Sherritt's Updated Reserve Estimate and Life of Mine Plan at the Moa JV More than Doubles Reserves and Extends Life of Mine to 26 years

Sherritt International Corporation (“Sherritt”, the “Corporation”) (TSX:S), a world leader in the mining and refining of nickel and cobalt – metals essential for the growing adoption of electric vehicles, announced today that it is filing an updated National Instrument 43-101 Technical Report (NI 43-101 or 2023 Moa JV Technical Report) for the Moa Joint Venture (the Moa JV) indicating that current reserves are expected to support a 26 year life of mine.

Highlights

• Proven and Probable Reserves⁽ⁱ⁾ increased to 1,182 kt of nickel and 144 kt of cobalt, an increase of 110% and 129%⁽ⁱⁱ⁾, respectively;
• The life of mine (LOM) extends to 2048, an increase of 14 years, with total estimated metal recovered of 724 kt of nickel and 85 kt of cobalt;
• Over the next 10 years, average annual finished metal production of 30 kt of nickel and 3.3 kt of cobalt from Moa is expected, excluding the impact of the Moa JV expansion program and refining of third-party feeds;
• Favourable economics in the base case scenario supports an after-tax NPV (8%) of US$812 million (100% basis) using conservative prices of US$7.12/lb nickel and US$21.32/lb cobalt;
• Significant upside in an alternative case increases the after-tax NPV (8%) to US$1.5 billion (100% basis) using recent analyst commodity price forecasts of US$9.00/lb nickel, US$23.50/lb cobalt and higher input commodity prices;
• The 2023 Moa JV Technical Report excludes the upside NPV impact from the Moa JV expansion. Once completed by the end of 2024, the full expansion is expected to result in a higher NPV but shorten the LOM by 3-5 years.

“The updated reserves and associated life of mine at the Moa JV underpins and validates our long-term strategy for producing low cost, high purity nickel and cobalt,” said Leon Binedell, President and CEO of Sherritt International. “With an estimated 26-year mine life and a strong market outlook for our products, the revised economics supports both our near-term strategy of expanding production capacity and our long-term growth ambitions to meet the demand from evolving markets increasingly driven by the energy transition and, in particular, electric vehicle battery supply chains.”

Mineral Reserve Estimates

The 2023 Moa JV Technical Report, which incorporates a newly developed strategic LOM plan based on the economic cut-off grade (ECOG) methodology, estimates that as of August 31, 2022 the Moa JV had 117.2 millions of tonnes (Mt) of proven and probable reserves at an average nickel grade of 1.01% and cobalt grade of 0.12%, providing total reserves of 1,182 kt of contained nickel and 144 kt of contained cobalt. The updated contained nickel and cobalt reserves are 110% and 129% higher, respectively, compared to the amounts previously reported and as disclosed in the 2021 Annual Information Form (2021 AIF).

The following table provides a summary of the proven and probable reserves for the Moa JV (100% basis):

1. Cut-off grades vary. All assumptions, parameters, and methods used to estimate the mineral resources and reserves are disclosed in the 2023 Moa JV Technical Report to be filed March 31, 2023. An excerpt from the report of the full resources table is provided in Appendix 2 of this press release.
2. Total tonnage amounts may not sum exactly due to each component number being rounded to its nearest decimal.

Mineral Resource Estimates

The 2023 Moa JV Technical Report estimates that as of August 31, 2022 the Moa JV had 156.5 Mt of Measured and Indicated Resources⁽¹⁾ at an average nickel grade of 1.07% and cobalt grade of 0.12%, providing total measured and indicated resources of 1,677 kt of contained nickel and 192 kt of contained cobalt. The updated contained nickel and cobalt resources are 12% and 2% higher, respectively, compared to the amounts previously reported and as disclosed in the 2021 AIF.

The following table provides a summary of the Mineral Resources that are inclusive of Mineral Reserves for the Moa JV (100% basis):

1. All assumptions, parameters, and methods used to estimate the mineral resources and reserves are disclosed in the 2023 Moa JV Technical Report to be filed March 31, 2023. An excerpt from the report of the full reserves table is provided in Appendix 3 of this press release.
2. Totals may not sum exactly due to each component number being rounded to its nearest decimal.

