REG - Adriatic Metals - 2024 RUPICE MINERAL RESOURCE AND RESERVES UPDATE
31/03/2025 07:15
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RNS Number : 8650C Adriatic Metals PLC 31 March 2025
31 March 2025
Adriatic Metals PLC
('Adriatic Metals' or the 'Company')
2024 RUPICE MINERAL RESOURCE AND RESERVES UPDATE
HIGHLIGHTS
· The Indicated and Inferred 2024 Mineral Resource Estimate
update for Adriatic Metals' 100%-owned Rupice deposit in Bosnia and
Herzegovina is reported as:
- 20.9Mt @ 153g/t Ag, 4.3% Zn, 2.8% Pb, 1.1g/t Au, 0.4% Cu, 0.2% Sb,
28% BaSO(4,) (reported above a cut-off grade of 50g/t AgEq) and contains
102Moz Ag, 901kt Zn, 586kt Pb and 753koz Au.
· There have been additions and losses due to new
drilling, as well as depletion of 165kt from areas mined in 2024. The overall
change in Indicated and Inferred resource tonnes since the July 2023 Rupice
resource estimate is <1%.
· The December 2024 Ore Reserve Estimate for the Rupice deposit
is reported as:
- 12.3Mt @ 192g/t Ag, 5.7% Zn, 3.6% Pb, 1.5g/t Au, 0.5% Cu and 0.2% Sb
with a metal content of 76Moz Ag, 697kt Zn, 442kt Pb, 576koz Au, 60kt Cu and
20kt Sb.
· Reserve tonnage has decreased by 11% since the prior
statement due to depletion and a higher cut-off Net Smelter Return (NSR) value
being applied, while grades have increased and contained metals have seen a
smaller decrease which demonstrates the robustness of the orebody.
Table 1: Comparison of the 2024 and 2023 Ore Reserves
· The 2024 Ore Reserve results in a slightly reduced mine life to
2039 (previously 2041) based on an 800ktpa nominal feed rate through the
Vareš Processing Plant.
· Rupice NW has been drilled to the northern extent of the Rupice
Exploitation License boundary. Adriatic has applied to the Zenica-Doboj Canton
for an Exploration license along strike of Rupice NW.
Note: Unless otherwise stated, all dollar figures are United States dollars
($). Reporting of Mineral Resources is inclusive of Ore Reserves.
Laura Tyler, Adriatic's Managing Director and CEO commented;
"Positive outcomes from resource development drilling in 2024 have offset mine
production and provided tighter definition of the Rupice orebody. There is a
minimal change in the reported Mineral Resource Estimate with similarly
non-material changes in grade plus potential orebody extension to the
north-west.
The 2024 Ore Reserves have decreased with the inclusion of the production
costs announced with production guidance for 2025. This has resulted in a
higher cut-off NSR value being applied in the Ore Reserves. Despite this
increase in NSR, the robust nature of the orebody is clearly demonstrated with
contained metal and life of mine impacts relatively low. The Vareš Silver
Operation remains in the lowest quartile for costs for silver producers
globally and is a significant cash generative operation at nameplate
capacity."
Adriatic Metals Plc (ASX:ADT, LSE:ADT1, OTCQX:ADMLF) ("Adriatic" or the
"Company") is pleased to announce the updated Mineral Resource and Ore Reserve
Estimates for the Rupice Polymetallic Deposit that underpins the Vareš Silver
Operation in Bosnia and Herzegovina. The Mineral Resource has been completed
and peer reviewed by AMC Consultants Pty Ltd ("AMC") in Perth and Melbourne,
Australia for the sections completed by AMC. The Ore Reserves has been
completed by Adriatic and peer reviewed by AMC in the United Kingdom. The
updated Mineral Resource and Ore Reserves have been depleted of mined material
to the 31 December 2024 by Adriatic Metals with underground survey data
provided by qualified and certified Mine Surveyors.
Rupice Deposit Overview
The Rupice deposit is in Bosnia and Herzegovina, approximately 50 km north of
Sarajevo, near the historical mining town of Vareš. The site is about 60
minutes by car, accessed via the Sarajevo-Tuzla freeway to Podlugovi, then
along a sealed road to Vareš. The administrative centre for the district is
located in Vareš.
The Vareš Silver Operation consists of an underground mine and a surface
mineral processing plant. It is located within a single concession, which
comprises three separate exploitation licence areas: one at Rupice in the west
and two at Veovača in the east (Figure 1). Exploitation licences allow
mineral extraction, while exploration licences are for resource assessment.
Figure 1: Vareš Silver Operation; Rupice and Veovača location map.
2024 RUPICE MINERAL RESOURCE ESTIMATE
The Rupice 2024 Mineral Resource Estimate (MRE) was jointly completed by
Adriatic Metals and AMC Consultants (AMC). The Rupice Indicated and Inferred
Mineral Resources as of 31 December 2024 comprises 20.9Mt at 153g/t Ag, 4.3%
Zn, 2.8% Pb, 1.1g/t Au and 0.4% Cu as set out in Table 1.
A total of 88% of the 2024 Rupice MRE is classified as Indicated resource.
There has been sufficient growth in the Indicated resource through additional
drilling since previous reporting to replace depleted reserves and deliver 1%
more Indicated resource tonnes compared to 2023 Mineral Resource reporting.
The Rupice ore deposit is comprised of two separate significant orebodies -
Rupice Main (RM) and Rupice Northwest (RNW). When estimating the Rupice MRE,
the RM and RNW orebodies are estimated separately and then combined into a
single combined MRE.
The estimates are inclusive of exploration infill drilling; step-out drilling
to extend mineralization; verification drilling of historic holes at RM and
RNW; and underground grade control drill holes completed between the beginning
of May 2024 and the end of September 2024.
Table 2: Rupice Mineral Resources as of 31 December 2024 (using 50g/t AgEq
cut-off grade).
Table 3: Rupice Mineral Resources as of 21 July 2023 (using 50g/t AgEq cut-off
grade).
Notes:
· Mineral Resources are based on 2012 JORC Code definitions.
· A cut-off grade of 50g/t silver equivalent has been applied.
· AgEq - Silver equivalent was calculated using conversion factors
of 31.1 for Zn, 24.88 for Pb, 80.0 for Au, 1.87 for BaSO(4), 80.87 for Cu and
80.87 for Sb, and recoveries of 90% for all elements. Metal prices used were
US$2,500/t for Zn, US$2,000/t for Pb, $150/t for BaSO(4), $2,000/oz for Au,
$25/oz for Ag, $6500/t for Sb and $6,500 for Cu.
· The applied formula was: AgEq = Ag(g/t) * 90% + 31.1 * Zn(%) *
90% + 24.88 * Pb(%) * 90% + 1.87 * BaSO(4)% * 90% + 80 * Au(g/t) * 90% + 80.87
* Sb(%) * 90% + 80.87 * Cu(%)* 90%
· It is the opinion of Adriatic Metals and the Competent Persons
that all elements and products included in the metal equivalent formula have a
reasonable potential to be recovered and sold.
· Metallurgical recoveries of 90% have been applied in the metal
equivalent formula based on recent and ongoing test work results.
· A bulk density was calculated for each model cell using
regression formula BD = 2.745 + BaSO(4) * 0.01793 + Pb * 0.06728 - Zn *
0.01317 + Cu * 0.1105 for the halo domain, BD = 2.7341 + BaSO(4) * 0.01823 +
Pb * 0.04801 + Zn * 0.03941 - Cu * 0.01051 for the fault zones and BD = 2.7949
+ BaSO(4) * 0.01599 + Pb * 0.05419 + Zn * 0.01169 + Cu * 0.06303 for the low
grade domain. Bulk density values were interpolated to the combined high-grade
domain from 631 BD measurements.
· Rows and columns may not add up exactly due to rounding.
2024 RUPICE ORE RESERVE ESTIMATE
The 2024 Rupice Mine Ore Reserve totals 12.3Mt at 192g/t Ag, 5.7% Zn, 3.6% Pb,
1.5g/t Au, 0.5% Cu and 0.2% Sb containing an estimated 76Moz of Ag, 697Kt Zn,
442Kt Pb, 576Koz Au, 60Kt Cu and 20kt Sb.
The updated Ore Reserve estimate (ORE) was completed collaboratively by AMC
and the Adriatic Technical Services team, following industry best practices.
This update is based on the latest Rupice Mineral Resource estimate, as
outlined in Table 2 of the preceding Mineral Resource section, which is
inclusive of Ore Reserves.
Table 4: Updated Rupice Ore Reserve - 31 December 2024
Reserve Tonne Ag Zn Pb Au Cu Sb
Classification Mt g/t % % g/t % %
Probable 12.3 192 5.7 3.6 1.5 0.5 0.2
Total 12.3 192 5.7 3.6 1.5 0.5 0.2
Notes:
· The Rupice Ore Reserve estimate is consistent with JORC 2012
reporting guidelines.
· The 2024 Ore Reserve estimate uses a NSR Cutoff grade of
US$130/t.
· The 2024 Ore Reserve is depleted of 2024 mined ore material
Inferred Mineral Resources were excluded from the Ore Reserve conversion and
estimate. The Ore Reserve is reported on a 100% basis, with a cut-off applied
of a net smelter return (NSR) of US$130/t ore. Adriatic has demonstrated that
the Operation has a positive net present value (NPV), supporting the statement
of Ore Reserves. The 2024 Ore Reserve and the previously reported 2023 Ore
Reserve have been presented in Table 5 for visual comparison.
Table 5: Comparison of 2024 and 2023 Rupice Ore Reserve Estimates and
Contained Metal
2024 Rupice Ore Reserve Estimate - 31 December 2024
Classification Tonnes Mt Ag g/t Zn % Pb % Au g/t Cu % Sb %
Probable 12.3 192 5.7 3.6 1.5 0.5 0.2
Total 12.3 192 5.7 3.6 1.5 0.5 0.2
Ag (Moz) Zn (kt) Pb (kt) Au (koz) Cu (kt) Sb (kt)
Contained metal 76 697 442 576 60 20
2023 Rupice Ore Reserve Estimate - 20 October 2023
Classification Tonnes Mt Ag g/t Zn % Pb % Au g/t Cu % Sb %
Probable 13.8 187 5.2 3.3 1.4 0.5 0.2
Total 13.8 187 5.2 3.3 1.4 0.5 0.2
Ag (Moz) Zn (kt) Pb (kt) Au (koz) Cu (kt) Sb (kt)
Contained metal 83 723 457 640 64 24
Modifying Factors
Depletion of Ore Reserve
By the end of December 2024, a total of 164,850 tonnes of ore had been mined,
with all extracted material taken only from inside the defined Ore Reserve
boundary. Mined material consisted of both development and stope ore, with the
volumes of both broken down in Table 6.
Table 6: Ore Reserve Depletion
Reserve Depletion Mass Mined (t) Ag (g/t) Zn (%) Pb (%) Au (g/t) Sb (%) Cu (%)
Development Ore 80,755 381 6.7 5.0 3.4 0.2 0.6
Stope Ore 84,095 185 3.5 2.4 1.3 0.2 0.5
Total 164,850 281 5.0 3.7 2.3 0.2 0.5
Ore Price Assumptions
An Ore Reserve Estimate was completed jointly by Adriatic and AMC under the
direction of Competent Persons (CP) who were assisted by key technical staff
at Adriatic and AMC. Adriatic used a Life-of-Mine (LOM) approach, whereby all
mining areas were re-evaluated using the new NSR calculation to determine
economic mining areas.
NSR
For the 2024 Ore Reserve Update, Adriatic changed to the classic method of NSR
calculation by excluding all on-mine costs while including the sale of mineral
products after deducting all off-mine concentrate-related costs such as
transport, refining, treatment, and sales of the product. As part of this
change, the recovery model was simplified down to total recovery parameters
and the off-take modelling was stripped down to just the Spot Sale off-take
models The final result is a true NSR value per tonne per block in the block
model.
The applied 2024 NSR cut-off value is US$130/t, which is 91.2% higher than in
2023 (US$68/t) when the 2021 DFS figures were used. Application of a higher
cut-off NSR value has resulted in fewer Rupice Indicated mineral resource
tonnes being converted to mineable reserve tonnes.
Metal Prices
Adriatic Metals ran multiple scenarios, testing various metal prices within
offtake and recovery parameters. Metal prices used in the 2024 Ore Reserve NSR
calculation were adjusted based on a commodity forecast provided by the
corporate finance team and are summarised in Table 7.
Table 7: Metals prices used in the 2024 Ore Reserves NSR (Adriatic, 2024) vs
2023 Ore Reserves
Ag ($/oz) Zn ($/t) Pb ($/t) Au ($/oz) Cu ($/t) Sb ($/t)
2024 29 2,700 1,900 2,450 9,000 20,000
2023 23 2,450 2,280 1,912 8,335 11,252
Operational Expenses
The cost assumptions used in the 2023 Rupice Reserve Update were based
primarily on the Vareš Project Definitive Feasibility Study (DFS) unit rates
generated in 2021. Since entering production, Adriatic Metals has undertaken a
review of cost models and updated the cut-off grade, as shown in Table 8.
Given the time between the DFS model and the 2024 update, inflationary effects
post-covid on labour, energy, material, contractor and other costs have
affected most areas of the model, along with other factors.
Table 8: Cost (US$/t) Assumptions used in the 2023 vs 2024 Ore Reserve cut-off
grade calculation
Mining Processing G & A Royalties Sustaining Capex COG Total
2023 Cost 35 26 5 2 Included in Proc/Mining Cost 68
2024 Cost 59 38 22 3 8 130
The mining, milling, backfill and general and administrative (G&A) costs
have increased as follows:
Mining costs increased due to:
• increased ground support requirements in areas of poor ground
conditions, primarily experienced in areas of capital development.
• increased labour costs associated with an expatriate labour model
used to support production ramp up and national workforce training.
• increased backfill costs associated with higher aggregate and
binder rates for Paste Aggregate Fill and Cement Aggregate Fill.
Milling costs increased based on:
• increased labour costs associated with an expatriate labour model
used to support production ramp up and national workforce training.
• additional screening of the ore prior to crushing not foreseen in
the DFS.
• increase in reagent usage compared to the DFS.
G&A costs increased based on:
• increased labour costs associated with an expatriate labour model
used to support production ramp up and national workforce training.
• under resourcing of support services in the DFS.
Mine Operations
At Rupice, mining is planned from two orebodies (RM and RNW) with all ore
hauled to a surface stockpile, before being crushed and transferred via
surface trucks to the Vareš Processing Plant. Active mining is from the RM
orebody. As of 2024, mining of the RNW orebody had not yet begun.
