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Zinnwald Lithium plc / EPIC: ZNWD.L / Market: AIM / Sector: Mining

28 January 2025

Zinnwald Lithium plc ('Zinnwald Lithium' or the 'Company')

Operational Update

Advancing the EU's Second Largest Hard-Rock Lithium Project

Zinnwald Lithium plc, the European focused lithium company developing the integrated Zinnwald Lithium Project (the 'Project') in Germany, is pleased to provide an operational update on recent activities.

HIGHLIGHTS

·    The PFS remains on track to be published in Q1 2025.

·    Detailed mine plan finalised to deliver increased production scenarios, following the publication of an updated Mineral Resource Estimate ('MRE') in June 2024.

·   Metso process engineering and design work in final stages following completion of mineral processing basic engineering and the key calcination, and hydrometallurgical testwork programmes.

·      Site layout design and infrastructure completed indicating sufficient supply of key utilities.

·    The geotechnical drill programme has been completed as part of detailed planning for constructing an exploration adit to access the Zinnwald orebody.

·      Advancing environmental licencing and permitting, with updates to the spatial planning process submitted to Landesdirektion Sachsen.

·      ERM contracted to provide the Environmental and Social Impact Assessment ('ESIA') Scoping Study.

·     LOI signed with solar development company Solar-Bau to explore the option for long term clean power offtake.

·    New CDU-SPD coalition agreement in Saxony highlights the raw material industry as critical to the region's economy, prioritising the simplification and acceleration of mining project approvals, with the Zinnwald Lithium Project being the only project formally referenced.

Zinnwald Lithium CEO, Anton du Plessis, commented: "Our Zinnwald Lithium Project is making significant strides towards becoming a cornerstone of Europe's battery supply chain. With the PFS on track to be published in Q1 2025, we are progressing on all fronts, from optimising mine planning and advancing metallurgical testwork to collaborating on solar power solutions to minimise environmental impact. These milestones, combined with strong partnerships, local government support and ongoing stakeholder engagement, position us to deliver lithium hydroxide at scale, essential for Europe's green energy transition and raw material security." 

DETAILS

Zinnwald Lithium continues to make significant progress in the development of its integrated lithium hydroxide ('LiOH') project in Germany, which is the second largest hard-rock lithium project in the EU.

Pre-Feasibility Study ("PFS")

Following the completion of the revised Mineral Resource Estimate ('MRE') in June 2024, Zinnwald Lithium has been advancing its PFS, which remains on track to be published in Q1 2025.

Having completed detailed mine planning, the work is now focused on preparation of the Reserve Statement. The potential of the ore body to support larger scale mining in the future has also been evaluated and incorporated into the PFS.

Based on representative samples generated from its exploration programme, including both high grade greisen and albite granite ore types found in the deposit, the Company has continued its mineral processing, calcination and hydrometallurgical testwork programmes. These have been undertaken by Metso, a frontrunner in sustainable technologies, end-to-end solutions and services for the aggregates, minerals processing and metals refining industries globally.

The Basic Engineering for the mineral processing circuit was completed to a level of accuracy consistent with a definitive feasibility standard. As noted in the Company's interim results, the mineral processing flowsheet and equipment selected is a simple, proven, mainstream modular design that can be scaled for increased production levels if required.

With regard to pyro-metallurgy, calcination testwork has been successfully concluded at Metso's facility in York, Pennsylvania and equipment selection has been confirmed. Basic Engineering is well advanced.

Hydrometallurgical testwork is also nearing completion. Remaining testwork is primarily focused on refining the treatment of effluent streams and the production of saleable by-products.

Site layout and infrastructure planning has been completed in conjunction with Fichtner, a leading German engineering company. This work indicates that water, power, and gas supplies available in the area are sufficient to support the planned operation.

Water management and hydrogeology is a critical component of both mine design and the permitting process. A main operating plan for hydrogeological monitoring in the Zinnwald area was approved by the Saxony Mining Authority ('SOBA') in November 2024 and is valid until November 2028. This plan outlines a comprehensive framework for evaluating water resources in the area. It includes the establishment and operation of monitoring stations for surface water, groundwater, and mine water, ensuring data collection on water levels, flow, and quality. In cooperation with Geomet s.r.o., which is the owner of the Cinovec Project in the Czech Republic, Zinnwald Lithium has contracted ERM, the largest global pure play sustainability consultancy, to develop a cross-border hydrogeological model. The model will be used to evaluate the potential impact of mining operations on the hydrogeology.

A geotechnical drill programme was also completed as part of detailed planning for the construction of an exploration adit to access the Zinnwald ore body. The exploration adit will provide the opportunity to extract a large-scale bulk sample to be used for piloting, as well as providing further detailed information on the ore body.

Whilst the Company's primary focus is on the development of its core Zinnwald Licence, it continues to advance targets on its surrounding 100% owned prospective exploration licence areas, including Falkenhain, Altenberg, Bärenstein and Sadisdorf. Work on these licences has mainly involved relogging and sampling historical data and core. Furthermore, the Company applied for and received an extension of its Altenberg exploration licence, which is now valid until 20 February 2027.

