Mr. Julian Treger reports

COTEC HOLDINGS CORP. TO INCREASE INTEREST IN MAGINITO THROUGH LOAN NOTE CONVERSION

Cotec Holdings Corp. has notified Mkango Resources Ltd. and Maginito Ltd. of its intention to increase its equity position in Maginito from 10 per cent to approximately 20.6 per cent.

Cotec intends to convert its two-million-pound convertible loan note in Mkango into Maginito stock on completion of Maginito's recently announced acquisition of the 58-per-cent equity interest in HyProMag it does not already own.

HyProMag's patented hydrogen processing of magnet scrap technology (HPMS) enables the recovery and recycling of rare earth magnets embedded in scrap sources such as electronic waste, electric motors and wind turbines. HyProMag has the added capability to then remanufacture the recovered material into rare earth magnets with a significantly reduced carbon footprint. The HPMS technology has benefited from approximately $100-million (U.S.) in research and development expenditure at the University of Birmingham in the United Kingdom and with associated project partners. A pilot plant was successfully launched in the U.K. in 2022 and a scaled-up plant is expected to be commissioned later this year, with first production is targeted for Q4 2023. A second plant is being developed in Germany with expected commissioning and first production targeted for 2024. These projects have received grant funding from the U.K. and German governments.

In February, 2023, Cotec and Maginito entered into a co-operation agreement in relation to rare earth element (REE) opportunities in the United States. Pursuant to this agreement, the parties are in the process of forming a 50/50 joint venture for the rollout of the HyProMag technology in the U.S. Scoping studies and site selection are under way ahead of the feasibility study. Discussions with the U.S. government, potential customers and recycling partners have commenced and are continuing. The U.S. rollout will be completed in parallel with the U.K.- and German-based developments and will benefit from operational experience and production ramp-up in the U.K. and Germany. Revenue from the U.S. operation is targeted for 2025/2026.

Julian Treger, Cotec chief executive officer, commented: "This conversion will simplify our investment structure in the exciting and revolutionary HyProMag technology to a 20.6-per-cent equity interest in Maginito and a 50-per-cent interest in the U.S. operations. The acquisition of HyProMag by Maginito is a significant milestone for all parties involved and we are looking forward to working with the Maginito and HyProMag team in the rollout of this venture in the U.S.

"The Maginito investment and subsequent operational rollout is an example of the Cotec business model of acquiring minority positions in disruptive technology combined with joint venture participation at an operational level. It also allows Cotec to commence, together with its other operational opportunities, its transition from a technology investment company to resource producer."

About Cotec Holdings Corp.

Cotec is an ESG-focused (environmental, social, governance) company investing in innovative technologies which have the potential to fundamentally change the way metals and minerals can be extracted and processed. The company is committed to supporting the transition to a lower-carbon future for the extraction industry, a sector on the cusp of a green revolution as it embraces technology and innovation. Cotec is a publicly traded mining issuer listed on the Toronto Venture Stock Exchange and the OTCQB.

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