Mining Method
The mining method combines mechanised, trackless underground mining using
longitudinal longhole open-stoping (LLHOS) and transverse longhole
open-stoping (TLHOS) with footwall decline access. Access to the underground
workings is through two declines developed from the surface with orebody
access via capital development of ramps, level access drives, and footwall
drives.
The mine design created in Deswik is shown in the two longitudinal sections
below (Figure 2), highlighting the planned stopes and development areas.
Figure 2: Mine design looking east (Adriatic Metals, 2024 Deswik Output
Recovery and processing
The Vareš Processing Plant (VPP) has a nominal capacity of 800,000tpa, and
applies three-stage crushing, grinding, flotation and filtration to produce
two saleable concentrates (silver/lead and zinc). Concentrates are transported
via rail to the Port of Ploče for shipment to smelters.
The silver/lead concentrate contains payable Ag, Pb, Zn, Cu, Sb and Au (Sb is
payable if over 2% and if Ag is over 2,500g/t and Zn is payable if over 10%).
The zinc concentrate contains payable Zn, Ag, and Au. Figure 4 shows the basic
flowsheet, with further breakdowns of the circuits contained within the VPP in
Table 9.
Figure 3: Vareš Process Plant flowsheet (Ausenco, 2021)
Table 9: A breakdown of the circuits contained within the plant infrastructure
Three-stage crushing Primary jaw crusher, grizzly screen on feed, P80 of 121 mm.
Crushing plant has capacity to produce aggregate for underground backfill
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Flotation Silver-lead flotation Roughers
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Three-stage cleaners.
Zinc flotation Roughers.
Concentrate regrinds to P80 of 20 µm using 355 kW IsaMill
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Infrastructure
The Vareš Municipality offers general trade services and suppliers, and a
considerable amount of 1980s mining infrastructure, including a rail line
which connects to the national rail grid and inter alia, the Port of Ploče in
the Republic of Croatia, where bulk commodities, including metal concentrates
are shipped. The capital of Bosnia and Herzegovina, Sarajevo and its
international airport is approximately 60 minutes away.
The VPP is located on a brownfield site that was previously used for mineral
processing. It is located approximately 25km south-east of the town of Vareš.
A newly constructed, all-weather road was completed in 2023 and is available
for inbound freight. Concentrates are trucked 5km from the VPP to an existing
rail siding where it will be transloaded and then railed to the Port of
Ploče.
Permitting
Adriatic has committed to ensuring that the Vareš Silver Operation will
comply with international best practice regarding environmental and social
standards. Environmental and groundwater management plans have been submitted,
approved and permitted. All major permits for operations have been granted by
the various competent authorities within Bosnia and Herzegovina, however some
more routine permits and permits that would not ordinarily be issued until
after the commencement of production are outstanding and are expected to be
issued in due course.
Tailings Management
The Veovaca Tailings Storage Facility (TSF) design concept is based on
providing a dry stack facility with sufficient capacity in exceedance of the
Life of Mine via a phased development which allows progressive closure of the
facility. The TSF is a fully lined impoundment structure that spans the width
of the Veovaca II opencast pit. The tailings will be trucked from the VPP to
the TSF and deposited to form 10m lifts with 9 lifts in total resulting in an
overall stack height of 50m (both Phase 1 and 2). The final stack
configuration will not pond water at closure.
The facility will be developed in two phases. Phase 1 has an estimated
capacity of approximately 6 years production at nameplate production. Phase 2
has an estimated capacity of an additional 13 years production, with
approximately 40% of tailings being used in the backfill paste plant. Contact
water from the facility will be managed to minimise collection on the active
tailings area. Bleed water from the stack will be collected by an over
drainage layer above the lining system and gravity fed into the contact water
sump which is located at the toe of the facility. Non-contact water will be
prevented from entering the stack by a series of perimeter ditches which are
progressively extended as the TSF is developed.
Water supply
Local water is supplied to all surrounding villages and is provided by a
public company owned and operated by the Vareš council. Raw water supply to
the Rupice mine is from a dedicated utility source provided by the local water
company JKP d.o.o. Vareš (JKP).
Upgrades to the water supply for VPP were executed in Q1 2025, this included a
dedicated pipeline from the distribution tank to ensure stable supply.
Additional to this, a project was initiated to extract ground water, this will
allow decoupling from the utility provider and ensure water supply security.
This project will be completed during 2025.
Power
Power is supplied by the local utility company (JP Elecktroprivreda BiH). The
electrical infrastructure at the Processing Plant has been designed for 8.3MW
peak demand, with an average load of 7.6MW. Upgraded 35kV transmission lines
connect the local grid to the Vareš Majdan Substation where the feed is
stepped down to 6kV for further distribution.
Power supply for the Rupice Surface Infrastructure is provided from a new,
buried 35kV powerline which runs from Vareš Majdan regional sub-station,
following the route of the road between Rupice Mine and VPP, and
terminate/connect at the 35kV incomer switchgear at the Rupice main
sub-station. From the new sub-station at Rupice, power is reticulated at 10kV
through underground powerlines to the Rupice surface and underground
infrastructure.
Underground power distribution
The electrical power to underground mining consumers via the underground
reticulation is supplied at 10kV and stepped down via secondary distribution
transformers which feed 1kV underground power distribution centres.
Maximum power demand for the underground mine operation at site supply voltage
to support full development and production activities is required to
appropriately size and select the electrical infrastructure for the
underground mine. A provision of emergency power has been made for the
critical underground loads.
Underground services
Services, namely service water, potable water, compressed air, and dewatering,
are reticulated underground via adequately sized and rated polyethylene piping
routed up or down decline ramps or up or down service holes to or from the
production levels.
-ends-
Authorised by Laura Tyler, CEO and Managing Director of Adriatic Metals.
For further information please visit: www.adriaticmetals.com
(http://www.adriaticmetals.com/) ; email: info@adriaticmetals.com
(mailto:info@adriaticmetals.com) ,; or contact:
Adriatic Metals PLC
Klara Kaczmarek Tel: +44 (0) 7859 048228
GM - Corporate Development Klara.kaczmarek@adriaticmetals.com (mailto:Klara.kaczmarek@adriaticmetals.com)
Burson Buchanan Tel: +44 (0) 20 7466 5000
Bobby Morse / Oonagh Reidy adriatic@buchanan.uk.com (mailto:adriatic@buchanan.uk.com)
RBC Europe Limited
Farid Dadashev / James Agnew / Jamil Miah Tel: +44 (0) 20 7653 4000
Stifel Nicolaus Europe Limited
Ashton Clanfield / Callum Stewart / Varun Talwar Tel: +44 (0) 20 7710 7600
Sodali & Co
Cameron Gilenko Tel: +61 466 984 953
MARKET ABUSE REGULATION DISCLOSURE
The information contained within this announcement is deemed by the Company
(LEI: 549300OHAH2GL1DP0L61) to constitute inside information for the
purpose of Article 7 of EU Market Abuse Regulation (EU) No. 596/2014 as it
forms part of UK domestic law by virtue of the European Union (Withdrawal) Act
2018, as amended. The person responsible for arranging and authorising the
release of this announcement on behalf of the Company is Laura Tyler, CEO and
Managing Director.
COMPETENT PERSONS REPORT
The information in this report that relates to the Mineral Resources is based
on and fairly represents information and supporting information compiled by
Dmitry Pertel. Dmitry Pertel is a full-time employee of AMC Consulting and is
a Member of the Australian Institute of Geoscientists. Dmitry Pertel has
sufficient experience relevant to the style of mineralization and type of
deposit under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2012 Edition of the
Australasian Code for the Reporting of Exploration Results, Mineral Resources,
and Ore Reserves (JORC Code). Dmitry Pertel consents to the disclosure of
information in this report in the form and context in which it appears.
The information in this report which relates to Exploration Results is based
on and fairly represents information and supporting information compiled by Mr
Sergei Smolonogov, who is a member of the Australian Institute of
Geoscientists (AIG) and Registered Professional Geologist (RPGeo). Mr
Smolonogov is General Manager Growth for Adriatic Metals Plc and has
sufficient experience relevant to the style of mineralization and type of
deposit under consideration and to the activity he is undertaking to qualify
as a Competent Person as defined in the 2012 Edition of the "Australian Code
of Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr
Smolonogov consents to the inclusion in this report of the matters based on
that information in the form and context in which it appears.
The information in this report that relates to the Ore Reserves is based on
and fairly represents information and supporting information compiled by
Dominic Claridge and Christopher Hunter. Dominic Claridge is a full-time
employee of AMC Consulting and is a Fellow of the Australian Institute of
Mining and Metallurgy. Christopher Hunter is a full-time employee of Adriatic
Metals and is a Member of the Australian Institute of Mining and Metallurgy.
Dominic Claridge and Christopher Hunter have sufficient experience relevant to
the style of mineralisation and type of deposit under consideration and to the
activity which they are undertaking to qualify as a Competent Persons as
defined in the 2012 Edition of the Australasian Code for the Reporting of
Exploration Results, Mineral Resources, and Ore Reserves (JORC Code). Dominic
Claridge and Christopher Hunter consent to the disclosure of information in
this report in the form and context in which it appears.
DISCLAIMER
Forward-looking statements are statements that are not historical facts. Words
such as "expect(s)", "feel(s)", "believe(s)", "will", "may", "anticipate(s)",
"potential(s)"and similar expressions are intended to identify forward-looking
statements. These statements include, but are not limited to statements
regarding future production, resources or reserves and exploration results.
All of such statements are subject to certain risks and uncertainties, many of
which are difficult to predict and generally beyond the control of the
Company, that could cause actual results to differ materially from those
expressed in, or implied or projected by, the forward-looking information and
statements. These risks and uncertainties include, but are not limited to: (i)
those relating to the interpretation of drill results, the geology, grade and
continuity of mineral deposits and conclusions of economic evaluations, (ii)
risks relating to possible variations in reserves, grade, planned mining
dilution and ore loss, or recovery rates and changes in project parameters as
plans continue to be refined, (iii) the potential for delays in exploration or
development activities or the completion of feasibility studies, (iv) risks
related to commodity price and foreign exchange rate fluctuations, (v) risks
related to failure to obtain adequate financing on a timely basis and on
acceptable terms or delays in obtaining governmental approvals or in the
completion of development or construction activities, and (vi) other risks and
uncertainties related to the Company's prospects, properties and business
strategy. Our audience is cautioned not to place undue reliance on these
forward-looking statements that speak only as of the date hereof, and we do
not undertake any obligation to revise and disseminate forward-looking
statements to reflect events or circumstances after the date hereof, or to
reflect the occurrence of or non-occurrence of any events.
APPENDICES
Appendix 1
RUPICE 2024 MRE by DOMAIN & CLASSIFICATION
Table 10: Rupice Mineral Resources on 31 December 2024 by Classification -
Total (using AgEq cut-off of 50g/t)
Notes:
· Mineral Resources are based on 2012 JORC Code definitions.
· A cut-off grade of 50g/t silver equivalent has been applied.
· AgEq - Silver equivalent was calculated using conversion factors
of 31.1 for Zn, 24.88 for Pb, 80.0 for Au, 1.87 for BaSO(4), 80.87 for Cu and
80.87 for Sb, and recoveries of 90% for all elements. Metal prices used were
US$2,500/t for Zn, US$2,000/t for Pb, $150/t for BaSO(4), $2,000/oz for Au,
$25/oz for Ag, $6500/t for Sb and $6,500 for Cu.
· The applied formula was: AgEq = Ag(g/t) * 90% + 31.1 * Zn(%) *
90% + 24.88 * Pb(%) * 90% + 1.87 * BaSO(4)% * 90% + 80 * Au(g/t) * 90% + 80.87
* Sb(%) * 90% + 80.87 * Cu(%)* 90%
· It is the opinion of Adriatic Metals and the Competent Persons
that all elements and products included in the metal equivalent formula have a
reasonable potential to be recovered and sold.
· Metallurgical recoveries of 90% have been applied in the metal
equivalent formula based on recent and ongoing test work results.
· A bulk density was calculated for each model cell using
regression formula BD = 2.745 + BaSO(4) * 0.01793 + Pb * 0.06728 - Zn *
0.01317 + Cu * 0.1105 for the halo domain, BD = 2.7341 + BaSO(4) * 0.01823 +
Pb * 0.04801 + Zn * 0.03941 - Cu * 0.01051 for the fault zones and BD = 2.7949
+ BaSO(4) * 0.01599 + Pb * 0.05419 + Zn * 0.01169 + Cu * 0.06303 for the low
grade domain. Bulk density values were interpolated to the combined high-grade
domain from 631 BD measurements.
· Rows and columns may not add up exactly due to rounding.
RUPICE GEOLOGY AND MINERALIZATION
The host rocks at Rupice Main and RNW include Middle Triassic limestone,
dolostone, calcareous and dolomitic marl, and a range of mostly fine-grained
siliciclastic rocks including cherty mudstone, mudstone, siltstone and
fine-grained sandstone. The main mineralized horizon is a brecciated dolomitic
unit that dips at around 50˚ to the northeast and has been preferentially
mineralized with base, precious and transitional metals. The Triassic sequence
has been deformed by early-stage ductile shearing and late-stage brittle
faulting.
The Rupice Main and RNW polymetallic mineralization consists of sphalerite,
galena, barite and chalcopyrite with silver, gold, tetrahedrite, boulangerite,
bournonite and pyrite. The majority of the high-grade mineralization is hosted
within the brecciated dolomitic unit. The majority of deformation is along
shears wrapping about the margins of mineralization. This is consistent with
the deposit being within a compressional low angle thrust environment mapped
on a regional scale. Thickening of the central portion of the Rupice deposit
is considered to be associated with thrust related folding. Mineralized widths
of up to 65m true thickness are seen in the central portion of the Rupice
deposit. URNW is less deformed than Rupice Main. Differential shearing along
the deposits' massive sulphide boundaries appears to have created a large
sigmoidal structure which hosts the polymetallic mineralization. Effectively a
large lozenge with tapering ends in section-view that gently rolls-over to the
west. Rupice Main sits at a stratigraphically higher position than RNW. They
are separated by a ferruginous siliceous chert unit (GYD). Rupice and RNW
overlap at their strike extremities over an interval of ~80m. The area between
Rupice and RNW is referred to as the 'GAP'. In the area of the GAP, both
Rupice and RNW lenses transition from massive to semi-massive to disseminated
sulphides.
To date, the massive sulphide mineralization at Rupice Main has a defined
strike length of >600m, with a maximum true-width thickness of around 65m
and a minimum of 0.3m. Mineralization at Rupice still remains open to the
northwest. In the existing areas drilled, the up-dip portions of Rupice are
yet to be closed-off to the southwest. This presents a significant opportunity
for further resource growth at Rupice over its strike length.
