Cinovec LCP Optimisation Offers Potential Savings

This announcement contains inside information for the purposes of Article 7 of the UK version of Regulation (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

Cinovec LCP Optimisation Delivers Potential Significant Savings

European Metals Holdings Limited (ASX and AIM: EMH, OTCQX: EMHXY and EMHLF) ("European Metals" or the "Company") is pleased to announce preliminary results for the design optimisation of the lithium chemical plant ("LCP") for the Cinovec Project.

·      Potential to reduce consumption of major reagents by US$51m per annum (based on Definitive Feasibility Study ("DFS") reagent pricing[1]).

·      Potential to reduce power consumed in the LCP post-roast and leach filtration by more than 25% or US$3.4m per annum (based on DFS power pricing[2]).

·      Taken together, these reductions represent the potential to increase the pre-tax NPV8 of US$1.455bn established in the December 2025 DFS, however the exact quantum of such increase based upon the revised assumptions will only be known once the Project DFS is updated.

Keith Coughlan, Executive Chairman, commented: "The LCP optimisation programme delivers a compelling improvement in the economics of the Cinovec Project. The potential reductions in reagent consumption and power represent a material improvement in operating costs relative to the DFS, and if adopted, the scaled-down plant infrastructure required to process lower reagent volumes is expected to also reduce capital costs relative to the initial capex of US$1.72bn established in the DFS."

"Separately, the project team is conducting advanced testwork on the use of a tunnel kiln - which may be fuelled with electricity from renewable sources and/or gas - in place of the current gas-fired rotary kiln."

"Initial indications are that the results of this testwork may lead to further downward revision of both capex and opex, and we look forward to updating the market on this programme in due course."

Optimisation Review of LCP Process Flowsheet

As part of Geomet's post-DFS project review, the LCP circuit team reviewed the potential for reconfiguration of the LCP process flowsheet without introducing any new untested unit processes. The DFS flowsheet is extremely effective in separating lithium from the other Group I cations in the pregnant leach solution, in the lithium phosphate precipitation stage. However, this process is a strong consumer of tri-sodium phosphate ("TSP") and, indirectly, caustic soda ("NaOH") used to regenerate the TSP, as well as sulphuric acid used to dissolve the lithium phosphate for onwards processing.

The proposed reconfiguration of the LCP flowsheet results in the majority of solubilised lithium reporting directly to crude lithium carbonate precipitation, with the balance of lithium and the majority of other Group I cations being processed by the lithium phosphate precipitation reactor in a side-stream / recycle configuration.

The reconfigured flowsheet has been modelled in SysCAD, utilising testwork data and partition coefficients from locked cycle testwork programmes from 2022 and 2024. SysCAD is a process simulation platform used across the minerals industry to model and validate hydrometallurgical flowsheets prior to physical testwork and engineering design.

The principal process improvements in the flowsheet optimisation from SysCAD modelling are:

·      80% reduction in annual run-of-plant caustic soda usage, from 18.8 tph to 3.8 tph.

·      65% reduction in annual run-of-plant sulphuric acid usage, from 14.3 tph to 5.0 tph.

·      54% reduction in annual run-of-plant anhydrous sodium sulphate output, from 25.2 tph to 11.7 tph.

In addition to the above process improvements, the optimised flowsheet modelling forecasts a slight improvement in LCP lithium recovery, from 90.8% in the DFS to 91.1%. (Refer to the Company's ASX/ AIM release dated 23 December 2025) (Successful Completion - Cinovec Definitive Feasibility Study) for DFS LCP lithium recovery.

The potential reduction in power consumption in the LCP brought about by the proposed changes has been assessed by a factored estimation approach, utilising known power consumptions for unit processes in the DFS. The potential power consumption assessed should be considered to be indicative only, until testwork is completed and the Project DFS has been updated.

