The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation ("MAR") (EU) No. 596/2014, as incorporated into UK law by the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

22 March 2022

Beowulf Mining plc

("Beowulf" or the "Company")

Kallak North Exploitation Concession Awarded

Beowulf (AIM: BEM; Spotlight: BEO), the mineral exploration and development company, is pleased to announce that its 100 per cent owned Jokkmokk Iron Mines AB ("JIMAB") has been awarded an Exploitation Concession for the Kallak North Iron Ore Project ("Kallak").

Kurt Budge, Chief Executive Officer of Beowulf, commented:

"I am grateful to the new Minister of Enterprise and Innovation for placing trust in the Company to take the Kallak project forward.  The award of the Concession is simply a long-awaited milestone on the development timeline and we now look forward to environmental permitting.

"Beowulf's ambition is to build the most sustainable mine possible. I firmly believe that there is no better country than Sweden in which to make this vision a reality, where mining can take place in balance with the environment and stakeholder interests for the benefit of wider society.

"Following our guiding principles, Beowulf seeks to build mutually respectful relations and productive partnerships with Jokkmokks Kommun, local entrepreneurs, landowners and reindeer herders. The Beowulf team is looking forward to establishing our proposed 'Task Force' with the municipality, local agencies and enterprises, to help build local capacities and to maximise local economic opportunities during Kallak's development, construction and when the mine is in operation.

"The Company remains committed to working constructively - and in good faith - with all stakeholders and engaging in meaningful dialogue.  I believe there is space for us all to be part of Jokkmokk's future, one that is sustainable, diversified and thriving. Beowulf is planning for that future.

"The Company looks forward to reviewing the full detail of the decision in due course but will naturally seek to comply with any relevant requirements in respect of minimising the mine's impact on the Sami community.

"The Company will be engaging with stakeholders in Jokkmokk on what happens next in the development of Kallak and will provide further updates to the market in due course."

About Kallak

Kallak is located approximately 40 kilometres ("km") west of Jokkmokk in the County of Norrbotten, Northern Sweden, 80 km southwest of the major iron ore mining centre of Malmberget, and approximately 120 km to the southwest of LKAB's Kiruna iron ore mine.  The first Exploration Licence for Kallak was awarded by Bergsstaten, the Mining Inspectorate of Sweden, in 2006.

Testwork on Kallak ore has produced a concentrate of 71.5 per cent iron content, which is 'market leading' among known and current future producers.  In the Kallak area, 389 million tonnes of iron mineralisation have been estimated, a potential source of high-quality iron ore for fossil-free steel making in Norrbotten for decades to come.

Kallak Iron Ore Project - Mineral Resource Estimate ("MRE") and Exploration Target Upgrade

RNS dated 25 May 2021

https://polaris.brighterir.com/public/beowulf_mining_plc/news/rns/story/x8q5k9x  

·      An additional 19 million tonnes ("Mt") of iron mineralisation equating to a 12.5 per cent increase in the resource.

·      Measured and Indicated Mineral Resource of 132 Mt grading 27.8 per cent iron ("Fe").

·      Inferred Mineral Resource of 39 Mt grading 27.1 per cent Fe.

The definitions of Measured, Indicated and Inferred Resources, as well as Reserves, as used in this MRE, conform to the definitions and guidelines of the PERC Reporting Standard, 2017.

Market Leading Potential

RNS dated 17 September 2020

https://polaris.brighterir.com/public/beowulf_mining_plc/news/rns/story/x8l7kjr 

·      Testwork on Kallak ore has produced an exceptionally high-grade magnetite concentrate at 71.5 per cent Fe with minimal detrimental components.

·      This would make Kallak the market leading high-grade product among known current and planned future producers.

·      The next best magnetite product is LKAB's (the state-owned Swedish iron ore company), which produces magnetite fines ("MAF") with a target specification of  70.7 per cent Fe and is regarded as unique, until now, due to its exceptionally high iron content.

·      Kallak magnetite concentrate would reduce the carbon footprint of traditional steel manufacturing, improve energy efficiency in any downstream process and reduce waste.  Magnetite has inherent energy content, which ultimately results in lower energy demand for steel manufacturing when compared to current common practice.