To date, the massive sulphide mineralization at RNW has a defined strike
length of >300m, with a maximum true-width thickness of around 40m and a
minimum of 0.4m. The mineralization increases in width, grade and thickness
from southeast to northwest. RNW has been drilled to the northern extent of
the Rupice Exploitation License boundary. There is no geological reason to
believe mineralization does not extend beyond the Exploitation License
boundary to the northwest. Adriatic is in process with Zenica-Doboj Canton to
secure an Exploration license over land to the northwest of Rupice to confirm
extension of the RNW deposit beyond the current Rupice Exploitation license.
RNW south-eastward narrows with increasing base metal content, higher grades,
elevation in copper and gold values, and a reduction in barium content.
Figure 4: Plan View of 2024 Resource Block Model Outline of Rupice vs 2023
Resource Block Model
RUPICE MODELLING AND GRADE INTERPOLATION
The geological controls on polymetallic mineralization at Rupice Main and RNW
were interpreted using lithological, alteration, structural and geochemical
data available from logging and assays. Separate solids for each lithology
from surface to below mineralization were modelled. Massive and semi-massive
visually logged sulphides where combined to form coherent mineralized solids.
The trends in mineralization were matched to modelled stratigraphic units
controlling the distribution of mineralization. The current mineralization and
geological interpretation assume the majority of movement is compressional and
sub-parallel to mineralization, controlling the geometry of mineralization
thickening and thinning. Multiple high-grade and low-grade mineralized solids
exist as satellite stratabound mineralized bodies on the hanging wall and in
the footwall of continuous bodies of massive sulphide mineralization.
The majority of satellite mineralized solids have been modelled to capture
isolated mineralization at various elevations and associated with different
parts of the stratigraphic sequence. The majority of smaller, discontinuous,
poorly informed and low-grade solids are not included in either Inferred or
Indicated mineralization as they are currently considered uneconomic. The
subgrade solids are there to identify areas: of future mineralization
potential, of low-grade mining dilution, for potential acid rock drainage, and
for mine planning.
Statistical analysis of modelled domains shows that the main mineralized
brecciated dolomite has a bi-modal population for the majority of the elements
being modelled. The higher-grade populations clustered spatially and were
subsequently individually interpreted and wireframed.
Ten elements were modelled; Ag, Zn, Pb, BaSO4, Cu, Au, Sb, Hg, As and S. The
higher-grade populations were interpreted and wireframed for all elements
except Hg, As, S and Sb, and Ag in the Main zone. Sulphur grade populations
were modelled using indicator approach.
All the domains were interpreted on a section-by-section basis and were used
to generate three-dimensional (3D) 'solid' wireframes. The same method was
applied for the individual high-grade and low-grade populations for each
modelled main element. Once mineralization and domains for each element were
interpreted and wireframed, classical statistical analysis was repeated for
the samples within the interpreted domains. Drill data was composited to 2m
down hole intervals for the Main zone and 1m down hole intervals for the
Northwest zone. Boundary statistical analyses and top-cuts were determined and
applied where appropriate. The geostatistical analysis generated a series of
semi-variograms that were used during grade estimation. The semi-variogram
ranges determined from the analysis contribute to the determination of the
search neighbourhood dimensions. All variograms were calculated and modelled
using composited sample files, constrained by the corresponding mineralized
envelopes for each element. Where low-grade and high-grade domains were
modelled, samples were combined for both domains to make sure that the number
of samples was sufficient for robust geostatistical analysis. It was found
that absolute semi-variograms were difficult to model for most of elements,
and therefore, relative pair-wise variograms were modelled for all elements.
The bulk density values were calculated for each model cell based on its
domain and regression formula. Domains included Main zone, high-grade barite,
low-grade barite, and northwest domains. The formulas were derived using
scattergrams for density versus BaSO4, Pb, Cu and Zn grades.
A block model was constructed, constrained by the interpreted mineralized
envelopes. A parent cell size of 5m(E) x 5m(N) x 5m(RL) was adopted with
standard sub-celling to 1m(E) x 1m(N) x 1m(RL) to maintain the volumetric
resolution of the mineralized lenses. Grades for all ten elements were
interpolated into the empty block model using the Ordinary Kriging method and
a "parent block estimation" technique, i.e., all sub-cells within a parent
cell were populated with the same grade. The ordinary kriging (OK) process was
performed at different search radii until all cells were interpolated. The
search radii were determined by means of the evaluation of the semi-variogram
parameters, which determined the kriging weights to be applied to samples at
specified distances. Hard boundaries were honoured between each modelled lens
and each grade domain. Block grades were validated both visually and
statistically and all modelling was completed using Micromine software.
Figure 5: Rupice Ore Block Model by AgEq Grade Ranges
CLASSIFICATION AND REPORTING
Clause 20 of the JORC (2012) Code requires that all reports of Mineral
Resources must have reasonable prospects for eventual economic extraction,
regardless of the classification of the resource. The Rupice deposit has
reasonable prospects for eventual economic extraction on the following basis:
· The Rupice Mineral Resource classification criteria is based on
the geological understanding of the deposit, geological and mineralization
continuity, drillhole spacing, QAQC results. The MRE is reported by
classification in Table 10 above a cut-off grade of 50 g/t AgEq with the
effective date of 30 November 2023.
· The cut-off grade adopted for reporting (50 g/t Ag equivalent) is
considered reasonable given the Mineral Resource will be exploited by
underground mining methods and potentially processed using flotation
techniques to produce a concentrate or as a direct shipping crushed product
for massive ores.
· Adriatic has secure long-term tenure across all tenements.
· All permits and licenses from the Bosnian and Herzegovinian
Government (Federal, State, Cantonal) are in good standing and as required to
mine and produce base and precious metals concentrates.
· Rupice Mine is at the production stage.
· Underground workings are actively in progress, with the first
stope blasted in August 2024. The accuracy of the Resource and Reserve was
confirmed.
Figure 6: Grade Tonnage Curve with AgEq Grades
Figure 7: Grade Tonnage Curve with AgEq Metal
Figure 8: Cross Section #4 Rupice 2024 Resource Block Model - Rupice Main,
Upper and Lower Zones
Figure 9: Cross Section #20 Rupice 2024 Resource Block Model - Rupice Main,
Upper and Lower Zones, northern orebody extension.
Figure 10: Cross Section #2 Rupice 2024 Resource Block Model - Main orebody
currently being mined and developed.
Figure 11: Cross Section #1 Rupice 2024 Resource Block Model - Southwest Upper
Orebody. Extension to near surface of Rupice 'Upper' orebody.
APPENDIX 2: RUPICE MRE JORC TABLES
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code Explanation Commentary
Sampling techniques Nature and quality of sampling (e.g. cut channels, random chips, or specific Exploration
specialised industry standard measurement tools appropriate to the minerals
under investigation, such as down hole gamma sondes, or handheld XRF Drill core is collected from half cut PQ3 and HQ3 diameter core, where the
instruments, etc). These examples should not be taken as limiting the broad core was sawn exactly in half along a pre-defined cutting line.
meaning of sampling.
The half core samples, typically weighing between 4-12kg, were placed into
labelled and tagged sample bags prior to dispatch to the SGS Ankara laboratory
in Republic of Türkiye.
Sample intervals were determined by the geologist, routinely at nominal 1 m
intervals unless selectively sampled on narrower intervals where geological
boundaries exist with intervals varied from 0.2 m to 2m.
Portable XRF is used to confirm sulphides and barite quantities in core. pXRF
results are used for indicative purposes only and not as final assay.
Underground
Drill core samples were collected from HQ, NQ and BQ (some cases recorded due
to a bad ground condition) diameter core, where full core was selected for NQ
and BQ diameters, and the core was sawn exactly in half for HQ along a
pre-defined cutting line. The core samples, typically weighing between 4-12kg,
depend on the material type and were placed into labelled and tagged sample
bags prior to dispatch to the SGS Burgas Laboratory in Bulgaria. Sample
intervals were determined by the geologist, routinely at nominal 1m intervals
unless selectively sampled areas with intervals varied from 0.4m to 4.0m where
the residual material exists.
Include reference to measures taken to ensure sample representivity and the Exploration
appropriate calibration of any measurement tools or systems used.
Sample intervals were selected by the logging geologist based on geological
criteria or using a nominal 1m sample length in homogenous massive sulphide
ore unless selectively sampled on narrower intervals where geological
boundaries exist with intervals varied from 0.2 m to 1.2m. Sampling is based
on visually mineralized intervals, with a calibrated portable XRF device used
only as a guide. pXRF is calibrated using standards daily when in use.
Underground
From May 2024 to September 2024 the entire hole has been sampled with a
nominal 1m length from the start to the end of the hole which has not been
defined based on geological or mineralization features unless selectively
sampled areas with intervals varied from 0.4m to 4.0m where the residual
material exists.
From October 2024 to the date the sampling procedure has been changed, and the
samples have been selected with a nominal 1m length in homogenous massive
sulphide ore zones with additional sampling of 10m before and 15m after the
visible ore zone has been sampled to identify the dilution impact of the
material. A calibrated portable XRF device used only as a guide, pXRF is
calibrated using standards daily when in use. The sampling process has been
defined by the logging geologist.
Aspects of the determination of mineralization that are Material to the Public Exploration
Report. In cases where 'industry standard' work has been done this would be
relatively simple (e.g., 'reverse circulation drilling was used to obtain 1 m For drill hole analyses, diamond drilling was used to obtain 4 to 12kg
samples from which 3 kg was pulverised to produce a 30 g charge for fire samples, crushed, pulverized and split for Fire Assay (30g charge), ICP-AES
assay'). In other cases, more explanation may be required, such as where there and ICP-MS, AAS, XRF and 4-acid digest using external laboratories and
is coarse gold that has inherent sampling problems. Unusual commodities or certified laboratory methods.
mineralization types (e.g. submarine nodules) may warrant disclosure of
detailed information. Prior to October 2022, samples were dispatched by dedicated road transport to
ALS Bor in Serbia for sample prep, splitting and analysis across several ALS
labs (Ireland and Romania).
From October 2022 core samples were sent to SGS Ankara, Türkiye by truck for
sample preparation (SGS Code PRP89), gold analysis by 30-gram fire assay with
AA finish (SGS code FAA303), base and precious metal as well as multi-element
analyses using a 4-Acid Digest with ICP-AES finish (code ICM40B). AAS was used
for over-detection limit analysis of base metals.
Barium was assayed using lithium borate fusion prior to acid dissolution and
ICP-MS analysis (SGS code ICP95A). Overlimit Barium (>10%) results were
analysed using portable pXRF (SGS code pXRF73C27) and the results above
detection limit (50%) sent to SGS Lakefield, Canada by air freight for
whole-rock XRF analysis (SGS Code GC_XR76V).
Underground
For drill hole analyses, diamond drilling was used to obtain 4 to 12kg
samples, crushed, pulverized and split in the SGS Burgas Laboratory in
Bulgaria and the following methods have been used to process the samples:
· sample preparation (SGS Code PRP90),
· gold analysis by 30-gram fire assay with AA finish (SGS
code FAA313),
· base and precious metal as well as multi-element analyses
using a 4-Acid Digest with ICP-OES finish (code ICP40B).
· AAS was used for over-detection limit analysis of base
metals.
· total carbon and sulphur were determined by an ELTRA
analyser.
Samples were dispatched by dedicated road transport to SGS Burgas in Bulgaria
for sample prep, splitting and analysis in SGS Burgas Laboratory, except the
Ba analysis. During the sample prep process, the sub-samples of pulps were
prepared and delivered by DHL service to the ACME Laboratory (Bureau Veritas,
Türkiye) for Ba analysis. The Barium has been analysed in ACME Laboratory by
XRF with the detection limit to 100%. from May 2024 till November 2024.
From November 2024 Barium commenced being analysed at SGS Ankara by ICP95A
method and XRF with the detection limit to 50%. The reason of changing the
laboratory is the technical issue in the ACME laboratory. The sub-samples of
pulps were prepared in the SGS Burgas Laboratory and delivered by DHL service
to the SGS Ankara Laboratory in Türkiye for the Ba analysis.
SGS Ankara Laboratory uses lithium borate fusion prior to acid dissolution and
ICP-MS analysis (SGS code ICP95A) for the Barium analysis. Overlimit Barium
(>10%) results were analysed using portable pXRF (SGS code pXRF73C27) and
the results above detection limit (>50%) will be analysed to the SGS
Lakefield Laboratory in Canada.
Drilling techniques Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air Exploration
blast, auger, Bangka, sonic, etc) and details (e.g. core diameter, triple or
standard tube, depth of diamond tails, face-sampling bit or other type, All drill holes were drilled using PQ3 and HQ3 diameter core.
whether core is oriented and if so, by what method, etc).
All drill holes were drilled by drilling contractor Drillex BH d.o.o., a
division of Drillex International.
PQ3 and HQ3 core was held in a core barrel by a stainless steel "split" inner
tube. The use of the inner tube ensured that all core maintained its
orientation prior to removal into the core trays. Drill core was stored in
suitable core boxes and stacked on the premises of the secure exploration
facility in Vareš.
All drill holes were surveyed at 9 m and every 30 m thereafter by a Reflex
"Ezy-Track" digital down-hole survey tool to end of 2022. As of 2023, all
holes have been surveyed using the Reflex 'Sprint IQ' and 'Omni' on the fly
north seeking non-magnetic gyroscopic tools at 5 m intervals in and 10 m out
of holes. No significant deviation or drilling problems have been identified.
Representatives from Reflex have been to drill rigs to calibrate, check and
train on correct usage of tools.
Underground
All drill holes were drilled using HQ3, HQ and NQ3, NQ diameter core.
All drill holes were drilled by drilling contractor SWICK BH d.o.o., a
division of Swick Mining Services.
HQ3 and NQ3 core was held in a core barrel by a stainless steel "split" inner
tube. The use of the inner tube ensured that all core maintained its
orientation prior to removal into the core trays. Additionally, orientation
measurements were taken, and the REFLEX ACT-III orientation device was used as
the orientation device. Drill core was stored in suitable core boxes and
staked on the premises of the secure exploration facility in Vareš.
Drill sample recovery Method of recording and assessing core and chip sample recoveries and results Exploration
assessed.
All core was geotechnically logged to verify drillers blocks, record run
length, recovered length, core recovery (%) and RQD.
There is no observed relationship between sample recovery and grade, and no
significant loss of core. No sample bias has been identified. Core recoveries
are generally >90%.
