Nordic Mining ASA: Contemplated private placement

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES (OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL). THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.

Nordic Mining ASA ("Nordic Mining" or the "Company") has retained Clarkson Platou Securities AS and SpareBank 1 Markets AS as joint lead managers (together the "Managers") to advise on and effect an undocumented private placement of new shares directed towards Norwegian and international investors after the close of Oslo Stock Exchange today (the "Private Placement").

Private Placement

In the Private Placement, the Company is offering up to 28.7 million new shares, representing up to approximately 17 % of the outstanding capital of the Company. The price in the Private Placement will be determined through an accelerated bookbuilding process to be conducted by the Managers. The minimum application and allocation amount have been set to the NOK equivalent of EUR 100,000. The Company may however, at its sole discretion, allocate an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirement pursuant to the Norwegian Securities Trading Act and ancillary regulations are available.

Use of proceeds and procedure

The proceeds from the offering will be used primarily to finance the Engebø project until the construction financing has been secured. This includes all activities relating to front-end engineering and design (FEED) and to secure a financing package.

The bookbuilding period for the Private Placement opens today at 16:30 CET and closes on 29 January 2020 at 08:00 CET. The Managers and the Company may, however, at any time resolve to close or extend the bookbuilding period, or cancel the Private Placement, at their sole discretion and on short notice. The new shares to be issued in connection with the Private Placement will be issued based on a Board authorisation granted by the Company's general meeting held 13 September 2019. Allocated shares are expected to be settled on or around 31 January 2020 through a delivery versus payment transaction on a regular T+2 basis. However, the new shares will not be tradable before the new capital is registered by the Norwegian Register of Business Enterprises, expected on or about 30 January 2020, based on a pre-payment agreement with the Managers.

The Company has considered the Private Placement in light of the equal treatment obligations under the Norwegian Securities Trading Act and Oslo Børs' Circular no. 2/2014 and is of the opinion that the waiver of the preferential rights inherent in a private placement is considered necessary in the interest of time and successful completion of the Private Placement in order to obtain the proceeds necessary to finance the Engebø project.

For more information, including risks associated with the investment, see the attached company presentation.

For additional information please contact Clarksons Platou Securities (+47 22016301) or SpareBank 1 Markets (+47 24147470).

Completion of Engebø Definitive Feasibility Study (“DFS”)

Nordic Mining has completed the DFS for the Engebø rutile and garnet project which reinforces Engebø as a world class rutile and garnet project with long-term industrial benefits and attractive financials. The Project will be developed in accordance with high international standards for environment, health and safety during construction and operation.

The key results were provided in a stock exchange notice this morning and is available at https://newsweb.oslobors.no/message/494057/ The Executive summary and a webcast of the presentation are also available at the corporate website https://www.nordicmining.com/operations/engebo/.

Trading update

In the first quarter of 2019, and following a share issue in Keliber where Nordic Mining was diluted from 22% to 18.5% ownership, the Company consequently assessed that it no longer imposed significant influence and reclassified the investment in Keliber from an Associate to a Financial Asset Measured at Fair Value Through Profit and Loss under IFRS 9 (“FVTPL Method”). The reclassification resulted in recognition of a gain on investments of NOK 97.9 million in the first quarter of 2019 which was based on the share issue price of EUR 49.

The share issue price of EUR 49 was considered an appropriate reference of Keliber’s value and the EUR share value applied as basis for the valuation of the investment as of 30 June and 30 September 2019 was not changed. However, due to currency effects, the accumulated gain at the end of the third quarter of 2019 was NOK 100.6 million. Balance sheet value was NOK 115.9 million.

Since 30 September 2019, Keliber has made several positive announcements including increased mineral resources, improved recoveries and increase in reserve estimates. However, it has also announced that its lithium project will be delayed by at least one year compared to previous estimates. In addition, and despite a positive long-term outlook, conditions for the global lithium market has softened due to weak spot prices. This has adversely impacted Keliber’s progress on securing offtake directly as well as driven down the general market sentiment/valuation.

Due to the complexity in estimating the impact of the news flow in the updated fair value calculation of the investment, the Company engaged a reputable independent valuation expert with significant experience within the mining industry. The valuation is based on estimates and assumptions regarding future commodity prices as well as transactions in comparable assets and valuation of similar listed entities.

The Company considers the long-term outlook for lithium to be positive despite the pressure on spot-prices. The Company assessed the external valuation, which provided a range, and narrowed it down to the mid-range of EUR 38.5 per share which implies a total value of Keliber of EUR 49.7 million (NOK 90.8 million for the Group’s share). The investment is under the tax exemption and no tax is therefore calculated. The estimated resulting implications for the financial statements for 2019 are as follows:

Unaudited preliminary balance sheet:

For additional information, please contact: Birte Norheim, CFO, +47 95 29 33 21

Oslo, 28 January 2020

Nordic Mining ASA

Nordic Mining ASA (www.nordicmining.com)

Nordic Mining ASA ("Nordic Mining" or the "Company") is a resource company with focus on high-end industrial minerals and metals. The Company's project portfolio is of high international standard and holds significant economic potential. The Company's assets are in the Nordic region.

Nordic Mining is undertaking a large-scale project development at Engebø on the west coast of Norway where the Company has rights and permits to a substantial eclogite deposit with rutile and garnet. Nordic Mining also holds 18.5% of the shares in Keliber Oy, which is developing a lithium project in Finland to become the first European producer of battery grade lithium hydroxide.

In addition, Nordic Mining holds interests in other initiatives at various stages of development. This includes patented rights for a new technology for production of alumina and exploration of seabed minerals.

Nordic Mining is listed on Oslo Axess with ticker symbol "NOM".