Base Resources: Halving production in fiscal 2024

On June 26, 2023, Base Resources released its 2024 fiscal year production guidance. According to the latest production guidance, Base Resources 'titanium ore production in Kenya in fiscal year 2024 will be reduced from 260,000 - 310,000 tons in fiscal year 2023 to 130,000 - 160,000 tons, rutile production will be reduced from 62,000 - 73,000 tons to 35,000 - 41,000 tons, and zircon sand will be reduced from 22,000 - 27,000 tons to 13,000 - 16,000 tons.

According to production guidance, the decline in production was mainly due to:

1.  The heavy mineral grade of the remaining ore body in Kuangqu and the heavy mineral grade of the north Kuangqu is lower than Kwale's historical heavy mineral grade;

2. Mining in Kuangqu began in February 2023. Due to the increase of size gravel and mud, the mining rate in Kuangqu was lower than expected

3. Half of mining operations are expected to be closed in March 2024 to allow for the relocation of mining units in Kuangqu and slurry collection buckets leading to the Bumamani ore body

From January to May 2023, Base Resources exported a total of 105,700 tons of titanium ore, 8800 tons of zircon sand and 400 tons of rutile to China, of which titanium ore exports dropped by 7.3% year-on-year. Kenya's titanium ore is mainly used in the production of sulfuric acid titanium dioxide. As the output of the Kuangqu decreases, Kenya's exports of titanium ore to China will be significantly reduced.