30 June 2022

Arc Minerals Ltd

('Arc Minerals' or the 'Company')

Annual Report - December 2021

Arc Minerals Limited announces its audited results for the year ended 31 December 2021 (the "Annual Report") which is available to view at the following link: http://www.rns-pdf.londonstockexchange.com/rns/8870Q_1-2022-6-30.pdf and will be made available on the Company's website at http://www.arcminerals.com/investors/document-library/default.aspx. The Chairman's Statement and primary financial statements are set out below. The Annual Report will be sent today to any shareholders who have requested a printed or electronic copy.

Notice of the Company's Annual General Meeting will be announced in due course.

Market Abuse Regulation (MAR) Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

Forward-looking Statements

This news release contains forward-looking statements that are based on the Company's current expectations and estimates. Forward-looking statements are frequently characterised by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "suggest", "indicate" and other similar words or statements that certain events or conditions "may" or "will" occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Such factors include, among others: the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; possible variations in ore grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing; and fluctuations in metal prices. There may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

Shareholder consent to receive information electronically

At the Annual General Meeting of the Company held in September 2012, Shareholders approved electronic communication and dissemination of information via the Company's official website, including but not limited to Notices of General Meetings, Forms of Proxy and Annual Reports and Accounts. Shareholders are reminded that their right to request information in print remains unaffected and that they can do so by contacting the Company giving no less than 14 days' notice.

**ENDS**

Contacts

Chairman's Statement

2021 Overview

2021 was a solid year for the Company. Notable milestones included raising gross proceeds of £2 million through a placement in January 2021, acquisition of a 75% interest in the Virgo copper project in Botswana, continued exploration activities in Zambia albeit at a slower pace as a result of the COVID restrictions, continued discussions with strategic partners that culminated in a Joint Venture Transaction with Anglo American plc ("Anglo American") as a major partner for the Zambian copper and cobalt assets.

The period of uncertainty and volatility before and during the initial global pandemic lockdown dissipated and was followed by a strong rebound in global markets commencing at the end of the first lockdown in the UK and continuing throughout 2021 and into 2022. Commodity prices performed strongly due to a significant increase in demand, coupled with supply chain delays and staff shortages due to the ongoing impacts of Covid-19.

At Arc Minerals, we moved quickly to ensure that business activities were managed and conducted in a manner which continued to provide a safe working environment and enable continuity of operations. Our health and safety policies and procedures were all updated for covid management, including PPE requirements, protocols for testing, isolating and medical treatment and working from home requirements. Staff and contractors were provided with appropriate training and all personal visiting and operating on our sites were updated on the covid protocols as part of health and safety inductions.

Government imposed lockdowns and extensive travel restrictions resulted in many businesses and government departments working at reduced capacity, remotely or from home. The onset of Covid-19 impacted a number of our staff and contractors and certain work was delayed due to travel restrictions. Despite these challenges our team continued to make good progress on project activities and discussions with potential strategic partners.

In January 2021, the company secured Hargreave Hale Ltd as a significant shareholder on its register following a successful £2 million placing which was well supported by existing as well as new shareholders.

In May 2021, we engaged Rothschild & Co as a financial advisor in respect of an anticipated transaction on our copper and cobalt assets. We also continued to work on restructuring our Zambian entities to optimise the corporate structure for an anticipated transaction.

During the year, the company carried out exploratory diamond drilling activities at both the Fwiji and Cheyeza targets in Zambia. At Fwiji, drilling tested a coninident magnetic and soil anomaly 2.5km southwest of the previous years drilling, with the last hole drilled intersecting copper sulphide mineralisation in quartz veins and associated wall rock alteration.

At Cheyeza East, further drilling was carried out 500m to the northwest of the previous year's oxide drilling campaign. The programme was designed test an anomalous structural feature, with one of the holes intersecting a zone of massive and disseminated sulphide mineralisation.

In October, the Company flew a high resolution (50m line spacing) airborne magnetic and radiometric survey away with c.5,000 line kilometres flown over the Cheyeza, Muswema and Lumbeta target areas. The survey has resulted in a new and simplified mineralisation model that opens over 20km of strike length for focussed exploration in lower stratigraphy.

