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European Metals Holding Limited: Drill Programme Update

European Metals Holdings Limited (“European Metals” or “the Company”) (ASX and AIM: EMH) is pleased to announce analytical results for the confirmation drillhole CIW-11 at the Cinovec Lithium-Tin-Tungsten Project (“the project” or “Cinovec”).

Key Points:

- Drillhole CIW-11 returned two main mineralized intercepts of 89.95m averaging 0.61% Li2O and 109.4m averaging 0.38% Li2O.

- The first intercept includes a high-grade interval of 63.85m @0.76% Li2O, which hosts an internal very high grade interval of 12m @1.04 %Li2O. In addition, two sections of  this lithium interval contain significant tin and tungsten mineralization: 2.85m averaging 0.27% tin and 0.053% tungsten; and 6m averaging 0.18% tin and 0.009% tungsten. This yields the best Li intercept recorded by the Company to date.

- Drilling continues in the main section of the deposit, targeting near-surface mineralization on the flanks of the historic underground mine. Altogether, five drillholes (1,644m) have been completed this year, with three underway.

European Metals CEO Keith Coughlan said “We are very pleased with the exceptional results for the latest drillhole. This is the first hole drilled in the main part of the deposit where the lithium mineralization zones are generally at shallower depths. The just obtained results are our best lithium results to date in terms of grade and continuity. The drill programme will continue in the shallowest parts of the main deposit, along the flanks of the historic mine, where in some areas the mineralization outcrops”.

Drill Programme

The CIW-11 drillhole is located on the southern edge of the Cinovec Main sector of the deposit, in an area of relative sparsity of historic drill data and lithium analyses.

The current drill programme at Cinovec Main has been planned to confirm and delineate near surface lithium and tin mineralisation that would provide initial feed to the mill. Other goals are the conversion of resources from the Inferred to Indicated category, and delivery of material for metallurgical testing. So far, five diamond core holes have been completed, and three are underway. Visual inspection and logging indicates that the geology in these holes is as expected. Drill details are listed in Table 1 below.

Table 1 – Completed drillholes, Cinovec Main

Hole locations are recorded in the local S-JTSK Krovak grid, 1) Coordinates surveyed, 2) Coordinates determined by GPS, 3) Planned, no inclinometry yet

After geological logging, drill core is cut in half with a diamond saw.  Quarter core samples are selected (honouring geological boundaries) and dispatched to ALS (Romania) for preparation and assay; the 3/4 of the core is returned to the core box and stored securely on site. Samples are being prepared and analysed by ALS using ICP and XRF techniques following standard industry practice for lithium and tin deposits. Strict QAQC protocols are observed, including the insertion of a Li standard in random fashion for every 10 core samples.

Mineralized Intercepts and Lithology in CIW-11

The CIW-11 drill hole is collared in rhyolite in the western area of the Cinovec cupola. The drillhole is located in the southern part of the Cinovec Main section, near the arbitrary boundary between the Cinovec Main and Cinovec South Sections. Geologically, the drillhole resembles the geology and mineralization style of the drillholes at Cinovec South, and it yields the best Li intercept recorded by the Company to date. The main characteristics are the presence of two massive greisen/greisenized zones in granite just below its contact with the overlying rhyolite. Based in initial observations of core from the most recently drilled holes, the near-surface or outcropping mineralization in the northern part of Cinovec Main appears of somewhat different style, with numerous but comparatively narrow greisen cored by quartz veins.

In CIW-11, the high grade Li-mineralized greisen and strongly greisenized granite starts immediately bellow the rhyolite/granite contact at a depth of 181.15m. The mineralized intercepts in this drillhole are the best the Company has drilled to date in terms of grade, with intercepts of i.e., 63.85m@0.76%Li2O (including 12m @1.04% Li2O) and containing locally economic grade tin. The best individual 1m sample reached grade of 2.13%Li2O.

The second mineralized interval of 109.4m@0.38% Li2O starts in 335m and thought the final depth of the hole reached 444.4m.

According to the geological and block model the greisen bodies (and the mineralized zones) dip to the southwest, although this fact could not be fully confirmed by core angles observations in the core. The CIW-11 drillhole was angled 12 degrees toward the NE and the reported intercepts appear close to true thicknesses.

Table summarizing mineralised intercepts in CIW-11

Figure 1 – A geological map showing the Company’s drill holes against surface geology and subsurface greisen bodies projected to surface (in green). Historic UG workings and drill holes not shown.

As required under the 2012 JORC Code, details of the current drill programme are appended (Table 2).

PROJECT OVERVIEW

Cinovec Lithium/Tin Project

European Metals owns 100% of the Cinovec lithium-tin deposit in the Czech Republic. Cinovec is an historic mine incorporating a significant undeveloped lithium-tin resource with by-product potential including tungsten, rubidium, scandium, niobium and tantalum and potash. Cinovec hosts a globally significant hard rock lithium deposit with a total Indicated Mineral Resource of 49.1Mt @ 0.43% Li2O and an Inferred Mineral Resource of 482Mt @ 0.43% Li2O containing a combined 5.7 million tonnes Lithium Carbonate Equivalent.

This makes Cinovec the largest lithium deposit in Europe and the fourth largest non-brine deposit in the world.

Within this resource lies one of the largest undeveloped tin deposits in the world, with total Indicated Mineral Resource of 15.7Mt @ 0.26% Sn and an Inferred Mineral Resources of 59.7 Mt grading 0.21% Sn for a combined total of 178kt of contained tin. The Mineral Resource Estimates have been previously released on 18 May 2016. The deposit has previously had over 400,000 tonnes of ore mined as a trial sub-level open stope underground mining operation.

A Scoping Study conducted by specialist independent consultants indicates the deposit could be amenable to bulk underground mining. Metallurgical test work has produced both battery grade lithium carbonate and high-grade tin concentrate at excellent recoveries with the Scoping Study. Cinovec is centrally located for European end-users and is well serviced by infrastructure, with a sealed road adjacent to the deposit, rail lines located 5 km north and 8 km south of the deposit and an active 22 kV transmission line running to the historic mine. As the deposit lies in an active mining region, it has strong community support.

COMPETENT PERSON

Information in this release that relates to exploration results is based on information compiled by European Metals Director Dr Pavel Reichl. Dr Reichl is a Certified Professional Geologist (certified by the American Institute of Professional Geologists), a member of the American Institute of Professional Geologists, a Fellow of the Society of Economic Geologists and is a Competent Person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves and a Qualified Person for the purposes of the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009. Dr Reichl consents to the inclusion in the release of the matters based on his information in the form and context in which it appears. Dr Reichl holds CDIs in European Metals.

The information in this release that relates to Mineral Resources and Exploration Targets has been compiled by Mr Lynn Widenbar. Mr Widenbar, who is a Member of the Australasian Institute of Mining and Metallurgy, is a full time employee of Widenbar and Associates and produced the estimate based on data and geological information supplied by European Metals. Mr Widenbar has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the JORC Code 2012 Edition of the Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves. Mr Widenbar consents to the inclusion in this report of the matters based on his information in the form and context that the information appears.

CAUTION REGARDING FORWARD LOOKING STATEMENTS

nformation included in this release constitutes forward-looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”, or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs.

Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the company’s actual results, performance and achievements to differ materially from any future results, performance or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licences and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.