28 April 2023

Beowulf Mining plc

("Beowulf" or the "Company")

Grafintec Collaborates on Sustainable Graphite Purification Technology

Beowulf (AIM: BEM; Spotlight: BEO), is pleased to announce that the Company's wholly owned Finnish subsidiary Grafintec Oy ("Grafintec") has signed a Memorandum of Understanding ("MoU") with Thermal & Material Engineering Center ("TMEC") from Ukraine to establish a joint venture technology company ("JV").

TMEC has developed proprietary state-of-the-art purification technology, a continuous thermal process which consumes significantly less energy than conventional commercially available thermal solutions and eliminates the need of hazardous chemicals when purifying graphite.

Grafintec and TMEC are seeking to apply the technology to both natural flake and secondary sources of graphite, in conjunction with Grafintec's graphite anode materials plant ("GAMP") development in the GigaVaasa area.  In parallel, the first stage of process design work and Pre-Feasibility Study ("PFS") for the GAMP being undertaken by RB Plant Construction Ltd. ("RB Plant") for Grafintec will conclude in May 2023.  

Key Terms of the MoU

·    The Parties have agreed to collaborate through the development of a European technology company for the supply under licence of commercial processing technology services to natural and synthetic graphite producers (including secondary sources of graphite), for the provision of commercial testing services to graphite producers, and for the supply of engineering and design activities for the technology, under commercial agreements within the battery market supply chain.

·    Under the proposed JV, Grafintec will own 51 per cent of the JV and TMEC will own 49 per cent of the JV.

·    Both Parties have agreed to work exclusively with each other related to the use of the technology in the battery markets supply chain.

·    Grafintec will have the exclusive right to progress the formation of a JV with TMEC, provided that certain terms set out in the MoU are met.

European Critical Raw Materials Act

On 16 March 2023, the European Commission published the 'European Critical Raw Materials Act'. The Commission proposes a comprehensive list of actions for the EU to access a secure, diversified, affordable, and sustainable supply of Critical Raw Materials such as Natural Graphite to enable the green transition and reduce its dependency on supply from certain countries.

Some of the more important actions includes simplifying and streamlining the permitting process for Critical Raw Materials projects in the EU including access to financial support and shorter permitting timeframes for strategic mining, processing, and recycling projects.

Rasmus Blomqvist, Managing Director of Grafintec, commented:

"We are excited to be working with TMEC on incorporating their technology into our plans for sustainable anode materials production in the GigaVaasa area.

"Testwork has shown that TMEC's purification technology in our commercial plant design could deliver a step change in process performance, when considering cost and sustainability factors.

"As the demands from battery manufacturers for low cost and low carbon solutions increases, it is our objective to ensure the JV company will be a leader in the market.

"Given the forecast market growth for Lithium-Ion Batteries and the lack of commercial production of graphite anodes in Europe, the 'European Critical Raw Materials Act' should focus the EU's efforts on strengthening its regional raw material supply chains and presents a unique window of opportunity for Grafintec to establish itself in the graphite anode space."

European Lithium-Ion Battery and Graphite Anode Market

Currently graphite, either natural or synthetic, counts for approximately 95 per cent of the anode market and due to its cost-performance ratio it will remain the material of choice for anodes for the next decade. The World Bank has said graphite demand will increase by 500 per cent between 2018 and 2050, while the global graphite market is expected to reach US$21.6 billion. In Europe the graphite anode market is expected to grow even faster with an expected growth rate by more than eight times from a current level of 162,000 tonnes to 1.3 million tonnes of graphite anodes by 2030 (Benchmark Mineral Intelligence, March 2023). Geopolitical tensions, the European Green Transition, and a focus on sustainable and secure supply-chains, as well as self-sufficiency, has led countries to re-assess their overreliance on Chinese supply of strategic materials including graphite.

About Grafintec

Beowulf Mining's 100 per cent owned subsidiary Grafintec is recognised in Finland as one of the main companies in the anode space and continues to be supported by Business Finland, the Finnish governmental organisation for innovation funding and investments.

The Company's most advance natural flake graphite project, Aitolampi, has an Indicated and Inferred Mineral Resource of 26.7 Mt at 4.8 per cent TGC for 1,275,000 tonnes of contained graphite (see announcement 30 October 2019), possessing almost perfect crystallinity, an important prerequisite for high tech applications such as lithium-ion batteries. The Mineral Resource was estimated by CSA Global of Australia in accordance with the JORC Code, 2012 Edition. In addition to Aitolampi, the Company has other graphite exploration prospects, including Rääpysjärvi.

The development of downstream capabilities is a key part of Grafintec's strategy and following the announcement on 26 September 2022 on signing a MoU with Hensen, the collaboration between the companies has proceeded with regards to establishing an anode materials hub in Finland, the GAMP. 

On 21 February Beowulf announced signing of a site reservation agreement with the municipality of Korsholm, securing Plot 1, Block 3017 in the GigaVaasa area, for the establishment of a Graphite Anode Materials Plant. The reserved Plot 1 covers an area of approximately 47 hectares and is located immediately to the south-southeast of the area where FREYR, the battery cell manufacturing company, has secured land to develop industrial scale battery technology and production (see FREYR Battery begins preparatory work in Vaasa, Finland | Gigavaasa).

About TMEC

TMEC is a Ukraine-based enterprise established as an R&D company by a group of leading scientists with a long-term experience in engineering to boost smart thermal solutions for industrial applications.

TMEC's history goes back to 2002 when the business started as a part of the Department of Industrial Thermal Engineering at National Metallurgical Academy of Ukraine.

To get closer to customers on the global market in 2018, TMEC evolved into an independent company with a wide range of services from fundamental research to full functioning up-scaled industrial products.

TMEC provides:

·      Innovations for petrochemical-, metallurgical- and mining industries.

·      Engineering of Lab and Industrial Units with specific focus on fluidized and fixed bed reactors.

·      Electro-thermal fluidized bed solutions. 

·      Optimization of furnaces' operating modes.  

·      Lab thermal treatment of carbon materials. 

·      Energy management and audit.

·      Consulting and training services.

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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 forecasts.