Updated Life of Mine Plan

With the increase in Proven and Probable Reserve estimates, Moa’s mine life is expected to extend by approximately 14 years to 2048 based on the utilization rates at the effective date of the 2023 Moa JV Technical Report. Over the next 10 years, average annual finished nickel and cobalt production, exclusive of the impact of the current expansion program and third-party feed, is estimated at 30 kt of finished nickel and 3.3 kt of finished cobalt. Total recovered metals over the extended life of mine are estimated to be 724 kt of nickel and 85 kt of cobalt.

The current LOM strategy used to support the 2023 Moa JV Technical Report uses an “economic cut-off grade” (ECOG) methodology versus a “fixed cut-off grade” (FCOG) used in the previous NI 43-101 Technical Report filed June 26, 2019 for the Moa JV in determining the amounts of Proven and Probable reserves. The primary difference between the ECOG and FCOG is that the ECOG better reflects the potential economic benefit of extracting the selected material. The ECOG definition incorporates the nickel and cobalt commodity prices, the metallurgical recovery of these metals, and the costs involved in the mining, refining and marketing of these metals.

Economic Analysis

The base case extended LOM has a favourable after tax NPV of US$812 million (100% basis) at an 8% discount rate using conservative prices of US$7.12/lb nickel and US$21.32/lb cobalt. This is based on the LOM in the 2023 Moa JV Technical Report.

Additionally, the 2023 Moa JV Technical Report includes an alternative scenario which results in an after tax NPV of US$1.5 billion (100% basis) at an 8% discount rate, based on recent analyst commodity price forecasts for nickel, cobalt and key input commodity prices.

The following table provides a summary of some of the key assumptions related to the net economic evaluation contained in the 2023 Moa JV Technical Report for the Moa JV (100% basis) ⁽¹⁾⁽²⁾:

1. All assumptions, parameters, and methods used in preparing the economic analysis are included in Section 22.0 ECONOMIC ANALYSIS of the 2023 Moa JV Technical Report to be filed March 31, 2023. A copy of the economic analysis summary is included in Appendix 4 of this press release.
2. The economic analysis including the NPV calculation is for the Moa JV and production from the Moa mine only and does not consider the impact of operating results of Sherritt’s 100% owned fertilizer business, potential third-party feed opportunities, and the impact of the current Moa JV expansion on timing of production and capital cost estimates.
3. In addition to the nickel and cobalt prices in the table, key input commodity prices for the base case and alternative scenario include: sulphur – US$161/t and US$230/t, diesel – US$0.64/l and US$1.00/l, and fuel oil – US$320/t and US$500/t, respectively.

Impact of Current Moa JV Expansion Program on the LOM

In 2021, the Moa JV embarked on a low capital intensity expansion program to capitalize on the growing demand for high purity nickel and cobalt being driven by the accelerated adoption of electric vehicles (EV). The scope of the expansion program was narrowed during 2022 to better reflect the evolving intermediate market for nickel and cobalt and to focus on the most critical components of growth in light of supply chain challenges and inflationary price pressures on capital. The current program is aimed at increasing annual mixed sulphide precipitate (MSP) production by 20% or 6,500 t of contained nickel and cobalt (100% basis).

The expansion program consists of two phases with phase one focused on the construction of a new slurry preparation plant (NSPP) at Moa, and phase two is focused on the expansion of the Moa processing plant, including the Leach Plant Sixth Train and Fifth Sulphide Precipitation Train as well as construction of additional acid storage capacity at Moa. The total capital cost is expected to be US$77 million (100% basis) or approximately US$13,200 per additional annual tonne of contained nickel for the full expansion. Growth spending on capital for the expansion program is expected to be self-funded by the Moa JV primarily using operating cash flows.

The economic analysis in the 2023 Moa JV Technical Report includes the remaining capital for the construction of the NSPP and the related ore haulage distance and mining fleet benefits; however, it does not include any of the incremental MSP production associated with that phase. Therefore, Sherritt estimates only US$50 million of additional capital would be required to complete the expansion program and realize the increased annual production of MSP by 6,500t of nickel and cobalt and associated economic benefits.

