Georgian Mining Corporation Chairman’s Statement from Anthony Frizelle,

Georgian Mining Corporation LON:GEO has given DirectorsTalk its final results for the 12 months ended 31 December 2016. The Company also announces that its Annual General Meeting will be held at The Washington Mayfair Hotel, 5 Curzon Street, London, W1J 5HE, at 2:30 p.m. BST on 21 July 2017.

Highlights:

— Work conducted which has identified that the Kvemo Bolnisi (‘KB’) Copper and Gold Project has the potential to host large scale epithermal gold-copper mineralisation

   --     Exploration target of >50Mt of copper and gold identified 
   --     Established a first mover advantage as a Tethyan Belt play in Georgia

— Implementing a three-phase strategy to deliver on exploration target and build a major copper and gold producer

— Phase 1 achieved and exceeded with initial JORC resource of 2.22 Mt @ 0.8% Cu and 0.1 g/t Au identified, positioning GEO to achieve proof-of-concept production in 2017

— Raised GBP5.5m via an oversubscribed, nil-discount placing which has fully funded GEO to achieve 2017 Phase 2 target of delivering a JORC Resource of 3-5Mt of combined copper-gold sulphide and gold oxide mineralisation at KB and explore wider tenure in Georgia

LON:GEO Managing Director Greg Kuenzel said, “2016 was a year which saw us achieve many major milestones. We have now developed a clear three-phase strategy to reach our ultimate exploration target of a 50Mt copper-gold deposit and recent drill results from KB continue to demonstrate the strong potential for this expansive project to represent a large copper/gold epithermal deposit. Having already achieved phase one of our strategy to deliver a minimum of 1-2 Mt, our focus for 2017 is to report a 3-5 Mt copper and gold resource and to commence low cost production to be processed at our JV partner’s neighbouring operations. Following a recently oversubscribed placing we are fully funded to achieve our resource target via additional drilling and we are looking forward to updating shareholders on what we believe is going to be a really exciting year during which we hope to establish ourselves as a prominent Tethyan Belt play.”

Chairman statement

In July 2015, we secured an option to earn into a 50% interest in Georgian Copper & Gold (“GCG”), the holder of an 860 sq km mining licence in Georgia. This gave us access to an under-explored copper-gold region along the highly prospective Tethyan Belt with the potential to host significant mineral deposits similar to our Joint Venture partner’s nearby Madneuli mine, which has to date produced an estimated 80Mt of copper – gold ore at a reported average grade of circa 1.0% Cu and 1g/t Au. Almost two years and 10,450 metres of drilling later, our initial assessment of the potential of our project has been validated and we now believe that the JV licence area has the potential to host large scale epithermal gold-copper mineralisation with a number of exciting identified targets. Our first priority is to realise the full potential of our initial discovery Kvemo Bolnisi (“KB”), as a combined gold oxide and copper-gold sulphide deposit and then the remainder of the JV license area.

To date, $5 million has been contributed by the Company to the equity of GCG, thereby financing exploration activities and the Georgian based operations. We expect to meet our full $6 million obligation in the coming weeks effectively earning our 50% interest in the operations.

Large Scale, High Grade Epithermal Geological Model

As our geological model for KB and the Bolnisi District evolves, our strategy must adapt to realise the project’s full potential. When we first commenced work at KB, we hoped to deliver small scale production by the end of 2016. But our access to an extensive database of historic work and drilling carried out in the Soviet era, enabled us to identify several starter pits capable of providing feedstock for processing at nearby plants owned by our JV partner. As our exploration drilling got underway the drill results at KB East exceeded our expectations by repeatedly intersecting significant copper and gold mineralisation. Resource drilling has exposed a suite of mineralisation styles typical of epithermal systems, beginning at surface with outcropping heap leachable oxide gold mineralisation overlying an enriched (supergene) high-grade chalcocite copper blanket. This extends into copper-gold sulphide mineralisation hosted in breccia pipes that are surrounded by lower grade bulk tonnage potential copper-gold sulphides and high-grade sheeted pyrite-gold epithermal vein-type mineralisation. Breccia-type sulphide mineralisation with grades in excess of 20% Cu now extend down to a drill-indicated 200m and remains open at depth.