Sustainability / ESG Matters

Zinnwald Lithium has placed its social license to operate at the heart of its operations and intrinsic to the Project's future success. Meaningful and transparent engagement and information disclosure are essential to facilitate community and stakeholder acceptance.

Permitting and Environmental

Zinnwald Lithium continues to collaborate with key stakeholders, such as SOBA, the Landesdirektion Sachsen (State Directorate responsible for spatial planning) and local municipal, district, state, and federal authorities. In December 2024, Zinnwald Lithium submitted updates to its spatial planning scoping documents for its sites and expects to receive feedback on the proposed assessments required for its Environmental Impact Assessment ('EIA') by the end of Q1 2025. This will initiate the submission of its full spatial planning application. In addition to the ongoing hydrogeological work noted above, in October 2024, the Project commenced its 12-month baseline flora and fauna studies at the proposed plant site as part of the EIA process. The assessment areas were defined by Schulz Umweltplanung and approved by the lower nature conservation authority.

Environmental Social Impact Assessment ('ESIA')

A comprehensive ESIA for the Project will be completed to meet the standards required by International Financing Institutions ('IFIs'), which are generally more rigorous and extensive than national permitting requirements. In October 2024, Zinnwald Lithium contracted ERM to provide the initial ESIA Scoping Study phase. Zinnwald Lithium will issue this Scoping Report to SOBA and publish it following completion of the PFS for wider stakeholder participation.

Direct stakeholder engagement

Zinnwald Lithium continues to undertake regular engagement with the local communities directly impacted by the planned site locations and other stakeholders. The Company has established a physical presence in Altenberg, providing access for interested parties to obtain information about the Project. The Company will continue to hold town hall events in the coming months to provide further details on the development of the Project, its benefits, and its aim to mitigate impact on the environment and community.

Corporate and other Matters

The Company has signed a letter of intent ('LOI') with P+S Projektentwicklung Solar-Bau GmbH ('Solar-Bau') to explore the purchase of solar-generated power. Solar-Bau, a solar development company, plans to establish several solar power generation facilities near the Project. This partnership could therefore minimise environmental impact by using solar energy close to its source, thereby reducing energy transfer losses and infrastructure costs, while providing Zinnwald Lithium with a clean energy source to lower the CO₂ content of its final product.

In August 2024, Zinnwald Lithium applied for Critical Raw Materials Act ("CRMA") strategic project designation under the Extraction and Processing categories. The European Commission ('EC') has confirmed the application has passed the initial evaluation stage and anticipates informing applicants of the final outcome in March 2025, following the high number of applications (170 in total, of which 121 were from within the EU). Zinnwald Lithium believes the Project meets the criteria for recognition as a Strategic Project, given its significant contribution to LiOH production in the EU, its resource scale, feasibility, sustainability credentials and broader EU benefits.

As announced on 27 June 2024, Zinnwald Lithium was invited to apply for Phase 2 of the Temporary Crisis and Transition Framework ('TCTF') grant programme to support Germany's battery cell manufacturing ecosystem. The review by the German Federal Ministry for Economic Affairs and Climate Action is ongoing. While the invitation does not guarantee funding, it acknowledges the Project's strong potential. Updates will be provided as more information becomes available. The upcoming general election in Germany on 23 February 2025 may affect the timeline for decision-making.

On 16 December 2024, the Christlich Demokratische Union Deutschlands ('CDU'), which won the highest individual share of the state elections in September 2024, approved a coalition agreement with the Sozialdemokratische Partei Deutschlands ('SPD') to form a minority coalition government. Zinnwald Lithium was delighted that this agreement specifically refers to the importance of the raw material industry to Saxony and establishes as a key goal the ability to simplify and speed up the planning and approval of mining projects. The agreement specifically refers to the Zinnwald Lithium Project in this context and is the only project formally referenced. Notably, in August and December 2024, Zinnwald Lithium attended meetings with German Federal Chancellor Olaf Scholz to discuss raw material security and the Project's potential.

OUTLOOK

The Company remains on track to publish its PFS during Q1 2025 before further refining its plans with a Definitive Feasibility Study. To support this, the Company plans to conduct a large-scale continuous pilot test to refine and validate the flowsheet design, which will serve as the basis for process guarantees that are crucial for future financing options.

The Company remains well financed with a cash position as at 27 January 2025 of €5.0 million  and the Board looks forward to updating the market on progress on all of fronts as its various workstreams continue.

*ENDS*

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

Notes

AIM quoted Zinnwald Lithium plc (EPIC: ZNWD.L) is focused on becoming an important supplier of lithium hydroxide to Europe's fast-growing battery sector. The Company owns 100% of the Zinnwald Lithium Project in Germany, which has an approved mining licence, is located in the heart of Europe's chemical and automotive industries and has the potential to be one of Europe's more advanced battery grade lithium projects.