Assuming an accelerated mining sequence in order to meet the expected increased production related to the Moa JV expansion, the LOM would likely be reduced by 3 to 5 years, resulting in a LOM of approximately 21 to 23 years. This increased production would be expected to increase cashflows and the NPV of the Moa JV.

Qualified Persons

The technical information contained in this press release has been reviewed and approved by Bryce Reid, P.Eng, Senior Chemical Engineer, who is a Qualified Person with respect to the Moa JV as defined under NI 43-101. Information related to the 2023 Moa JV Technical Report contained in this news release has been reviewed and approved by the report co-authors, Béatrice Foret, M.Sc., AUSIMM(CP), Associate Mineral Resource Geologist; Michiel Frederik Breed, M.Eng., Pr.Eng., SAIMM(CP), Associate Senior Mining Engineer; and Christopher Jacobs, CEng., MBA, MIMMM, Mining Economist and President of Micon International Limited.

The qualified persons have verified the information disclosed herein, including the sampling, preparation, security and analytical procedures underlying such information, and are not aware of any significant risks and uncertainties that could be expected to affect the reliability or confidence in the information discussed herein. Each of Béatrice Foret, Michiel Frederik Breed, and Christopher Jacobs is an "Independent Qualified Person", vis-à-vis Sherritt, as such term is defined in National Instrument 43-101 – Standards for Disclosure for Mineral Projects.

Filing of the 2023 Moa JV Technical Report

The 2023 Moa JV Technical Report, which is to be filed on March 31, 2023, has been prepared in compliance with National Instrument 43-101 – Standards for Disclosure for Mineral Projects, for Sherritt by Micon International Limited with an effective date of August 31, 2022. The 2023 Moa JV Technical Report will be available on Sherritt’s profile on SEDAR at www.sedar.com and on Sherritt’s website at www.sherritt.com.

Readers are encouraged to read the 2023 Moa JV Technical Report in its entirety, including all qualifications, assumptions and exclusions that relate to the details summarized in this news release. The report is intended to be read as a whole, and sections should not be read or relied upon out of context.

About the Moa Joint Venture

The Moa Joint Venture is a 50/50 joint venture between Sherritt and General Nickel Company S.A. of Cuba. The Moa JV explores, develops, mines and processes nickel laterite deposits in Cuba for refining into finished nickel and cobalt from its refinery in Fort Saskatchewan, Alberta or for potential sale as intermediary products and markets its products to customers internationally, except the United States.

About Sherritt

Sherritt is a world leader in using hydrometallurgical processes to mine and refine nickel and cobalt – metals essential for an electric future. Its Technologies Group creates innovative, proprietary solutions for natural resource-based industries around the world to improve environmental performance and increase economic value. Sherritt has embarked on an expansion program focused on increasing annual mixed sulphide precipitate production by 20% or 6,500 tonnes of contained nickel and cobalt (100% basis). The Corporation is also the largest independent energy producer in Cuba. Sherritt’s common shares are listed on the Toronto Stock Exchange under the symbol “S”.

End notes:

1. The terms Proven and Probable Reserves and Measured and Indicated Resources are industry defined terms and are summarized in Appendix 1 to this press release. These terms are fully defined and discussed in the 2023 Moa JV Technical Report.
2. Compared to the amounts reported in the Corporation’s Annual Information Form for the year-ended December 31, 2021 (the 2021 AIF), which incorporates estimates based on the NI 43-101 Technical Report filed by the Moa JV on June 26, 2019 with an effective date of December 31, 2018, net of depletions to December 31, 2021.

Forward-Looking Statements

This press release contains certain forward-looking statements. Forward-looking statements can generally be identified by the use of statements that include such words as “believe”, “expect”, “anticipate”, “intend”, “plan”, “forecast”, “likely”, “may”, “will”, “could”, “should”, “suspect”, “outlook”, “potential”, “projected”, “continue” or other similar words or phrases.

