Adriatic Metals : Vares Project Update

30 MAY 2022

onlyABOUT ADRIATIC METALS (ASX:ADT, LSE:ADT1,

OTCQX:ADMLF)

Adriatic Metals Plc is focused on the development of the use100%-owned, Vares high-grade silver project in Bosnia &

Herzegovina, and exploration at the Raska base & precious metals project in Serbia.

personalDIRECTORS

Mr Michael Rawlinson

NON-EXECUTIVE CHAIRMAN

Mr Paul Cronin

MANAGING DIRECTOR & CEO

Mr Peter Bilbe

NON-EXECUTIVE DIRECTOR

Mr Julian Barnes

NON-EXECUTIVE DIRECTOR

Ms Sandra Bates

NON-EXECUTIVE DIRECTOR

Ms Sanela Karic

NON-EXECUTIVE DIRECTOR

Forad iaticmetals.com

VARES PROJECT UPDATE

HIGHLIGHTS

• Lower decline construction to the Rupice underground mine expected to commence imminently. Upper decline construction expected to start by quarter end.
• Mobilisation of underground mining equipment underway
• Haul road construction has commenced
• Vares Processing Plant civil works expected to commence in the coming weeks
• The newly appointed drilling contractor delivering a dramatic increase in productivity
• Rupice NW continues to show continuity of high grade mineralisation
• In-filldrilling program targeting the conversion of Inferred Mineral Resources on the periphery of the Rupice orebody
• New healthcare facilities opened in Vares town
• Project Webinar at 10:30am BST today - will start following the AGM. Registration details below.

Paul Cronin, Adriatic's Managing Director and CEO commented:

"We are very happy with the advances made in construction activities so far, with the Project progressing on time as planned. Site preparation activities at Rupice Surface Infrastructure have progressed well and with the recent mobilisation of Ciftay, the first phase of underground construction is due to start imminently. Concurrently we have recently started site works on the haul road connecting Rupice to the Vares Processing Plant site.

The strong oil price continues to impact the cost of diesel in Bosnia, however this has not made a substantial impact overall on Project costs, which is promising. Therefore we are not experiencing any major changes in budget estimates due to cost inflation.

We continue to be excited about the north west extension to the Rupice deposit. Although assays are pending, analysis from the core logging completed to date has significantly improved our understanding of the continuity and grade of the main Rupice deposit."

Adriatic Metals PLC, Regent House, 65 Rodney Road, Cheltenham GL50 1HX United Kingdom

For personal use only

Adriatic Metals PLC (ASX:ADT, LSE:ADT1, OTCQX:ADMLF) ("Adriatic" or the "Company") is pleased to provide an update on the construction activities and drilling at its flagship Vares Silver Project in Bosnia

• Herzegovina (" Project or Vares Project"). In addition, the Company invites investors to join a webinar starting today at 10.30am BST / 5:30pm AWST / 7:30pm AEST. Registration details are provided below.

For a short video on recent developments, click here: https://youtu.be/htXMoyVdLC0

CONSTRUCTION ACTIVITIES

Construction activities are advancing on time as planned. Activities are split across the following three sites:

1. Rupice Surface Infrastructure Site / Rupice Underground Mine

Ground support installation around the lower portal to the Rupice underground mine has been completed and decline development is expected to commence in the coming weeks. Excavation of the upper portal is ongoing and ground support installation is expected to start in the coming weeks, with decline development ready to start at the end of the quarter.

Aerial photo of the lower portal at the Rupice Surface Infrastructure Site

Adriatic Metals plc Regent House, 65 Rodney Road, Cheltenham GL50 1HX United Kingdom

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Aerial photo of the upper portal pad at the Rupice Surface Infrastructure Site

The imminent start of construction of the lower decline will mark the start of the three phases of mining at Rupice. The first phase is the concurrent construction of the two declines from the upper and the lower portal, down to the two parallel production levels of the Rupice orebody. The first phase is expected to be completed during Q4 2022.

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Shotcreting of the lower portal in preparation for decline construction to start

Phase two of mining will start at the beginning of Q1 2023, with the construction of the production levels, cross cuts, ore development drives and installation of underground infrastructure ready for production mining. Phase two will be when the majority of the underground equipment mining fleet is mobilised, as there will be the multiple simultaneous

Adriatic Metals plc Regent House, 65 Rodney Road, Cheltenham GL50 1HX United Kingdom

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headings under development. There will be just two concurrent development headings in phase 1.

The final and third phase of mining, will be production mining in ore as well as backfilling. This is expected to commence in Q2 2023. Phase three will also have additional underground mobilised, albeit in smaller incremental increase than that for phase 2.

Underground concrete mixer trucks, jumbo & excavator will be used during the first phase

of mining for decline construction

Çiftay İnşaat Taahhüt ve Ticaret A.Ş. ("Ciftay"), the Company's appointed underground mining contractor, has started its initial mobilisation of mining equipment and workshop facilities to site. By the end of this quarter, the initial phase of mobilisation will have been completed. This includes the mobilisation of equipment for the first phase of mining, as well as the installation of temporary surface facilities (offices, warehouse and workshops). Over the next 12 months further supplementary equipment will be mobilised, as required for the subsequent second and third phase of mining.

Construction of the temporary surface facilities at Rupice

The installation of utilities (water, telecommunications, compressed air, ventilation fans and generators) for the underground development has started. The ventilation fans and compressors for compressed air will be delivered within the next 2 weeks, and the installation

Adriatic Metals plc Regent House, 65 Rodney Road, Cheltenham GL50 1HX United Kingdom

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of the surface water distribution system is also nearing completion. A telecommunications mast providing 4G network coverage across the site has also been installed.

Installation of telecommunications mast at Rupice

Diesel generators ("Gen-sets") have been purchased and are currently in the process of being delivered. The Gen-sets will provide power to the Rupice underground mine during the early stages of mine development until the 35kV buried cable grid connection is laid and electrified, which is expected to be completed in Q1 2023. Thereafter, the Gen-sets will remain in place as a backup power source for underground operations. In addition, a fuel supply contract has been signed for the supply of diesel for the Gen-sets, as well as the site's mobile equipment.

A temporary explosives magazine is in the process of being installed near the lower portal. It will be utilised until the underground development has been completed in Q1 2023. At which point the explosives magazine will be relocated to a new secure location underground.

Long lead order mechanical equipment packages for the backfill plant, will be imminently awarded by subcontractor Paterson and Cooke. These items include the positive displacement pumps and batching plant. The longest lead time on these items is expected to be 8 months. Backfilling of stopes will start in Q3 2023.

2. Haul Road

The first section of the haul road's construction commenced earlier this month. The 25km haul road construction is phased into 5 lots of approximately 5km each in length. Roadworks have started on Lot 1, with Lot 5 expected to commence in early June. Lot 1 is the first 5km of road from Rupice Surface Infrastructure site towards the Vares Processing Plant site, and Lot 5 is last 5km. Permitting for Lots 2, 3 and 4 is underway and completion of the haul road is expected in Q1 2023. The haul road is being constructed by the Vares Municipality, but with funding and technical assistance from the Company.

Adriatic Metals plc Regent House, 65 Rodney Road, Cheltenham GL50 1HX United Kingdom

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