Mr. Brendan Yurik reports

ELECTRIC ROYALTIES PROVIDES UPDATE ON PROPOSED ACQUISITION OF MILLION-ACRE LITHIUM OPTION AND LAND PACKAGE IN EASTERN CANADA

Electric Royalties Ltd. has provided an update on the proposed transaction to acquire a portfolio of 126 lithium properties (Ontario lithium projects (OLP)) in Eastern Canada. For an overview on the lithium properties and proposed transaction terms, please see Electric Royalties' news release dated Nov. 6, 2023.

Brendan Yurik, chief executive officer of Electric Royalties, commented: "We are progressing our due diligence on the OLP, an opportunity to participate in one of the most exciting early-stage exploration areas in North America, at a time when Canadian-sourced lithium is increasingly prized for shortening supply chains for U.S. battery plants."

Lithium outlook, lithium development in Ontario and overview of selected projects in the OLP

The shift to clean energy systems is forecast to drive a significant increase in the demand for battery metals and this is particularly true in the case of lithium. Lithium is a key component in current and anticipated battery chemistries. According to the International Energy Agency (IEA)'s sustainable development scenario (SDS), clean energy technologies will ultimately account for 90 per cent of the demand for lithium, which could result in a 40fold increase in demand by 2040.

New sources of lithium will need to be developed and, equally important, new processing facilities will need to be built to meet long-term demand. Finding new lithium deposits in proximity to where the metal is processed into products suitable for battery production is imperative to secure supply chains. Complex supply chains and foreign sources of supply increase the risk of exposure to physical disruption and trade restrictions, while increasing the carbon footprint of the process.

Ontario is a province with a deep-rooted mining tradition, abundant clean hydroelectric and nuclear power, and a skilled mining work force. The permitting environment in Ontario is rigorous, fair and process based, and both the federal and provincial governments are supportive of battery metal projects as shown in their recent investments and initiative.

Access to sustainable power, abundant water and skilled staff makes mine development and permitting easier and it is one of the compelling reasons for Electric Royalties' interest in the OLP acquisition. The properties cover a collective area of over one million acres and are adjacent to some of the most prominent lithium exploration and development plays in North America.

One of the most advanced and high-grade lithium projects in Ontario is Frontier Lithium's PAK and Spark deposits on which a positive prefeasibility study was recently announced. Further, Frontier has recently received a grant from the Ontario government to advance its understanding of the processing of lithium into battery metal products. Electric Royalties' proposed OLP acquisition includes two large unexplored, optioned claim groupings located less than 10 kilometres from the Frontier projects and adjacent to terrane hosting geologically favourable two-mica granitic rocks.

One of the most exciting new lithium exploration stories in Ontario is the emerging Root Bay project being advanced by Green Technology Metals. Drilling programs completed in the last 1.5 years resulted in the announcement of a 9.4-million-tonne (Mt) indicated resource grading 1.3 per cent lithium oxide (Li2O) for Root Bay and a 4.5-million-tonne inferred resource grading 1.01 per cent Li2O for the associated McCombe deposit, at a 0.2-per-cent Li2O cut-off, reported under the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. The OLP includes numerous claims in this area, staked prior to the Root Bay discovery. Many of these claims are on or near to the subprovince terrane boundary, host numerous tourmaline occurrences and are on or near the Root Bay pluton -- all of which are key exploration indicators of lithium-bearing pegmatites. One such claim in the OLP, the Surge property, was optioned to Xplore Resources Ltd. and is located less than two kilometres from the Root Bay deposit. Another claim group in the OLP, the Harrison Road property, was sampled by the Ontario Geological Survey (OGS) and returned anomalous lithium values in lake sediments; hence, it is considered to be prospective.

Rock Tech Lithium's Georgia Lake project is also one of the more advanced integrated lithium development projects in Ontario. Rock Tech Lithium is, reportedly, pursuing a vertically integrated strategy which not only includes development of the Georgia Lake deposit, but also the construction of a lithium processing plant. The plan is to build a facility that is capable of processing material from various sources and is adaptable to the region's growing lithium industry. There is tremendous exploration potential in the Georgia Lake area as it has been described as the largest concentration of rare-element mineralization in the Superior Province of Ontario. Other companies have reported interesting results from work in the Georgia Lake district. Tearlach Resources recently announced the results of channel sampling which ranged from 1.56 per cent Li2O over three metres to 4.04 per cent Li2O over 0.7 metre in channel samples on its property.

The OLP includes the largest land position in the Georgia Lake lithium district. One of the properties is 20 kilometres east of the Rock Tech pegmatites. The Arrel Lithium property is underlain by a muscovite-bearing peraluminous granite and is in contact with metasediments which make excellent hosts for pegmatites.

Completion of the proposed Transaction remains subject to a number of conditions, including the satisfactory completion of due diligence; board approval; the receipt of any required regulatory approvals; and the negotiation of definitive documentation.

David Gaunt, PGeo, a qualified person who is not independent of Electric Royalties, has reviewed and approved the technical information in this release.

About Electric Royalties Ltd.

Electric Royalties is a royalty company established to take advantage of the demand for a wide range of commodities (lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc and copper) that will benefit from the drive toward electrification of a variety of consumer products: cars, rechargeable batteries, large scale energy storage, renewable energy generation and other applications.

We seek Safe Harbor.