Next Steps

The LCP flowsheet optimisation proposed has been reviewed in a fatal flaw analysis by Dr. Stephen La Brooy of Ausenco Services Pty Ltd. Dr. La Brooy's review has concluded that the proposal may be expected to be viable subject to confirmation through testwork and has made testwork recommendations to confirm the SysCAD modelling, the extent of reagent reduction possible, the potential increase in expected lithium recovery and maintenance of battery-grade status of the end product.

The principal recommendation is to run a new set of locked cycle tests of the full LCP flowsheet, followed by updating the SysCAD model and then re-running locked cycle tests for a final confirmation of expected chemistry throughout the flowsheet.

At the point at which process stream compositions and recoveries stabilise in the locked cycle testwork programme to the satisfaction of independent reporting chemical engineers, the DFS is expected to be updated.

Dr Stephen La Brooy has more than 46 years of experience in metallurgical test work, hydrometallurgical process development and independent technical review across the global minerals industry. He holds a PhD in Chemical Metallurgy and is recognised as a leading authority in the development and assessment of complex hydrometallurgical flowsheets, innovative leaching technologies and purification processes.

Environmental Impact Assessment ("EIA") Update

The EIA public hearing took place as planned on 17 June 2026. No new substantial questions or comments about the Project were raised by local stakeholders that have not been encountered in dialogue with the Project's management team before and all questions were answered by Project executives at the hearing.  The EIA process is expected to conclude by the end of 2026. The Company will announce further updates as and when necessary.

Once completed the EIA process will enable Geomet to apply for both the Mining and Construction permits which once issued will enable the construction of the Cinovec underground mine as well as the Dukla transfer portal and the Lithium Chemical Plant.

ENDS

This announcement has been approved for release by the Board.

CONTACT

For further information on this update or the Company generally, please visit our website at www.europeanmet.com or see full contact details at the end of this release.

ENQUIRIES:                                                                                             

BACKGROUND INFORMATION ON CINOVEC

PROJECT OVERVIEW

Cinovec Lithium Project

Geomet s.r.o. controls the mineral exploration licenses awarded by the Czech State over the Cinovec Lithium Project. Geomet has been granted a preliminary mining permit by the Ministry of Environment and the Ministry of Industry. The company is owned 49% by EMH and 51% by CEZ a.s. through its wholly owned subsidiary, SDAS. Cinovec hosts a globally significant hard rock lithium deposit with a total Measured Mineral Resource of 54.4Mt at 0.58% Li2O , Indicated Mineral Resource of 378.23Mt at 0.41% Li2O and an Inferred Mineral Resource of 309.49Mt at 0.39% Li2O containing a combined 7.45 million tonnes Lithium Carbonate Equivalent (refer to the Company's ASX/ AIM release dated 23 December 2025) (Cinovec DFS Confirms Long-life Battery Grade Lithium Carbonate Producer Strategically Positioned to supply European EV and Energy-storage Sectors)[3].

A Proven and Probable Ore Reserve of 54.4Mt at 0.58% Li2O has been declared to cover the first 26 years mining at an output of 37,500tpa of lithium carbonate (refer to the Company's ASX/ AIM release dated 23 December 2025) (Cinovec DFS Confirms Long-life Battery Grade Lithium Carbonate Producer Strategically Positioned to supply European EV and Energy-storage Sectors)[4].

The Definitive Feasibility Study ("DFS") confirmed the economic viability of the Cinovec Project with steady-state production of 37,500 tpa of battery-grade lithium carbonate ("Li₂CO₃"), representing ~5.2% of EU demand in 2030 and sufficient for >900,000 50kWh EV batteries annually.  Cinovec will have a 28+ year operating life, underpinned by a 748Mt Resource @ 0.19% Li₂O and a 55.4Mt Ore Reserve, with expansion optionality (refer to the Company's ASX/ AIM release dated 23 December 2025) (Cinovec DFS Confirms Long-life Battery Grade Lithium Carbonate Producer Strategically Positioned to supply European EV and Energy-storage Sectors)[5].

This makes Cinovec the largest hard rock lithium deposit in Europe and by far the largest hard rock lithium deposit in the European Union.

