Akobo Minerals Ab

Good morning and welcome to our Q1 operational update. This will not be your regular Q1 presentation. I think we're all more eager to hear about the latest operational updates. So we'll focus on that today. A lot of things have happened recently and we are pretty excited about the latest development and the milestones that we have achieved. So with me today, we'll also have our COO, Dr. Matt Jackson, and our Head of Mining and Processing, Helge Ursfeldt. So we'll take you through the presentation and take some questions at the end. So this time, I'll jump straight into the operational highlights that we've had lately. This has been a very busy period for us and as you can see here we have actually now completed the processing plant construction. It's 100% done. As you see also, important element that we have to mention is really the good and robust support and collaboration we've had now with the Ministry of Mines and other governmental bodies to make this happen. It's been a joint effort and we've all been working very hard to get this done. And as you can see also here, we're targeting actually the commencement of first low-grade ore production by end of July. So this is a milestone for us, a huge milestone in the history of the company, and we're really looking forward to presenting this today and tell you more about what we're doing and what's next. Just to give you some of the highlights here, we've been talking previously about tailings, diesel, electrical work, piping, and it's all been completed. A big effort from the team working 24-7 to get this done. So we're really proud of all the hard work that's been done lately at site. It's been hard, but they really came through, and it's all done now. We've also started the phase commissioning at site with Universal Power and Solo Resources. They arrived a few days ago and already a lot has happened. We've had successful synchronization, testing and operation of all the generators that will provide power to the processing plant. Actually this morning we just got the first video of the mill being commissioned and is running. That's really a big thing for us. And we'll continue with the conveyor belts and the crusher in, well, today, tomorrow, next couple of days. The ore body is now to be reached in the eastern winds very, very shortly, any day. And that will, of course, give us access to more gold or ore-rich gold. And that, together with the fact that we reached the gold in the western winds, will provide us with material to run through the mill and the processing plant during July. We have also engaged industry leading contractor DRA Global. They will support us to enhance the mining operation efficiency, reduce the operational risk, and we're really looking forward to develop that cooperation with them. They're really one of the big players in the mining industry. We also worked a lot on sourcing and logistics, and now we have a very good setup in place with several third party procurement houses or enterprises together with airline logistics. And we also have DRA Global working with us on the procurement side now. And we have worked hard with our local team and also we need to mention Prudent Logistics who are helping us a lot on the local side of this to get things in and out of customs. So the setup there looks really good these days. We've had some trouble, as you all know, with the diesel supply over the last few months. We have now received the license from the Ethiopian Petroleum and Energy Authority for our own fuel sourcing and transportation. This, together with the fuel agreement that has been signed with the national oil company, will really make a big difference in the reliability of sourcing fuel and having that always at site. that together with the new diesel infrastructure that we have at site with some large 60 000 liter tanks then i think we're good we're good there A bit earlier this year we had a successful restructuring of the debt obligations with monetary metals. We converted all other convertible loans to equity. We raised 5.5 million dollars in new equity and the balance sheet looks good and the restructuring was a success. Updated mine plan. We forecast actually some really good revenue in the first three, four months of full production. That does not mean from July, but once we're really up and running. But it says a lot about the potential in the near mining operations that we're going into. And also, we see an improved EBITDA over the first 12 months compared to the plan we presented earlier this year. So a lot of good things happening these days and just seeing now the mill running, the generators up and providing electricity to the plant, it gives me a good feeling. And for those who don't know us that well, I'll go through some of the slides. just talking about the company. As some of you know, some of you don't, we are listed in Oslo on the Euronext exchange. We're trading on the OTC in New York. We're Scandinavian based and our only asset is in Ethiopia. There we have a license for both exploration and mining in the Gambela region. It's all the way to the southwest of Ethiopia, closer to the border of South Sudan. It's been a nice area to work in over the last few years and it continues to be so. We've been there for 14 years now. We really have built a strong local foothold. We have good relationship with the community and all the necessary governmental bodies, all the way from the region or the local Voreda region and all the way up to the ministries. And we believe that we're still uniquely positioned to become one of the major players in the Ethiopian mining and exploration industry over the next 5, 10, 15 years. And why we're so excited, of course, still, is that there is a significant gold production potential in our area. We have the exploration license. It's an attractive part of the Arabian Nubian Shield. It's where the gold is supposed to be, and that's where we found it. We have an ambition still to develop a world class deposit of 1.5 to 2 million ounces. and we've identified several targets that we think will take us there. The mining license that we have is giving a potential for significant cash flow from the Segelov deposit alone, but it's also large enough to bring adjacent targets into production so that we can use the same production plant, the processing plant, to develop new areas. The plant machines and equipment side, we have now the processing plant up and running. It's complete, it's constructed, it's a modern and really fit for purpose. And as we all know, we still have a very low cost drilling operation that we will hopefully now get back on track. Why Segheli is interesting is definitely the really high grade that we can see here. The indicated mineral resource alone has an average of 40.6 gram per ton. That's rarely seen anywhere else in the world. It's still a small resource, but we expect to expand. It's still open at that, and we have several near mine targets that will feed into this. So we do expect a high margin gold production going forward. The estimated free cash flow from Segelian itself is around $50 million, based upon just the current resource estimates. And we have an agreement with the refinery MKS PAMP that will handle all the logistics sides and refinery sides from getting this gold out of our gold room into their refinery in Switzerland and then again convert that into cash. So we have the setup, we have everything in place. But what else? We also need to do it right. This is an important part of our company. We have a great ESG team working hard to make sure that we follow international standards and international guidelines. We have developed some award-winning programs. We're trying to be at the forefront using technology and the latest innovations to really make our operation as efficient as possible but also within the frame of international guidelines and standards. So this is a very important part of our business and this is really what makes me believe that we have a solid base to build upon. So ESG, environmental, social, and governments, we continue to develop it. They're working hard and as an integral part of the rest of the organization, helping with ideas, helping with developing new projects, being it the tailings, being it the use of tailings that we hope that we can do. so that we don't have to have a lot of tailings stored, but instead use it in production of construction materials. We're also establishing this tree nursery that we will use to rehabilitate and improve the local environment around us. This is also an important part of reducing our footprint in the area. Again, they're part of everything we're doing. All decisions made on the mining side is also done in cooperation with our ESG team. So they will have ongoing environmental monitoring now of air, noise, surface and groundwater as we move into production. And we're also participating on some high level conferences around, lately global session of the UN Science Policy Business Forum on the environment. So we're really putting a lot of effort into this. Looking forward on the ESG side, we're working hard on the mine closure plan. That's something that will be done soon. We will hire more environmental performance coordinators to oversee what we're doing. Everything that has to do with fuel tankers going in and out will be evaluated. We're also expanding our collaboration with Lynx ESG data platform that will enhance training and ensure accurate social, environmental and engagement data recording. This has been a great tool for us and continues to be in development and we see great use for this. And last year we're also developing a partnership with the Jima University, Addis Ababa University and the Oslo University to map wildlife in the Gambela region and hosting ecology researchers and contributing to biodiversity mapping. So a lot happening also on that side. But maybe now a bit more into our operational details. As I said, we're all pretty, yeah, it's been a good day and a good week and a lot of things are happening. So I'll leave it now to Helge to talk through some of the details on the mining operations and the plant side. So Helge.

