Ertis POX construction approval

Solidcore Resources plc (“Solidcore” or the “Company”) is pleased to announce that the Company’s Board of directors have approved construction of the Ertis POX (EPOX), which will become Central Asia’s first hub for large-scale high-tech refractory concentrate processing.

“We move forward with the full-scale construction of Ertis POX, a cornerstone project for our growth strategy and de-risking the Company’s operations. The feasibility study confirmed EPOX’s ability to create significant value for the Company while accruing economic and social benefits to Kazakhstan. With Board approval, all-level government support and Solidcore’s highly experienced project team we are confident in our ability to complete this transformational project successfully”, said Vitaly Nesis, Group CEO of Solidcore Resources plc.

STRATEGIC RATIONALE

• EPOX will de-risk the Company’s operations by eliminating the current reliance on third-party off-takes and tolling arrangements, whilst also providing additional capacity to meet the growing demand for refractory ore processing in Central Asia.
• Pressure oxidation is one of the most sustainable and safe technologies in the hydrometallurgical industry. The project will have minimal environmental footprint and the Company’s value chain will benefit from substantial reductions in air pollution, water usage, and generation of solid waste.
• With an IRR of 13% at US$ 2,300/oz gold price, based on the processing of concentrate from the Company’s Kyzyl asset alone, the project offers strong returns on investment compared to significantly more expensive concentrate offtake. Additionally, there are opportunities to enhance project economics through the processing of third-party feed.
• The project will create about 500 permanent jobs and more than 1,000 jobs during construction phase, contributing to regional economic development, with a priority of employing local staff.

PROJECT OVERVIEW

• The project will deliver Kazakhstan’s first large-scale and high-tech full cycle pressure oxidation plant. The plant is designed for processing of refractory and double refractory concentrates, which comprise over 80% of the Company’s Ore Reserves.
• Pressure oxidation is the most feasible processing technology for refractory concentrate. It can achieve high recoveries by utilising high temperatures, elevated pressure and oxygen to recover carbon-encapsulated gold while conventional cyanidation methods would result in sub-optimal recovery rates of 20-40%.
• The plant’s design throughput is up to 300 Ktpa of concentrate with 94%-96% metal recovery rate.
•  Kyzyl concentrate will contribute to 55% of the design capacity with the remaining spare capacity to be available for the third party and own material from future projects.
• Pre-production capital expenditures are estimated at US$ 978 million including US$ 112 million of historical CAPEX incurred in 2023-2024. An increase versus the initial conceptual estimate of US$ 800 million is attributable to the higher cost of construction materials and equipment, increased infrastructure requirements and additional staffing needs. The expenditures will be funded out of the Company’s operating cash flow and bank loans.
• EPOX will be located within “Pavlodar” Special Economic Zone, Kazakhstan, 440 km from Astana and 500 km from Kyzyl mine. The area has a developed grid and water connectivity, supported by well-developed road infrastructure and convenient access to nearby railroads and river port on the Ertis river in Pavlodar.
• The facility will utilise a titanium-lined steel autoclave operating at temperatures of 240˚С and a pressure of 43.4 bar. The vessel, at 50 m length and 1.1 Kt weight, is considered to be the largest Ti-clad autoclave in the gold industry. It has already been manufactured by COEK in Belgium and is currently being transported to Kazakhstan with arrival on site scheduled for June 2025.
• Procurement support and engineering is carried out by Hatch Inc.

PROJECT DEVELOPMENT

EPOX construction will be managed by the team of highly-skilled professionals who were previously responsible for the successful execution of the previous Company’s POX construction project, which employs identical technology and flowsheet. This significantly eliminates the execution risk of the project. The project team is based at the Company’s HQ in Astana and project office in Pavlodar.

The Company has already made substantial progress in preparation for construction:

• The autoclave has been manufactured and transportation is in progress;
• The land plot selected and site layout is permitted;
• Detailed site surveying activities in progress (80% completion);
• Positive state ecological expert review conclusion for temporary buildings and facilities received;
• Pilot test piles installation on POX building site started;
• Hatch basic engineering in progress (54% completion);
• Hatch procurement in progress (26% completion), first priority packages with long lead items are currently being finalized for contracting.

Major future milestones include:

• Completion of basic engineering: H1 2025
• Autoclave on-site delivery and foundations installation: H2 2025
• Commencement of full-scale construction activities: H2 2025
• Mechanical completion and start of commissioning activities: H2 2027
• End of commissioning and first production: H2 2028

SUSTAINABLITY

• Ertis POX will offset significant Scope 2 carbon emissions, sulphur and arsenic oxides emissions currently generated by Chinese off-takers utilising roasting technology. POX itself has minimal carbon dioxide discharge and no sulphur or arsenic oxides discharge.
• Up to 70% of water utilised for the concentrate processing will be recycled and re-used.
• 95% of the autoclave heat will be captured by heat recovery systems.
• Over 90% of primary energy consumption will be supplied by the grid.

About Solidcore

Solidcore Resources is a leading gold producer registered in AIFC, Kazakhstan, and listed on Astana International Exchange. Solidcore operates two producing gold mines and a major growth project in Kazakhstan.

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FORWARD-LOOKING STATEMENTS

This release may include statements that are, or may be deemed to be, “forward-looking statements”. These forward-looking statements speak only as at the date of this release. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “targets”, “believes”, “expects”, “aims”, “intends”, “will”, “may”, “anticipates”, “would”, “could” or “should” or similar expressions or, in each case their negative or other variations or by discussion of strategies, plans, objectives, goals, future events or intentions. These forward-looking statements all include matters that are not historical facts. By their nature, such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the company’s control that could cause the actual results, performance or achievements of the company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the company’s present and future business strategies and the environment in which the company will operate in the future. Forward-looking statements are not guarantees of future performance. There are many factors that could cause the company’s actual results, performance or achievements to differ materially from those expressed in such forward-looking statements. The company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the company’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.