Cinovec has been designated a Strategic Project by the European Union under the Critical Raw Materials Act (refer to the Company's ASX/ AIM release dated 25/26 March 2025) (Cinovec declared a Strategic Project under EU Critical Raw Materials Act) and a Strategic Deposit by the Czech Government (refer to the Company's ASX/ AIM release dated 7 March 2025) (Cinovec declared Strategic Deposit by Czech Government).

Cinovec has received recent impetus from the EU and the Czech Government in the form of grants of USD36 million from the EU Just Transition fund (refer to the Company's ASX/ AIM release dated 28 April 2025) (USD 36 million Just Transition Fund Grant Approved for Cinovec Project) and up to EUR360 million by the Czech Government (refer to the Company's ASX/ AIM release dated 7 March 2025) (Approval of up to €360 Million  Czech Government Grant).

The deposit has previously had over 400,000 tonnes of ore mined as a trial sub-level open stope underground mining operation.

Cinovec is centrally located for European end-users and is well serviced by infrastructure, with a sealed road adjacent to the deposit, rail lines located 5 km north and 8 km south of the deposit, and an active 22 kV transmission line running to the historic mine. The deposit lies in an active mining region.

The Cinovec processing plant comprises of a Front-End Comminution and Beneficiation circuit ("FECAB") and Lithium Chemical Plant circuit ("LCP") in combination producing Lithium Carbonate end products and will be located on the Prunéřov 1 Power Station site located approximately 59km by rail from the Cinovec mine site (refer to the Company's ASX/ AIM releases dated 26 April 2024 (New Lithium Plant Site Expected to Improve Project Permitting and Economics) and 27 November 2024 (Cinovec Project Update)).

BACKGROUND INFORMATION ON CEZ

Headquartered in the Czech Republic, CEZ a.s. is one of the largest companies in the Czech Republic and a leading energy group operating in Western and Central Europe. CEZ's core business is the generation, distribution, trade in, and sales of electricity and heat, trade in and sales of natural gas, and coal extraction. The foundation of power generation at CEZ Group are emission-free sources.  The CEZ strategy named Clean Energy for Tomorrow is based on ambitious decarbonisation, development of renewable sources and nuclear energy. CEZ announced that it would move forward its climate neutrality commitment by ten years to 2040.

The largest shareholder of its parent company, CEZ a.s., is the Czech Republic with a stake of approximately 70%. The shares of CEZ a.s. are traded on the Prague and Warsaw stock exchanges and included in the PX and WIG-CEE exchange indices. CEZ's market capitalization is approximately EUR 28.2 billion.

As one of the leading Central European power companies, CEZ intends to develop several projects in areas of energy storage and battery manufacturing in the Czech Republic and in Central Europe.

CEZ is also a market leader for E-mobility in the region and has installed and operates a network of EV charging stations throughout Czech Republic. The automotive industry in the Czech Republic is a significant contributor to GDP, and the number of EV's in the country is expected to grow significantly in the coming years.

COMPETENT PERSONS AND QUALIFIED PERSON FOR THE PURPOSES OF THE AIM NOTE FOR MINING AND OIL & GAS COMPANIES

Information in this release that relates to the FECAB metallurgical testwork is based on, and fairly reflects, technical data and supporting documentation compiled or supervised by Mr Walter Mädel, a full-time employee of Geomet s.r.o, an associate of the Company. Mr Mädel is a member of the Australasian Institute of Mining and Metallurgy ("AUSIMM") and a mineral processing professional with over 27 years of experience in metallurgical process and project development, process design, project implementation and operations. Of his experience, at least 5 years have been specifically focused on hard rock pegmatite Lithium processing development. Mr Mädel consents to the inclusion in the announcement of the matters based on this information in the form and context in which it appears.  Mr Mädel is a participant in the long-term incentive plan of the Company.

