Kinetic Development Group Achieves Key Milestone in MC Mining Investment and Makhado Project Development

Key Developments for Investors

• Completion of the Sixth Tranche of MC Mining Share Subscription: Kinetic Development Group Limited (“the Company”) has successfully completed the sixth tranche of its second closing in the MC Mining share subscription. This major step means the Company and its designees now hold approximately 44.01% of the enlarged issued share capital of MC Mining, representing a significant strategic stake in the company.
• Ongoing Commitment to Increasing Stake: The Company intends to continue with subsequent tranches of the share subscription, targeting an ultimate holding of 51.00% of MC Mining’s ordinary shares on a fully diluted basis. This would give Kinetic Development Group effective control over MC Mining, a move that may have substantial implications for both companies’ future directions and valuations.

Latest Progress on the Makhado Project

The Makhado Project, MC Mining’s flagship initiative, continues to make significant progress:

• Resource Base: MC Mining holds total mineral rights resources (Total Tonnes in Situ) of approximately 8.3 billion tonnes, with the Makhado Project itself boasting 706 million tonnes of coal resources. The main products will be coking coal and 5,500 kcal thermal coal.
• Construction Timeline: Mining construction is advancing steadily, with completion anticipated by the end of March 2026. Joint trial operations of the mine and coal preparation plant are set to commence in April 2026.
• Mining Operations: Overburden stripping works have completed approximately 5.04 million cubic meters, with only 1.5 meters remaining before reaching coal seams. Operations now focus on expanding the stripping area, with joint commissioning of the mine and preparation plant scheduled for April 2026.
• Coal Handling and Preparation Plant (CHPP): Civil foundations are largely complete, with machinery, equipment installation, pipeline, and cable works currently underway. Full completion of CHPP is also targeted for March 2026.
• Infrastructure & Power Supply: Bridge construction is finished and open to traffic. Water supply pipeline connections are progressing, and the 22kV main power line installation is nearly complete, with all supporting facilities expected to be ready by the end of March 2026.
• Operational Readiness: Site infrastructure, including access routes and public service facilities, is progressing according to schedule, supporting the planned April 2026 trial operations.

Production Plans and Expansion Potential

• Initial Production Capacity: Upon stable operation, the Makhado Project is expected to achieve annual production of 800,000 tonnes of coking coal and 700,000 tonnes of thermal coal.
• Future Capacity Expansion: Design and testing for further expansion are ongoing, with the potential to increase annual output to 2,200,000 tonnes of coking coal and 1,800,000 tonnes of thermal coal within the next two years, should tests prove favorable.
• Pricing Mechanism: Coal products will adopt a pricing mechanism linked to international spot market indices, with adjustments for coal quality, procurement scale, and commercial terms. As a reference, the latest indicative China port CFR price for relevant coking coal products is approximately USD200 per tonne.
• Sales and Marketing: The Company is negotiating with over 20 potential customers across global markets, including Africa, Southeast Asia, the Middle East, South America, Europe, and China. This broad customer base is expected to support sales and revenue generation once production commences.

Strategic and Shareholder Considerations

• Significant Strategic Opportunity: The Board highlights that the ongoing share subscription and development of the Makhado Project presents a significant opportunity for the Group to participate in a global, high-quality mining asset.
• Completion Risks: The completion of the remaining tranches of the share subscription is subject to various conditions precedent, which may or may not be fulfilled. Shareholders are advised to exercise caution, as these conditions can affect the timeline and ultimate outcome of the Company’s investment and control in MC Mining.
• Potential Impact on Share Price: Updates regarding milestone completions, project delays, or changes in market conditions could have a material impact on the share price of Kinetic Development Group, given the scale and importance of the Makhado Project to the Group’s strategy and future revenue streams.

Corporate Governance Update

The Board of Directors of Kinetic Development Group currently comprises seven members: three executive Directors (Mr. Ju Wenzhong – Chairman, Mr. Li Bo – CEO, and Mr. Ji Kunpeng), one non-executive Director (Ms. Zhang Lin), and three independent non-executive Directors (Ms. Liu Peilian, Mr. Chen Liangnuan, and Ms. Xue Hui).

Conclusion

This announcement contains significant developments that are likely to influence the share price of Kinetic Development Group Limited. The expansion of its stake in MC Mining, steady progress at the Makhado Project, and the potential for substantial growth in coal production capacity all indicate a pivotal period for the Company. Investors should closely monitor further announcements regarding completion of share subscriptions, construction milestones, and production ramp-up, as these could have direct implications for the Company’s valuation and market positioning.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a solicitation to buy or sell securities. Actual project outcomes and financial results may differ from those stated or implied herein due to various risks and uncertainties. Investors are advised to exercise caution and consult professional advisers before making investment decisions.

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