Underground
All core was geotechnically logged to verify drillers blocks, record run
length, recovered length, core recovery (%) and RQD.
There is no observed relationship between sample recovery and grade, and no
significant loss of core. No sample bias has been identified. Core recoveries
are generally >90%.
Measures taken to maximise sample recovery and ensure representative nature of
the samples.
Whether a relationship exists between sample recovery and grade and whether
sample bias may have occurred due to preferential loss/gain of fine/coarse
material.
Logging Whether core and chip samples have been geologically and geotechnically logged Exploration
to a level of detail to support appropriate Mineral Resource estimation,
mining studies and metallurgical studies. Diamond drill core samples have been geologically and geotechnically logged to
a level of detail to support appropriate Mineral Resource estimation, mining
studies and metallurgical studies. Not all drill holes penetrated the massive
sulphide mineralization, but all were used to guide the geological
interpretations supporting the Mineral Resource estimates.
Underground
Diamond drill core samples have been geologically and geotechnically logged to
a level of detail to support appropriate Grade Control estimation, and the
short-term mine plan.
Whether logging is qualitative or quantitative in nature. Core (or costean, Exploration
channel, etc) photography.
All core is photographed. Core logging is both qualitative and quantitative.
Logging records lithology, alteration, structures, veining, sulphide minerals
and percentages.
Underground
All core is photographed. Core logging is both qualitative and quantitative.
Logging records lithology, alteration, structures, veining, sulphide minerals
and percentages.
The total length and percentage of the relevant intersections logged. Exploration
100% of drill core is logged.
Underground
100% of drill core is logged.
Sub-sampling techniques and sample preparation If core, whether cut or sawn and whether quarter, half or all cores taken. Exploration
Drill core was cut in half using an Almonte automatic diamond core saw.
Nominally 1 in 30 samples were cut in quarters, and both halves analysed (for
purposes of field duplicates).
Underground
The core was cut in half using an Almonte automatic diamond core saw for the
HQ diameter core
If non-core, whether riffled, tube sampled, rotary split, etc and whether Exploration
sampled wet or dry.
Not applicable, as all samples are core.
Underground
Not applicable, as all samples are core.
For all sample types, the nature, quality, and appropriateness of the sample Exploration
preparation technique.
Collection of around 4-12kg of HQ and PQ half core material with subsequent
pulverisation of the total charge provided an appropriate and representative
sample for analysis. Generally, 4-6kg for HQ core and 6-12kg for PQ.
Prior to October 2022, sample preparation was undertaken at the ALS laboratory
in Bor, Serbia to industry best practice.
From October 2022, sample preparation was undertaken at the SGS Laboratory in
Ankara, Türkiye to industry best practice.
Underground
Collection of around 4-12kg of HQ and PQ half core material with subsequent
pulverisation of the total charge provided an appropriate and representative
sample for analysis. Generally, 4-6kg for HQ core and 6-12kg for PQ.
From the start of drilling all sample preparation was undertaken at the SGS
Burgas laboratory in Bulgaria to industry best practice.
Quality control procedures adopted for all sub-sampling stages to maximise Exploration
representativity of samples.
Blank material such as quartz sand, bricks, crushed limestone, all with no
visible mineralization, was used in 2020, 2021 and 2022 to control the
accuracy of sample preparation. However, some outliers were identified with
the blank samples therefore a standardized blank material has started being
used since 2023.Whole rock blanks and certified standards (~1 in 15) were
introduced to the sample stream as a QAQC check on laboratory processes.
Industry best practice was adopted by ALS and SGS for laboratory sub-sampling
and the avoidance of any cross contamination. ALS + SGS inserted internal
controls and cleaned all sampling equipment with a barren quartz rock every 20
samples. All sample preparation stations, and equipment were compressed air
cleaned after every sample.
Underground
Whole rock blanks and certified standards (~1 in 15) were introduced to the
sample stream as a QAQC check on laboratory processes. Industry best practice
was adopted by SGS for laboratory sub-sampling and the avoidance of any cross
contamination. The SGS laboratory inserted internal controls and cleaned all
sampling equipment with a barren quartz rock every 20 samples. All sample
preparation stations, and equipment were compressed air cleaned after every
sample. A QAQC inspection of SGS (Bulgaria) facilities was completed with
practices found to be in line with industry best practice in November 2024 by
Adriatic Metals Representatives (Senior Project Geologist - QAQC focused,
Geologist - Sampling, Assay and QAQC focused and Senior Mine Project Geologist
- Underground Drilling focused).
Measures taken to ensure that the sampling is representative of the in-situ Exploration
material collected, including for instance results for field
duplicate/second-half sampling. The half-core sampling is considered a reasonable representation of the
in-situ material. Nominally 1 in 30 samples were cut in quarters, and both
halves analysed (for purposes of field duplicates). All field duplicate and
pulp duplicates are reviewed and compared. Standards and Blanks are
investigated if over 2SD (2 Standard Deviations) from certified mean and
re-assay initiated if over 3SD or as required when over 2SD to validate
materials either side of poorly performing blanks or standards. QAQC outcomes
are checked on assay receipt by Adriatic Metals and before acceptance into the
Database. A dedicated Data Geologist support managing all received QAQC data
as it arrives.
Underground
The full core of NQ and BQ diameter core and the half-core of HQ core sampling
is considered a reasonable representation of the in-situ material. The pulp
duplicates are reviewed and compared. Standards and Blanks are investigated if
over 2SD (2 Standard Deviations) from certified mean and re-assay initiated if
over 3SD or as required when over 2SD to validate materials either side of
poorly performing blanks or standards. The QAQC outcomes are checked on assay
receipt by Adriatic Metals and before acceptance into the Database. A
dedicated Data Geologist support managing all received QAQC data as it
arrives.
Whether sample sizes are appropriate to the grain size of the material being Exploration
sampled.
Sample size of around 4-12kg is appropriate and found to reasonably represent
the material being tested. There is acceptable repeatability of multiple
economic elements. 4-6kg for HQ and 6-12kg for PQ.
Underground
Sample size of around 4-12kg is appropriate and found to reasonably represent
the material being tested. There is acceptable repeatability of multiple
economic elements.
Quality of assay data and laboratory tests The nature, quality and appropriateness of the assaying and laboratory Exploration
procedures used and whether the technique is considered partial or total.
Prior to October 2022, primary analysis was completed through ALS
Laboratories. With Sample preparation as ALS Bor, Republic of Serbia with
splitting and sending pulps to Loughrea, Ireland and Rosa Montana, Romania.
From October 2022, primary sample preparation and analysis was completed by
SGS Laboratory in Ankara, Republic of Türkiye.
All facilities are industry best practice and ISO certified. Multi elements
were assayed by an ICP-AES technique following a four-acid digest. Gold was
determined using a fire assay on nominal 30g charges. Barite was determined
from a lithium meta-borate fusion followed by dissolution and ICP-AES
analysis. Total carbon and sulphur were determined by a Leco analyzer.
All techniques were appropriate for the elements being determined. Use of a
4-Acid digest is a near-total digestion of all minerals present.
Additional pXRF and whole rock XRF analysis is required to determine accurate
concentrations of barium as part of reported assays. Whole rock XRF analysis
is completed at Lakefield Canada.
Initiation of a gravimetric finish was initiated at start of Q2 2023. Gold
results >3.00 g/t are re-assayed by fire assay with gravimetric finish at
SGS Ankara laboratory.
Total carbon and sulphur were determined by a Leco analyser.
All techniques were appropriate for the elements being determined.
The external control was carried out at ACME Laboratory (Bureau Veritas,
Türkiye).
The basic methods of 4-acid decomposition as well as the methods of
determination of concentrations in the sample are similar to the main
laboratory. All methods of the laboratory are also accredited according to
ISO standards
Underground
The SGS Burgas Laboratory in Bulgaria has been selected as the main Laboratory
for the Underground diamond drilling. The first sample shipments began in June
2024.
The SGS Ankara and ACME Laboratory have been used for barium analysis.
All facilities are industry best practice and ISO certified.
Laboratory workflow is set up with the best standard practices.
All analyses reported are certified by ISO laboratories, (SGS Burgas; SGS
Ankara; ACME Laboratory (Bureau Veritas, Türkiye), using calibrated, industry
standard and recognized methods, QAQC and equipment.
For geophysical tools, spectrometers, handheld XRF instruments, etc, the Exploration
parameters used in determining the analysis including instrument make and
model, reading times, calibrations factors applied and their derivation, etc. There was no reliance on determination of analysis by geophysical tools. A
Hitachi X-Met 8000 hand-held pXRF analyzer is used to rapidly define metal and
barite abundance during logging, field mapping and sampling. Results are not
used in resource estimates or publicly reported.
Underground
There was no reliance on determination of analysis by geophysical tools. A
Hitachi X-Met 8000 hand-held pXRF analyzer is used to rapidly define metal and
barite abundance during logging, field mapping and sampling. Results are not
used in resource estimates or publicly reported.
Nature of quality control procedures adopted (e.g. standards, blanks, Exploration
duplicates, external laboratory checks) and whether acceptable levels of
accuracy (i.e. lack of bias) and precision have been established. Certified Reference Materials ("CRM's"), certified blanks (coarse grained),
half and quater core duplicates (Field Duplicated), Duplicates of crushed
stage and duplicate after pulverizing stage, were used.
CRM's, blanks, and duplicates were added at a rate around than 1 in 20.
Absolute majority results reported by SGS Ankara on the CRMs and blanks were
within 2 standard deviations (2SD). As a part of the QAQC procedure the trend
of the 1SD deviations has been observed and the assay results has been
considered as complete unless there is no negative trend (5 points in the same
row above or in the line to 1SD) and if there is a negative trend, the
necessary samples above and below of the required standards and blanks have
been re-assayed. To date returned results are considered to be representative
of material sampled. A program of 5% of assay pulps are submitted for
External lab testing. The program is continuous and ongoing as part of QAQC
controls in addition to measures already in place.
All necessary procedures and statistical observations have been made to ensure
the quality and accuracy of the assay results.
All assay results reported have passed the QAQC procedure.
ACME Laboratory (Bureau Veritas) in Ankara, Republic of Türkiye is used as
the current independent Umpire Laboratory replicating 5% of pulp duplicate
results for QAQC.
Underground
Certified Reference Materials ("CRM's"), certified blanks (coarse grained) and
duplicates after pulverizing stage, were used. CRM's, blanks, and duplicates
were added at a rate better than 1 in 15. All results reported by SGS on the
CRMs and blanks were within 2 standard deviations (2SD).
As a part of the QAQC procedure the trend of the 1SD deviations has been
observed and the assay results has been considered as complete unless there is
no negative trend (5 points in the same row above or in the line to 1SD) and
if there is a negative trend, the necessary samples above and below of the
required standards and blanks have been re-assayed.
To date returned results are representative of material sampled. CRM's,
blanks, and duplicates were added at a rate better than 1 in 15. All results
reported by SGS on the CRMs and blanks were within 2 standard deviations
(2SD). Where deviations greater than 1SD where noted, testing could be
considered as completed unless it does not exist negative tendency (5 points
in row upper or close to 1SD) and where necessary samples above and below
queried Standards and Blanks were re-assayed. To date returned results are
representative of material sampled.
A program of 5% of assay pulps will be organised in the Q1 2025 to be sent for
an External Control.
Verification of sampling and assaying The verification of significant intersections by either independent or Exploration
alternative company personnel.
Significant mineralization is reviewed internally by multiple Senior
geological staff, the Vareš Silver Operation Exploration Manager, and Head of
Exploration. Significant intercepts are visually verified daily as core is
brought in for logging, included in summary logs, and then cross-checked
during detailed logging. Tenor and confirmation of mineralization and barite
content is checked by portable XRF (Hitachi X-Met 8000) only to support the
geological logging process. XRF results have not been used for any
mineralization interpretation or mineral resource estimation.
Independent relogging of select mineralized and non-mineralized drill core has
been completed by multiple consultants involved in technical studies including
Elizabeth Thompson (Structural Consultant - Transition Elements), Joe Crummy
(ARD Consultant - JC Consulting), Joe Burke (Geotechnical Consultant - Avoca
Geotechnical) and others.
Underground
Mineralization opened faces in the crosscuts and mineralized core intervals
are regularly viewed and verified by geosciences qualified and certified
staff, investors and analysts.
Tenor and confirmation of mineralization and barite content is checked by
portable XRF (Hitachi X-Met 8000) only to support the geological logging
process. XRF results have not been used for any mineralization interpretation
or grade control estimation.
The use of twinned holes. Exploration
Several twinned holes have been completed to verify the historic holes. The
mineralization position, grade, and thickness have been clarified.
Several cross-holes have also been drilled from adjacent drill platforms,
passing through the trace of previous holes and at near right angle cutting
previously intercepted mineralization. The mineralization position, grade, and
thickness have been clarified.
Underground
No twin holes were drilled.
Documentation of primary data, data entry procedures, data verification, data Exploration
storage (physical and electronic) protocols.
The data and databases are managed by Data Geologists in an acQuire Geological
Database Management System. The acQuire database is regularly backed-up in the
company server at Vareš, Bosnia and Herzegovina. There are a dedicated Data
Geologist and a Junior Data Geologist managing and ensuring the QAQC of all
daily geological inputs and outputs from the database and various software
(downhole survey, surface survey, audits, drilling data, logging, sampling,
sample dispatch, assaying and assay QAQC). The QAQC charts review is managing
by Project Geologists, and the assay results are being accepted in the system
based on the Project Geologists review.
Underground
The data and databases are managed by Data Geologists in an acQuire Geological
Database Management System. The acQuire database is regularly backed-up in the
company server at Vareš, Bosnia and Herzegovina. There are a dedicated Data
Geologist and a Junior Data Geologist managing and ensuring the QAQC of all
daily geological inputs and outputs from the database and various software
(downhole survey, surface survey, audits, drilling data, logging, sampling,
sample dispatch, assaying and assay QAQC). The QAQC charts review is managing
by Project Geologists, and the assay results are being accepted in the system
based on the Project Geologists review.
Both the Exploration and the Underground geological data consolidation and
storage, and assay results acceptance passed QAQC are managing by the
Independent Mineral Resource Group of the Adriatic Metals.
Discuss any adjustment to assay data. Exploration
No adjustments were necessary.
Underground
No adjustments were necessary
Location of data points Accuracy and quality of surveys used to locate drill holes (collar and Exploration
down-hole surveys), trenches, mine workings and other locations used in
Mineral Resource estimation. Sampling sites were surveyed using Total Station to better than 0.05 m
accuracy in the local BiH coordinate system.
