The mineral resource is estimated from a drill hole database containing 117 drill holes consisting of 15,160 metres of drilling and 8,850 assay intervals.

The total Mineral Resource Estimate (MRE) is summarized in Table below, with the base case cut-off of 1.5% Graphite highlighted. A Lerchs-Grossman resource pit has been constructed using the 150% pit case based on the prices, offsite costs, metallurgical recovery and graphite prices used for the economic analysis thus confining the resource to a “reasonable prospects of eventual economic extraction” pit shape. The cut-off grade is based on a processing cost of CDN$11.85/tonne, and General and Administrative Costs of CDN$2.37/tonne and a C$1.00 = US$0.75 as summarized in the notes below. A cut-off grade of 1.5% Cg has been used for the base case of the resource estimate, which more than covers the Process and G&A costs.

Notes:

1. Resources are reported using the 2014 CIM Definition Standards and were estimated using the 2019 CIM Best Practices Guidelines.
2. Mineral Resources are reported inclusive of Mineral Reserves.
3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
4. The Mineral Resource has been confined by a “reasonable prospects of eventual economic extraction” pit using the following assumptions: Exchange Rate C$1.00 = US$0.75; Weighted average price of graphite of US$ 916/tonne; 100% payable; Offsite costs including transportation and insurance of CDN$37.42/tonne; a 1.5% NSR royalty; Metallurgical recoveries of 95%.
5. Pit slope angles are 45º below overburden, 20o in overburden.
6. The specific gravity of the deposit is 2.86 in unmineralized and low-grade zones and 2.78 in high-grade zones (within solids above a 4% Graphite grade).

The mine plan includes 21.9 Mt of mill feed and 88.4 Mt of waste over the 14.7-year project life. Mine planning is based on conventional open pit methods suited for the project location and local site requirements. Owner-operated and managed open pit operations are anticipated to begin prior to mill start up, running for 14.7 years to pit exhaustion, with feed from the low-grade stockpile supplementing plant feed over the last two years.

The subset of Mineral Resources contained within the designed open pits, summarized in Table below with a 2.5% Cg cut-off, forms the basis of the mine plan and production schedule. La Loutre deposit comprises the Battery (B) zone and the Electric Vehicle (EV) zone. The B zone is planned as two pits, and the EV zone is split into two pits EV North (EVN) and EV South (EVS) with the EVN pit split into two phases. Pit designs are based on 45 degree overall configured on 6 metre bench heights, with 7.8-metre-wide berms placed every two benches with 70 degree face angles.

*Overburden is 2-3m of broken and weathered rock overlaying more competent material.

Pit figures:

The La Loutre Process Plant employs standard flotation technology to produce a graphite concentrate. The plant includes crushing, grinding, classification, flotation, tailings thickening and filtration, graphite concentrate filtration, drying and screening and separation into the product sizes. Graphite concentrate is loaded into 1 tonne bags for shipment and sale.

The plant is expected to treat 1.5 Mt of feed per year at an average throughput of 4,100 t/d. The mill design availability is 8,147 hours per year or 93%, with an operating throughput of 184 t/h.

The plant has been designed to realize an average recovery of 93.5% of the graphite at a concentrate grade of 95% Cg over the life of the project based on metallurgical test work completed by SGS Lakefield in 2021. Graphite product split is estimated to be 32% plus 80 mesh (177 microns) and 68% less than 80 mesh (177 microns).

Mill tailings storage capacity has been identified to safely accommodate the life of mine production as described in this PEA. Mill tailings produced will be comingled or co-disposed with 50% of the mine waste rock in the central and southern portion and the balance of the waste rock will be stored predominantly in the northern section until after Year 9 of the operation in a co-disposal facility constructed northwest of the process plant.

The Co-Disposal Storage Facility perimeter containment berms will be constructed with waste rock from open pit mine development and will utilize downstream construction method to ensure safe tailings storage over the long-term. Run-off water and seepage from the Co-Disposal Storage Facility will be collected in an adjacent Water Management Ponds. Tailings production after Year 9 will be placed in the mined out EVN pit.