Specifically, forward-looking statements in this document include, but are not limited to, statements regarding resource and reserve estimates, including potential resources and reserves expansion, assumed commodity prices and exchange rates, life of mine and life of mine production plan, production, net present value, operating and capital cost estimates. Forward-looking statements are not based on historical facts, but rather on current expectations, assumptions and projections about future events, including commodity and product prices and demand; the level of liquidity and access to funding; share price volatility; production results; realized prices for production; earnings and revenues; global demand for electric vehicles and the anticipated corresponding demand for cobalt and nickel; the commercialization of certain proprietary technologies and services; advancements in environmental and greenhouse gas (GHG) reduction technology; GHG emissions reduction goals and the anticipated timing of achieving such goals, if at all; statistics and metrics relating to Environmental, Social and Governance (ESG) matters which are based on assumptions or developing standards; environmental rehabilitation provisions; environmental risks and liabilities; compliance with applicable environmental laws and regulations; risks related to the U.S. government policy toward Cuba; and certain corporate objectives, goals and plans for 2023, together with projected mine and process recovery rates, mining dilution, projected closing costs and requirements and assumptions as to environmental, permitting and social considerations and risks. By their nature, forward-looking statements require the Corporation to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that the assumptions may not be correct and that actual results may differ materially from such predictions, forecasts, conclusions or projections. The Corporation cautions readers of this press release not to place undue reliance on any forward looking statement as a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward looking statements.

Risks, uncertainties and other factors regarding resources and reserves include, but are not limited to: the ability to obtain required Cuban approvals for the Economic Cut-Off Grade methodology and new cut-off grade, the degree of confidence that can be attained in relation to the resource models for certain areas, the frequency of waste dump and stockpile surveying and lower resource categorization with respect to saprolites. In addition, those associated with reserves include but are not limited to: the ability to assure sufficient and continuous tailings capacity, the ability to successfully implement the revised mine plan associated with the increased reserves on site Risks to forward looking statements also include changes to costs of production from what is assumed, unrecognized environmental risks, unanticipated reclamation expenses, unexpected variations in the quantity of mineralized material, grade or recovery rates, geotechnical or hydrological considerations differing from what is assumed, failure of mining methods to operate as anticipated, changes to assumptions as to the availability and cost of electrical power and process reagents, the ability to maintain the social license to operate, accidents, labour disputes and other risks of the mining industry, changes to interest rates and changes to tax rates, and availability of allowances for depreciation and amortization.

Additional risks, uncertainties and other factors include, but are not limited to, security market fluctuations and price volatility; level of liquidity and the related ability of the Moa Joint Venture to pay dividends; access to capital; access to financing; the risk to Sherritt’s entitlements to future distributions (including pursuant to the Cobalt Swap) from the Moa Joint Venture, the impact of infectious diseases (including the COVID-19 pandemic), the impact of global conflicts; changes in the global price for nickel, cobalt, oil, gas, fertilizers or certain other commodities; risks related to Sherritt’s operations in Cuba; risks related to the U.S. government policy toward Cuba, including the U.S. embargo on Cuba and the Helms-Burton legislation; political, economic and other risks of foreign operations; uncertainty in the ability of the Corporation to enforce legal rights in foreign jurisdictions; uncertainty regarding the interpretation and/or application of the applicable laws in foreign jurisdictions; compliance with applicable environment, health and safety legislation and other associated matters; risks associated with governmental regulations regarding climate change and greenhouse gas emissions; risks relating to community relations; maintaining social license to grow and operate; risks related to environmental liabilities including liability for reclamation costs, tailings facility failures and toxic gas releases; uncertainty about the pace of technological advancements required in relation to achieving ESG targets; risks to information technologies systems and cybersecurity; identification and management of growth opportunities; the ability to replace depleted mineral reserves; risk of future noncompliance with debt restrictions and covenants; risks associated with the Corporation’s joint venture partners; variability in production at Sherritt’s operations in Cuba; risks associated with mining, processing and refining activities; potential interruptions in transportation; uncertainty of gas supply for electrical generation; reliance on key personnel and skilled workers; growth opportunity risks; the possibility of equipment and other failures; uncertainty of resources and reserve estimates; the potential for shortages of equipment and supplies, including diesel; supplies quality issues; risks related to the Corporation’s corporate structure; risks associated with the operation of large projects generally; risks related to the accuracy of capital and operating cost estimates; foreign exchange and pricing risks; credit risks; shortage of equipment and supplies; competition in product markets; future market access; interest rate changes; risks in obtaining insurance; uncertainties in labour relations; legal contingencies; risks related to the Corporation’s accounting policies; uncertainty in the ability of the Corporation to obtain government permits; failure to comply with, or changes to, applicable government regulations; bribery and corruption risks, including failure to comply with the Corruption of Foreign Public Officials Act or applicable local anti-corruption law; the ability to accomplish corporate objectives, goals and plans for 2023; and the ability to meet other factors listed from time to time in the Corporation’s continuous disclosure documents.