A Reflex TN4 north seeking, gyroscopic rig alignment tool was used as of 2023
for precision alignment of holes at the collar. The TN14 is mounted on the
rod string with preset mast dip and hole azimuth referenced to grid north
converted from UTM. Mast and rig are moved till TN14 reads that the rod
string is aligned to set dip and direction. The TN14 can also be used in
place of the Total Station or as a check of the Total Station collar set-up
survey accuracy.
Underground
Minnovare Azimuth Aligner north seeking, gyroscopic rig alignment tool was
used as of 2024 underground drilling for precision alignment of holes at the
collar. The Minnovare Azimuth Aligner is mounted on the rod string with preset
mast dip and hole azimuth referenced to grid north converted from UTM. Mast
and rig were moved till the Minnovare Azimuth Aligner reads that the rod
string is aligned to set dip and direction. The wireless hand-held interface
streams live data from the Azimuth Aligner unit is displaying both target and
actual Azimuth and dip readings in real time.
The Minnovare Azimuth Aligner can also be used in place of the total Station
or as a check of the total Station collar set-up survey accuracy.
All drill holes were surveyed (down hole survey) using the Reflex 'Sprint IQ'
and 'Omni' on the fly north seeking non-magnetic gyroscopic tools at 5 m
intervals in and 10 m out of holes. No significant deviation or drilling
problems have been identified. Reflex (IMDEX) representatives are in
constant communication and provide training on device usage. Calibration
certificates for all tools are provided by Reflex.
Specification of the grid system used. Exploration
The grid system used MGI 1901 / Balkans Zone 6.
Underground
The Mine Local Grid used for the underground drillholes preposition, and all
the surface holes have been converted from the grid system MGI 1901/Balkans
Zone 6. The grid converting is automated in the Acquire Geological Database
Management System where all geological data captured.
Quality and adequacy of topographic control. Exploration
The topographic surface of the immediate area was generated from a LiDAR
survey to an accuracy of approximately 0.05 m. It is considered sufficiently
accurate for the Company's current activities. All drill collars have been
compared to the LiDAR surface and physically validated where discrepancies in
elevation or position where noted. Validation has been periodically required
in mountainous terrain where holes post-date LiDAR and earthworks have been
completed to establish drill pads.
Underground
The topographic surface of the immediate area was generated from a LiDAR
survey to an accuracy of approximately 0.05 m. The surface drill collars have
been compared to the LiDAR surface and physically validated where
discrepancies in elevation or position where noted. It is considered
sufficiently accurate for the Company's current activities.
Data spacing and distribution Data spacing for reporting of Exploration Results. Exploration
Drill hole spacing does not exceed 50 m which is considered acceptable for
reporting exploration results. The nominal drill spacing is on 40 m spaced
sections. The primary method of drilling is to complete holes from a single
drill platform in mountainous terrain. Holes are drilled as part of a 'fan' of
holes. Design of holes aims to achieve a nominal 25 m to 30 m separation
between mineralized zones to achieve either an Inferred or Indicated level of
exploration confidence.
Underground
Drill hole spacing is on 10-15 m spaced sections and design of the holes is
on 10-15 m between holes in the fan. The spacing is considered acceptable for
reporting underground results. The exploration holes have been drilled with a
nominal drill spacing is of 40 m on section and 20-30 m between holes in
cross section.
Whether the data spacing and distribution is sufficient to establish the Exploration
degree of geological and grade continuity appropriate for the Mineral Resource
and Ore Reserve estimation procedure(s) and classifications applied. Drill hole spacing is deemed sufficient to establish the degree of geological
and grade continuity appropriate for the Mineral Resource classification to be
applied. The data spacing is suitable for a stratabound, continuous style of
polymetallic mineralization with minimal structural disturbance or
remobilisation.
Where structural complexity is noted (RNW Western and Lower Zones), drill hole
spacing is reduced to <20 m.
Underground
Drill hole spacing is deemed sufficient to establish the degree of geological
and grade continuity appropriate for the production and the grade Control
Estimation to be applied. The data spacing is suitable for a stratabound,
continuous style of polymetallic mineralization with minimal structural
disturbance or remobilisation
Whether sample compositing has been applied. Exploration
Sample compositing was not applied.
Underground
Sample compositing was not applied.
Orientation of data in relation to geological structure Whether the orientation of sampling achieves unbiased sampling of possible Exploration
structures and the extent to which this is known, considering the deposit
type. Drill holes have been drilled at dips of between -45 to -90° from surface.
The mineralized body is generally shallow dipping to the NE and plunging to
the NW at angles of 30 to 40 degrees.
The drilling in the RNW Lower Zone has seen mineralization approach
subvertical angles. Drilling in these areas has been at right angles to steep
mineralization and from 45 to 60 degrees allowing multiple holes to transect
steeper mineralization over a vertical elevation spread of holes.
Underground
Drill holes have been drilled at dips of rising from 26° to dipping -45°
dipping from the underground drill platforms at the level of underground
workings.
If the relationship between the drilling orientation and the orientation of Exploration
key mineralized structures is considered to have introduced a sampling bias,
this should be assessed and reported if material. It is not considered that the drilling orientation has introduced a sampling
bias, as the drilling is considered to be orthogonal to the stratabound
mineralization, or close to it.
Underground
Drilling orientation is not considered to have introduced sampling bias as
drilling is considered to have been targeted to cross the strike of the
orebody.
Sample security The measures taken to ensure sample security. Exploration
Chain of Custody of digital data is managed by the Company. Physical material
was stored on site and, when necessary, delivered to the assay laboratory.
Thereafter laboratory samples were controlled by the nominated laboratory. All
sample collection was controlled by digital sample control file(s) and
hard-copy ticket books.
Transfer of samples to laboratories is by a dedicated enclosed commercial
truck. No other freight is included with shipments. Weigh-bills are used as
are multiple customs declarations. Dispatched samples have sample tickets
included, are referenced to a pre-dispatch sample submission sheet, and are
cross-checked on receipt at laboratory. To date no discrepancies, sample
loss or tampering with samples has been recorded.
Underground
Chain of Custody of digital data is managed by the Company. Physical material
was stored on site and, when necessary, delivered to the assay laboratory.
Thereafter laboratory samples were controlled by the nominated laboratory. All
sample collection was controlled by digital sample control file(s) and
hard-copy ticket books.
Transfer of samples to laboratories is by a dedicated enclosed commercial
truck. No other freight is included with shipments. Weigh-bills are used as
are multiple customs declarations. Dispatched samples have sample tickets
included, are referenced to a pre-dispatch sample submission sheet, and are
cross-checked on receipt at laboratory. To date no discrepancies, sample
loss or tampering with samples has been recorded.
Audits or reviews The results of any audits or reviews of sampling techniques and data. The ACME Laboratory (Bureau Veritas, Türkiye) and SGS Ankara Laboratory
reviews have been carried out by the Adriatic representatives as following,
Senior Project Geologist specialised in QAQC procedure, QAQC Geologist and
Data Geologist in April 2024. The Report has been issued on the findings of
both Laboratories and further improvements have been discussed with the
Laboratory representatives. No material issues have been recorded.
The SGS Burgas Laboratory review has been carried out by the Adriatic
representatives as following, Senior Project Geologist specialised in QAQC
procedure, QAQC Geologist and Underground Mine Geologist in November 2024. The
Report has been issued on the findings and further improvements have been
discussed with the Laboratory representatives. No material issues have been
recorded.
Items for laboratory improvement were noted but were not considered material
to sample QAQC outcomes.
Section 2 Reporting of Exploration Results
(Criteria in this section apply to all succeeding sections)
Criteria JORC Code explanation Commentary
Mineral tenement and land tenure status Type, reference name/number, location and ownership including agreements or Exploration
material issues with third parties such as joint ventures, partnerships,
overriding royalties, native title interests, historical sites, wilderness or The Rupice deposit is located within the Company's 100% owned Concession, No.
national park and environmental settings. 04-18-21389-1/13, located 13km west of Vareš in Bosnia. There are no known
material issues with any third party other than royalties due to the State.
Underground
The Rupice Mine is situated within the Company's Decision of Concession
Agreement, No. 06-14-1-334/21, covering a total area of 1.04 km². The mine is
located approximately 17 km from Vareš. Near the Rupice Mine, there is a
medieval castle, which remains unaffected by the underground mining
activities. Additionally, to the northwest of the Rupice Mine, there is the
protected Trstionica Forest area, which is also not impacted by mining
operations. There no cases recorded in relation to third-party concerns.
The security of the tenure held at the time of reporting along with any known Exploration
impediments to obtaining a licence to operate in the area.
The Concession is in good standing with the governing authority and there is
no known impediment to the Concession remaining in force until 2038 (25
years), subject to meeting all necessary reporting requirements.
Underground
The Concession Agreement for Mining is in good standing with the governing
authority and there is no known impediment to the Concession remaining in
force until 2038 (25 years), subject to meeting all necessary reporting
requirements.
Exploration done by other parties Acknowledgment and appraisal of exploration by other parties. Exploration
Modern exploration commenced with the work of Energoinvest in the late 1960s.
During 1968-1969 underground development of 455m of drives and crosscuts were
made, and 11 surface trenches dug for a total length of 93.5m. Between 1980
and 1989, 49 holes were drilled for an advance of 5,690.8m. Sample material
from all of these programs was routinely analyzed for lead, zinc, and barite,
and on occasion silver and gold. The deposit was the subject of several
reserve estimates in the 1980s. This work is documented in many reports which
are certified by those geoscientists and Institutes that undertook the work.
The work is considered of a standard equal to that found within today's
exploration industry.
During the reporting period, Reports were prepared according to the rules of
the local Ministry of Resources Supervision. An expert from the State was
invited and confirmed the quality of the prepared report.
The resource estimation was also carried out by a consultant from the AMC
company.
Underground
Not applicable
Geology Deposit type, geological setting and style of mineralization. The host rocks at Rupice Main and RNW include Middle Triassic limestone,
dolostone, calcareous and dolomitic marl, and a range of mostly fine-grained
siliciclastic rocks including cherty mudstone, mudstone, siltstone and
fine-grained sandstone. The main mineralized horizon is a brecciated dolomitic
unit that dips at around 50 degree to the northeast and has been
preferentially mineralized with base, precious and transitional metals. The
Triassic sequence has been deformed by early-stage ductile shearing and
late-stage brittle faulting.
The Rupice Main and RNW polymetallic mineralization consists of sphalerite,
galena, barite and chalcopyrite with silver, gold, tetrahedrite, boulangerite,
bournonite and pyrite. The majority of the high-grade mineralization is hosted
within the brecciated dolomitic unit. The majority of deformation is along
shears wrapping about the margins of mineralization. This is consistent with
the deposit being within a compressional low angle thrust environment mapped
on a regional scale. Thickening of the central portion of the Rupice deposit
is considered to be associated with thrust related folding. Mineralized widths
of up to 65m true thickness are seen in the central portion of the Rupice
deposit.
RNW is less deformed than Rupice Main. Differential shearing along the
deposits' massive sulphide boundaries appears to have created a large
sigmoidal structure which hosts the polymetallic mineralization. Effectively a
large lozenge with tapering ends in section-view that gently rolls-over to the
west.
Rupice Main sits at a stratigraphically higher position than RNW. They are
separated by a ferruginous siliceous chert unit (GYD). Rupice and RNW overlap
at their strike extremities over an interval of ~80m. The area between Rupice
and RNW is referred to as the 'GAP'. But the GAP area is both Rupice and RNW
lenses transition from massive to semi-massive to disseminated sulphides.
To date, the massive sulphide mineralization at Rupice Main has a defined
strike length of >600m, with a maximum true-width thickness of around 65m
and a minimum of 0.3m. In the latest areas drilled, the up-dip portions of
Rupice Main have been tested to the southwest. To date, some low mineralized
lenses have been identified, but this has not been continuous.
To date, the massive sulphide mineralization at RNW has a defined strike
length of >300m, with a maximum true-width thickness of around 40m and a
minimum of 0.4m. The mineralization increases in width, grade and thickness
from southeast to northwest and remains open. There is no geological reason to
believe mineralization does not extend beyond the Exploitation License
boundary to the northwest. This presents a significant opportunity for further
resource growth at Rupice NW over its strike length. Adriatic Metals plc has
applied to the Zenica-Doboj Canton to expand the Concession Agreement along
strike of RNW. The deposit south-westward narrows with increasing base metal
content, higher grades, elevation in copper and gold values, and a reduction
in barium content.
To date, the massive sulphide mineralization at Rupice Main has been verified
by the underground diamond drilling completed as part of grade control for
mine planning.
Drill hole information A summary of all information material to the understanding of the exploration For the 2024 MRE (Rupice Main and RNW), a total of 469 diamond drill holes for
results including a tabulation of the following information for all Material a total of 110,620m define the current limits of known mineralization. Up to
drill holes: mid-2022, the deposit was drilled and sampled using diamond drill holes on a
nominal 20m by 20m spacing. From mid-2022 to October 2024, the drill hole
o easting and northing of the drill hole collar spacing was widened to a 40m x 30m spacing across RNW reflecting the robust
continuity of the stratabound mineralization along and across strike. Drilling
o elevation or RL (Reduced Level - elevation above sea level in has defined a combined Rupice Main and RNW mineralized system having a strike
metres) of the drill hole collar length of >900m and an across-strike width of >350m.
o dip and azimuth of the hole
o downhole length and interception depth The Rupice Main portion of the 2024 MRE update includes a total of 297 diamond
drill holes for a total of 71,578m to define the current limits of known
o hole length. Rupice mineralization. The deposit was drilled and sampled using diamond drill
holes on a nominal 20m by 20m spacing up to the end of 2022. Historic hole
If the exclusion of this information is justified on the basis that the verification drilling was completed in 2024. Drilling defined the Rupice
information is not Material and this exclusion does not detract from the deposit as having a strike length of >600m and an across-strike width of
understanding of the report, the Competent Person should clearly explain why >350m.
this is the case.
The RNW portion of the 2024 MRE update includes a total of 137 diamond drill
holes from the Company's drilling programmes in 2021 to October 2024 for
35,274m to define the current limits of the known RNW mineralization. Up to
mid-2022, the deposit was drilled and sampled using diamond drill holes on a
nominal spacing of 40m by 20m. From mid-2022 to the end of October 2024 the
drill hole spacing was widened to a 40m by 30m spacing. The widening of the
drill spacing was in response to the RNW deposit being spatially continuous
over its >300m strike length and having a >260m across-strike width.
