Net Smelter Return Agreement Signed between Kenz Madencilik and Polimetal

ACG Metals Limited ("ACG") announced a significant step forward for its subsidiary, Polimetal, with the signing of a 2% Net Smelter Return (NSR) royalty agreement concerning a mining license in Türkiye’s Ni?de Province. This agreement arises from a partnership formed in 2012 with Kenz Madencilik. At that time, the mining license was transferred to Kenz in exchange for $150,000 and a commitment to fund exploration activities, while Polimetal retained the option to acquire the NSR.

The new NSR agreement allows Polimetal to earn 2% of the gross revenue from all mineral sales generated from the licensed area, deducting standard expenses. This arrangement provides Polimetal with a revenue stream throughout the project's operational lifespan, while allowing ACG to gain future cash flow benefits without directly investing in exploration or operational activities.

Currently, exploration efforts are focused on identifying precious metals and other mineral deposits in the area. The deal shapes ACG’s strategic direction to enhance its exposure in the mining sector, particularly as it positions itself to leverage future production capabilities without incurring the associated direct costs.

ACG Metals aims to continue its strategic growth through further acquisitions in the copper industry, with a focus on ESG principles and an environmentally conscious approach. The company recently completed its acquisition of the Gediktepe Mine, which will begin transitioning to primary copper and zinc production by 2026. ACG's leadership team boasts extensive experience in mergers and acquisitions in the mining sector, which underscores its intent to solidify its position in the industry while adhering to strong corporate governance practices.

The recent Net Smelter Return (NSR) Agreement signed between Kenz Madencilik and Polimetal marks a significant milestone in ACG Metals Limited's strategic positioning within the mining sector. This agreement allows Polimetal to benefit from a 2% royalty on gross revenues of mineral sales linked to exploration activities in Türkiye's Ni?de Province, thereby providing an innovative flow of revenue without necessitating direct exploration or operational commitments.

From an investment perspective, the NSR structure presents an appealing risk-mitigated profit opportunity. Since ACG Metals aims to consolidate its presence in the copper industry and leverage its ESG commitments, the NSR potentially enhances the company’s cash flow profile, especially given current mining trends favoring metals with strong demand fundamentals, such as copper and precious metals.

Investors should consider that the value of the NSR agreement is closely tied to the success of exploration activities in the Çamard? District. As exploration results materialize and if they indicate viable mineral deposits, the value of the NSR could increase considerably, translating into higher revenue streams for Polimetal and, by extension, ACG Metals.

Furthermore, with the company shifting towards operational copper and zinc production at the Gediktepe Mine, the NSR adds another layer of financial resilience, diversifying ACG's revenue sources as it progresses through various stages of project development.

In conclusion, the NSR agreement is a strategic advantage for ACG Metals, enhancing its growth profile while minimizing exposure to operational risk. Investors should monitor exploration developments and market conditions affecting mineral prices, as these factors will directly influence the NSR's profitability. Overall, this agreement reinforces ACG's commitment to sustainable growth while aligning with current market dynamics favoring critical minerals.