Variscan Mines: PERMITTING APPROVAL OF PRE-WORKS, DEVELOPMENT & TRIAL MINING FOR SAN JOSE MINE RESTART

Highlights

• Government of Cantabria has approved the Preliminary Mining Plan (‘Anteproyecto’) for the San Jose Mine ReStart; a significant permitting approval

• The Anteproyecto permits all of the pre works and development required to enable Mine Restart

• In keeping with the Mine Restart philosophy of seeking to leverage the advantages of a former producing asset and minimize capex, early works will seek to adapt the existing facilities and in-situ infrastructure required for larger scale mining with a focus on mine access, transportation, electrical installation, drainage and underground safety

• Together with the already granted Mining Licences, Restoration Plan and annual Plan de Labores, the Anteproyecto also provides permitting approval to proceed with underground trial mining and small scale exploitation

• Final Mining Plan to be submitted following publication of the Mine Restart Study, the implementation of its recommendations as well as EIA approval

• Variscan on track with progressing its Explorer-Producer Strategy to Mine Restart

Variscan Mines Limited (ASX:VAR) (“Variscan” or “the Company”) is pleased to announce that it has received official approval from the Government of Cantabria (Consejería de Industria, Empleo, Innovación y Comercio and Directorate General de Industria, Energía y Minas) of its Preliminary Plan for the permits and concessions (Anteproyecto De Permisos Y Concesiones De Variscan En Cantabria) over the granted Mining Licences for the San Jose and Udias Mines, which form a central part of the Novales-Udias Project in Cantabria, northern Spain.

Approval of the Anteproyecto enables pre-works, site and underground development and trial mining to be conducted ahead of the proposed San Jose Mine ReStart.

Following on from the authorization of the Restoration Plan for the Mining Licences granted over the San Jose and Udias Mines, the Anteproyecto has been approved by the Government of Cantabria. The Anteproyecto serves as a foundational document to inform the Government and provides a basis for initial operational approvals to be granted and a guide for detailed engineering phases and design for a larger mining operation to follow.

The Anteproyecto is a further forward step in permitting. Critically it approves the general characteristics of the future mining restart and exploitation activities together with the adaption of the current facilities that is required for larger scale mining with a focus on mine access, transportation, electrical installation, drainage and underground safety.

Variscan has made significant progress on securing the permits required towards a restart of the San Jose Mine:

Licence/ Permit | Status | Notes
Mining Licence | Approved | Valid to 2035 with ability to extend for a further 30 years
Restoration Plan | Approved |
Plan de Labores | Approved | Work Plan submitted annually
Anteproyecto | Approved | Preliminary Mining Plan

Additional permit applications and the associated workstreams to support them are underway. More details will be set out the Mine ReStart Study when it is published. The effect of the permitting progress made to date confers a number of advantages to Variscan:

• Able to conduct the pre works and development required to enable Mine Restart

• Able proceed with underground trial mining and small scale exploitation

• Allows additional permitting processes to run concurrently to those works resulting in no time delays or additional costs and ensuring continuity of permitting progress

• Evidences strong in-house permitting capability and positive relationship with the Government of Cantabria

Based on the work conducted for the Mine Restart Study, to be published, Variscan anticipate that the following activities will be included in the initial pre-works and development package:

• Underground mine development

• Underground locomotive and haulage refurbishment

• Geotechnical works

• Power installation

• Communication installation

• Safety facilities

• Surface earthworks & site preparation

• Trial mining and stockpiling

Variscan’s Managing Director & CEO, Stewart Dickson, said:

“The approval of the Anteproyecto is a major milestone, advancing the Novales-Udias Zinc Project towards recommencing production.

We have been granted the necessary permits to conduct all of the pre works and development required to enable Mine Restart. Additionally, lower volume trial mining and stockpiling can commence.

These works can run parallel with additional permitting requirements such as Environmental Impact Assessment for which certain flora and fauna studies have already been completed. We are leveraging the project’s status as a past producing asset to de-risk permitting and also the works required for Mine Restart.

This approval has been a substantial piece of work, achieved as a collaborative outcome between our local team and the Government of Cantabria. We have a highly valued, constructive working relationship with the authorities of the Government of Cantabria. I am grateful for their trust as well as that of the local communities.

In our experience, Cantabria is an excellent operating jurisdiction, and the Government are demonstrably enacting their publicly stated commitment to support the re-start of zinc mining in the region. Both the Company and the Government are keen to maintain continuity of permitting progress.

Our next key deliverable is publication of the Mine ReStart Study which will deliver a realistic plan for early cash-flow from small scale production, re-positioning Variscan as cash-flow generating zinc producer, to sustainably fund ramp-up production growth and exploit exploration upside as well as the overall development of our project portfolio”.

Next Steps & Way Forward

Variscan continues to deliver against its dual-track Producer-Explorer strategy of mine restart readiness and high-impact exploration with key upcoming catalysts including:

• Results from metallurgical test work for inclusion in the Mine Re-Start Study

• Results from geotechnical test work for inclusion in the Mine Re-Start Study

• Publication of the Mine Re-Start Study

• Further assay results from underground drilling at the Udías Mine

About Variscan Mines Limited (ASX:VAR)

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Variscan Mines Limited (ASX:VAR)
Stewart Dickson
Managing Director & CEO
E: [email protected]
T: +44 (0) 7799 694195

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Chloe Hayes / Jane Morgan
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