Oct 158 min read

Euro Manganese Update

October 2024

Dear investors,

Welcome to the first edition of Euro Manganese’s investor bulletin. We are pleased to bring you updates and insights into our progress and future plans through this publication.

In this edition, you will find insights into key developments during 2024.

In March this year, we received the much-anticipated approval for the Environmental and Social Impact Assessment (or ESIA) for the Chvaletice Project from the Czech Ministry of Environment. This assessment is the key gating permit from which subsequent, more procedural, permits can follow.

Operationally, the Demonstration Plant in the Czech Republic has successfully completed several milestones, including completion of commissioning, successfully producing high-purity manganese sulphate (32.4% pure) from high-purity electrolytic manganese metal (“HPEMM’) produced in the Demonstration Plant, and more recently successfully completing a 5-day continuous operation program for the production of HPEMM surpassing key technical targets which form part of the conditions for accessing the next draw-down from the Orion financing package announced on November 28, 2023.

With the EU Critical Raw Materials Act (CRMA) coming into force earlier this year, we have submitted our application for Strategic Project status. The benefits of gaining Strategic Project status include potential access to financing from numerous private and public sources such as national banks, EU institutions, regional and national funding authorities, and private financial institutions. It is anticipated the result of the application will be announced in March 2025.

Euro Manganese has also secured three additional offtake term sheet agreements in the last two months for the sale of high-purity manganese products from the Company’s Chvaletice Manganese Project. There are now four offtake term sheets plus the off-take commitment to Orion up to 22.5% of the project’s production. One of these terms sheets also included the purchase of a by-product from the project, magnesium carbonate. In the Feasibility Study no revenue was considered from by-product sales.

We also engaged with the Investment and Business Development Agency of the Czech Republic (CzechInvest) for an application to be made for Czech government investment incentives, including potential cash grants on eligible capital expenditures and income tax relief. In addition, we engaged in exploration of an application, with the support of EIT InnoEnergy (EIT), to the EU Innovation Fund’s next call for proposals which is expected to open in Q4 2024.

Finally, the Chvaletice Manganese Project received a substantial show of support from the European Investment Bank for debt funding, and is now listed on the EIB website under the list of ‘Projects to be Financed’. We view this as a key step towards securing the required debt component of the total project financing.

During the remainder of 2024, we remain focused on advancing our flagship project in Europe. Chvaletice remains the only sizeable proven and probable reserve of manganese in the EU - uniquely positioning Euro Manganese to provide a secure, traceable, and responsibly produced supply of high-purity manganese products to the North American and European EV markets.

Thank you for your continued support and I look forward to updating you on our progress after we report our financial results for the fourth quarter of 2024.

2024 NEWS RECAP

Below is a quick round-up of Euro Manganese's key developments during the third fiscal quarter of 2024 and to date. Follow our LinkedIn to keep up-to-date with what's going on in our world.

Euro Manganese Appoints Ms. Ludivine Wouters as Non-Executive Director

Euro Manganese is pleased to announce the appointment of Ms. Ludivine Wouters as a non-executive Director to the Board of Directors of the Company, effective October 2, 2024. As previously announced, Ms. Wouters’ official appointment follows her successful acquisition of a Director Identification Number (DIN) from the Australian Business Registry Services.

John Webster, Chair of the Board of Directors of Euro Manganese, commented: “We are delighted to welcome Ms. Wouters to our Board. Her extensive experience in European policy on mining and minerals, particularly in critical raw materials, will be instrumental as the Company strengthens its unique position to support the supply of critical materials essential for energy transition and focuses on delivering sustainable growth for our shareholders." (please refer to EMN news release dated Oct 3,2024).

Euro Manganese Announces Offtake Term Sheet with FeMoCat Ltd

Euro Manganese Inc. is pleased to announce it has entered into an offtake term sheet dated September 6, 2024 with FeMoCat Ltd, for the sale of high-purity manganese sulphate and a process by-product, magnesium carbonate, from the Company’s Chvaletice Manganese Project in the Czech Republic.

FeMoCat is an established industrial catalyst manufacturer, with a plant at Pardubice in the Czech Republic, less than 1 hour’s drive from the Chvaletice Manganese Project. They will use these products for its catalysts and Synthetic Hydrotalcites production in Pardubice. (please refer to EMN news release dated September 09, 2024).

Euro Manganese Submits Application for Strategic Project Status under EU’s Critical Raw Materials Act

Euro Manganese has successfully submitted an application to designate the Chvaletice Manganese Project as a Strategic Project under the European Union’s Critical Raw Materials Act (“CRMA”).

The CRMA, which took effect in May 2024, is designed to sustainably ensure the availability of raw materials that are essential and strategic for Europe's economy and green transition. The CRMA lists more than 30 raw materials and defines high-purity manganese (battery grade) as a strategic raw material, and manganese as a critical raw material. The European Commission is expected to announce the first list of Strategic Projects in December 2024. (please refer to EMN news release dated August 28, 2024).