Our exploration activities increasingly demonstrate that KB has the characteristics of a large epithermal copper-gold system with high-grade areas, as well as lower grade bulk tonnage potential. This enables us to build a geological model for KB which includes an exploration target in excess of 50Mt of copper and gold ores such as exists nearby at Madneuli. The size of this opportunity has grown over the last eighteen months of exploration work. Other analogues along the Tethyan Belt encourage our ambition.

We intend to prove up the model and build a new copper and gold producer

We are developing a three-phase program to test our 50Mt exploration target. In Phase 1, KB will deliver ‘proof of concept’ copper and gold production using our JV Partner’s existing processing infrastructure. This has multiple benefits: it de-risks the project as it enhances the processing route, provides non-dilutive cash flow to fund additional exploration, and strengthens our relationship with our partner. We set a Phase 1 objective to delineate a minimum of 1 to 2Mt of copper-gold ore feedstock to provide for this initial production.

In April 2017 we announced an initial JORC resource of 2.22 Mt @ 0.8% Cu and 0.1 g/t Au, which achieved our initial objective for Phase 1 and we plan to commence the negotiation of a processing agreement with our JV partner in the near future. An MoU has previously been agreed with JSC RMG Gold and JSC RMG Copper (together ‘RMG’), our partner’s production company, for mining and processing arrangements for the future production of precious and base metal ores mined from our licence area. Access to RMG’s processing facilities will significantly reduce capital expenditure requirements, fast track production and provide known and agreed contract mining and processing costs.

Phase 2 is now underway, and on track to be completed in 2017. In Phase 2 our objective is to delineate 3 to 5Mt of combined copper-gold sulphide and gold oxide mineralisation and at the same time test the epithermal characteristics of the deposit. As part of Phase 2, resource development drilling is ongoing across three zones. At Gold Zone 1 a maiden resource of 52,000t @ 1.92g/t Au has already been delineated, however only the top 10m of the zone has to date been tested. Both the base of the oxide and the extent of the gold mineralisation are yet to be established. Similarly, only a small part of the large target that we have identified at Gold Zone 2 has so far been defined. Current drilling at Gold Zone 2 is focused on establishing a first resource of 1Mt @ >1g/t Au. An updated resource including both gold zones is expected in the near term but importantly gold and copper mineralisation remains open in all directions. Our Phase 2 exploration program is fully funded.

At Gold Zone 2, in addition to the gold mineralisation from surface, recent drilling has intercepted continuous copper mineralisation from the base of the gold oxide zone to a depth of 200 m. There is continuous gold oxide mineralisation from surface to the base of the weathering at depths ranging from 20 to 80m, included an intersection of 24m @1.58 g/t Au from 1m depth, and further intersections of copper mineralisation. The high-grade copper sulphide found at the base of the oxides returned 16m @ 15.4% Cu from 47m, including 4.95m @ 40.50% Cu, 0.46g/t Au and 55.6 g/t Ag (Drill hole TGD-044). Resource development drilling is underway principally to extend the gold oxide Resource which remains open in all directions. This programme is also testing extensions to copper-gold sulphide mineralisation both at depth beneath the Gold Zone 2 oxides and the expected link between the two copper-gold sulphide breccia bodies that have now been drill defined. 65 drill holes have been completed to date with depths varying from 20 metres to 120 metres at Gold Zone 2 and a follow up programme of a further 30 holes for circa 3,250 metres is already well advanced and generating positive results. As most holes drilled in the first programme ended in mineralisation, this new copper-gold zone remains open at depth. The Company’s consultants are preparing the initial JORC (2012) Resource for Gold Zone 2 which should be finalised in July 2017.