In November,  Arc acquired a 75% interest in the Virgo copper project in Namibia from Kopore Metals Limited. The Virgo project is located in a emerging copper district in the Kalahari district in close proximity of some larger discoveries.  As Arc focuses on identifying early stage opportunities that can become world-class operations, this acquisition is a very exciting opportunity for the group  and we are looking forward to reporting on the developments on this exciting exploration asset.

Anglo American transaction

During the period, Arc continued to progress its joint venture discussions with Anglo American plc in respect to its copper and cobalt projects. In May 2022, the Company announced that it has signed a Letter Agreement with Anglo American whereby Anglo American will have the right to retain a 70% ownership in the Joint Venture company for an aggregate investment by Anglo American of up to USD 88.5 million including cash consideration of up to USD 14.5 million. This transaction is subject to regulatory and shareholder approval but this transaction is a major validation of our geological modelling and work to date and now paves the way for the execution of a comprehensive exploration and development programme which will unlock significant value for the group.

Casa transaction

In 2020, Arc entered into a sale and purchase agreement with Golden Square Equity Partners Limited ("Golden Square") for the sale of its interest in Casa Mining Limited ("Casa") which has a 73.84% stake in the Misisi gold claims in the Democratic Republic of Congo ("DRC"). Despite Golden Square's best efforts, they failed to raise the funds for the acquisition and were subsequently replaced by Regency Mining Limited ("Regency"). As announced on 29 April 2022, Arc concluded a transaction for its interest in Casa and accepted 3 million shares in Tingo Inc. (OTC:TMNA) in settlement of the USD 5 million loan note.

Governance

At a corporate level, we bolstered the board with the appointment of Mr Valentine Chitalu. Mr Chitalu is a prominent entrepreneur in Zambia and southern Africa specialising in private equity and local private sector development. He is the co-founder and Chairman of Phatisa Group, a private equity fund manager in Sub-Saharan Africa, and has previously worked for the CDC Group in London and Lusaka. Mr Chitalu already brings invaluable insights to the group and we look forward to his advise as the group grows.

In addition the company has continued to strengthen its technical team in Zambia and Botswana and will continue to do so throughout 2022 as the company progresses its exploration assets.

Sustainability

From an ESG perspective, I am proud to report that the Company continued with its local outreach programme to support a number of communities in Zambia and we will continue to increase our levels of community engagement as the copper and cobalt assets develop in 2022 and beyond.

Outlook

At the time of writing this report, it appears that the worst of the global pandemic is behind us, many of the major economies have committed to large infrastructure development programmes focussed on decarbonisation and the transition to renewable energy and electrification of transport.

The COP26 conference held in Glasgow in November 2021, again underlined the importance of energy transition minerals as more and more countries aim to achieve net zero by 2050. This enormous task will continue to add pressure on the mining industry to deliver the critical minerals required for the build out of renewable energy generation and distribution infrastructure.

Copper is expected to be a major beneficiary of these policies as the energy transition will require significant additional copper supply over and above the current baseload requirements. This anticipated uplift in demand comes at a time when supply is likely to be constrained due to prolonged underinvestment in exploration and new mine development. Most market analysts suggest the gap between supply and demand is widening and are expecting a prolonged period of strong prices.

Existing copper producers will inevitability need to replace or replenish dwindling reserves and the level of exploration and M&A activity in the sector is expected to increase to meet this objective. With  its portfolio of copper assets, Arc Minerals is well positioned to benefit from a sustained strong outlook for copper.

Also during period, Zambia elected President Hakainde Hichilema whose new government has made the commitment to become Africa's largest copper producer by 2025. To date his new government has attracted significant investment into the mining sector and is expected to continue to do so in the coming years.

Acknowledgements

I would like to extend my gratitude to our shareholders for their continued support over the past year and look forward to reporting further on our progress during 2022.

As a final note, I would like to thank our employees, consultants and contractors for their continued hard work and express my sincere thanks to all our stakeholders in Zambia, Botswana and internationally for their support throughout the year. It is much appreciated.

Nicholas von Schirnding

Executive Chairman

30 June 2022

Consolidated Statement of Comprehensive Income for the year ended 31 December 2021

Consolidated Statement of Financial Position as at 31 December 2021

These financial statements were approved by the Board of Directors on 30 June 2022 and signed on its behalf by:

Consolidated Statement of Cash Flows for the period ended
31 December 2021

In 2020, the major non-cash transactions were shares issued in lieu of payment under the drill for equity programme