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Alphamin’s release Q3 tin production and sales exceed guidance

Alphamin Resources Corp., a producer of 4% of the world’s mined tin1 from its high grade operation in the Democratic Republic of Congo, is pleased to provide the following operational update for the quarter ended September 2022:

Operational and Financial Performance – Q3 2022

Contained tin production of 3,139 tonnes was in line with the previous quarter and above market guidance of 3,000 tonnes. A highly mineralised area underground, not previously included in the mineral resource or mine plan due to its structurally complex nature, was successfully mined and processed during the quarter. This area delivered ore at good tin grades but contained high levels of sulphides which impacted processing recoveries.

Sales volumes were in line with production at an average achieved tin price of US$22 011/t and weighted towards the back end of the quarter. Year-to-date contained tin production of 9,380 tonnes has exceeded the forecast rate to achieve market guidance of 12,000 tonnes for the year ending December 2022. We expect contained tin production and sales of approximately 3,000 tonnes for the quarter ending December 2022.

AISC per tonne of tin sold is expected to decrease by 10% to US$13 200 due to the impact of the lower tin prices on the off-mine costs particularly to product marketing fees, royalties, export duties and smelter payables.

EBITDA for Q3 2022 is estimated at US$30.1 million (Q2: US$67 million) following a 38% reduction in the tin price quarter on quarter. This represents a healthy EBITDA margin of 44% in a low tin price environment. Tin currently trades at between US$20,000/t and US$21,000/t with demand having been impacted by worsening global macroeconomics. The Company remains of the opinion that global tin supply is likely to be constrained during the next five years while demand for tin is expected to increase. The anticipated production expansion from the development of the Mpama South deposit remains a priority and is progressing well.

The Alphamin consolidated Net Cash position of US$112 million at quarter-end is after dividend payments of US$36 million to Alphamin shareholders and minority shareholders of the operating mine. Alphamin’s unaudited consolidated financial statements and accompanying Management’s Discussion and Analysis for the quarter ended 30 September 2022 are expected to be released on or about 8 November 2022.

Mpama South development project

The Mpama South project, which is adjacent to the producing Mpama North mine, is expected to produce approximately 7,200 tonnes of contained tin per year effective FY2024 thereby increasing Alphamin’s annual tin production to ~20,000 tonnes. The project is progressing on schedule for targeted commissioning in December 2023. Overall project completion is at 18.6%, and 84.3% of the procurement requirements have been finalised and ordered. The project is not expected to exceed its total cost estimate of US$116 million.

Exploration activities

Alphamin’s vision is to become one of the world’s largest sustainable tin producers. In addition to drilling for resource extensions at Mpama North and Mpama South, the Company is actively exploring for more tin deposits on its license areas.

Resource expansion drilling, resource confidence drilling and new deposit discovery drilling progressed well during the third quarter with 9,094 metres drilled. The Bisie Ridge Phase 1 new discovery drilling campaign saw 2,355 metres drilled completing 17 holes in the quarter. Minor visual cassiterite was intersected in two drillholes while prospective associated chlorite alteration was intercepted in multiple other drillholes, assays are awaited.

The Phase 1 campaign has been accelerated with ~90 drillholes planned in fences across the Bisie Ridge on six highly anomalous targets, following which a Phase 2 campaign will delineate any discoveries or else in-fill the most prospective targets.

The Mpama South Phase 6 drilling campaign is the largest single campaign to date on the licence and aims to both in-fill and extend the Mineral Resource announced on 30 May 2022. An update to that Mineral Resource is expected in December 2022. Based on the success of Phase 6 and the still open-ended mineralization showing visual cassiterite and good grades from already received assays, a Phase 7 resource extension campaign will continue upon completion of Phase 6.

The Mpama North Phase 2 drilling campaign progressed well during the quarter. Visual intercepts of cassiterite were intersected on the southern and eastern extensions of the orebody – many on current mining levels. These intercepts contain the visual mineralization style characteristic of the Mpama North mine and, although less intensely mineralized than elsewhere, should provide valuable blending material for the deeper high-grade zones of Mpama North, thus potentially extending the life of mine and maintaining current production levels for longer.

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