The Corporation, together with its Moa Joint Venture is pursuing a range of growth and expansion opportunities, including without limitation, process technology solutions, development projects, commercial implementation opportunities, life of mine extension opportunities and the conversion of mineral resources to reserves. In addition to the risks noted above, factors that could, alone or in combination, prevent the Corporation from successfully achieving these opportunities may include, without limitation: identifying suitable commercialization and other partners; successfully advancing discussions and successfully concluding applicable agreements with external parties and/or partners; successfully attracting required financing; successfully developing and proving technology required for the potential opportunity; successfully overcoming technical and technological challenges; successful environmental assessment and stakeholder engagement; successfully obtaining intellectual property protection; successfully completing test work and engineering studies, prefeasibility and feasibility studies, piloting, scaling from small scale to large scale production, , procurement, construction, commissioning, ramp-up to commercial scale production and completion; and securing regulatory and government approvals. There can be no assurance that any opportunity will be successful, commercially viable, completed on time or on budget, or will generate any meaningful revenues, savings or earnings, as the case may be, for the Corporation. In addition, the Corporation will incur costs in pursuing any particular opportunity, which may be significant.

Readers are cautioned that the foregoing list of factors is not exhaustive and should be considered in conjunction with the risk factors described in the Corporation’s other documents filed with the Canadian securities authorities, including without limitation the “Managing Risk” section of the Management’s Discussion and Analysis for the year ended December 31, 2022 and the Annual Information Form of the Corporation dated March 24, 2022 for the year ending December 31, 2021, which is available on SEDAR at www.sedar.com.

The Corporation may, from time to time, make oral forward-looking statements. The Corporation advises that the above paragraph and the risk factors described in this press release and in the Corporation’s other documents filed with the Canadian securities authorities should be read for a description of certain factors that could cause the actual results of the Corporation to differ materially from those in the oral forward-looking statements. The forward-looking information and statements contained in this press release are made as of the date hereof and the Corporation undertakes no obligation to update publicly or revise any oral or written forward-looking information or statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. The forward-looking information and statements contained herein are expressly qualified in their entirety by this cautionary statement.

APPENDIX 1 – RESOURCE AND RESERVE DEFINITIONS

Mineral resource and mineral reserve definitions, according to the “CIM Standards on Mineral Resources and Reserves – Definitions and Guidelines”, are as follows.

MINERAL RESOURCE

A ‘Mineral Resource’ is a concentration or occurrence of solid material of economic interest in or on the Earth’s crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade or quality, continuity and other geological characteristics of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling.

An ‘Inferred Mineral Resource’ is that part of a Mineral Resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade or quality continuity.

An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.

An ‘Indicated Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit.

Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing and is sufficient to assume geological and grade or quality continuity between points of observation.

An Indicated Mineral Resource has a lower level of confidence than that applying to a Measured Mineral Resource and may only be converted to a Probable Mineral Reserve.

A ‘Measured Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or quality, densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and final evaluation of the economic viability of the deposit.

Geological evidence is derived from detailed and reliable exploration, sampling and testing and is sufficient to confirm geological and grade or quality continuity between points of observation.

A Measured Mineral Resource has a higher level of confidence than that applying to either and Indicated Mineral Resource or an Inferred Mineral Resource. It may be converted to a Proven Mineral Reserve or to a Probable Mineral Reserve.

Modifying Factors are considerations used to convert Mineral Resources to Mineral Reserves. These include, but are not restricted to, mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental factors.

MINERAL RESERVE

A ‘Mineral Reserve’ is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified.

The reference point at which Mineral Reserves are defined, usually the point where the ore is delivered to the processing plant, must be stated. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported.

