Azteca Operating Licence Granted

The Company deems the information contained within this announcement to constitute Inside Information as stipulated under the Market Abuse Regulation (EU) No. 596/2014, as it forms part of UK domestic law under the European Union (Withdrawal) Act 2018, as amended. Upon publication of this announcement via a regulatory information service, this information is considered to be in the public domain.

Cadence Minerals plc

("Cadence Minerals", "Cadence", or "the Company")

Azteca Operating Licence Granted

Operating Licence received and production commencing at Azteca at a reduced rate; full-rate operation expected approximately two weeks after the working capital is received.

Cadence Minerals plc (AIM: KDNC) announces that DEV Mineração S.A. (“DEV”) has received the Operating Licence (Licença de Operação) for the Azteca processing plant at the Amapá Iron Ore Project from the Amapá State Environmental Secretariat (“SEMA/AP”).

DEV is commencing production at a reduced rate, limited for now by feed access, heavy plant and personnel. With the licence received, the conditions for the US$1.15 million working capital tranche of the existing project funding have been satisfied. DEV expects to reach full-rate operation approximately two weeks after those funds are received. DEV’s aim remains a first shipment before the end of 2026, timing depends on the drawdown, feed access, plant performance and logistics.

Highlights

●      Operating Licence received: SEMA/AP has issued the Operating Licence to DEV for iron ore processing at the Azteca plant. It is valid for five years, renewable on application, and carries standard monitoring and reporting conditions. The Installation Licence, which covers the mine, processing plant and tailings facility for the larger Amapá DR Iron Ore Project, remains in force alongside it.

●      Production commencing; full rate to follow funding: DEV is commencing production at a reduced rate while access works and site preparation continue. The Operating Licence was the remaining condition for the US$1.15 million working capital tranche under the prepayment offtake facility, and DEV expects full-rate operation approximately two weeks after the funds are received.

●      Contracts: Heavy mobile equipment and operating personnel contracts are expected to be finalised in the coming days. Haulage and port-handling contracts are at an advanced stage and are expected to be concluded as operations build up.

●      Target unchanged: Approximately 380,000 tonnes per annum of approximately 65% Fe concentrate on design-grade feed. Assay and optimisation testwork is progressing to plan, and the on-site XRF laboratory remains expected to be operational by the end of November 2026.

●      First shipment: The first cargo of approximately 45,000 to 48,0000 wet tonnes will be scheduled once it is at port. DEV’s aim remains to ship before the end of 2026. Timing depends on the drawdown, feed access, plant performance and logistics.

Kiran Morzaria, Chief Executive Officer, commented:

“The Installation Licence allowed us to rebuild the plant. The Operating Licence allows us to run it and sell what it produces. We now have both, and since the construction funding arrived in May, the work has run within days of the schedule we set.

“The licence releases the working capital for the fleet and people needed to run at full rate. We are starting now at a smaller scale, and full mobilisation takes about two weeks from the day the funds land. Our aim is still a first shipment before the end of the year, provided the drawdown, mobilisation and logistics come together as planned.

“Azteca is the first operating step, and the larger DR project is the main prize. Production and cash flow are the strongest statements we can make about this asset. Once Azteca has covered its costs and repaid the facility, its cash is intended to pay for the Definitive Feasibility Study and the port and rail licences, so the project funds its own next stage. My thanks to the DEV team, our contractors and SEMA/AP.”

Operating License

The Operating Licence authorises iron ore processing by physical concentration at the Azteca plant, with use of the Mário Cruz tailings dam, for a period of five years, renewable on application before expiry. SEMA/AP issued it on the basis of its technical opinion following the commissioning and compliance reports DEV filed in on 29 October 2026, completing the Preliminary, Installation and Operating Licence sequence for Azteca.

The licence carries the conditions standard for an operation of this type in the State of Amapá, which form part of DEV's ongoing compliance programme: publication of the licence, a consolidated commissioning report within 30 days, half-yearly geotechnical and structural monitoring of the Mário Cruz dam, monthly water sampling with half-yearly reporting, half-yearly waste-disposal certificates, and annual community, fauna, rehabilitation and noise reports. DEV already undertakes monitoring of this kind under the Installation Licence.

The Installation Licence remains in force alongside the Operating Licence. It covers refurbishment and construction across the larger Amapá DR Iron Ore Project operational area, including the new magnetic separation, ball mill and screening circuits. The Operating Licence covers the Azteca portion of that undertaking. Azteca concentrate is to be transported by road and shipped through an existing public port, so it does not depend on the railway or private port, whose licences are not yet held. The Operating Licence certifies environmental compliance and does not replace any other consent that may be required.

Working capital and the path to full operation

The Azteca restart is funded under the US$4.6 million prepayment offtake facility announced on 9 September 2025 and completed later that year. US$3.45 million of that amount funded licensing, tailings dam work, refurbishment and recommissioning and has been advanced in full.