Information in this release that relates to exploration results is based on, and fairly reflects, information and supporting documentation compiled by Dr Vojtech Sesulka. Dr Sesulka is a Certified Professional Geologist (certified by the European Federation of Geologists), a member of the Czech Association of Economic Geologists, and a Competent Person as defined in the JORC Code 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr Sesulka has provided his prior written consent to the inclusion in this report of the matters based on his information in the form and context in which it appears. Dr Sesulka is an independent consultant with more than 10 years working for the EMH or Geomet companies. Dr Sesulka does not own any shares in the Company and is not a participant in any short- or long-term incentive plans of the Company.

Information in this release that relates to metallurgical test work and the process design criteria and flow sheets in relation to the LCP is based on, and fairly reflects, information and supporting documentation compiled by Dr. Stephen La Brooy. Dr. La Brooy, who holds a PhD in Chemical Metallurgy, has provided his prior written consent to the inclusion in this report of the matters based on his information in the form and context that the information appears. Dr La Brooy does not own any shares in the Company and is not a participant in any short- or long-term incentive plans of the Company.

The information in this release that relates to Mineral Resources and Exploration Targets is based on, and fairly reflects, information and supporting documentation prepared by Mr Lynn Widenbar. Mr Widenbar, who is a Member of the Australasian Institute of Mining and Metallurgy and a Member of the Australasian Institute of Geoscientists, is a full-time employee of Widenbar and Associates and produced the estimate based on data and geological information supplied by European Metals. Mr Widenbar has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the JORC Code 2012 Edition of the Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves. Mr Widenbar has provided his prior written consent to the inclusion in this report of the matters based on his information in the form and context that the information appears. Mr Widenbar does not own any shares in the Company and is not a participant in any short- or long-term incentive plans of the Company.

The information that relates to production targets for the Cinovec Lithium Project is based on information compiled by Mr Graeme Fulton, a Competent Person who is a Fellow of the Australasian Institute of Mining & Metallurgy. Mr Fulton is an Employee of Bara Consulting who are a consultant to the Company. Mr Fulton does not own any shares, options / performance rights in the Company and is not a participant in the Company's short or long-term incentive plan. Mr Fulton has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Fulton consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcement.

CAUTION REGARDING FORWARD LOOKING STATEMENTS

Information included in this release constitutes forward-looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as "may", "will", "expect", "intend", "plan", "estimate", "anticipate", "continue", and "guidance", or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs.

Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the company's actual results, performance, and achievements to differ materially from any future results, performance, or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licences and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.

Forward looking statements are based on the Company and its management's good faith assumptions relating to the financial, market, regulatory and other relevant environments that will exist and affect the company's business and operations in the future. The company does not give any assurance that the assumptions on which forward looking statements are based will prove to be correct, or that the company's business or operations will not be affected in any material manner by these or other factors not foreseen or foreseeable by the company or management or beyond the company's control.

Although the Company attempts and has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in forward looking statements, there may be other factors that could cause actual results, performance, achievements or events not to be as anticipated, estimated or intended, and many events are beyond the reasonable control of the company. Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, in providing this information the company does not undertake any obligation to publicly update or revise any of the forward looking statements or to advise of any change in events, conditions or circumstances on which any such statement is based.

LITHIUM CLASSIFICATION AND CONVERSION FACTORS

Lithium grades are normally presented in percentages or parts per million ("ppm"). Grades of deposits are also expressed as lithium compounds in percentages, for example as a percent lithium oxide ("Li2O") content or percent lithium carbonate ("Li2CO3") content.

Lithium carbonate equivalent ("LCE") is the industry standard terminology for, and is equivalent to, Li₂CO₃. Use of LCE is to provide data comparable with industry reports and is the total equivalent amount of lithium carbonate, assuming the lithium content in the deposit is converted to lithium carbonate, using the conversion rates in the table included below to get an equivalent Li₂CO₃ value in percent. Use of LCE assumes 100% recovery and no process losses in the extraction of Li₂CO₃ from the deposit.

Lithium resources and reserves are usually presented in tonnes of LCE or Li.

The standard conversion factors are set out in the table below:

Table: Conversion Factors for Lithium Compounds and Minerals