DNI Metals Inc. to Build a Modular Graphite Pilot Plant for its Madagascar Properties

Toronto, Ontario--(Newsfile Corp. - August 17, 2017) - DNI Metals Inc.(CSE: DNI ) "DNI", is pleased to announce that it will build a graphite pilot plant for testing its properties in Madagascar.

1. DNI Metals has had positive Drilling and metallurgical results from its first mining claims.
2. DNI's projects are permitted.
3. Saprolitic-hosted (weathered) material, average depth from current drill program is 28 meters.
4. Modular plant to be on site in 3-4 months..
5. Budget for the pilot plant is $1 million.
6. Plant to be designed to produce up to 6,000 tonnes of graphite per year, depending on the head grade.
7. Plant will be built in ocean shipping containers, and will be used to test multiple zones in both of DNI's project areas.
8. MOU for up to 20,000 tonnes per year of large flake graphite.The MOU is intended to form the basis of a binding flake graphite concentrate supply/offtake joint venture agreement that DNI will use its best endeavors to complete within the next 6 months.
   

DNI's Madagascar, graphite assets claim numbers PE8904 and PE38642.

Madagascar is known for large flake and high quality graphite; the vast majority of which is sourced from the central-eastern coastal area between Toamasina and Brickaville (refer Figure 1 left below).The project lies in a well-defined graphitic belt, which has been producing for over 50 years.

Infrastructure can be the key to any project.It is a significant advantage that the claims are 50kms by paved highway from Madagascar's main operating port at Toamasina.

Figure 1: Regional (left) & detailed (right) location plans for PE8904 'Marofody' Project tenement

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About DNI Metals

Certain advisors and directors of DNI have significant operational experience at historical hard rock graphite mines in Canada (e.g. Ontario and Quebec) and Australia.Between them, they have built three (3) processing plants and designed two (2) others; all, which were shut down in the 1990,'s due to increased Chinese competition.Keith Minty, a director, previously worked at Cal Graphite near Kearny, Ontario.

It was our team's understanding of the high production and capital expenditure costs associated with so-called "hard rock" graphite mining that inspired DNI to search for saprolite-hosted graphite deposits.

Certain parts Madagascar and Brazil, produce graphite from weathered material called saprolite.

According to Dictionary.com, saprolite is described as:

"Soft, thoroughly decomposed and porous rock, often rich in clay, formed by the in place chemical weathering of igneous, metamorphic, or sedimentary rocks.Saprolite is especially common in humid and tropical climates. It is usually reddish brown or grayish white and contains those structures (such as cross-stratification) that were present in the original rock from which it formed."

DNI owns a commercially permitted, saprolite-hosted graphite deposit in Madagascar; located 50kms from the country's main seaport.The deposit is located less than two (2) kms from the paved national highway.DNI intends to develop the Vohitsara project, should the economic viability and technical feasibility be established. DNI has not yet established mineral resources or mineral reserves supported by a PEA or mining study (PFS or FS).

DNI has a graphite wholesale business, in which it buys and sells high quality graphite.This business has shown a steady increase in volume over the past year.

Steven Goertz (MAusIMM, MAIG), who is a qualified person, approved the technical disclosure in this news release.

DNI - Canadian Securities Exchange
DMNKF - OTC
Issued: 62,968,155

For further information, contact:
DNI Metals Inc. - Dan Weir, CEO 416-595-1195
DanWeir@dnimetals.com
Also visit www.dnimetals.com

We seek Safe Harbour. This announcement may include forward looking statements. While these statements represent DNI's best current judgment, they are subject to risks and uncertainties that could cause actual results to vary, including risk factors listed in DNI's Annual Information Form and its MD&A's, all of which are available from SEDAR and on its website.