Chairman’s update on the Toral lead, zinc, silver project

Throughout the last financial year, we have continued to advance Johannesburg-listed Europa Metals Ltd’s wholly-owned Toral lead, zinc, and silver project located in the province of Castilla y León, northwest Spain.

Our efficient and cost effective approach to exploration and development has included the successful prosecution of several drilling campaigns designed to extract maximum value and information from each drill hole. This approach has also seen Europa Metals successfully complete several phases of exciting metallurgical test work and oversee an increasing level of confidence in the pre-existing mineral resource estimate via the commissioning of regular independent updates.

In the first half of the financial year, the Company completed an oversubscribed fundraising of £1 million (gross), thereby enabling us to fund further development work which was efficiently targeted towards both increasing our levels of confidence in the resource from the inferred to indicated category and to securing a further metallurgical sample to facilitate ongoing work to better define potential future processing routes.

During the financial year, we announced our first indicated resource at Toral, which we achieved with the first drilling campaign of 2019. This area of higher tenor mineralisation on the deposit was further substantiated later in 2019 with the successful drilling of hole TOD-025, intersecting 7.70m @ 17.3% ZnEq(PbAg) from 483.6m to 491.3m, including 4.3m @ 25.6% ZnEq(PbAg) from 486.3m to 490.6m.

This also delivered a 40% increase in the indicated inventory defining 3.8Mt @ 8.3% ZnEq (including Pb credits), which is a very good result serving to demonstrate the efficiency of Europa’s project team’s drill targeting.

The metallurgical test work commissioned and conducted on material from Toral during and subsequent to the reporting period involved two key objectives, firstly the accumulation of further mineralisation representivity across the deposit and, secondly, the initiation of X-ray transmission (“XRT”) ore sorting test work.

The results obtained proved to be excellent on both fronts, with the high grade intersection from hole TOD-025 performing very well through flotation to prove up a globally significant lead concentrate of 79.2%.

The XRT programme delivered very exciting results illustrating the capacity to upgrade low grade ore by a factor of 2 – 4x, which could prove transformational in how we approach potential future mining operations at Toral.

The achievement of such milestones is important to the future development of the Company as more financing options become available to us on the back of increasing confidence levels in the deposit.

Further drilling should enable Europa to grow the size of the current indicated resource estimate which will feed into updated economic parameters for the Toral Project. In addition, the successful metallurgical test work has provided an understanding of potential future concentrate products and, with the retention of third-party marketers, such as Conrad Partners from Hong Kong, we will be able to engage in preliminary marketing discussions with potential third party concentrate buyers.

As Europa progresses through the next 12 month period, with its planned activities having been financed by the recent post year end fundraising of £2 million (gross), further drilling and metallurgical work will feed into an updated production flow sheet, and assist the project team in identifying efficiencies versus the initial 2018 Scoping Study’s findings.

We are also advancing the key components of a pre-feasibility study (“PFS”) with work commencing on hydrogeology, waste management and geotechnical analysis, while continuing with environmental baseline studies and community engagement.

The first half of 2020 saw Europa acclimatise to the new and challenging global environment stemming from the COVID-19 pandemic. We implemented appropriate procedures at an early stage in the onset of the pandemic in order to mitigate its effects on the group’s workplaces and activities and will continue to monitor events as they unfold.

Myles Campion

Executive Chairman

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