Adriatic Metals PLC provided an update on the construction activities and drilling at its flagship Vares Silver Project in Bosnia & Herzegovina. Construction activities are advancing on time as planned. Activities are split across the following three sites: 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. 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 Fourth Quarter 2022. Phase two of mining will start at the beginning of First Quarter 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
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 Second Quarter 2023. Phase three will also have additional underground mobilised, albeit in smaller incremental increase than that for phase 2. Çiftay naat Taahhüt ve Ticaret A., 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. 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 of the surface water distribution system is also nearing completion. A telecommunications mast providing 4G network coverage across the site has also been installed. 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 First Quarter 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 First Quarter 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 Third Quarter 2023.