Reserves and Resources

The 2025 Mineral Resource Estimate, effective December 31, 2024, incorporates production and pit depletions since the 2019 Mineral Resource was completed. Average diamond value estimates are derived from historical sales and adjusted for changes to market conditions since the 2019 FS, with specific updates for rough diamond sales consolidated across three diamond sales channels over the period 2020 to end 2023. The 2025 in-situ mineral resources for the Karowe Mine have been classified as either Indicated or Inferred Mineral Resources, according to CIM Guidelines. Mineral Resources reported are inclusive of those portions of the Mineral Resources that have been converted to Mineral Reserves. Mineral Resources reported are exclusive of stockpiles which are reported in the Mineral Reserve.

Mineral Resources

Notes

1. 1. Prepared by Hermanus Grütter, P.Geo., Ph.D. of SRK
2. 2. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. All numbers have been rounded to reflect accuracy of estimate.
3. 3. Mineral Resources are in-situ Mineral Resources and are inclusive of in-situ Mineral Reserves.
4. 4. Mineral Resources are exclusive of all mine stockpile material.
5. 5. Mineral Resources are quoted above a +1.25 mm bottom cut-off diamond size and have been factored to account for diamond losses within the smaller sieve classes expected within the current configuration of the Karowe Mine process plant.
6. 6. Inferred Mineral Resources are estimated on the basis of limited geological evidence and sampling, sufficient to imply but not verify geological grade and continuity. They have a lower level of confidence than that applied to an Indicated Mineral Resource and cannot be directly converted into a Mineral Reserve.
7. 7. The base of the South Lobe Indicated Mineral Resource is 250 masl, the base of the Inferred Mineral Resource is 66 masl for the South Lobe. The base of the Centre and North Lobe Indicated Mineral Resource is 745 masl.
8. 8. Average diamond value estimates are derived from historical sales and adjusted for current market conditions since completion of the 2019 FS and updated in 2024 for rough diamond sales over the period 2020 to end 2023.
9. 9. Mineral Resources have been estimated with no allowance for mining dilution and mining recovery.

A consolidated open pit and underground mine plan was developed to extract the economic portions of Karowe Mine Indicated Mineral Resources plus stockpiled ore. The mine plan includes extraction of three adjacent lobes of kimberlite. The South Lobe is planned to be mined through a combination of open pit and underground mining methods. The Centre Lobe is planned for extraction by open pit mining methods only. All Mineral Reserves are classified as Probable. The North Lobe mined from the open pit, is uneconomic and not considered a reserve.

The Qualified Persons preparing the Mineral Reserve Estimate was Brandon Chambers, P. Eng. The Qualified Persons did not identify any extraordinary risk, including legal, political or environmental risks that would materially affect potential Mineral Reserves development. The effective date of this Mineral Reserve Estimate is December 31, 2023.

Mineral Reserves

A consolidated open pit and underground mine plan was developed to extract the economic portions of Karowe Mine Indicated Mineral Resources plus stockpiled ore. The mine plan extracts only the South Lobe of the three adjacent lobes of Kimberlite (South, Centre, North). The South Lobe is planned to be mined through a combination of open pit and underground mining methods. All Mineral Reserves are classified as Probable.

The Qualified Person preparing the Mineral Reserve Estimate, Brandon Chambers, P. Eng., did not identify any extraordinary risk, including legal, political, or environmental that would materially affect potential Mineral Reserves development. The effective date of this Mineral Reserve Estimate is December 31, 2024.

Notes:

1. 1. Prepared by Brandon Chambers, P.Eng. JDS;
2. 2. CIM definitions were followed for Mineral Reserves;
3. 3. Process recovery of the diamonds was assumed to be 100% as the recoveries were included in the Mineral Resource block model assumptions and therefore have taken recoveries into account;
4. 4. The bottom elevation of the Probable Reserve is 310 masl;
5. 5. Mineral Reserves are quoted above a +1.25 mm bottom cut-off and have been factored to account for diamond losses within the smaller sieve classes expected within the current configuration of the Karowe Mine processing plant;
6. 6. Diamond price estimates are provided by Lucara; prices were updated in 2024 for rough diamond sales over the period 2020 to end 2023;
7. 7. Tonnages are rounded to the nearest 100,000 tonnes, diamond grades are rounded to one decimal place to properly reflect the Reserve estimate accuracy;
8. 8. Tonnage and grade measurements are in metric units; contained diamonds are reported as thousands of carats;
9. 9. Open pit Mineral Reserves are estimated at a cut-off value of US$37/t based on an open pit mining cost of US$13/t, a processing cost of US$12/t and a G&A cost of US$12/t;
10. 10. Underground Mineral Reserves are estimated at a cut-off value of US$35/t based on an underground mining cost of US$11/t, a processing cost of US$12/t and a G&A cost of US$12/t;
11. 11. Open pit dilution included in the Reserve was estimated from the following source:

• 2.0 m of zero-grade dilution from drill and blast activities along the Kimberlite and host rock contact.
• A total open pit dilution of 1.5%, which is less than 0.1 Mt, has been included in the open pit reserve estimate;

12. 12. Underground dilution assumptions in the 2019 FS were revised in 2021. Underground dilution included in the Reserve was estimated from the following three sources:

• 1.0 m of zero-grade overbreak from stoping adjacent to the granite host rock;
• 2.7 Mt of zero-grade overbreak from stoping adjacent to sedimentary rocks (based on geomechanical modelling);
• Inclusion of Inferred KIMB3 Kimberlite within the overall pipe shape as zero-grade waste.
  A total underground dilution of 9.6%, or 3.5 Mt has been included in the underground Reserve estimate;

13. 13. Stockpile Mineral Reserves are estimated at a cut-off value of US$19/t based on a rehandle cost of US$2/t, a processing cost of US$12/t and a G&A cost of US$5/t, when processed at the end of mine life;
14. 14. A portion of the LOM stockpile did not meet the economic cut-off due to diamond price updates performed in 2024; 2.3 Mt of material historically reported in the stockpile Reserves was removed in the 2024 Mineral Reserve Estimate;
15. 15. Stockpile Reserves are not included in the Karowe Mineral Resource Estimate, which covered only in-situ mineralized material;
16. 16. Stockpile Reserves are based on surveyed volumes and block model grades; and
17. 17. Stockpile LOM diamond price is determined from the weighted average of the North, Centre, South - M/PK(s), and South – EM/PK(s) ratios.

For additional details on the extent to which the Mineral Resources and Mineral Reserves may be materially affected by metallurgical, environmental, permitting, legal, title, taxation, socio-economic, marketing, political and other relevant issues, please see the section titled “Risks and Uncertainties” contained in the Company’s Annual Information Form, interim and annual audited consolidated financial statements and management's discussion and analysis of those statements, all of which are filed and available for review under the Company's profile on SEDAR at www.sedarplus.com.