The third zone where work is ongoing is Copper Zone 1 which includes a JORC (2012) optimised in-pit Resource of 1.2Mt @1.03% Cu @ a 0.4% Cu cut-off within the unconfined estimate of 2.22Mt @ 0.8% Cu and 0.1 g/t Au @ a 0.3% Cu cut-off. These initial resources launched discussions with our JV partner for delivery of an initial 1Mt @ 1% Cu-Au sulphide ore for toll treatment at the float plant at our partner’s Madneuli mine. Although work to date has focused on the three zones as separate areas, results now indicate that they may either coalesce or blow out at depth to form a large epithermal copper-gold system which provides the basis for our new KB geological model and support for our Phase 3 exploration target of a 50Mt copper-gold deposit.

The Phase 3 exploration will commence immediately upon completion of Phase 2, and if successful is designed to allow for the opportunity of the KB project to grow into a stand-alone mine operation able to support its own plant and associated infrastructure. This requires us to delineate a 50Mt+ Resource at KB. While KB is of course our first priority to grow the company, our large JV license area offers significant scope for additional gold and copper discoveries. Work on several identified targets has commenced as part of a wider exploration strategy and we anticipate further positive news-flow as we explore our portfolio of exciting projects in Georgia.

Management

We have assembled an experienced Management Team which will be expanded as further skills and resources are required.

The appointment of Dr. Neil O’Brien and Mr. Peter Damouni as Non-Executive Directors has significantly strengthened our Board. They bring wide and deep experience in developing and financing mining projects. Dr. O’Brien is also a leading authority on geology of the Tethyan Belt.

In March 2017, I joined the Board as Non-Executive Chairman and Mr. Laurence Mutch was appointed as a Non-Executive Director. At this time, Non-Executive Director Roderick McIllree stepped down from the board to pursue his other business interests and Non-Executive Chairman Michael Hutchinson retired. We would like to thank them both for their stalwart efforts over the years and wish them the best for their future endeavors.

In addition to the above, the Company is able to access highly experienced outside consultants specialised in geology, Resource estimation, mining and metallurgy to further strengthen our technical capabilities.

Financial Results

As an exploration and development group which has no revenue we are reporting a loss for the twelve months ended 31 December 2016 of GBP5,645,734 (2015: GBP653,854), which is in line with our budget. The loss includes a one-off charge related to the impairment of the Company’s Austrian projects of GBP3,937,375.

The Group’s cash position at the end of the period was GBP1,659,314. Post period end, the Company successfully raised GBP5,463,942 million by way of a placing of 34,149,638 new ordinary shares of no par value in the capital of the Company. The funds raised will enable the Company to expand the resource development at the Kvemo Bolnisi copper and gold project in Georgia.

Outlook

We have met several major milestones at both project and corporate levels during the year under review. As our three-phase plan has been developed and is now in place, GEO’s exploration momentum should build in the year ahead and beyond. We are on track to complete the $6 million obligation for our 50% interest in GCG, and to achieve our resource development objectives at KB. Drill results consistently reaffirm and strengthen our confidence that we have a large copper-gold epithermal deposit on our hands, which should join the ranks of the many profitable copper-gold mine operations along the Tethyan Belt.

Our twin objectives for 2017 are to report a 3 to 5 Mt copper and gold resource and to commence low cost production to be processed at our JV partner’s neighbouring operations. We are on course to meet both objectives and with GBP5.5m raised via the recently oversubscribed private placement and expected revenues from ore sales, we are well funded for additional drilling, follow-up work and initial investigation of new targets.

This is proving an active and productive year as we work towards our 50Mt+ target to transform Georgian into a major European copper and gold Developer and Producer.

Finally, I would like to thank the Board and Advisors for all their hard work and commitment during what has been a very successful year. We are excited by the opportunity for Georgian to play a key role in developing the highly prospective mineral potential of Georgia to the benefit our Shareholders, the local community and the country as a whole. I look forward to providing regular updates on our progress as we evolve from early stage Exploration to significant mineral Production.

Anthony Frizelle

Chairman

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