Mr. Mark Selby reports

CANADA NICKEL ANNOUNCES CARBON STORAGE TESTING RESULTS BETTER THAN ANTICIPATED; INTEGRATED FEASIBILITY STUDY EXPECTED IN SEPTEMBER

Test work for Canada Nickel Company Inc.'s novel carbon storage process, in-process tailings (IPT) carbonation, is demonstrating results that are significantly above expectations.

Highlights

• Carbon capture test work confirms ability to store one million tonnes of carbon annually;
• Crawford project has potential to achieve 7 per cent of Canada's 15-megatonne carbon removal goal;
• Canada Nickel has received approaches from several large multinational companies seeking carbon storage solutions.

The company also announced that its integrated feasibility study (IFS) is expected to be released in September, following the completion of final engineering design for IPT carbonation. All other engineering work for the Crawford feasibility study has been successfully completed.

Mark Selby, chief executive officer of Canada Nickel, said: "We believe the IPT carbonation process has transformative potential for the company. Our test work demonstrates the ability to efficiently store one million tonnes of CO2 annually when the project is fully ramped up utilizing a process plant design of only 6.5 hours of residence time versus an initial design target of 12 to 24 hours. These results can help contribute to delivering this solution at relatively low capital and operating costs."

Canada Nickel's Crawford project is hosted in ultramafic rock, which naturally absorbs and sequesters CO2. Canada Nickel has developed the novel IPT carbonation process which involves injecting a concentrated source of CO2 into tailings generated by the milling process for a brief period of time. This simple process captures CO2 geologically in the tailings while they are still in the processing circuit, rather than after they have been finally deposited.

"Crawford is poised to be a leader in the energy transition through the large-scale production of critical minerals, including nickel and cobalt, and to become the sole North American producer of chromium, while also supporting Canada's climate objectives through large-scale carbon capture and storage and providing an anchor for a zero carbon industrial cluster in the Timmins-Cochrane region," Mr. Selby added.

Access to the required testing facilities for pilot scale tests to confirm the engineering design for IPT carbonation has been delayed to this summer and, as a result, the integrated feasibility study for the project is now expected to be delivered in September, 2023. This delay has no impact on the overall timeline to production as the company continues to target receipt of permits by mid-2025 with construction to follow. Permitting remains on track and good progress is being made through the second stage of the federal permitting process.

"We are very pleased to reach successful completion of the remainder of the engineering for the Crawford project. Our decision to incorporate our IPT carbonation into an integrated feasibility study has been validated by the multiple approaches we've received from multinationals pursuing comprehensive carbon solutions. I am very proud of our team that is taking our IPT carbonation process from breakthrough to a feasibility study engineered design in just 14 months."

The company believes that the successful incorporation of IPT carbonation could potentially allow a portion of the company's project capital expenditures to become eligible for the carbon capture and storage refundable investment tax credits of 37.5 per cent to 60 per cent for years 2022 to 2030 and 18.75 per cent to 30 per cent for years 2031 to 2040, as announced in the 2022 federal budget. The interest received from multiple large multinational companies pursuing carbon storage solutions further supports the company's belief that the mineral sequestration utilized by the company may be considered an effective carbon storage approach that would meet Environment and Climate Change Canada requirements.

"Canada Nickel has generated significant momentum in 2023 with the strategic investment by Anglo American, our successful completion of the first phase of federal permitting for Crawford, our appointment of Cutfield Freeman & Co. to support the debt portion of our project financing team alongside our equity advisers, Scotiabank and Deutsche Bank, and our ongoing success in our regional exploration program. We expect this momentum to continue through the rest of the year with the completion of the integrated feasibility study, our initial resource estimate and preliminary economic analysis for potential near-term production at our Texmont project, and advancing both the permitting and financing to allow a construction decision to be made for Crawford by mid-2025, when permits are expected to be received," said Mr. Selby.

IPT carbonation test work

In the current phase of test work, Canada Nickel has conducted a series of variability tests to establish the IPT carbonation process engineering design criteria and develop predictive CO2 storage models. The results have exceeded expectations. Testing was done on samples based on their brucite content as well as their location within the deposit with a bias toward material that is expected to be processed in the initial project phases. The results received to date have confirmed the ability to store more than one million tonnes of CO2 per year.

Qualified person and data verification

Arthur G. Stokreef, PEng (Ontario), manager of process engineering and geometallurgy and a qualified person as such term is defined by National Instrument 43-101, has reviewed and approved the technical information in this news release on behalf of Canada Nickel.

About Canada Nickel Company Inc.

Canada Nickel is advancing the next generation of nickel-sulphide projects to deliver nickel required to feed the high-growth electric vehicle and stainless steel markets. Canada Nickel has applied in multiple jurisdictions to trademark the terms NetZero Nickel, NetZero Cobalt and NetZero Iron and is pursuing the development of processes to allow the production of net zero carbon nickel, cobalt and iron products. Canada Nickel provides investors with leverage to nickel in low political risk jurisdictions. Canada Nickel is currently anchored by its 100-per-cent-owned flagship Crawford nickel-cobalt sulphide project in the heart of the prolific Timmins-Cochrane mining camp.

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