Strategic Minerals (SML.L) Leigh Creek Copper Mine Update

Approval Process, Funding Progress and Appointment of Mine Manager

Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a profitable, producing mineral company is pleased to confirm that its wholly owned subsidiary, Leigh Creek Copper Mine (“LCCM”), has received notification from the Department of Energy and Mining of South Australia (“DEM”) of its intention to finalise its assessment on the Paltridge North deposit (“Paltridge North”) Programme for Environmental Protection and Rehabilitation (“PEPR”) during July 2021.

Highlights

· DEM is currently assessing the latest element of the PEPR submission and has informed the Company of its intention to finalise the assessment during July (providing previous feedback has been adequately addressed).

· Appointment of John Speck as LCCM’s Mine Manager.

· The Board has elected to seek additional funding to conduct both production at Paltridge North and exploration simultaneously, as well as preparing LCCM for a potential listing on the Australian Stock Exchange (“ASX”).

· Aetas Global Capital Pte Ltd (“Aetas”) has been appointed to assist the Company in its endeavours to raise, preferably by way of debt at the LCCM level, AUD $10m to fund production at Paltridge North, exploration work and pre-listing costs.

PEPR Approval Process

Based on discussions with the DEM, the Board understands they are currently in the latter stages of finalising their assessment and the approval process should conclude during July.

In light of the Board’s expectation that this approval will be forthcoming in July 2021, the Company has appointed Mr John Speck as Mine Manager for LCCM.

Mr Speck’s career in the mining industry spans over 25 years in commodities that include copper, gold, iron ore and nickel. He has worked for both contractors and mining companies in a variety of technical roles as well as in supervisory and management roles. He is experienced with in-house project management of pre-feasibility and definitive feasibility studies as well as a range of consultancy roles. His areas of expertise include mine optimisation, design and scheduling and he holds a Western Australian Quarry Manager’s Certificate.

Mr Speck will commence his position in the first week of July and the timing of Mr Speck’s appointment reflects;

1. Management and the Board’s confidence that LCCM will be undertaking production in the second half of 2021 subject to the receipt of required funding; and

2. The need to commence work on tendering, reviewing, executing and managing both the mining and processing sub-contractors expected to be employed in operating the Mountain of Light plant.

Financials and Funding

For over a year, the Company has been engaged in discussion with either potential joint venture partners or funders to develop LCCM. Progress on this has been partly hampered by the COVID-19 depressed copper price in early 2020 and the relatively small size of funding sought. With the strong rebound in copper prices, which Macquarie Bank forecast to remain largely at the higher levels in both the medium to longer term, the funding emphasis has shifted to a stronger debt focus, but also to underwrite the future development of LCCM via exploration. To understand the change in underlying financials, the following table shows forecast values one year ago, at time of acquisition and under current internal management expectations for long term pricing:

The Company has recently engaged Aetas Global Capital Pte Ltd (“Aetas”) ( http://aetas-global.com/ ) to assist it in introducing suitable counterparties. Aetas has a strong track record of having successfully raised funding for other resource projects closely known to the Company. Aetas has had considerable success with project funding and has an extensive Asia-Pacific investor network.

Prior to their appointment, Aetas undertook a due diligence review of LCCM and from this identified that;

a) the target funding level to attract appropriate engagement was likely to be above the level LCCM was seeking to solely restart production at Paltridge North; and

b) that the project’s resource upside needed to be augmented via an additional exploration program for both copper oxide and sulphide deposits.

In light of these conclusions, the Board decided to mandate a funding brief for AUD $10m to include funding required to get into production at Paltridge North and conduct a new exploration program. In light of the project’s increased profitability, the Board considered it appropriate to concentrate on debt funding, where possible.

In order to ensure the greatest flexibility to obtain funding, Aetas has recommended that the Company target the potential listing of the LCCM project on the ASX within a year. This is consistent with the Board’s broad strategy as previously announced in November 2020 and, once funding is obtained, work will commence on this approach.

Commenting, John Peters, Managing Director of Strategic Minerals, said:

“Although the Company has been anticipating an expected PEPR approval by the end of June 2021, the slight delay into July still ensures that plans continue unchanged, with the recent appointment of a mine manager and the engagement of Aetas.

“Aetas have begun making introductions and, given the current favourable market conditions for copper projects, the Board feels confident that a funding solution to recommence LCCM production and advance exploration will be secured.

“Sensitivity analysis for LCCM clearly demonstrate the expected, significant returns from the project. The use of the funds to undertake production and new exploration, continue to de-risk LCCM and further enhance its future prospects

“The planned undertaking of an ASX listing for a South Australian Copper project seeks to further secure the overall position of the parent Company. ”

Notes to Editors

Strategic Minerals plc is an AIM-quoted, profitable operating minerals company actively developing projects tailored to materials expected to benefit from strong demand in the future. It has an operation in the United States of America along with development projects in the UK and Australia. The Company is focused on utilising its operating cash flows, along with capital raisings, to develop high quality projects aimed at supplying the metals and minerals likely to be highly demanded in the future.

In September 2011, Strategic Minerals acquired the distribution rights to the Cobre magnetite tailings dam project in New Mexico, USA, a cash-generating asset, which it brought into production in 2012 and which continues to provide a revenue stream for the Company. This operating revenue stream is utilised to cover company overheads and invest in development projects orientated to supplying the burgeoning electric vehicle/battery market.

In May 2016, the Company entered into an agreement with New Age Exploration Limited and, in February 2017, acquired 50% of the Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds from the Company’s investment were utilised to complete a drilling programme that year. The drilling programme resulted in a significant upgrade of the resource. This was followed in 2018 with a 12-hole 2018 drilling programme has now been completed and the resource update that resulted was announced in February 2019. In March 2019, the Company entered into arrangements to acquire the balance of the Redmoor Tin/Tungsten project which was settled on 24 July 2019 by way of a vendor loan which was fully repaid on 26 June 2020.

In March 2018, the Company completed the acquisition of the Leigh Creek Copper Mine situated in the copper rich belt of South Austra lia and brought the project temporarily into production in April 2019. The project currently awaits clearance from the South Australian Government of its lodged Program for Environmental Protection and Rehabilitation (PEPR).


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