Euro Manganese Announces Offtake Term Sheet with Blue Grass Chemical Specialties

Euro Manganese is pleased to announce it has entered into an offtake term sheet with Blue Grass Chemical Specialties August 23, 2024 for the sale of high-purity manganese metal from the Company’s Chvaletice Manganese Project in the Czech Republic.

Based in New Albany, Indiana, Blue Grass Chemical has over five decades of experience in producing specialty chemicals in numerous industries. It produces manganese nitrate as a precursor to manganese dioxide and other manganese oxides which are critical components in battery production, particularly lithium-ion batteries, powering everything from electric vehicles to portable electronic devices. High-quality manganese nitrate plays an important role in the performance and longevity of these batteries. (please refer to EMN news release dated August 23, 2024).

Euro Manganese Announces Offtake Term Sheet with Wildcat Discovery Technologies

Euro Manganese is pleased to announce it has entered an offtake term sheet dated August 15, 2024 with Wildcat Discovery Technologies, for the sale of high-purity manganese product from the Company’s Chvaletice Manganese Project in the Czech Republic.

Based in San Diego, California, Wildcat partners with global leaders throughout the battery industry to align and integrate all elements of the full battery cell for optimal performance. Consistent and significant progress in Wildcat’s technology has led to a focus exclusively on nickel and cobalt free cathode production. Wildcat has announced the building of a U.S.-based plant expected 2026 – 2027 to produce a portfolio of safe sustainable, and cobalt/nickel-free cathode materials for electric vehicle battery cells and other markets including stationary storage. (please refer to EMN news release dated August 15, 2024).

Euro Manganese Receives Approval of Environmental and Social Impact Assessment for Chvaletice Manganese Project

The Company has received a positive ESIA binding statement from the Czech Ministry of Environment, which approves the environmental and social conditions set out in the ESIA. This is the culmination of a four-year process, where 14 separate government authorities were required to provide a positive opinion on the Company’s ESIA, after which the ESIA was open to a public commentary period. No comments were received from the public, NGOs or regional municipalities during this period, demonstrating the excellent stakeholder engagement processes managed by the Company’s local Czech team.

The approval of the ESIA is the key gating permit from which subsequent permits can follow, including the Land Planning Permit and the Construction Permit. Receipt of the ESIA also allows the Company to progress to the final determination of the Mining Lease for the Project (please refer to EMN news release dated March 27, 2024).

Euro Manganese Advances to Next Stage of Debt Funding Process with the European Investment Bank

Euro Manganese’s Chvaletice Project has progressed to the formal appraisal stage for debt financing with the EIB in what was a significant milestone in securing funds for the Czech Republic's high-purity manganese production plant. Chvaletice is the European Union's (“EU”) sole large manganese reserve, positioning Euro Manganese as a key supplier of local, recycled, ESG compliant high-purity manganese for the European EV market.

Recognised by the EU as both a Strategic and Critical Raw Material source, the Chvaletice Project is set to boost EU resilience in battery materials while delivering environmental benefits through historical tailings remediation. Debt financing from the EIB supports the aims of the inter-governmental Minerals Security Partnership ("MSP"), which includes 13 countries and the EU, that has endorsed the Chvaletice Project as a key initiative (please refer to EMN news release dated March 10, 2024).

FEASIBILITY STUDY HIGHLIGHTS ($ figures in USD)

Good cashflow and margins together with security of supply for Europe. Stable production over 25-year project life, supported by 27 Mt reserve base. On July 27, 2022, Euro Manganese announced the results of FS for the Chvaletice Manganese Project. Read the full news release here

FEASIBILITY STUDY PRICE FORECAST for HPMSM US$/t REAL (July 2022)

FINANCIAL METRICS (June 30, 2024)

CORPORATE TEAM GROWTH

Change of Corporate Secretary

Euro Manganese is pleased to announce the appointment of Ms. Laurel Petryk as Vice President Legal & Corporate Secretary of the Company effective September 1, 2024. In keeping with the Company’s long-standing succession plan, Ms. Petryk will replace Mr. Fausto Taddei, who retired on August 31, 2024. Mr. Taddei will work with the Company to support a seamless change and remain available to provide guidance and support during the transition phase.

Appointment of Project Director

Mr. Tim Kindred recently joined the Company as Project Director for the Chvaletice Project. Tim is responsible for leading the team that will work together with Wood to deliver FEED work followed by EPCM once a final investment decision has been made. Tim will initially be based in Perth, Australia and will relocate to the Czech Republic during the construction phase of the Project. Tim is a Chemical Engineer and a Graduate of the Australian Graduate School of Management. With a background in hydrometallurgy, Tim is a highly skilled project and operations leader in the mining and metals industry. He has successfully led project delivery from feasibility study to FEED, construction, completion and commissioning on multibillion dollar projects, including large and complex operations. Tim has experience in nickel, cobalt, copper, lithium, and gold and has a strong background in battery metal projects supporting decarbonisation. During his tenure of over 10 years working with Vale Base Metals, he led the project turnaround and successful construction, completion, and commissioning of the Vale Long Harbour Project, a US$5 billion nickel processing plant project, transitioning to an integrated team delivery model that drove success and delivered the project on time and on budget.