Progress report for Grand Sanyuan's Alaska Mine Operations – January 2022.

Copper Smelting Phase

Alaska Copper Smelting Project resuscitation project a vision of, and partnership between Grand Sanyuan China, RNH of Defence and ZMDC continues to develop and proceed with the same thrust as befitting a national project of its size and magnitude.

We are happy to report that the project's copper smelting phase will soon be entering the final stages of installation and commissioning and trial production should commence by the end of March 2022.

Latest developments…

On site experiments and laboratory tests of the raw materials, for the project estimated at 400 million tons have been underway since December 2021 through January 2022. Unfortunately, the expected output has proven to be much less than previously anticipated.

As a temporary solution to improve the expected output of the copper smelting furnace, we plan to locally source and buy copper concentrates to mix together with the current raw materials.

Installation and commissioning of the critical components and infrastructure of the furnace itself is expected to be completed by the end of February 2022 and final installation and connection of all electrical infrastructure and supplies expected to be completed by the middle of March 2022.

To address the current raw material challenge and improve the quality of thereof, we plan to quickly proceed with the installation of a floatation plant, three (3) months after commencement of trial production.

Noteworthy is the fact that all worker's needs and protection against the effects of COVID-19 continue to be top priority to us as an organization; we plan on continuing with our mandatory testing for the foreseeable future, especially as the organization continues to grow.

We are also happy to report that accommodation for our Chinese personnel and technical team has been successfully completed and already put into use.

Future plans and Projections

Project Phases of Completion in the future are expected to be as follows:

Phase 1 : Completion of Copper Smelting Furnace.

Expected time of completion is end of March 2022 and at the time of completion, recruited workers are expected to be a total 150. Currently our workforce is standing at 126 workers.

Output of copper bullion is expected to be 450 Tons per month and monthly revenues of up to US$3,500,000.

Phase 2 : Completion of Floatation Plant. Time of completion is still expected to be in the end of second half of 2022 and at the time of completion, total recruited workers are expected to be 230. Output of copper bullion is still expected to be 450 Tons per month and with this plant in place, we may no longer need to buy copper concentrates locally.

Phase 3 : Completion of Electrolysis Plant. Time of completion is expected to be sometime in 2023 and at the time of completion, the total recruited workers are expected to be 400.  

The projected production is expected to be doubled after 18 - 24 months of operations at the currently projected full production capacity.

Production output is expected to increase to 1,000T per month of copper bullion after the doubling of the copper smelting furnace capacity, floatation capacity and electrolysis plant. Recruited workers are also expected to increase to a total of 550 workers at the completion of another copper smelting plant, and increase up to a total of 630 workers with the doubling in the floatation plant capacity, and ultimately up to a total 800 workers with an additional electrolysis plant.

Monthly Revenues at 1,000T copper bullion production capacity is expected to be USD$7,800,000.

Project Challenges

At the present moment, were happy our challenges have been few and also manageable.

These minor challenges include the following;

·  Delays due to the effects of the COVID-19 pandemic with 16 of our valued team members having been infected, as well as the impact of the rainy season negatively affected our timelines and team mobilization and management.

·  Stricter Chinese passport controls have also adversely affected our plans to increase the number of personnel required as support for Chinese technical team.