The remaining US$1.15 million is working capital, available now that production has commenced and the Operating Licence is in force. The US$1.15 million will be used to fund production, transport and delivery to the port of the first shipment, which DEV plans as a cargo of approximately 45,000 to 48,000 wet tonnes. Repayment is made per tonne of concentrate delivered, deducted from sale proceeds, and Cadence, which funded part of the facility, receives its proportion of the repayments and of the marketing fee.

DEV has commenced mining and processing at a reduced rate, limited by feed access and the heavy plant and personnel currently on site. The working capital pays for the mobilisation of the larger mining fleet and the operating personnel needed to run the plant at full rate, which DEV expects to take approximately two weeks from receipt of the funds.

There are four major contracts supporting full operation. The heavy mobile equipment and operating personnel contracts are expected to be finalised in the coming days. The haulage and port-handling contracts are at an advanced stage and are expected to be concluded as operations build up, ahead of the first shipment.

Product, testwork and infrastructure

Commissioning feed and concentrate samples remain at an accredited laboratory, and the testwork on higher-intensity magnetic separation announced on 3 November 2026 is progressing to plan. Results were expected within four to six weeks of that date will be reported when received. The on-site XRF laboratory remains expected to be operational by the end of November 2026, after which feed and product grades will be available within hours to guide feed selection and plant settings.

The approximately 2,800 wet tonnes of concentrate produced during commissioning is stockpiled on site and is intended to form part of the first shipment, subject to assay results and product specification.

Refurbishment of the Pedra Branca do Amapari bridge deck is progressing, from approximately one-third complete at 30 October 2026, with completion targeted before the first shipment. We previously stated that  the target was completion before first road haulage. DEV now plans to haul concentrate to port over the bridge while the deck work continues, with the bridge in use under temporary controls. The Company will report when substantial further progress has been made.

The bridge works, optimisation studies, site laboratory and dewatering screen are funded from the September 2026 fundraising, which raised approximately £2.25 million before expenses.

Next steps

The Company expects to report next on receipt of the working capital and the start of full-rate production, then on the assay and testwork results, bridge completion and the first shipment. The drawdown depends on the offtaker’s acceptance of DEV’s notice. DEV manages the access works, contracts and mobilisation.

Cash remaining after operating needs and funding obligations is intended to support the Definitive Feasibility Study and the advancement of the Preliminary Licences for the port and railway. Cash generation depends on plant performance, prices and costs.

Preparation for the Definitive Feasibility Study, planned to commence in 2027, continues alongside the Azteca programme. The larger Amapá redevelopment remains subject to further technical studies, financing, construction planning and regulatory approvals.

Basis of figures

Tonnages are approximate wet weights recorded at the plant. The production target and concentrate grade assume design-grade feed of approximately 48% Fe, as confirmed by the testwork announced on 27 July 2026, and the target of approximately 380,000 tonnes per annum is unchanged. Commissioning concentrate grade is not yet known; assay results are pending. Mobilisation and start-up timings are DEV's current estimates and depend on the timing of the drawdown and contractor availability. Bridge progress is as reported by DEV at 30 October 2026.

Cadence Ownership

As at 31 May 2026, Cadence’s total investment in the Amapá Project was approximately US$16.1 million. Cadence holds a 36.2% equity interest in Pedra Branca Alliance Pte Ltd (“PBA”), which owns 100% of DEV, the owner and operator of the Amapá Project.

About the Amapá Project

The Amapá DR Iron Ore Project comprises established mine, rail, port and beneficiation infrastructure in Brazil. The Project hosts a JORC-compliant Mineral Resource of 276.2 million tonnes at 38% Fe and a Proven and Probable Ore Reserve of 195.8 million tonnes at 39.34% Fe.

An updated Pre-Feasibility Study published on 3 December 2024 confirmed the potential to produce 67.5% Fe direct reduction grade concentrate at 5.5 Mtpa, with a post-tax NPV (10%) of US$1.97 billion over a 15-year mine life.

Licensing status: the Azteca plant holds its Preliminary, Installation and Operating Licences. The Installation Licence also covers the mine, processing plant and tailings facility for the larger project. The port and railway require separate licences, which DEV intends to advance following the Azteca start-up.

For further information, contact:

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

Cautionary and Forward-Looking Statements

This announcement contains forward-looking statements. Such statements are based on the current expectations, assumptions and beliefs of the Directors and are subject to known and unknown risks and uncertainties. Forward-looking statements are not guarantees of future performance and may often be identified by words such as “believe”, “expect”, “intend”, “may”, “plan”, “should”, “will”, “could” and similar expressions. Actual results may differ materially from those expressed or implied by such statements due to a range of factors, many of which are outside the control of the Company, including changes in economic conditions, market conditions, regulatory developments, the actions of governmental authorities, the availability of funding and other risks affecting the Company’s operations. Readers should not place undue reliance on forward-looking statements, which speak only as at the date of this announcement. Except as required by law or applicable regulation, the Company undertakes no obligation to update or revise any forward-looking statements.