Katanga Mining Provides Update on Major Projects, Announces 2019 Second Quarter Production Results and Appointment of a New Director

ZUG, Switzerland, July 30, 2019 /CNW/ - Katanga Mining Limited (TSX: KAT) ("Katanga" or the "Company") today provides an update on its major projects and announces its 2019 second quarter production results and the appointment of a new director of the Company.

Update on Major Projects

June 2019 Cobalt Projects Update
The Company's previously announced cobalt debottlenecking projects (the "Cobalt Projects") are expected to be completed and in full production during Q2 2020. The commissioning of two filter presses was completed earlier in the year, while the third filter press is expected to be completed in Q3 2019. The commissioning of the MgO plant was completed in the first half of 2019.

The objective of the Cobalt Projects is to upgrade the existing cobalt plant in order to reduce bottlenecks by modification of the precipitation, thickening, filtration, drying and bagging processes. This will align the capacity of the cobalt plant with the average planned life-of-mine cobalt production of 30,000 tonnes per annum. Following these improvements, the cobalt circuit will be fully integrated with the existing whole-ore-leach processing facilities at the Luilu metallurgical plant.

At the end of Q2 2019 and in July 2019, the recently commissioned cobalt dryers suffered mechanical breakdowns, which has prevented the Company from drying cobalt hydroxide until the expected completion of repairs to the dryers in Q4 2019.

June 2019 Acid Plant Update
The Company's sulphuric acid, sulphur dioxide production plant and steam turbine generator project (the "Acid Plant"), continues to progress in accordance with the latest construction plan. Final design items and minor procurement items will be finalized in Q3 2019, and all critical civil works have now been completed for Phase 1 of the Acid Plant. Structural, mechanical, plate work and piping installation are in accordance with the plan. All major long lead items have arrived on site and are being installed. Commissioning of the Acid Plant is scheduled to commence in the first half of 2020.

Production highlights during the six months ended June 30, 2019 and Cobalt Update

Copper and Cobalt Production
Copper cathode production decreased to 52,514 tonnes in Q2 2019 from 57,175 tonnes in Q1 2019.

Cobalt contained in hydroxide production decreased to 2,607 tonnes in Q2 2019 from 3,511 tonnes in Q1 2019.

As previously announced in Q4 2018, the Company's 75%-owned subsidiary Kamoto Copper Company ("KCC") temporarily suspended the export and sale of cobalt due to the presence of uranium detected in the cobalt hydroxide at levels that exceed the acceptable limit allowed for export of the product through main African ports. The low levels of radioactivity detected in the uranium to date do not present a health and safety risk. On April 25, 2019, KCC resumed the export and sale of a limited quantity of cobalt that complies with both international and local Democratic Republic of Congo ("DRC") transport regulations with respect to the levels of uranium (the "Applicable Regulations"). An aggregate of 97% of the cobalt hydroxide produced in Q2 2019 (30% in Q1 2019) complied with international transport regulations and was also below the acceptable limit of contained uranium allowed for export through main African ports.

KCC, together with the Company and KCC's 25% shareholder, DRC state-owned La Générale des Carrières et des Mines ("Gécamines"), has been working with the DRC government's Ministry of Mines and the Congolese Atomic Energy Agency on a long-term technical solution in the form of an ion exchange plant (the "Ion Exchange Plant"). KCC has also implemented various alternative interim solutions, both operational and regulatory, resulting in the recommencement of the export and sale of a limited quantity of cobalt.

Subject to obtaining the necessary authorizations for the Ion Exchange Plant, the plant is expected to be commissioned in Q2 2020. The Ion Exchange Plant project has been approved by the boards of the Company and KCC.

Refer to Luilu Metallurgical Plant update below.

Mining

Total ore mined increased to 2,458,522 tonnes in Q2 2019 from 2,308,037 tonnes in Q1 2019. Total ore mined increased to 4,766,559 tonnes in Q2 2019 YTD from 4,256,429 tonnes in Q2 2018 YTD.

Total waste mined increased to 13,660,266 tonnes in Q2 2019 from 10,259,978 tonnes in Q1 2019. Total waste mined increased to 23,920,244 tonnes in Q2 2019 YTD from 21,780,865 tonnes in Q2 2018 YTD.

Total contained copper increased to 68,731 tonnes in Q2 2019 from 67,616 tonnes in Q1 2019. Total contained copper increased to 136,348 tonnes in Q2 2019 YTD from 87,111 tonnes in Q2 2018 YTD.

The increase in total material mined in the combined open pits in Q2 2019 compared to Q2 2018 related to the ramp-up of production and commissioning of the second Whole Ore Leach train in H2 2018.

The increase in total material mined in the combined open pits in Q2 2019 compared to Q1 2019 reflects the start of the dry season and subsequent ramp-up of production in line with the optimized mine plan.

The ongoing mining and stockpiling of low-grade ore and cobalt ore reflects the optimization of the long-term feed strategy. As a result of this strategy, low-grade ore and cobalt ore are currently being stockpiled and will be fed into the processing plant in the future.