·      Globally, the feedstock for steelmaking is 80 per cent hematite and 20 per cent magnetite.  The demand for high-quality feedstock and therefore magnetite should increase as producers look to protect the environment by improving energy efficiency, minimizing waste and the impact of waste disposal.

Economic Potential

In response to the Government's request, in the middle of 2015, for the County Administrative Board for the County of Norrbotten (the "CAB") to provide comments on the national economic assessment for Kallak, the CAB's findings were as follows:

·      Mining is economically relevant and that the Kallak North project generates economic benefits at local, regional and national levels, including direct and indirect jobs, tax revenues, and more broadly across mining equipment and services sectors in Sweden.

·      The Concession Area applied for by the Company creates no conflicts where national interests are considered.

·      The Concession is designated as an Area of National Interest ("ANI") for minerals.

·      The Company should work with communities that could be affected by the development of a mining project, in order to eliminate or mitigate any impacts, including reindeer herders and Sami villages.

·      The Company should consider in its ongoing studies the potential impact of its mining activities on tourism and transport infrastructure.

In 2017, Copenhagen Economics produced a 'Big Picture' study for Kallak  ("the Study" or "the Kallak Study"):

https://beowulfmining.com/wp-content/uploads/2018/10/Copenhagen-Economics_Presentation_SEP17_Swedish.pdf 

The Study built on the work carried out by the Company and others, including the 2015 independent socio-economic study initiated by Jokkmokks Kommun, completed by consultants Ramböll, which in its findings concluded that a mining development at Kallak would create direct and indirect jobs, increase tax revenues and slow down population decline, and the 2010 study by the Economics Unit of Luleå University of Technology, 'Mining Investment and Regional Development: A Scenario-based Assessment for Northern Sweden'.

Copenhagen Economics had previously reviewed the attractiveness of the Swedish mining sector on a number of parameters, including licensing and regulation, commissioned by the Swedish Agency for Growth Policy Analysis, part of the Government of Sweden.

The Study demonstrated that the economic effect of Kallak is 'not just about a mine'. A mining project would economically transform Jokkmokk and support other major capital expenditure and economic activity e.g. Inlandsbanan, Luleå Hamn, Vattenfall etc, spreading the benefits, through Norrbotten and beyond.

When it comes to Kallak's economic effect on Jokkmokk, the Study highlights were as follows:

·      A mining operation at Kallak has the potential to create 250 direct jobs and over 300 indirect jobs in Jokkmokk, over the period that a mine is in operation.

·      These jobs could be sustained over a period of 25 years or more, if the Kallak South deposit is mined after the Kallak North deposit, and further deposits at Parkijaure can be defined.

·      The Company will seek to establish a 'Task Force' with Jokkmokks Kommun and local employment agencies, so that between now and the start of operations, plans are developed and implemented to make sure as many as possible jobs are available to people living in Jokkmokk.

·      Kallak has the potential to generate SEK 1 billion in tax revenues, considering the case where 70 per cent of the mine's workforce are based locally, with annual tax revenues of SEK 40 million over a 25-year mine life.

·      These tax revenues would help to develop and sustain public services and infrastructure in Jokkmokk, which are at risk due to a lack of new investment and job creation in the community, a declining population, and an ageing population.

Enquiries:

Cautionary Statement

Statements and assumptions made in this document with respect to the Company's current plans, estimates, strategies and beliefs, and other statements that are not historical facts, are forward-looking statements about the future performance of Beowulf. Forward-looking statements include, but are not limited to, those using words such as "may", "might", "seeks", "expects", "anticipates", "estimates", "believes", "projects", "plans", strategy", "forecast" and similar expressions. These statements reflect management's expectations and assumptions in light of currently available information. They are subject to a number of risks and uncertainties, including, but not limited to , (i) changes in the economic, regulatory and political environments in the countries where Beowulf operates; (ii) changes relating to the geological information available in respect of the various projects undertaken; (iii) Beowulf's continued ability to secure enough financing to carry on its operations as a going concern; (iv) the success of its potential joint ventures and alliances, if any; (v) metal prices, particularly as regards iron ore. In the light of the many risks and uncertainties surrounding any mineral project at an early stage of its development, the actual results could differ materially from those presented and forecast in this document. Beowulf assumes no unconditional obligation to immediately update any such statements and/or forecast.