Mr. Garrett Ainsworth reports

DISTRICT SIGNS DEFINITIVE AGREEMENT TO ACQUIRE 2.0% NSR ROYALTY ON VIKEN ENERGY METALS DEPOSIT IN SWEDEN

District Metals Corp. has entered into a definitive royalty purchase agreement with an arm's-length vendor to acquire the 2.0-per-cent net smelter return (NSR) royalty previously granted by the company over the remaining four mineral licences (Norra Leden, Norr Viken, Lill Viken and Storviken) covering the Viken deposit, located in Jamtland county, central Sweden (see news release dated Jan. 15, 2024). As a result, subject to closing, District's 100-per-cent-owned Viken deposit is now completely free of any NSR royalty.

Pursuant to the purchase agreement, District will acquire the 2.0-per-cent NSR royalty for a purchase price consisting of 500,000 common shares of District. Closing of the purchase agreement remains subject to TSX Venture Exchange approval. The consideration shares will be subject to a hold period of four months and one day from the date of issue.

Garrett Ainsworth, chief executive officer of District, commented: "District consolidated 100 per cent of the Viken energy metals deposit in January, 2024, and we have now executed a definitive agreement to make the Viken deposit free and clear of any and all NSR royalties. Alum Shales are the host rock for the Viken deposit, which contains critical energy metals essential for the green energy transition that include uranium, vanadium, nickel, molybdenum, copper, zinc and rare earth elements. Additionally, Alum Shales present the potential to produce significant amounts of sulphate of potash, which would greatly benefit the agriculturally dominant Jamtland county.

"The timing of this acquisition comes after the Swedish government released their inquiry report on lifting the uranium moratorium and their supporting press release that we commented on here."

Viken deposit

The Viken deposit is situated in the province of Jamtland, approximately 570 kilometres northwest of Stockholm, Sweden. Infrastructure is well developed in the area with daily air service as well as rail and truck freight services. Electrical power and modern communications are also readily available in the area.

The Geological Survey of Sweden (SGU) carried out work on the Alum Shales from 1977 to 1978 and drilled approximately 19 holes within and in the vicinity of the Viken deposit. In 2005, Continental Precious Minerals Inc. (CPM) purchased mineral licences that covered prospective Alum Shales, where CPM drilled 26,293 metres in 133 holes from 2006 to 2008 to delineate the Viken deposit.

CPM retained P&E Mining Consultants Inc. to carry out a mineral resource estimate and preliminary economic assessment in 2010 that resulted in the following historical mineral resource estimate.

In 2012, a bio-heap-leach scenario was evaluated, and P&E Mining Consultants was retained again to conduct an updated mineral resource estimate and preliminary economic assessment on the Viken deposit with the following historical estimate.

The Viken deposit is a polymetallic shale resource contained within the Cambrian Viken shale, which regionally is referred to as the Alum Shale. The Alum Shale is enriched in metals such as vanadium, uranium, nickel, copper, zinc and molybdenum. It also contains significant concentrations of potash. Alum Shale occurs over a significant area in Sweden and is locally valued as a bituminous shale with recoverable hydrocarbons. The Alum Shale is regionally extensive in Sweden.

The stratigraphy across the Viken property consists of Upper Middle age and Upper Cambrian age Alum Shale occurring as both in situ and fault detached blocks, with the latter having greater potential for economic mineralization due to imbrication of mineralized blocks. The Alum Shale is mostly exposed at surface and is underlain by Proterozoic granites and gneisses thrust Eastward over Archean granitic basement rocks. The thickness of the Alum Shale host rock has been tectonically thickened from 20 to 30 m by thrusting and folding during the Silurian to approximately 180 m.

Mineralization of potential economic significance is hosted in Middle and Upper Cambrian Alum Shale, with the Upper Cambrian age strata more enriched in vanadium and uranium than the Middle Cambrian. Vanadium occurs within the lattice of a mica mineral named roscoelite. Uranium values are predominantly associated with submicron-scale uraninite crystals. Nickel, molybdenum, copper and zinc are present as sulphides.

Technical information

All scientific and technical information in this news release has been prepared by or approved by Garrett Ainsworth, PGeo, president and chief executive officer of the company. Mr. Ainsworth is a qualified person for the purposes of National Instrument 43-101, Standards of Disclosure for Mineral Projects.

Drilling data disclosed in this news release relate to historical drilling results. District has not undertaken any independent investigation of the sampling, nor has it independently analyzed the results of the historical exploration work in order to verify the results. District considers these historical drill results relevant as the company is using these data as a guide to plan exploration programs. The company's current and future exploration work includes verification of the historical data through drilling.

About District Metals Corp.

District Metals is led by industry professionals with a record of success in the mining industry. The company's mandate is to seek out, explore and develop prospective mineral properties through a disciplined science-based approach to create shareholder value and benefit other stakeholders.

District is a polymetallic exploration and development company focused on the Viken and Tomtebo properties in Sweden. The Viken property covers 100 per cent of the Viken uranium-vanadium deposit, which is an asset with substantial exploration and development expenditures that resulted in the definition of historic polymetallic resource estimates in 2010 and 2014.

The advanced-exploration-stage Tomtebo property is located in the Bergslagen mining district of south-central Sweden and is situated between the historic Falun mine and Boliden's Garpenberg mine, which are located 25 kilometres to the northwest and southeast, respectively. Two historic polymetallic mines and numerous polymetallic showings are located on the Tomtebo property along an approximately 17-kilometre trend that exhibits similar geology, structure, alteration and VMS/sedex-style (volcanogenic massive sulphide/sedimentary exhalative) mineralization as other significant mines within the district.

For further information on the Tomtebo property, please see the technical report entitled "NI 43-101 Update Technical Report on the Tomtebo Project, Bergslagen Region of Sweden," dated effective Oct. 15, 2020, and amended and restated on Feb. 26, 2021, which is available on SEDAR+.

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