plc (“Serabi” or the “Company”) (AIM: SRB, TSX: SBI), is pleased to announce the Company’s second quarter production results and operating highlights for FY2024. (All financial amounts are expressed in U.S. dollars unless otherwise indicated).

QUARTER HIGHLIGHTS

Q2-2024 gold production of 9,003 ounces; a 6% improvement on Q2-2023.

Coringa contributed 4,752 ounces of gold production at plant grades of 6.25 g/t gold.

Palito plant processed a record quarterly total of over 55,000 tonnes of ore.

Cash held on 30 June was $12.0 million vs cash held on 31 December 2023 of $11.6 million.

Net cash balance at the end of Q2-2024 (after interest bearing loans and lease liabilities) of $6.6m (31 December 2023: net cash $5.0 million)

Construction of the classification plant (crusher and ore sorter) is well underway at Coringa, with the crusher expected to be operational in August while the ore sorter remains on track to being operational by the start of Q4.

NCL Ingeniería y Construcción SpA of Santiago de Chile (“NCL”) continue to progress the updated Preliminary Economic Study (PEA) at Coringa, which will incorporate a revised geological resource, and economic study outlining the planned use of the classification plant and process at the Palito Complex.

The Company is reiterating FY2024 consolidated gold production guidance of 38,000 – 40,000 ounces.

An interview with Mike Hodgson, CEO by Crux Investor can be accessed using the following link : https://youtu.be/pVvRVh6Eu94

Mike Hodgson, CEO of Serabi, commented:

“The mid-year position looks very positive after a second consecutive quarter exceeding 9,000 ounces which is both very satisfactory and maintains us in line with guidance. The process plant continued to perform admirably with a quarterly record of over 55,000 milled tonnes. Mine output exceeded 59,000 tonnes, which was also the highest ROM total in 3 years.

Taking Coringa first, the operation continued to contribute significantly with 4,752 ounces reported. With mining now on levels 320m, 290m and 260m, development continues on levels 260m, 225m and 195m. The main ramp will reach level 165m in July so Serabi will have four development levels ahead of production. The significant development we have completed to date places Coringa in a very healthy position for future production expansion.

This development ahead of production is made all the easier by the high (approximately 90%) payability of the Serra orebody. Simply put, this means the conversion of inferred resources into reserves is a remarkable 90%.

The classification plant being assembled at Coringa is progressing as planned and we expect it operational by Q4. The Company’s plans to pre-concentrate mined ore at the Coringa mine site and truck a preconcentrated product to the Palito plant, 200km to the north, will be formally documented in the forthcoming Preliminary Economic Assessment (“PEA”) which is underway by NCL. The NI 43-101 compliant Technical Report will incorporate the revised geological resource and economic study including projected operating costs considering the planned use of the classification plant and processing at the Palito Complex.

At Palito, the mine has seen excellent mined tonnages but grades have been below forecast. As noted in our Q1 Operational Update (news release dated 17 April 2024), one particular area in the Chico da Santa sector required a move to a more mechanised bulk method on safety grounds resulting in higher tonnages at lower grades due to unavoidable dilution. I am pleased to say we are working our way through the problems and seeing a return to selective mining with each successive month. The process plant performance has been exceptional with over 55,000 tonnes milled during the quarter equivalent to 600 tonnes per day, and we have now had a consistent six months of throughput at these new record levels.

We are tracking well towards guidance, and with the classification plant progressing according to plan at Coringa I am optimistic for the second half of 2024. We look forward to the forthcoming PEA for Coringa during Q3 and seeing the ore sorter operational in Q4.”

SUMMARY PRODUCTION STATISTICS FOR 2024 AND 2023

• The table may not sum due to rounding.
• Production numbers are subject to change pending final assay analysis from refineries.

OPERATIONAL RESULTS

Total production for the second quarter was 9,003 ounces, 4,251 ounces from Palito Complex and 4,752 ounces from Coringa.

Total ore mined from the Palito Complex during the quarter was 30,488 tonnes at 4.52 g/t compared to 36,471 tonnes at 4.72 g/t of gold for the first quarter of 2024. 29,076 tonnes at 5.62 g/t were mined from Coringa compared with 19,825 tonnes at 6.39 g/t for the first quarter of 2024. Five levels are now being worked at Coringa from level 340m to level 195m. The main ramp is expected to reach the next development level, 165m by the end of July.

