Mr. Rajat Marwah reports

ALGOMA STEEL AND HANWHA OCEAN SIGN BINDING MEMORANDUM OF UNDERSTANDING (MOU) FOR LONG-TERM STRATEGIC ARRANGEMENT SUPPORTING CANADIAN PATROL SUBMARINE PROJECT

Algoma Steel Group Inc.'s wholly owned subsidiary, Algoma Steel Inc., has entered into a binding memorandum of understanding with Hanwha Ocean Co. Ltd. Canada's future submarine program could soon be supported by Canadian steel, Canadian workers and Canadian industrial expertise under a new long-term strategic arrangement.

The two companies have entered into a binding memorandum of understanding (MOU) to establish a long-term strategic arrangement with an aggregate potential value of $250-million (U.S.) (approximately $345-million (Canadian)), comprising: (i) a cash contribution $200-million (U.S.) (approximately $275-million (Canadian)) toward the potential development of a structural steel beam mill in Sault Ste. Marie, Ont.; and (ii) anticipated purchases of Algoma products with an aggregate value of up to $50-million (U.S.) for use in connection with its Canadian Patrol submarine project (CPSP) related commitments, including submarine construction and the development of maintenance, repair and overhaul (MRO) infrastructure required to support the fleet throughout its operational life cycle in Canada. The MOU is structured to support Hanwha Ocean's ability to satisfy its industrial and technological benefits (ITB) obligations in connection with the CPSP.

The strategic arrangement is intended to strengthen Canada's domestic industrial base while supporting the long-term operational needs of the Royal Canadian Navy. If the contemplated beam mill project goes ahead, the operation would support the creation of new skilled, long-term Canadian jobs.

The MOU is subject to Hanwha Ocean being awarded and entering into an effective contract under the CPSP and the execution of definitive agreements with Algoma. The MOU also provides that Algoma will be required to make annual payments to Hanwha Ocean for 10 years following the commencement of operations of the beam facility equal to 3.0 per cent of the net sales of the beam mill facility, subject to its financial performance.

This arrangement demonstrates Canada's buy Canadian policy at work, ensuring that construction and sustainment activities are rooted in domestic supply chains and supporting industrial sovereignty, supply chain resilience, and high-quality Canadian jobs in an increasingly uncertain global environment.

Hee Cheul Kim, president and chief executive officer of Hanwha Ocean, said: "This partnership is about working side by side with Algoma as a leading Canadian steelmaker to build something lasting. By anchoring steel production, infrastructure and long-term sustainment in Canada, we are committed to strengthening Canada's industrial resilience and supporting a submarine capability that Canadians can rely on today and for generations."

Rajat Marwah, CEO of Algoma Steel, said: "As we usher in a new era for Algoma with electric arc furnace steelmaking and modernized finishing capabilities, this strategic arrangement with Hanwha Ocean represents a foundational step forward in our diversification strategy. It reinforces our focus on becoming Canada's leading sustainable steelmaker, aligned with the country's nation-building priorities in defence and infrastructure. We also recognize and applaud the government of Canada's support for policies that strengthen domestic manufacturing, supply chain resilience and long-term industrial capability."

About Hanwha Ocean

Hanwha Ocean is a leading global shipbuilder with more than four decades of experience in complex naval and commercial shipbuilding programs. Supported by its large-scale, integrated shipyard in Geoje, South Korea, the company combines proven industrial capacity with operational experience to deliver modern, in-service naval platforms backed by a resilient through-life support model.

Since its establishment in 1973, Hanwha Ocean has delivered more than 1,400 vessels worldwide, and has built deep expertise in the design, construction and sustainment of submarines and surface combatants for the Republic of Korea Navy. Hanwha Ocean's shipyards cover an area of approximately five milion square metres, employ around 31,000 people, and build approximately 45 commercial and naval ships each year.

About Algoma Steel Group Inc.

Based in Sault Ste. Marie, Ont., Algoma Steel is a leading Canadian producer of high-quality plate and sheet steel products, proudly supporting critical sectors including energy, defence, automotive, shipbuilding and infrastructure. Guided by a purpose to build better lives and a greener future, Algoma is shaping the next generation of sustainable steelmaking in Canada.

With the transition to electric arc furnace (EAF) steelmaking and a modernized plate mill, Algoma is redefining how steel is made in Canada. Powered by Ontario's clean electricity grid, this transformation represents one of the largest industrial decarbonization initiatives in North America and is expected to reduce carbon emissions by approximately 70 per cent once fully transitioned. These advancements provide stability for continued investment in diversification projects aligned with Canada's evolving needs.

This new chapter also introduces Volta, the brand for all steel produced through Algoma's EAF technology. Volta delivers the same trusted performance customers rely on, with significantly lower emissions-produced safely, sustainably and proudly in Canada. Building on more than a century of steelmaking expertise, Algoma continues to invest in its people, processes and technologies to strengthen domestic supply chains and deliver responsible, Canadian-made steel that helps build a better tomorrow.

We seek Safe Harbor.