Kamoto concentrator

Total material milled and processed decreased to 2,574,400 tonnes in Q2 2019 from 2,707,115 tonnes in Q1 2019. Total material milled and processed increased to 5,281,515 tonnes in Q2 2019 YTD from 3,595,014 tonnes in Q2 2018 YTD.

Total concentrate produced decreased to 66,828 tonnes in Q2 2019 from 67,286 tonnes in Q1 2019. Total concentrate produced increased to 134,114 tonnes in Q2 2019 YTD from 125,969 tonnes in Q2 2018 YTD.

Total oxide feed received at Luilu decreased to 1,599,507 tonnes in Q2 2019 from 1,822,820 tonnes in Q1 2019. Total oxide feed received at Luilu increased to 3,422,326 tonnes in Q2 2019 YTD from 1,839,306 tonnes in Q2 2018 YTD.

Total contained copper in concentrate and oxide feed produced decreased to 59,485 tonnes in Q2 2019 from 69,818 tonnes in Q1 2019. Total contained copper in concentrate and oxide feed produced increased to 129,302 tonnes in Q2 2019 YTD from 77,608 tonnes in Q2 2018 YTD.

The increase in total material milled and processed in Q2 2019 compared to Q2 2018 reflected the ramp-up and optimization of CM6 and CM7, following their commissioning at the end of 2018, as well as increased availability from the CM5 oxide mill. The decrease in total material milled and processed in Q2 2019 compared to Q1 2019 reflects the deceleration of milling rates to accommodate the reduced copper plating capacity at the Luilu refinery.

Luilu metallurgical plant

Total copper cathode produced decreased to 52,514 tonnes in Q2 2019 from 57,175 tonnes in Q1 2019. Total copper cathode produced increased to 109,690 tonnes in Q2 2019 YTD from 63,292 tonnes in Q2 2018 YTD.

Total cobalt contained in hydroxide decreased to 2,607 tonnes in Q2 2019 from 3,511 tonnes in Q1 2019. Total cobalt contained in hydroxide increased to 6,118 tonnes in Q2 2019 YTD from 2,954 tonnes in Q2 2018 YTD.

The sequential decrease in the production of copper cathode reflected the reduced plating capacity at Luilu refinery.

The increase from Q2 2018 in the production of cobalt contained in hydroxide was driven by increased in milling capacity following the ramp-up and optimization. The decrease from Q1 2019 production of cobalt hydroxide reflected the lower feed rates to accommodate the reduced plating capacity at Luilu refinery.

Outlook

On April 29 2019, the Company announced that a full and comprehensive business review (the "Review") had recently commenced, targeting efficiency and recovery improvements, better product quality realizations and significant cost reductions over the remainder of 2019 and into 2020, with the objective of improving the Company's prospects. At the same time, the Company noted that it expected that 2019 production of copper and cobalt would be lower than the guidance provided at the beginning of the year, namely c.285kt of copper and c.26kt of contained cobalt, and that it would provide an update in Q3 2019, once the Review was complete. The Company expects to be in a position to provide an update as part of the Company's second quarter financial results, scheduled to be released on August 6, 2019.

Appointment of Peter Freyberg as director of the Company and Chairman of HSSE committee

The Board of Directors approved the appointment of Peter Freyberg as director of the Company and Chairman of the Company's HSSE Committee. Mr. Freyberg replaces Mike Ciricillo, who tendered his resignation as director of the Company on July 12, 2019.

Mr. Freyberg is the Head of Industrial Assets for the Glencore group. He originally joined the Glencore coal assets business in 2000, and transferred to Xstrata in 2002 when Glencore sold its coal assets to Xstrata. Mr. Freyberg became Chief Executive Officer of Xstrata Coal in 2008 and rejoined Glencore in 2013 when Glencore merged with Xstrata.

Qualified Person

Tahir Usmani, PEng, APEGA, Chief Mine Planning Engineer of KCC, has reviewed and approved the scientific and technical disclosure in this news release. Mr. Usmani is a "qualified person" for the purposes of NI 43-101 - Standards of Disclosure for Mineral Projects.

About Katanga Mining Limited

Katanga Mining Limited operates a major mine complex in the Democratic Republic of Congo producing refined copper and cobalt. The Company has the potential to become Africa's largest copper producer and the world's largest cobalt producer. Katanga is listed on the Toronto Stock Exchange under the symbol KAT.

Forward Looking Statements

This press release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. This press release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.

All forward-looking statements reflect the Company's beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these forward-looking statements. All of the Company's forward-looking statements are qualified by the assumptions that are stated or inherent in such forward-looking statements, including availability and utilization of plant and equipment, geological and mining conditions, logistics, availability of reagents, availability of electricity, macro-economic factors such as commodity prices, input costs and geopolitical developments. Although the Company believes that these assumptions are reasonable, this list is not exhaustive of factors that may affect any of the forward-looking statements.

Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Although Katanga has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, except in accordance with applicable securities laws.

SOURCE Katanga Mining Limited

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