Management Update

19 September 2019

Beowulf Mining plc

("Beowulf" or the "Company")

Management Update

Beowulf (AIM: BEM; Spotlight: BEO), the Nordic focused mineral exploration and development company, provides a management update on the CEO’s recent visit to Stockholm and subsequent letter to Mr. Ibrahim Baylan, the Minister of Enterprise and Innovation of the Government of Sweden.

Kallak North (“Kallak”)

Last week, the CEO met with advisors, including legal advisors, and the new CEO at SveMin (the Swedish mining industry association). The Company understands that the Government and its ministers have discussed Kallak in recent weeks. The CEO has now written to Mr. Baylan requesting a meeting.

In the letter to Mr. Baylan, the CEO made the following points:

•  In 2015, the Government asked the County Administrative Board for the County of Norrbotten (“CAB”) about the economic case for Kallak and, in its response, it said that mining was economically relevant and that Kallak would have a positive economic impact locally, regionally and nationally. Following this statement, in October 2015, the Mining Inspectorate recommended to the Government that the Exploitation Concession (“Concession”) for Kallak should be awarded.

•  It is the Company’s belief that, in the absence of the Norra Kärr case, the Concession should have been awarded in 2016 and Beowulf would now be three years into the development of Kallak. As confirmed by the Mining Inspectorate to the Government in July 2017, the Company’s Environmental Impact Assessment is entirely consistent, in the detail provided, in meeting the Supreme Administrative Court’s requirements in the Norra Kärr judgement.

•  In the CAB’s most recent statement, dated 30 November 2017, it contradicted its earlier position in July 2015, and the statement was, in the Company’s opinion, flawed and invalid. Fundamentally, the CAB’s analysis ignored the financial health of Jokkmokks Kommun, and the critical need for safeguarding investment and job creation.

•  This year, the Company has seen the Government’s “January Agreement”, and a commitment to regional development across Sweden. Also, Jokkmokks Kommun has announced financial cuts of SEK 28 million to balance its budget over the next two years, with resultant job losses and reduced public services in Jokkmokk.

•  Every job counts in Jokkmokk. Kallak could create 250 direct jobs at the mine, and 300 indirect jobs, over a mine life of 25 years or more, with sequential mining of Kallak North and South, and the prospect of discovering more iron ore.

•  In the Prime Minister’s opening address to the Swedish Parliament, he spoke of Sweden’s natural resources being used efficiently and sustainably. Kallak has the potential to showcase the best of Swedish innovation and demonstrate Sweden’s leadership in modern and sustainable mining. The Company has been consistent in its approach to responsibly developing Kallak in partnership with the community in Jokkmokk, and it has significant local support from the Mayor, local entrepreneurs and the forestry owners’ association, and regional support from the Mayor of Luleå, Region Norrbotten and CEOs of infrastructure companies.

The letter to Mr. Baylan will be published by the Company once it has been made public by the Government of Sweden. 

Kurt Budge, Chief Executive Officer of Beowulf, commented:

“It is good to know that the Government is discussing Kallak, yet the Company and its shareholders remain in the dark on the process and timeline to a decision, and therefore I have written to the Minister to seek clarity on these matters.

“We have respectfully reminded all ministries in the Government that in 2015 the CAB supported the economic case for Kallak, and the Mining Inspectorate recommended to the Government that the Concession be awarded.

“I am concerned that weight may be being given to the CAB’s statement from November 2017, and this is a matter I am discussing with advisers in Stockholm. The CAB’s failure to consider the financial health of Jokkmokk Municipality starkly contrasts with the announced budget cuts from the Mayor of Jokkmokk earlier this year and the Government’s regional development agenda, as stated in its “January Agreement”.

“Jokkmokk needs investment and jobs, and deserves to have a thriving, diversified and sustainable economy, that includes reindeer herding, tourism, forestry, mining, and the many enterprises that display the town’s entrepreneurial spirit. The endgame is not about building a mine, it is about delivering an integrated plan for Jokkmokk’s economic future, with Kallak as the foundation.

“I look forward to keeping the market updated on further developments.”

Background to the Norra Kärr Case:

See Company announcement dated 18 April 2016:

https://polaris.brighterir.com/public/beowulf_mining_plc/news/rns/story/x86ydor

Tasman Metal's Norra Kärr rare earths project (Case 2047-14):

On 23 February 2016, Tasman Metals ("Tasman"), now known as Leading Edge Materials, announced that it had been notified of a decision by the Supreme Administrative Court (“SAC”) to cancel its Norra Kärr Mining Lease ("ML"). The ML was granted to Tasman in May 2013 by the Mining Inspectorate and remained in force since that time.

Based on a review of the process of granting the ML, the SAC determined that the decision by the Mining Inspectorate was incorrect, as the decision to grant the ML was not adequately supported by environmental studies into a future mining operation.  As a result, the Norra Kärr ML was cancelled, and the project reverted to an Exploration Licence. The SAC decision to cancel the ML could not be appealed, but Tasman was left free to re-apply for a ML.

Enquiries:

Cautionary Statement 

Statements and assumptions made in this document with respect to the Company's current plans, estimates, strategies and beliefs, and other statements that are not historical facts, are forward-looking statements about the future performance of Beowulf. Forward-looking statements include, but are not limited to, those using words such as "may", "might", "seeks", "expects", "anticipates", "estimates", "believes", "projects", "plans", strategy", "forecast" and similar expressions. These statements reflect management's expectations and assumptions in light of currently available information. They are subject to a number of risks and uncertainties, including, but not limited to , (i) changes in the economic, regulatory and political environments in the countries where Beowulf operates; (ii) changes relating to the geological information available in respect of the various projects undertaken; (iii) Beowulf's continued ability to secure enough financing to carry on its operations as a going concern; (iv) the success of its potential joint ventures and alliances, if any; (v) metal prices, particularly as regards iron ore. In the light of the many risks and uncertainties surrounding any mineral project at an early stage of its development, the actual results could differ materially from those presented and forecast in this document. Beowulf assumes no unconditional obligation to immediately update any such statements and/or forecasts.