Update Mineral Resource Estimate - Elandsfontein

20 June 2024

Kropz Plc

("Kropz" or the "Company")

Update of Mineral Resource Estimate for Elandsfontein

Kropz Plc (AIM: KRPZ), an emerging African phosphate producer and developer, is pleased to announce an update to the JORC (2012) compliant Mineral Resource Estimate ("MRE") at its South African phosphate project, Elandsfontein Phosphate Project ("Elandsfontein").

The significant write-down in declared Ore Reserves from 2018 to 2022 has been partially reversed in the 2023 Ore Reserve estimate, largely due to the additional infill drilling which was completed in 2023.

It is expected that the future drilling campaigns will continue to improve the Mineral Resource estimates from Inferred to Measured or Indicated categories and will enable improved conversion of the Mineral Resources to Reserves.

While both the declared Reserve tonnes and grade have increased, the grade and tonnage estimate of the Resource has decreased. This aligns to the improved confidence in the grade estimation of the deposit and reflects the declining grade of the deposit over its life.

Summary

·      The 2023 Reserve estimate was positively affected by the completed infill and exploration drilling, which significantly improved the total declared Measured and Indicated Mineral Resources. The Ore Reserves are stated at 30 September 2023, and account for the pit depletions up until the end of September 2023;

·      Total Measured and Indicated resource tonnage has increased by approximately 72%, while the Total resource tonnage has reduced by 30%;

·      Decrease in total phosphate resources at Elandsfontein to 74.23 million tonnes ("Mt") from 106.58 million tonnes in 2022;

·      Total Reserves are estimated at 26.63 Mt at a P₂O₅ grade of 9.38% of which 16.56 Mt is Proven at 10.25% P₂O_5, This compares to previous estimate at 17.42 Mt at 9.19% P₂O_5. 

Louis Loubser, Chief Executive Officer commented:

"Our planned infill drilling campaign has proved worthwhile. Although the changes in our Resource estimate have been substantive, our ability to accurately predict the spatial position and grade of the ore body has improved greatly. This has led to further accuracy and prediction improvements which are reflected in an encouraging increase in our mineable ore Reserves."

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The 2023 Mineral Resource Estimate (MRE) for Elandsfontein reflects significant changes compared to 2022 and was notably affected by the completed infill and exploration drilling. The total Measured and Indicated resources have increased by approximately 72%, rising from 19.02 Mt in 2022 to 32.74 Mt in 2023, despite a slight decrease in the P₂O₅ grade from 9.54% to 9.24%. Conversely, the total Inferred resources have decreased substantially from 87.56 Mt in 2022 to 41.49 Mt in 2023, accompanied by a decline in the P₂O₅ grade from 7.68% to 6.30%. This reduction in Inferred resources and the simultaneous increase in Measured and Indicated resources indicate improved confidence in the resource estimates due to the successful infill drilling program. These changes highlight the enhanced accuracy in predicting the spatial distribution and grade of the ore body, leading to a more reliable reserve estimate and better strategic planning for future mining operations.

The 2023 reserve statement for Elandsfontein reflects significant improvements compared to the 2022 estimates, driven by changes in the resource base and a better understanding of the modifying factors to be applied. The total proven reserves have increased substantially from 7.31 Mt at a P₂O₅ grade of 10.71% in 2022 to 16.56 Mt at a grade of 10.25% in 2023. Meanwhile, the total probable reserves have remained relatively stable, showing a slight decrease from 10.11 Mt at a P₂O₅ grade of 8.09% in 2022 to 10.07 Mt at a grade of 8.01% in 2023. As a result, the combined total of proven and probable reserves has risen from 17.42 Mt at a P₂O₅ grade of 9.19% in 2022 to 26.63 Mt at a grade of 9.38% in 2023.

These changes are largely attributable to the successful completion of infill and exploration drilling, which significantly improved the total declared Measured and Indicated Mineral Resources. Additionally, the enhanced understanding of modifying factors, such as mining, metallurgical, economic, and environmental considerations, has contributed to a more accurate and reliable reserve estimate. This improved accuracy in predicting the spatial distribution and grade of the ore body has bolstered confidence in the reserve estimations and strategic planning for future mining operations. 

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*Modifying Factors:

·      Mining loss of 2% applied

·      2.25% Dilution applied

Competent Persons Statement

The corresponding JORC Table 1 relating to the 2023 MRE and Reserve is available on the Company's website at:   https://www.kropz.com/investors/press-releases/2024

Information in this announcement pertaining to Reporting of Sampling Techniques and Data, Exploration Results and Estimation and Reporting of Mineral Resources has been reviewed and approved by Vanessa Clark-Mostert, a Principal Consultant for Practara (Pty) Ltd, Unit 1, Floor 1, Building 12 Thornhill Office Park, Bekker Rd, Midrand, 1686, RSA, South Africa. The Company Registration number is 2015/217925/07.

Ms Clark-Mostert is registered with the South African Council for Natural Scientific Professionals, in the field of Geological Science, Pr. Sci. Nat. member No. 400161/07. She holds an MSc Earth Science Practice and Management, University of Pretoria, 2012, BSc (Honours) Environmental and Engineering Geology, University of Pretoria, 2002 and a BSc (Geology) from the University of Pretoria. Ms Clark-Mostert has more than 19 years' experience in the mining industry of which most of her working career included work as a consultant. Roles fulfilled which is pertinent to the style of mineralisation and mining method include Geological Consultant and Technical advisor. Parent Companies include Anglo American, Tronox, Richards Bay Minerals, TRG, TWP Investments, Phalaborwa Mining Company, General Nice Mining, Norilsk & BCL, Namakwa Sands, Assmang and Assore.

Ms Clark-Mostert is a 'Competent Person' as defined in the SAMREC Code which allows her to act as a Competent/Qualified Person.

Ms Clark-Mostert consents to the inclusion in this announcement of the matters based on this information in the form and context in which it appears. Ms Clark-Mostert confirms that the Company is not aware of any new information or data that materially affects the information included in the relevant market announcements, and that the form and context in which the information has been presented has not been materially modified.

Glossary

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

For further information visit www.kropz.com or contact:

About Kropz Plc

Kropz is an emerging African phosphate producer with projects in South Africa and in the Republic of Congo. The vision of the Group is to become a leading independent phosphate rock producer and to develop into an integrated, mine-to-market plant nutrient company focusing on sub-Saharan Africa.

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