Thank you, Jørgen. So our mine is currently, we have these three winces going down into the earth and we have The eastern winds now at 66 meters out of 77 before we start to crosscut between the eastern and the western winds. We have the western winds at 53 meters out of 65. So just 12 more meters for that to go before we're done with that. And then the incline shaft, which will be the long wind uh term plan for getting ore out is at currently at 52 meters um we have hired a norwegian specialist mine planner who has made a new and updated mine plan for our project and he finished that some few months ago And this plan is now changed to give an early access to a very rich part of the ore. So it will give us a very good start on the mining side. There is no denying that we have had several challenges this first quarter of the year. We have had Some problems with imports, things taking a lot of time in the customs, etc. Matt will come back to that later. We also had problems with diesel availability in such severity that we actually had to stop mining because we didn't have any diesel at site. So, of course, that has influenced us a lot. And we have also had a few of these extreme rain events that carries a lot of mud into the mine. And this is difficult to remove and also tends to ruin the pumps. So these are the things that are kind of hard to see. The good thing is that whenever we have our, diesel available and every pump is in order we are mining very well so the last month I would say is we have blasted every day so that is a very good progress on the eastern winds we will reach the ore body any day now And the next phase there will be start cross-cutting, like to make a cross-cut between the eastern and the western winds. And then when that is done, then the stoping will start. So we have a trial stop that we will start with, containing about 12,800 grams of gold. This is to test out both the stopping system and also the plant. And then when that is done, we will move into a very rich part. So the stop number one is 306,000 grams of gold. So that's a very rich part of the ore. Yeah, so we have done a lot of work with the external factors. Matt will come back to some of them later in this presentation. Going forward, we have engaged the global consultant DRA for mining operations to increase the speed of ore extraction. So they will have booked flights and will come to us already next week on the site and then start cooperating with us to make the mine haulage even faster than today. We are also trying now to build a stock of consumables and spare parts to make the operation more robust for delivery challenges. And we are also working on permanent solution to prevent the rain events to influence the mine.

Yes. So this is the new mine plan.