Blencowe Resources Regulatory News (BRES)

Date: 20 February 2025

Blencowe Resources Plc

("Blencowe" or the "Company")

Hydropower Study Confirms Sustainable, Low-Cost Power Supply for Orom-Cross

Advancing Towards a Net-Zero Graphite Operation

Blencowe Resources Plc (LSE: BRES) is pleased to announce the completion of an initial hydropower study for its Orom-Cross Graphite Project in Uganda. The study confirms the availability of abundant, low-cost, and renewable hydropower from the Ugandan national grid, providing a strategic advantage for the Project's future mining and processing operations. This marks a major step towards Blencowe's commitment to sustainability and its ambition to deliver a net-zero graphite operation.

Key Findings of the Hydropower Study

· Plentiful renewable energy: Two high-capacity power transmission spurs extend to the regional grid near to Orom-Cross, one from the Bujagali Hydroelectric Dam in Jinga and the other from the Isimba Hydroelectric Dam, both located on the Nile River. This ensures a reliable supply of renewable energy to Orom-Cross, including redundancy.

· Low Cost Advantage: Uganda's hydropower tariffs are significantly lower than regional African comparisons, positioning Orom-Cross as one of the lowest-cost graphite producers globally.

· Ample Capacity: Uganda currently has over 1,000 MW of installed hydropower capacity, with additional hydro-projects underway. Orom-Cross's power demand of 12MW (Phase 2) rising to 40MW at full production can be comfortably accommodated.

· Advancing towards Power Purchase Agreement (PPA): The Company is now working towards securing a long-term PPA with Uganda Electricity Transmission Company Limited (UETCL) to formalise the supply of low-cost hydroelectricity for the Project.

· Net-zero Potential: Access to 100% renewable energy for strengthens Blencowe's ability to achieve net-zero production, making Orom-Cross one of the most environmentally responsible graphite projects globally, a critical factor for funding providers and offtake partners in Europe and North America.

Strategic Importance of Hydropower for Orom-Cross

Reliable, green, and cost-effective energy is a major advantage as Blencowe moves towards first production in 2026. Orom-Cross will require 12MW for Phase 2 commercial scale production, scaling to 40MW at full ramp up, making power a critical cost factor. The study reinforces confidence that Orom-Cross can operate with one of the lowest carbon footprints in the graphite sector, aligning with global ESG and sustainability standards.

Hydropower access strengthens Blencowe's appeal to OEMs, battery manufacturers, and critical mineral end-users seeking to secure sustainable supply chains. It also enhances discussions with potential offtake and funding partners, particularly in Europe and North America where securing non-China supply is a priority.

Downstream Beneficiation

A key differentiator for Orom-Cross is Blencowe's plan to develop a beneficiation facility near the Karuma Power Station, (190kms from site) in partnership with one of the most world's leading SPG producers ("SPG Partner"). This facility will upgrade 96% small fines graphite concentrate to 99.95% SPG (spheronised purified graphite) significantly increasing value and returns.

A low-cost, high-capacity power source is essential for this process. Blencowe intends to leverage its SPG Partner's proven thermal purification technology which requires considerable energy. This technology eliminates the need for acid leaching and avoids associated environmental concerns.

The availability of abundant, cost-effective hydropower makes this downstream processing strategy viable and highly competitive, reinforcing Orom-Cross's position ahead as a premier graphite supplier.

Next Steps

Blencowe will continue discussions with UETCL and the Ugandan Government to finalise a PPA and integrate renewable energy planning into the ongoing Definitive Feasibility Study (DFS). Additional studies will be conducted to assess potential power demand scenarios as Orom-Cross scales up production.

Executive Chairman Cameron Pearce commented:

"Access to abundant, low-cost hydropower directly from Uganda's national grid represents a major strategic advantage for Orom-Cross. This will enable us to operate sustainably with one of the lowest carbon footprints in the graphite sector while keeping production costs highly competitive."

"We are committed to building one of the world's most ESG-friendly graphite projects, and securing clean energy is a critical milestone towards that goal. With work now progressing to formalise a PPA, we are securing ensuring a long-term, sustainable power solution that aligns with our development timeline."

Conclusion

The integration of hydropower into the Orom-Cross development plan underscores Blencowe's strategic vision to establish a low-cost, high-purity, and net-zero graphite operation. As the Company advances its DFS and project financing discussions, securing sustainable energy further enhances Orom-Cross's appeal to global investors, end-users

Blencowe remains focused on delivering a world-class graphite project with industry-leading sustainability credentials and looks forward to providing further updates as the PPA process advances.

Figure 1: Isimba Hydroelectric Power Station, Uganda

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Background

Orom-Cross Graphite Project

Orom-Cross is a potential world class graphite project both by size and end-product quality, with a high component of more valuable larger coarse flakes within the deposit.

A 21-year Mining Licence for the project was issued by the Ugandan Government in 2019 following extensive historical work on the deposit. Blencowe completed a successful Pre-Feasibility Study on the Project in July 2022 and is now within the Definitive Feasibility Study phase as it drives towards first production.

Orom-Cross presents as a large, shallow open-pitable deposit, with an initial JORC Indicated & Inferred Mineral Resource of 24.5Mt @ 6.0% TGC (Total Graphite Content). This Resource has been defined from only ~2% of the total tenement area which presents considerable upside potential ahead. Development of the resource is expected to benefit from a low strip ratio and free dig operations together with abundant inexpensive hydro-electric power off the national grid, thereby ensuring low operating costs. With all major infrastructure available at or near to site the capital costs will also be relatively low in comparison to most graphite peers.

In 3Q 2024 Blencowe introduced a Joint Venture concept with experienced downstream graphite processing partners to ultimately produce upgraded 99.95% SPG in Uganda. This strategy has several key advantages plus substantial cost savings which will assist deliver a world class project once DFS is completed.