The Rupice Main Underground portion of the 2024 MRE update includes a total of
35 underground diamond drill holes from the Company's drilling programmes from
May 2024 to October 2024 for 3,768m of diamond core to define the current
limits of the known Rupice Main mineralization. The drill hole spacing is on
up to 20m spaced sections and design of the holes is 10-15m between
mineralization within holes in the fan. Tighter spaced diamond core drilling
has produced positive results not seen or anticipated from prior resource
development drilling completed from surface.
Exploration drill holes completed by the Company were set up to drill to the
southwest with holes dipping from -45 to -86 degrees from horizontal at the
surface. Additional drill holes were completed from the opposite direction,
and perpendicular to the mineralized trend. All historical holes were vertical
and focused on the up-dip portion of the Rupice mineralization.
Underground drill holes completed by the Company were set up to drill with
holes dipping from -4 to -45 degrees and elevations of up to 26 degrees for
upwards drilled holes. Drilling has been from the 1050 level (crosscuts 570 to
645) and 950 level (crosscuts 630 to 660).
Data aggregation methods In reporting Exploration Results, weighting averaging techniques, maximum No data aggregation methods were applied.
and/or minimum grade truncations (e.g. cutting of high grades) and cut-off
grades are usually Material and should be stated.
Where aggregate intercepts incorporate short lengths of high-grade results and Where significant assays have been previously reported, short intervals of
longer lengths of low-grade results, the procedure used for such aggregation significant high-grade are defined where results report as >600 g/t AgEq.
should be stated and some typical examples of such aggregations should be This applies down to a minimum 1 m interval. Where there are significant
shown in detail. intercepts >5 m, a maximum internal dilution of 5 m can be applied.
The assumptions used for any reporting of metal equivalent values should be Metal equivalent explanations are described in the body of the text.
clearly stated.
Silver equivalent (AgEq) -was calculated using conversion factors of 31.1 for
Zn, 24.88 for Pb, 80.0 for Au, 1.87 for BaSO4, 80.87 for Cu, 80.87 for Sb, and
recoveries of 90% for all elements. Metal prices used were US$2,500/t for Zn,
US$2,000/t for Pb, US$150/t for BaSO4, US$2,000/oz for Au, US$25/oz for Ag,
US$6,500/t for Sb and US$6,500 for Silver equivalent (AgEq) -was calculated
using conversion factors of 31.1 for Zn, 24.88 for Pb, 80.0 for Au, 1.87 for
BaSO4, 80.87 for Cu, 80.87 for Sb, and recoveries of 90% for all elements.
Metal prices used were US$2,500/t for Zn, US$2,000/t for Pb, US$150/t for
BaSO4, US$2,000/oz for Au, US$25/oz for Ag, US$6,500/t for Sb and US$6,500 for
Cu
AgEq = Ag(g/t) * 90% + 31.1 * Zn(%) * 90% + 24.88 * Pb(%) * 90% + 1.87 *
BaSO4(%) * 90% + 80 * Au(g/t) * 90% + 80.87 * Sb(%) * 90% + 80.87 * Cu(%) *
90%
Relationship between mineralization widths and intercept lengths These relationships are particularly important in the reporting of Exploration Drillholes have generally intercepted flat to shallow dipping mineralization
Results. orthogonally. Exploration Drillholes have dips ranging from 45 to 90
degrees. Underground Drillholes have had dips dipping from -4 to -45 degrees
and elevations of up to 26 degrees for upwards drilled holes. Drilling has
been from the 1050 level (crosscuts 570 to 645) and 950 level (crosscuts 630
to 660).
If the geometry of the mineralization with respect to the drill hole angle is The majority of the high-grade Rupice mineralization is hosted within a
known, its nature should be reported. brecciated dolomitic unit. Thickening of the central portion of the deposit
occurs in an area of interpreted local folding and deformation. Mineralized
widths up to 65 m true thickness are seen in the central portion of the
deposit. To date, the massive sulphide mineralization at Rupice has a defined
strike length of 650 m with an average true-width thickness of around 20 m.
However, mineralization at Rupice still remains open along strike to the
northwest, up-dip, and down-dip.
If it is not known and only the downhole lengths are reported, there should be The latest release was in the July 2023 MRE report
a clear statement to this effect (e.g. 'downhole length, true width not
known').
Diagrams Appropriate maps and sections (with scales) and tabulations of intercepts Relevant maps and diagrams are included in the body of the report.
should be included for any significant discovery being reported. These should
include, but not be limited to a plan view of drill hole collar locations and
appropriate sectional views.
Balanced reporting Where comprehensive reporting of all Exploration Results is not practicable, Not applicable. All mineralized incepts are being reported as part of 2023
representative reporting of both low and high-grades and/or widths should be July Rupice MRE Update and 2024 November 2024 MRE Update.
practiced to avoid misleading reporting of Exploration Results.
Other substantive exploration data Other exploration data, if meaningful and material, should be reported No substantive exploration or underground data not already mentioned in the
including (but not limited to): geological observations; geophysical survey report has been used in the preparation of the Mineral Resource estimate.
results; geochemical survey results; bulk samples - size and method of
treatment; metallurgical test results; bulk density, groundwater, geotechnical
and rock characteristics; potential deleterious or contaminating substances.
Further work The nature and scale of planned further work (e.g. tests for lateral To date, there is no exploration drilling is planned in 2025.
extensions or depth extensions or large-scale step-out drilling).
Underground drilling will be ongoing to support mine production and short term
mine planning.
Diagrams clearly highlighting the areas of possible extensions, including the
main geological interpretations and future drilling areas, provided this
information is not commercially sensitive.
Section 3: Estimation and Reporting of Mineral Resources
(Criteria listed in section 1, and where relevant in section 2, also apply to
this section)
Criteria JORC Code explanation Commentary
Database integrity Measures taken to ensure that data has not been corrupted by, for example, Data used in the MRE was provided from a validated Micromine database, which
transcription or keying errors, between its initial collection and its use for in turn was sourced from a validated acQuire database prepared by Adriatic
Mineral Resource estimation purposes. Metals and hosted on the company SQL server. QAQC routines were employed to
confirm the validity of data. Data entry was also checked using set procedures
e.g., drillhole ID verification, overlapping intervals, overlength of
intervals. All files (collar, survey, geology, assay, recovery, geotechnical,
density, logging) were validated to ensure they were populated with the
correct original data.
Assay data QAQC included checking every field in the data table for agreement
between received data and sample submission sheets. Strict control of incoming
data formats for compliance with SQL data requirements was in place.
Using the acQuire Data Management system, there is a strict prescriptive
workflow process requiring only registered users to be able to enter data in
preset formats. All data is validated by the user before being able to be
checked in. No non-conforming data passes validation. acQuire restricts the
ability to change / modify data by user level / authority. Changes to the
database at SQL level is restricted to Database management staff.
All logging data is directly entered into specific logging laptops. All
drillhole metadata e.g. collar, downhole survey, orientation, and logging
data are stored on the company SQL server in Vareš, Bosnia and Herzegovina.
The Database is managed by the Adriatic Metals dedicated Data Geologist. The
Database is updated as new data becomes available. Back-ups are generated
daily and kept on BiH servers.
Data validation procedures used. Data validation starts with the use of templates for logging core to ensure
the correct capture of data. There is flexibility to adapt and change the data
entry templates. Change can only be made by an authorized level acQuire
user.
Data is transferred directly to the SQL server in real-time as being
inputted. Data is checked for double entry across columns, logged intervals
against final depth, correct EOH depth, correct downhole survey coordinates,
correct collar survey coordinates, no overlapping logged or surveyed
intervals, no sampling or logging intervals exceed the actual EOH depth.
Incoming assay data is checked for correct format before importing. Checks
include usage of acceptable and agreed characters, headers and columns.
Initial imports are in text and csv formats. Checks are made before importing
data that there is no risk of overwriting or duplication of sample and assay
data.
The database is updated in a streaming format as the work is completed. The
method allows for checking of the data transfer process and detection /
avoidance of bulk load errors.
The following specific error validation rules are carried out:
• Missing collar coordinates.
• Missing values in fields FROM and TO.
• Cases when FROM values equal or exceed TO ones (FROM≥TO).
• Data availability. The data availability is checked for each
drill hole in the tables to spot missing: collar coordinates, sampling data,
downhole survey data, lithological characteristics.
• Duplicate drill hole numbers in the table of the drill hole
collar coordinates.
• Duplicate sampling intervals.
• Duplicate downhole measurement data.
• Duplicate intervals of the lithological column.
• Sample "overlapping" (when the sample TO value exceeds
FROM value of the next sample).
• Negative-grade samples.
Drill hole data is always verified against source documentation.
Surveyed drill holes are verified visually for consistency.
Survey data is checked visually for deviations in drilling angles and
direction.
The Competent Person is satisfied that database integrity is appropriate to
support Mineral Resource estimation.
Site visits Comment on any site visits undertaken by the Competent Person and the outcome Sergei Smolonogov (RPGeo) is based on-site in Vareš and is responsible for
of those visits. planning and implementation of the recent drilling programs, overseeing the
preparation of the samples and their dispatch to the various laboratories. Mr.
Smolonogov assumes responsibility for data components, QA/QC and geological
interpretation. Dmitry Pertel (AMC) assumes responsibility for the grade
interpolation and reporting of the Mineral Resource estimate and has
previously completed a site visit in July 2019. Sandugash Sadykova (MAIG) is
based on-site in Vareš and in charge of Mineral Resources of the Adriatic
assumes responsibility for resources depletion and reissuing the Mineral
Resources state.
If no site visits have been undertaken, indicate why this is the case. A site visit has been undertaken by Dmitry Pertel.
Geological interpretation Confidence in (or conversely, the uncertainty of) the geological Sufficient drilling has been conducted to reasonably interpret the geology and
interpretation of the mineral deposit. the polymetallic mineralization. The mineralization is traceable between
numerous drill holes and drill sections.
Specialists in structural geology (site visit), litho-geochemistry (remote),
regional geology (site visit), ARD (site visit) and geotechnical (site visit)
have been involved in reviewing and assessing collected data either through
site visits or through remote review of digital data, database, assay and core
photos. Check mapping has been completed by specialists and drilled collar
locations verified.
Interpretation of the deposit was based on the current understanding of the
deposit geology. Each cross section generally spaced 20-30 m apart was
displayed in Micromine software together with drill hole traces color-coded
according to grade values. The interpretation honored the interpretation of
the main geological elements. The mineralization for Rupice and RNW was
interpreted and modelled using core logging data, and with reference to
geological data. Construction of a 3D geological model and a 3D sulphide model
in Micromine assisted greatly in both confirming and bringing together the
geological information into a coherent and realistic interpretation tied to
observed fact from mapping, drill core and assay.
High-Grade and Low-Grade geological cut-off grades for 3D solid modelling were
established using classical statistical analysis (table below). All the major
economic elements were wireframed independently - Ag, Au, Pb, Zn, Cu, BaSO(4.)
(Rupice Main Orebody)
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(RNW Orebody)
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Nature of the data used and of any assumptions made. Geological logging in conjunction with assays and dynamic 3D modelling has
been used to interpret mineralization. Sample lengths of 0.2m to 1.2m were
allowed to honor discrete coherent geological / mineralization intervals. This
assisted in establishing precise geological and grade boundaries.
The average length of sampled intervals in the final estimation is 1.08m for
RNW and 1.7m for Rupice Main (taking into account historical data). The Rupice
Main deposit was historically sampled in 2m intervals, selectively, and
generally only where there was visible sulphide mineralization and 10m above
and below the main mineralized zone regardless of visible sulphides. This
methodology was updated as of 2022 to nominal 1m sampling of all core once
through the Jurassic cover sequence and into the Triassic mineralization host
sequence. The average sample interval for Rupice reflects the historic wider
2m sampling.
RNW has been sampled in 1m intervals through the complete mineralized Triassic
sequence.
The effect, if any, of alternative interpretations on Mineral Resource Alternative interpretations are likely to materially impact on the MRE on a
estimation. local, but not global basis.
Folding and low angle structures are considered mechanisms for localizing
thicker areas of mineralization, versus steep fault offsets which have been
interpreted historically. Review of drilling data (core and core photos)
linked with 3D modelling and knowledge of the developing structural
architecture controlling mineralization at RNW indicated that mineralization
thickening and continuity is more likely to be influenced by flatter thrust
related structures. This has resulted in a more continuous and simplified
Rupice Main mineralization model without major global impact on the resource.
RNW was treated as a separate geological entity. Geology and structure were
developed in parallel. Structures are present and are interpreted to be
flat, bedding sub-parallel and reflected as shearing about the mineralization
hanging-wall and footwall contacts. It is interpreted that a steep late-stage
structure is likely further west of the current resource model.
The use of geology in guiding and controlling Mineral Resource estimation. Geological logging, 3D geological model and 3D massive sulphide model in
conjunction with assays and results of the statistical analysis have been used
to interpret the mineralization. Available historical maps and sections have
been used to guide interpretation near surface.
Up to 5m of internal waste is included into interpreted mineralized bodies of
sufficient width to carry proportional amounts of internal waste. Where there
is greater than 5m of internal waste, a separate mineralization solid is
created.
There is a high correlation between interpreted logged sulphide mineralization
and mineralized zones defined by assay. There is a 98.7% correlation between
logged sulphides and returned assays. Variation occurs in areas of low grade
generally on the hanging-wall and footwall of significantly mineralized zones.
These are generally areas of strong alteration, disseminated and stringer
sulphide occurrence. Accurate estimation of sulphide percent is linked to
logger experience. Use of a pXRF has reduced the uncertainty.
The factors affecting continuity both of grade and geology. Continuity is affected by the nature of the host rocks, interpreted
deformation (faults and shears) and drill hole coverage.
As an example, the distribution of significant mineralization is localized
either on the hanging-wall or the footwall of a thick hematite altered
interbedded chert, sandstone and tuff rich unit logged as the GYD. The GYD
itself is unmineralized. There is an Upper and Lower GYD unit.
Mineralization rapidly lenses out in the absence of the GYD unit. The GYD is
present at both Rupice Main and RNW.
The Competent Person is satisfied that the geological interpretation is
appropriate to support Mineral Resource estimation.
Dimensions The extent and variability of the Mineral Resource expressed as length (along Drilling has defined a combined Rupice Main and RNW mineralized system having
strike or otherwise), plan width, and depth below surface to the upper and a strike length of >900m and an across-strike width of >350m.
lower limits of the Mineral Resource.
The Rupice Main deposit has a strike length of >600m and an across-strike
width of 300m to 350m. The true thickness of mineralization is from a few
metres to 65m. Mineralization is from surface to a depth of 380m below
surface. The orebody axis strikes to the Northwest and dips 35(0) to 45(0) to
the Northeast.
