Dr. Jean-Marc Lulin reports

AZIMUT AND RIO TINTO SIGN AGREEMENTS FOR THE CORVET AND KAANAAYAA LITHIUM PROPERTIES, JAMES BAY REGION, QUEBEC

Azimut Exploration Inc. signed, on July 7, 2023, two option to joint venture agreements with Rio Tinto Exploration Canada Inc. (RTEC or Rio Tinto) for its wholly owned Corvet and Kaanaayaa lithium properties. The agreements contemplate an aggregate value of up to $115.7-million in expenditures and cash payments.

The properties are located in Quebec's Eeyou Istchee James Bay region.

Rio Tinto Exploration Canada is a Canadian subsidiary of Rio Tinto Group, a leading global mining group focused on finding, mining and processing the Earth's mineral resources.

Highlights:

• Under the agreements, Rio Tinto can acquire an initial 50-per-cent interest on each of the properties from Azimut over four years by financing $7-million in exploration expenditures and by making cash payments totalling $850,000 per property (combined $14-million in expenditures and $1.7-million in payments, including $250,000 on signing per property). Azimut will be the operator during this first option phase. Exploration expenditures and cash payments, including a firm commitment of $1.5-million per property in the first 12 months, will initiate following the lifting of wildfire restrictions in Quebec.
• Rio Tinto can earn an additional 20-per-cent interest over five years with further work expenditures of $50-million per property ($100-million combined). Rio Tinto will act as the operator during this second option phase.
• Azimut holds the right, should it choose, to be financing to production by way of secured loan from Rio Tinto by granting Rio Tinto an additional 5-per-cent interest in the properties (for a total interest of 75 per cent).
• The first-year exploration program will aggressively assess and test the lithium potential of the properties ($1.5-million per property).

The properties display significant lithium exploration potential supported by regional geoscientific data and their strategic locations relative to a major emerging lithium district.

• The Corvet property (877 claims, 423 square kilometres) is 33 kilometres long and straddles a major tectonic boundary. The main geological features of interest are granitic intrusions surrounded by paragneiss. The property covers an outstanding exploration target represented by an extensive and prominent 26-kilometre-long lithium anomaly in lake sediments coupled with strong cesium, rubidium, gallium and tin (Cs-Rb-Ga-Sn) footprints.
• The Kaanaayaa property (421 claims, 216 square km) is 25.6 kilometres long and hosts several granitic intrusions surrounded by paragneiss and metavolcanics, including ultramafic rocks. Several coincidental Li-Cs-Rb-Ga anomalies have been identified from detailed multielement lake sediment geochemistry.

While the exploration programs under the agreements will focus on identifying lithium-cesium-tantalum (LCT) pegmatites, both properties also have strong potential for intrusion-related gold-copper and magmatic nickel-copper-cobalt mineralization.

Key terms of the agreements

Each property is subject to its own agreement, whereby Rio Tinto can acquire an initial 50-per-cent interest in the property by fulfilling the following conditions over four years:

• Financing work expenditures of $1.5-million in the first year (firm commitment) and $5.5-million in subsequent years for a total of $7-million per property;
• Making cash payments of $250,000 on signing within 45 days of the commencement date and $150,000 on each anniversary of the commencement date, for a total of $850,000 per property.

Upon earning a 50-per-cent interest, Rio Tinto can earn an additional 20 per cent by financing work expenditures of $50-million over five years per property. Rio Tinto will act as the operator during this second option phase.

Upon Rio Tinto earning a 70-per-cent interest, Azimut will have the option to be financed to production by way of secured loan from Rio Tinto in exchange for an additional 5-per-cent interest in the property. At this stage, the respective interests in the property will be Azimut 25 per cent, Rio Tinto 75 per cent. If exercised, the loan shall accrue interest at the secured overnight financing rate plus 4.5 per cent per annum, to be paid back from 50 per cent of the cash flow from production.

The parties are dealing at arm's length. The agreements remain subject to regulatory approvals by the TSX Venture Exchange.

This press release was prepared by Dr. Jean-Marc Lulin, PGeo, acting as Azimut's qualified person within the meaning of National Instrument 43-101.

About Azimut Exploration Inc.

Azimut is a leading mineral exploration company with a solid reputation for target generation and partnership development. The company holds the largest mineral exploration portfolio in Quebec. Its wholly owned flagship Elmer gold project is progressing to the initial resource stage in the James Bay region. Azimut also controls a strategic land position for copper-gold, nickel and lithium.