The Palito Complex process plant treated 55,192 tonnes of ROM ore during the quarter, with an average grade of 5.31 g/t of gold, compared with 54,521 tonnes at 5.38 g/t in the first quarter of 2024. This included 24,441 tonnes of Coringa ore at a feed grade of 6.25 g/t.

A total of 3,481 metres of horizontal development has been completed across the Palito Complex and Coringa. 2,252 metres of horizontal development were recorded at Palito Complex, of which 1,647 metres were ore development. The balance is the ramp, crosscuts and stope preparation development. Horizontal development at Coringa totalled 1,229 metres, of which 679 metres were in ore.

The Coringa orebody continues to perform very well, with the uppermost levels 320m, 290m and 260m in production and development. Of the lower levels 225m is fully developed with level 195m in active development. The main ramp will intersect level 165m next month. As a result, Coringa now has close to two full levels developed ahead of stoping, and with a third about to commence next month this is a very strong position.

The Palito Complex processed the highest volume since 2021, however grades were below budget. This was due to the lower than planned mined grades coming from the bulk mining of the Chico da Santa (CDS) sector. The switch to mechanised bulk mining from more selective mining had to be made on safety grounds. Bulk mining is where non-entry long hole open stoping is used as opposed to the very proven selective open stoping method. The difference is the workers do not enter the mining area. The CDS zone was considered too wide to use selective open stoping, and on safety grounds bulk mining has been adopted the past 4 months. Even with extensive cable bolting to support the sidewalls, excessive dilution is a consequence, resulting in greater volume and lower, though still viable grades.

Palito grades have improved in May and June, and we anticipate Palito grades to return to the 6-7g/t Au range seen in the first 9 months of 2023.

CORINGA LICENCING

As reported last quarter, in January 2024, the Company received the renewal of the GUIA trial mining license, for a period of three years and it is under the GUIA license that Coringa is operating. With respect to progress on the Installation License (LI), the Company along with its environmental consultancy, Araca, have now completed the Plano Basico Ambiental (PBA), and this study has been incorporated into the Indigenous Impact Report (ECI) and was submitted to FUNAI (the federal agency for indigenous communities) during the quarter for approval.

FINANCE UPDATE

Cash balances at the end of June 2024 were $12.0 million, in comparison to the cash balances at the end of March 2024 of $11.1 million. On 7 January 2024, the Group completed a $5.0 million unsecured loan arrangement with Itau Bank in Brazil. The loan is repayable as a bullet payment on 6 January 2025 and carries an interest coupon of 8.47 per cent. The proceeds raised from the loan are being used for working capital and secure adequate liquidity to repay a similar arrangement which was repaid on 22 February 2024. The Company had a net cash balance at the end of Q2-2024 (after interest bearing loans and lease liabilities) of $6.6m (31 December 2023: net cash $5.0 million)

FY2024 PRODUCTION GUIDANCE

The Company continues to estimate FY2024 consolidated gold production of 38,000 – 40,000 ounces.

Assay Results

Assay results reported within this release include those provided by the Company's own on-site laboratory facilities at Palito and have not yet been independently verified. Serabi closely monitors the performance of its own facility against results from independent laboratory analysis for quality control purpose. As a matter of normal practice, the Company sends duplicate samples derived from a variety of the Company's activities to accredited laboratory facilities for independent verification. Since mid-2019, over 10,000 exploration drill core samples have been assayed at both the Palito laboratory and certified external laboratory, in most cases the ALS laboratory in Belo Horizonte, Brazil. When comparing significant assays with grades exceeding 1 g/t gold, comparison between Palito versus external results record an average over-estimation by the Palito laboratory of 6.7% over this period. Based on the results of this work, the Company's management are satisfied that the Company's own facility shows sufficiently good correlation with independent laboratory facilities for exploration drill samples. The Company would expect that in the preparation of any future independent Reserve/Resource statement undertaken in compliance with a recognized standard, the independent authors of such a statement would not use Palito assay results without sufficient duplicates from an appropriately certificated laboratory.

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