RNW deposit being spatially continuous over its >300m strike length and
having a 260m to 350m across-strike width. The true thickness of
mineralization is from a few metres to 55m. Mineralization is from 78m to a
depth of 340m below surface. The orebody axis strikes to the Northwest and
dips 35(0) to 40(0) to the Northeast.
The Competent Person is satisfied that the dimensions interpreted are
appropriate to support Mineral Resource estimation.
Estimation and modelling techniques The nature and appropriateness of the estimation technique(s) applied and key Hard boundaries were used between mineralized lenses at each domain. The
assumptions, including treatment of extreme grade values, domaining, drillhole data were composited to a target length of 2 m at the Rupice Main
interpolation parameters and maximum distance of extrapolation from data zone and of 1 m at RNW zone based on the length analysis of raw intercepts.
points. If a computer assisted estimation method was chosen include a
description of computer software and parameters used. Geostatistical analysis was completed for all elements, and averaged long
ranges were employed to justify the search ellipse - 160 m along strike, 122 m
down dip and 33 m across dip.
Interpolation parameters were:
Search pass 1: 1/3 of the variogram log ranges (53 m by 40 m by 11 m). Minimum
samples number - 3, minimum drillholes - 2, maximum samples number - 16.
Search pass 2: 2/3 of the variogram log ranges (107 m by 80 m by 22 m).
Minimum samples number - 3, minimum drillholes - 2, maximum samples number -
16.
Search pass 3: Full semi-variogram ranges (160 m by 120 m by 33 m). Minimum
samples - 3, maximum samples - 16, minimum drillholes 2.
Search pass 4: Double the distances for full semi-variogram ranges with
minimum samples - 3, maximum samples - 16, minimum drillholes 2.
Block discretisation 2 x 2 x 2.
The optimal parent cell size was selected during block modelling based of
20x20 m exploration drilling.
Classical statistical analysis was used to identify grade domains for all main
modelled elements.
The Competent Person is satisfied that estimation and modelling techniques are
appropriate to support Mineral Resource estimation.
The availability of check estimates, previous estimates and/or mine production There is no material changes between the latest July 2023 MRE update and the
records and whether the MRE takes appropriate account of such data. November 2024 MRE update. The November 2024 MRE update has been estimated and
reported by AMC consultant. The Mineral Resources state reissued by Mineral
Resource Group of the Adriatic Metals as the depletion on 31 December 2024 has
been processed.
The assumptions made regarding recovery of by-products. The Rupice deposit is a silver-gold-zinc-lead-barite deposit. Historical
mining and beneficiation over a four-year period have shown that a
conventional sulphide flotation method is a suitable recovery method.
Metallurgical test work on the Rupice Main deposit has been completed and
included in the Rupice DFS and Reserve. Test work confirms a flotation process
is suitable for Rupice ore.
The RNW deposit is considered an analogue of the Rupice Main deposit in terms
of grades, mineralogy, depositional environment, internal waste, host rock and
controls on mineralization. Rupice Main recovery values and metallurgical
characteristics are extrapolated to apply to RNW for the MRE update. A
metallurgical test work program has been initiated to confirm RNW
metallurgical performance equivalence to Rupice.
Estimation of deleterious elements or other non-grade variables of economic As, Sb and Hg have been estimated in the model using their own semi-variogram
significance (e.g. sulphur for acid mine drainage characterisation). models and OK interpolation method.
In the case of block model interpolation, the block size in relation to the The average exploration drilling spacing was 20x20m. The selected parent cell
average sample spacing and the search employed. size was 5x5m (quarter the exploration density). The search was based on the
results of geostatistical analysis with average for all elements long ranges
of 102x61x31m.
Any assumptions behind modelling of selective mining units. No assumptions were made for selective mining unit, apart from the assumption
that the deposit is to be mined by underground method and that 5x5m parent
cell approximately reflects SMU for underground mining.
Any assumptions about correlation between variables. Correlation matrices were calculated for each zone and the indicators of
significant positive or negative correlation (in this case 30%) were
highlighted. The Rupice Main zone clearly stands out. The basic modelled
elements for Rupice have correlation coefficient ranges from 40 (Ag & Cu)
to 93 (Pb & Zn).
There are strong correlations with Sb, Cd and Hg. The Sb correlation varies
from 43% to 59%; Cd from 52% to 97% to Zn and 93% to Pb. The correlation
of Sb to Cd is 56%. Cd also correlates with As (34%), and Mo (47%). Sb
correlates with Hg (42%) and Mo (43%). Hg correlates with Cu (31%) and Ag
(51%). As correlates with Zn (35%) and Cu (56%). The correlations suggest
the possibility of multiple mineralizing events.
Correlations appear similar for RNW mineralization / elements to Rupice Main.
Correlation between bulk density and the main elements (BaSO4, Pb, Zn and Cu)
was used to calculate bulk density for all model domains except for the
combined high-grade domain.
Description of how the geological interpretation was used to control the The geological interpretation of the mineralized zone was based on geological
resource estimates. logging of drill core with cross-checking against assay data.
The position of lithological units was considered in the modelling. The
geological model was updated faster than the mineralization model allowing the
geological model to guide the mineralization model based on visual sulphides
and sulphide percent. The mineralization model was then calibrated against
received assays.
High-grade domains for each element were modelled individually, except for As,
Sb and Hg, which did not demonstrate mixed grade populations within the
modelled mineralized zone. Sulphur grades demonstrated mixed population with
the boundary of 10%, thus grade indicator approach was selected and used to
model sulphur grades.
Discussion of basis for using or not using grade cutting or capping. Statistical analysis was carried out for each element and each domain. It was
found that histograms and probability plots did not demonstrate any apparent
mixed populations within the limits of corresponding modelled domains.
Top-cuts were identified and applied as shown in the table below:
Rupice Main Orebody:
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RNW Orebody:
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The process of validation, the checking process used, the comparison of model Grade estimation was validated using visual inspection of interpolated block
data to drill hole data, and use of reconciliation data if available. grades versus underlying data, and swath plots.
Swath plots demonstrated reasonable correlation of modelled grades with the
sample composites.
The Competent Person is satisfied that estimation and modelling techniques are
appropriate to support Mineral Resource estimation.
Moisture Whether the tonnages are estimated on a dry basis or with natural moisture, The tonnages were estimated on an in-situ dry bulk density basis which
and the method of determination of the moisture content. includes natural moisture. Moisture content was not estimated.
Cut-off parameters The basis of the adopted cut-off grade(s) or quality parameters applied. The reporting cut-off grade of 50 g/t silver equivalent was supported by
estimation of marginal cut-off for underground mining using input economic
parameters and criteria.
The Competent Person is satisfied that cut-off parameters were appropriately
considered, to support Mineral Resource estimation.
Mining factors or assumptions Assumptions made regarding possible mining methods, minimum mining dimensions The following mining factors and assumptions were made based on the Reserve
and internal (or, if applicable, external) mining dilution. It is always Report December 2023:
necessary as part of the process of determining reasonable prospects for
eventual economic extraction to consider potential mining methods, but the • Ore Reserves are based on an operating mine design generated by the
assumptions made regarding mining methods and parameters when estimating on-site technical staff, which has been reviewed by AMC.
Mineral Resources may not always be rigorous. Where this is the case, this
should be reported with an explanation of the basis of the mining assumptions • The mining method used is long-hole open-stoping, which is an
made. appropriate method for the deposit.
• Avoca Geotech completed a geotechnical study in 2021, from which site
geotechnical personnel have developed procedures with operational experience.
All development headings and stopes are to be assessed before and during
development by the Geotechnical Engineer and have geotechnical specifications
detailing support requirements.
• Individual stopes have a maximum length of 20 m and maximum height of
25m.
• A minimum mining width of 15m has been set for the transverse
long-hole open-stoping.
• Two declines access the deposit.
• The infrastructure requirements of the selected mining methods.
• Dilution is accounted for in the Ore Reserve, based on geometry. The
average dilution factors in the Ore Reserve 12.8%.
• Inferred and Unclassified Mineral Resources were treated as waste
dilution.
Metallurgical factors or assumptions The basis for assumptions or predictions regarding metallurgical amenability. The following assumptions were made based on the Reserve Report December 2023:
It is always necessary as part of the process of determining reasonable
prospects for eventual economic extraction to consider potential metallurgical • Silver/lead and zinc concentrates are produced through conventional
methods, but the assumptions regarding metallurgical treatment processes and crushing, grinding, flotation, thickening, and filtration.
parameters made when reporting Mineral Resources may not always be rigorous.
Where this is the case, this should be reported with an explanation of the • The process plant is capable of crushing 290 tph. The grinding and
basis of the metallurgical assumptions made. flotation circuits have a maximum capacity of approximately 900 ktpa.
• Metallurgical recoveries are based on metallurgical testwork.
• The Ore Reserve is based on the Mineral Resource estimate which includes
individual estimation parameters for the payable metals Au, Ag, Cu, Pb, and
Zn; and as such, is appropriate to the mineralogy being processed.
• Deleterious elements Hg and As are also modelled in the Mineral resource
model; however, with the current mining locations and for the remainder of the
mine plan, the grades are not high enough to warrant corrective measures in
the process plant.
Environmental factors or assumptions Assumptions made regarding possible waste and process residue disposal The area of the current Rupice MRE update within a Bosnia and Herzegovina
options. It is always necessary as part of the process of determining approved and granted Mining Exploitation License. Underground work is
reasonable prospects for eventual economic extraction to consider the currently in progress.
potential environmental impacts of the mining and processing operation. While
at this stage the determination of potential environmental impacts, Environmental and groundwater management plans have been submitted, approved
particularly for a greenfield project, may not always be well advanced, the and permitted. Current surface and underground work are proceeding with all
status of early consideration of these potential environmental impacts should Environmental, Social, Governmental, Permitting requirements.
be reported. Where these aspects have not been considered this should be
reported with an explanation of the environmental assumptions made.
Bulk density Whether assumed or determined. If assumed, the basis for the assumptions. If Bulk densities were determined on drill core every 1 or 2 m in ore and every 5
determined, the method used, whether wet or dry, the frequency of the m in waste. Samples of approximately 20cm length were used. At total of 7,831
measurements, the nature, size and representativeness of the samples. determinations for Rupice Main, and 5,460 determinations for RNW were used to
calculate regression formulas using barite, lead zinc and copper grades vs
bulk density separately for high-grade and low-grade barite domains, and
separately for Rupice Main and RNW zones.
The bulk density for bulk material must have been measured by methods that Bulk density determinations adopted the weight in air / weight in water method
adequately account for void spaces (vugs, porosity, etc), moisture and using a suspended or hanging scale. First the core billet was accurately
differences between rock and alteration zones within the deposit. weighed dry ("in air"), the core billet was removed, and the wire cage fully
submerged in water and its tare set to "zero" mass. The billet of core was
then fully submerged and weighed ("weight in water"). The bulk density is
calculated by the formula BD = Md / Md - Mw, where Md = weight in air and Mw =
weight in water.
Discuss assumptions for bulk density estimates used in the evaluation process The density values were calculated for each model cell using regression
of the different materials. formulas.
• Density for barite high-grade domain (Main zone) = 2.66612 +
BaSO4(%) * 0.01832 + Pb(%) * 0.03655 + Zn(%) * 0.02206 + Cu(%) * 0.09279
• Density for barite low-grade domain (Main zone) = 2.72748 +
BaSO4(%) * 0.02116 + Pb(%) * 0.04472 + Zn(%) * 0.01643 + Cu(%) * 0.08299.
• Density for barite high-grade domain (Northwest zone) = 2.92581 +
BaSO4(%) * 0.01509 + Pb(%) * 0.04377 + Zn(%) * 0.02123 + Cu(%) * 0.10089.
• Density for barite low-grade domain (Northwest zone) = 2.74383 +
BaSO4(%) * 0.01731 + Pb(%) * 0.04573 + Zn(%) * 0.02023 - Cu(%) * 0.06041.
Classification The basis for the classification of the Mineral Resources into varying Resource classification was based on confidence in the QAQC data analysis,
confidence categories. geological interpretation, drill spacing, geostatistical measures, a visual
evaluation of cross sections and drill density, and manual interpretation of
resource categories. The interpreted boundaries between categories were
wireframed and used to code the block models. Generally, the Indicated
category was assigned to the areas with reasonable continuity of mineralized
lodes based on 20x20 m and 40x40 m exploration drilling. All other blocks were
classified as Inferred. No blocks were classified as Measured.
Whether appropriate account has been taken of all relevant factors (i.e. The classification has taken into account all available geological and
relative confidence in tonnage/grade estimations, reliability of input data, sampling information as well as the structural information, and the
confidence in continuity of geology and metal values, quality, quantity and classification level is considered appropriate for the current stage of this
distribution of the data). project.
Whether the result appropriately reflects the Competent Person's view of the The Mineral Resource estimate appropriately reflects the view of the Competent
deposit. Person.
The Competent Person is satisfied that classification of this Mineral Resource
estimate appropriately reflects the data and interpreted geological controls
on mineralization.
Audits or reviews The results of any audits or reviews of MREs. The Mineral Resources model has not been audited by an independent third-party
but has been subject to AMC's internal peer review processes.
Discussion of relative accuracy/ confidence Where appropriate a statement of the relative accuracy and confidence level in Estimation techniques used, including but not limited to:
the MRE using an approach or procedure deemed appropriate by the Competent
Person. For example, the application of statistical or geostatistical • Statistical analysis, cut-offs selection.
procedures to quantify the relative accuracy of the resource within stated
confidence limits, or, if such an approach is not deemed appropriate, a • Interpretation and wireframing.
qualitative discussion of the factors that could affect the relative accuracy
and confidence of the estimate. • Top-cutting and interval compositing.
• Geostatistical analysis.
• Block modelling and grade interpolation techniques.
• Model classification, validation and reporting.
• The relative accuracy of the estimate is reflected in the
classification of the deposit.
The relative accuracy of the Mineral Resource estimate is reflected in the
reporting of the Mineral Resource to an Indicated and Inferred classification
as per the guidelines of the 2012 JORC Code.
The statement should specify whether it relates to global or local estimates, The statement refers to global estimation of tonnes and grade and is suitable
and, if local, state the relevant tonnages, which should be relevant to for use in reserve conversion studies and further exploration at the deposit.
technical and economic evaluation. Documentation should include assumptions
made and the procedures used.
These statements of relative accuracy and confidence of the estimate should be Underground Drilling has been performed and confirmed the orebody position,
compared with production data, where available. grade and confidence. The Orebody boundaries have been clarified and no
material changes have been recorded.