The public disclosure of a Mineral Reserve must be demonstrated by a Pre-Feasibility Study or Feasibility Study.

A ‘Probable Mineral Reserve’ is the economically mineable part of an Indicated, and in some circumstances, a Measured Mineral Resource. The confidence in the Modifying Factors applying to a Probable Mineral Reserve is lower than that applying to a Proven Mineral Reserve.

A ‘Proven Mineral Reserve’ is the economically mineable part of a Measured Mineral Resource. A Proven Mineral Reserve implies a high degree of confidence in the Modifying Factors.

APPENDIX 2 – MOA JV MINERAL RESERVES

The following table is an excerpt from section 1.12 MINERAL RESERVES ESTIMATE of the NI 43-101 to be filed on March 31, 2023.

Table 1.2: Moa Project Mineral Reserves as at 31^st August 2022

Notes:

1. Mineral Reserves are reported with an effective date of 31 August 2022, using the 2014 CIM Definition Standards.
2. The Qualified Person for the estimate is Michiel Breed, a Micon employee.
3. Mineral Reserves are reported on a 100% basis. Sherritt and GNC are equal (50:50) partners in the Moa JV Moa Project.
4. The reporting cut-off is calculated as a Net Value = Revenue from Ni + Revenue from Co – Cost >0, and Ni>=0.7% and Fe>=25%. The costs are equal to the sum of mining costs, processing costs and nickel selling cost of US$2.00/lb, including Moa port and loading, freight and insurance, CRC refining and royalties. The processing cost has a fixed component of US$69.76/t and a variable cost related to Fe, Mg and Al content. Revenue was calculated at the market price of US$7.1/lb for nickel and US$21.3/lb for cobalt, with nickel and cobalt MSP to Product recovery of 98.2% and 92%, respectively. SPP to MSP nickel and cobalt recovery is variable and depends on iron content. Mineral Reserves include a 15% allocation for ore loss and a 5% dilution factor.
5. The Mineral Reserves volume and tonnage have been rounded to reflect the accuracy of the estimate, and numbers may not add up due to rounding.
   

APPENDIX 3 – MOA JV MINERAL RESOURCES

The following table is an excerpt from section 1.11 MINERAL RESOURCE ESTIMATE of the NI 43-101 to be filed on March 31, 2023.

Table 1.1: Mineral Resource Statement for the Moa Project
(per Metallurgical Category - Magnesium) as at 31^st August 2022

Notes:

1. Mineral Resources are reported in situ, with an effective date of 31st August 2022, using the 2014 CIM Definition Standards.
2. The Qualified Person for the estimate is Ms Beatrice Foret, MAusIMM (CP), a Micon employee.
3. Mineral Resources are reported inclusive of those Mineral Resources converted to Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
4. Mineral Resources are reported on a 100% basis. Sherritt and GNC are equal (50:50) partners in the Moa JV Moa Project.
5. The reporting cut-off is calculated as a Net Value = Revenue from Ni + Revenue from Co – Cost >0, and Ni>=0.7% and Fe>=25%. The costs are equal to the sum of mining costs, processing costs and nickel selling cost of US$2.00/lb, including Moa port and loading, freight and insurance, CRC refining and royalties. The processing cost has a fixed component of US$69.76/t and a variable cost related to Fe, Mg and Al content. Revenue was calculated at the market price of US$9.7/lb for nickel and US$28.1/lb for cobalt, with nickel and cobalt MSP to Product recovery of 98.2% and 92%, respectively. SPP to MSP nickel and cobalt recovery is variable and depends on iron content. The cut-off grade for the estimated Mineral Resource is based on similar mining operations in other countries and reasonable assumptions on mining and processing.
6. No stockpiled material is included in the Mineral Resources.
7. The block model grades were estimated using the ordinary kriging method.
8. The Mineral Resources volumes and tonnages have been rounded to reflect the accuracy of the estimate, and numbers may not add up due to rounding. 

APPENDIX 4 – LOM ECONOMIC SUMMARY

The following table is an excerpt from section 22.0 ECONOMIC ANALYSIS of the NI 43-101 to be filed on March 31, 2023.

Table 22.7: LOM Project Summary

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