APPENDIX 3: RUPICE ORE JORC TABLES
JORC Code (2012) Table 1 - Section 4: Estimation and Reporting of Ore Reserves
Criteria JORC Code explanation Commentary
Mineral Resource estimate for conversion to Ore Reserves · Description of the Mineral Resource estimate used as a · The Mineral Resource Estimate was produced by Mr Dmitry
basis for the conversion to an Ore Reserve. Pertel, Principal Geologist of AMC Consultants Pty Ltd (AMC), with an
effective date of 31 December 2024 as described in Section 3 of Table 1.
· Clear statement as to whether the Mineral Resources are
reported additional to, or inclusive of, the Ore Reserves. · The Mineral Resources are reported inclusive of the Ore
Reserves.
Site visits · Comment on any site visits undertaken by the Competent · A site visit from 17 February to 20 February 2025, was
Person and the outcome of those visits. undertaken by the Ore Reserves Competent Person (CP), Mr Dominic Claridge of
AMC Consultants (UK) Limited.
· If no site visits have been undertaken indicate why this
is the case. · Christopher Hunter is an employee of Adriatic Metals
PLC and is the Mine Manager based at Rupice.
Study status · The type and level of study undertaken to enable Mineral · A feasibility study was completed in 2021.
Resources to be converted to Ore Reserves.
· Rupice Mine started construction in 2022 and has
· The Code requires that a study to at least commenced mine production in 2024 with more than 15 years mine life.
Pre-Feasibility Study level has been undertaken to convert Mineral Resources
to Ore Reserves. Such studies will have been carried out and will have · The Ore Reserve is based on the life-of-mine design
determined a mine plan that is technically achievable and economically viable, generated by the Mine Technical Services Department (effective date of 23
and that material Modifying Factors have been considered. December 2024), which has been reviewed by AMC.
· Adriatic Metals produced a schedule and cost model
based on their mine design and internal cost data. AMC reviewed the cost
model.
Cut-off parameters · The basis of the cut-off grade(s) or quality parameters · Cut-off grades are calculated using a NSR calculation
applied. based at US$130/t using the revenue contributions of the payable metals Au,
Ag, Cu, Pb, and Zn and Sb
· The NSR calculation includes the sale of mineral
products after deducting all off-mine concentrate-related costs such as
transport, refining, treatment, and sales of the product
· Mining areas are considered for inclusion in the Ore
Reserve if the diluted NSR is greater than US$130/t.
Mining factors or assumptions · The method and assumptions used as reported in the · Ore Reserves are based on an operating mine design
Pre-Feasibility or Feasibility Study to convert the Mineral Resource to an Ore generated by the on-site technical staff, which has been reviewed by AMC.
Reserve (i.e. either by application of appropriate factors by optimisation or
by preliminary or detailed design). · The mining method used is long-hole open-stoping, which
is an appropriate method for the deposit.
· The choice, nature and appropriateness of the selected
mining method(s) and other mining parameters including associated design · Avoca Geotech completed a geotechnical study in 2021,
issues such as pre-strip, access, etc. from which site geotechnical personnel have developed procedures with
operational experience. All development headings and stopes are to be assessed
· The assumptions made regarding geotechnical parameters before and during development by the Geotechnical Engineer and have
(e.g. pit slopes, stope sizes, etc), grade control and pre-production geotechnical specifications detailing support requirements.
drilling.
· Individual stopes have a maximum length of 27 m and
· The major assumptions made and Mineral Resource model maximum height of 25 m.
used for pit and stope optimisation (if appropriate).
· A minimum mining width of 15m has been set for the
· The mining dilution factors used. transverse long-hole open-stoping.
· The mining recovery factors used. · A minimum mining width of 5m and a maximum mining width
of 20m was set for longitudinal long-hole open-stoping.
· Any minimum mining widths used.
· Two declines access the deposit.
· The manner in which Inferred Mineral Resources are
utilised in mining studies and the sensitivity of the outcome to their · All underground infrastructure for mining operations is
inclusion. in place. This includes dewatering, ventilation, backfill, ground support
systems.
· The infrastructure requirements of the selected mining
methods. · Dilution is accounted for in the Ore Reserve, based on
geometry. The average dilution factors in the Ore Reserve 12.8%.
· During the stope optimization process all stopes were
limited to a maximum allowable inclusion of 5% Inferred material. . Less than
1% Inferred material is included in the total Ore Reserve.
Metallurgical factors or assumptions · The metallurgical process proposed and the · Silver/lead and zinc concentrates are produced through
appropriateness of that process to the style of mineralisation. conventional crushing, grinding, flotation, thickening, and filtration.
· Whether the metallurgical process is well-tested · The process plant is capable of crushing 290 tph. The
technology or novel in nature. grinding and flotation and dewatering circuits have a maximum capacity of
approximately 800 ktpa.
· The nature, amount and representativeness of
metallurgical test work undertaken, the nature of the metallurgical domaining · Metallurgical recoveries are based on metallurgical
applied and the corresponding metallurgical recovery factors applied. testwork.
· Any assumptions or allowances made for deleterious · The Ore Reserve is based on the Mineral Resource
elements. estimate which includes individual estimation parameters for the payable
metals Au, Ag, Cu, Pb, Zn and Sb; and as such, is appropriate to the
· The existence of any bulk sample or pilot scale test work mineralogy being processed.
and the degree to which such samples are considered representative of the
orebody as a whole. · Deleterious elements Hg and As are also modelled in the
Mineral resource model; however, with the current mining locations and for the
· For minerals that are defined by a specification, has the remainder of the mine plan, the grades are not high enough to warrant
ore reserve estimation been based on the appropriate mineralogy to meet the corrective measures in the process plant.
specifications?
Environmental The status of studies of potential environmental impacts of the mining and · The ESIA study by Wardell Armstrong assessed the
processing operation. Details of waste rock characterisation and the environmental and social impacts and was published in 2021. An ESMS was
consideration of potential sites, status of design options considered and, developed in compliance with EBRD requirements and standards. AMBH holds two
where applicable, the status of approvals for process residue storage and environmental permits, one for the Rupice mining area and one for the
waste dumps should be reported. Tisovci-Veovača processing plant area. An annex to the environmental permit
for the ore processing location has been prepared, covering the TSF location.
Both permits were issued by the Federal Ministry of Environment and Tourism.
· Detailed analyses and studies have been conducted
regarding the project's environmental impact, including the following:
· Elaborate on the Potential Impacts of Pollution on the
Surrounding Hydrological System and the Bukovica Water Intake; Rupice mine,
Adriatic Metals BH, June 2022.
· Supervision Report on the Implementation of the I and
II Phases of Hydrogeological Investigations, Geotehnos d.o.o., April 2022.
· Report on Professional Supervision of Exploration Works
According to the Project of Supplementary Hydrogeological Investigations at
the Rupice Location near Vareš, 30-02-01-230/22, Mining Institute Tuzla, May
2022.
· Baseline Study on the Quality of Surface Waters of the
Bukovica River and Borovički Creek (Monitoring measurements for the period
September 2022 - February 2024), Qualita System, Pale.
· Expert Report on the Impact of Ore Exploitation on the
Bukovica River Water Intake, record number V-016-05/24, Jasmina Feriz, May 17,
2024.
· Study on the Analysis of Available Data and Necessary
Supplementary Investigations to Determine the Status of Water in the Broader
Area of the Rupice Mine, Municipality of Vareš, Institute for Hydrotechnics
Sarajevo, May 2024.
Infrastructure The existence of appropriate infrastructure: availability of land for plant · All infrastructure required for the processing and
development, power, water, transportation (particularly for bulk commodities), mining of ore has been completed and operation has commenced. The Rupice
labour, accommodation; or the ease with which the infrastructure can be deposit is located near the mining town of Vareš approximately 50km north of
provided, or accessed. the capital Sarajevo.
· Upgrades to the backfill and tailing infrastructure are
due to commence in 2025.
Costs The derivation of, or assumptions made, regarding projected capital costs in · Operating costs are based on costs established during
the study. the completion of the Feasibility Study in 2021 and on operating costs
established since commencement of operations. AMC has reviewed all costs, and
The methodology used to estimate operating costs. Adriatic has updated costs based on additional studies and current market
rates.
Allowances made for the content of deleterious elements.
· Treatment and refining costs are based on indicative
The source of exchange rates used in the study. concentrate sales terms.
Derivation of transportation charges. · Penalty elements are accounted for in the concentrate
treatment charges.
The basis for forecasting or source of treatment and refining charges,
penalties for failure to meet specification, etc. · Transportation costs are included in the NSR
calculation.
The allowances made for royalties payable, both Government and private.
· Concentrates are trucked to the local rail siding. Rail
transport is then used to take the concentrates to the Port of Ploče.
Revenue factors The derivation of, or assumptions made regarding revenue factors including · Head grades are based on the block model prepared by
head grade, metal or commodity price(s) exchange rates, transportation and AMC in Dec 2024.
treatment charges, penalties, net smelter returns, etc.
· Revenue has been based on metal prices of US$2,450/oz
The derivation of assumptions made of metal or commodity price(s), for the Au, US$29.0/oz Ag, US$9,000/t Cu, US$1,900/t Pb, US$2,700/t Zn and US$20,000/t
principal metals, minerals and co-products. Sb applied to the concentrate sales terms. These pricing estimates were
provided by Adriatic and are viewed by AMC as reasonable.
· Transportation, treatment charges, and penalties for
both Ag/Pb and zinc concentrates are accounted for in the NSR cut-off grade
calculation.
Market assessment The demand, supply and stock situation for the particular commodity, · Adriatic Metals has agreements with customers for
consumption trends and factors likely to affect supply and demand into the Silver/Lead and Zinc concentrate sales.
future.
· Concentrates packed in 20ft shippers containers are
A customer and competitor analysis along with the identification of likely sent via rail to the Port of Ploče for sea shipment to end users, where the
market windows for the product. alternative solution to rail unavailability is road transport from the
production plant to the Port of Ploče.
Price and volume forecasts and the basis for these forecasts.
· Zinc concentrates are stored in bulk in a warehouse at
For industrial minerals the customer specification, testing and acceptance the Port of Ploče and shipped to destination Ports in bulk vessels, while
requirements prior to a supply contract. Silver/Lead concentrates are transported in shipping containers and stored at
the container terminal before they are loaded on container vessels towards the
Port of Destination.
Economic The inputs to the economic analysis to produce the net present value (NPV) in · NPV has been generated as part of the Ore Reserves
the study, the source and confidence of these economic inputs including determination; however, all material contained within the reserve is deemed to
estimated inflation, discount rate, etc. generate positive cashflow based on the economic input parameters.
NPV ranges and sensitivity to variations in the significant assumptions and · A life-of-mine plan (LOMP) has been generated from the
inputs. December 2024 mine design. Analysis of the LOMP physicals within the current
Adriatic financial model has been shown to yield a net positive cashflow and
NPV
Social The status of agreements with key stakeholders and matters leading to social · Adriatic Metals BH continues to strengthen
licence to operate. relationships with key stakeholders through ongoing engagement initiatives,
ensuring transparency and trust in its operations. The combination of
proactive engagement, transparent communication, and sustained community
investment continues to reinforce Adriatic Metals BH's social license to
operate, ensuring long-term stakeholder trust and project sustainability.
Adriatic Metals BH maintains strong stakeholder engagement through regular PLC
meetings, community consultations, and a structured grievance mechanism,
ensuring transparency and trust. Ongoing initiatives, including newsletter
distribution, sponsorships, health programs, and cultural events, reinforce
social responsibility, address community concerns, and strengthen the
company's social license to operate.
Other To the extent relevant, the impact of the following on the project and/or on · To the best of the CP's knowledge, Adriatic is
the estimation and classification of the Ore Reserves: currently compliant with all legal and regulatory requirements and there is no
reason to assume any further government or local council permits, licences, or
Any identified material naturally occurring risks. statutory approvals will not be granted, if required.
The status of material legal agreements and marketing arrangements. · The constitutional court ruling repealing the law
permitting the removal of state forest for temporary use resulted in Adriatic
The status of governmental agreements and approvals critical to the viability having to make changes to new infrastructure planning and operational
of the project, such as mineral tenement status, and government and statutory management of existing infrastructure. Adriatic consulted and continues to
approvals. There must be reasonable grounds to expect that all necessary consult with all levels of government within the State and Federation of
Government approvals will be received within the timeframes anticipated in the Bosnia and Herzegovina to determine a path forward to maintain operations of
Pre-Feasibility or Feasibility study. Highlight and discuss the materiality of the mine and associated infrastructure.
any unresolved matter that is dependent on a third party on which extraction
of the reserve is contingent.
Classification The basis for the classification of the Ore Reserves into varying confidence · As there are no Measured Resources, the Ore Reserves
categories. have been classed Probable as per JORC Code (2012) guidelines.
Whether the result appropriately reflects the Competent Person's view of the · It is the CP's opinion that the Ore Reserves reflect
deposit. the deposit accurately given the current level of geological and geotechnical
knowledge.
The proportion of Probable Ore Reserves that have been derived from Measured
Mineral Resources (if any). · Inferred Resources have not been included in the Ore
Reserve
Audits or reviews The results of any audits or reviews of Ore Reserve estimates. · The Competent Person's completed a "best practices"
review of the mine planning as part of the Ore Reserves.
· The Ore Reserve has been Peer Reviewed internally and
is in line with current industry standards.
Discussion of relative accuracy/ confidence Where appropriate a statement of the relative accuracy and confidence level in · The Rupice Mine is now in production. Anticipated mine
the Ore Reserve estimate using an approach or procedure deemed appropriate by life is 15 years.
the Competent Person. For example, the application of statistical or
geostatistical procedures to quantify the relative accuracy of the reserve · The deposit is well-understood by the on-site technical
within stated confidence limits, or, if such an approach is not deemed team which consists of locals and expats with experience of the deposit.
appropriate, a qualitative discussion of the factors which could affect the
relative accuracy and confidence of the estimate. · Owner and contractor costs are based on current
contracts.
The statement should specify whether it relates to global or local estimates,
and, if local, state the relevant tonnages, which should be relevant to · All modifying factors have been applied to the Ore
technical and economic evaluation. Documentation should include assumptions Reserves with dilution parameters ore widths and geotechnical assessments.
made and the procedures used.
Accuracy and confidence discussions should extend to specific discussions of
any applied Modifying Factors that may have a material impact on Ore Reserve
viability, or for which there are remaining areas of uncertainty at the
current study stage.
It is recognised that this may not be possible or appropriate in all
circumstances. These statements of relative accuracy and confidence of the
estimate should be compared with production data, where available.
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