Mr. Dan Sutton reports

SYNTHOLENE ENERGY SIGNS SITE LEASE AND RECEIVES CONSTRUCTION PERMIT AT HISTORIC HUSAVIK POWER STATION FOR DEMONSTRATION FACILITY

Syntholene Energy Corp. has entered into a definitive land lease agreement dated April 13, 2026, with the Municipality of Norturtingi (the lessor) in respect of a 500-square-metre site (the property) at the Husavik power station as the company's first Icelandic site. The company plans to use the property as the location for its first demonstration-scale thermally integrated electrolyzer (the demonstration facility). Syntholene is also pleased to announce that it has received municipal approval for its construction permit in Husavik, Iceland, marking a key regulatory milestone in the advancement of its demonstration facility.

Katrin Sigurjonsdottir, Mayor of Norturting, stated: "The municipality of Norturting, owner of Husavik Energy, is proud to support the development of Syntholene through its demonstration facility for non-fossil aviation fuel. Syntholene's goals of the sensible use of geothermal energy to produce cost effective and environmentally friendly synthetic fuel for the benefit of society, align with the goals of the municipality of Norturting. We look forward to supporting this initiative to make possible the expansion of the project and meet domestic demand for aviation fuel."

"This lease and permit represents a transformational step in establishing Syntholene's Icelandic footprint," said Dan Sutton, chief executive officer of Syntholene. "The site at Husavik power station offers an exceptional combination of geothermal availability, infrastructure, work force readiness and political alignment. It provides a strategic launch point for our first demonstration facility while offering Syntholene a pathway to scale in one of the most geothermally abundant regions on Earth.

"We are honoured to work with the community of Husavik and its leadership at a time when new industrial diversification is desired by the community," Mr. Sutton added. "Syntholene aspires to help build long-term economic diversification in the region, while advancing our mission to deliver ultrapure, cost-competitive synthetic fuels."

The lease agreement and the Husavik power station

Located inside the town of Husavik and adjacent to a commercial port, the Husavik power station represents a preserved geothermal energy centre, including heat exchangers, district-heating ties, water cooling systems and a 20-kilometre insulated geothermal pipeline from the Hveravellir geothermal field in Reykjahverfi.

Although the two-megawatt Kalina power unit has not produced electricity since 2010, the facility was not dismantled, its district-heating systems remain active and its core mechanical systems remain intact. Such attributes are expected to reduce early stage civil works, reduce schedule risk and lower capital requirements compared with other comparable development sites, and enable Syntholene to integrate its high-temperature thermal coupling and solid oxide electrolyzer cell (SOEC) demonstration system into an existing thermal footprint.

The lease agreement will remain in effect until April 1, 2027, unless renewed by the parties or earlier terminated in accordance with its terms. Under the terms of the lease agreement the company is responsible for maintaining the property, ensuring that all activities comply with applicable laws and regulatory requirements and that all necessary permits are obtained and maintained. A rental fee of 200,000 Icelandic krona (approximately $2,525) per month is payable during the term of the lease, and additional fees may be payable for use of certain facilities. The lease agreement provides that the company is required to obtain the lessor's consent prior to constructing any buildings or structures other than those specifically contemplated in the approved site plans on the property.

Construction permit issued

The local planning and development authority of Norturting Municipality granted the company a construction permit with respect to the property at its March 17, 2026, meeting.

The permit is effective until the end of March, 2027, and is subject to the planning and development authority receiving approval from the lessor. Subject to the conditions of grant being satisfied, this approval enables Syntholene to proceed with on-site preparation and construction activities, including the deployment of its modular, containerized demonstration facility integrating geothermal heat exchange and solid oxide electrolysis systems. The permitting process included co-ordination with local authorities to ensure alignment with land use planning, environmental considerations and safety requirements associated with hydrogen-integrated industrial operations.

The time-bound nature of the permit reflects the demonstration facility's classification as a temporary scientific and industrial demonstration, designed to validate system performance under real-world operating conditions. During the permitted period, the company intends to execute its approximately 1,000-hour effects test operational program, with a view to generating critical data to support engineering optimization, inform regulatory pathways and validate commercial scale-up.

Receipt of the permit represents achievement of a significant milestone and further evidence of the strong support and cooperation of the Norturting Municipality as Syntholene advances its presence in the region.

About Husavik and Norturtingi: a region positioned for long-term expansion

Husavik has a decades-long history of hosting large-scale industrial energy users, including silicon processing, shrimp processing, greenhouse operations, fish farming and municipal heating infrastructure. The municipality of Norturting and the government of Iceland have prioritized north Iceland for diversification and new industrial anchors (Soknaraatlun Norturlands eystra), creating uniquely aligned political, work force and infrastructure environments for Syntholene's demonstration facility.

The area surrounding Husavik is one of Iceland's most capable geothermal corridors. The demonstration facility intends to draw on the existing Hveravellir geothermal resource for thermal integration, and the Teistareykir high-temperature geothermal field represents an opportunity for potential long-term commercial expansion enabled by the Teistareykir high-temperature geothermal field, with an operational 90 MW geothermal power station environmentally assessed for up to 200 MW of expanded production capacity (Landsvirkjun).

Landsvirkjun, Iceland's national power company, also recently confirmed major investment plans for North Iceland's transmission system including new substations and 132-kilovolt line expansions (RUV), to attract next-generation industrial customers such as clean fuels and hydrogen.

The expansion ambitions for the Teistareykir geothermal field represent the cornerstone of Iceland's transition toward next-generation industrial applications. While the power station currently operates at a capacity of 90 MW, consisting of two 45 MW units commissioned in 2017 and 2018, the power station was designed with significantly higher long-term potential (Lansvirkjun).

According to the 2015 environmental impact assessment (EIA) overseen by the National Planning Agency, the site is environmentally cleared for a total production capacity of up to 200 MW (EIB). This expansion is supported by extensive reservoir modelling. Landsvirkjun's 2026 investment cycle prioritizes the utilization of this additional 110 MW to support energy-intensive industrial sectors (Lansvirkjun).

By leveraging the Teistareykir field's high-temperature steam, the expansion aims to provide the stable, renewable baseload power required for emerging industrial operations such as clean fuel synthesis, hydrogen production and the diversification of the North Iceland geothermal corridor.

Husavik also benefits from its deepwater port access, two airports (Husavik Regional and Akureyri International), and existing logistics infrastructure that support modular imports, equipment staging and future exports of synthetic fuels to domestic and international markets.

HD IS appointed as general contractor

Syntholene Energy also announces that it has appointed HD ehf. (HD IS), a leading Icelandic engineering and construction services firm, as general contractor for the company's demonstration facility in Husavik, Iceland. The appointment represents a critical step in advancing the company's development timeline by establishing a locally anchored execution partner with direct experience in Icelandic infrastructure delivery, regulatory co-ordination and industrial project management.

Under the terms of the agreement, HD IS will act as general contractor for early phase site execution activities, including overall project co-ordination, subcontractor management across civil, mechanical and electrical scopes, and day-to-day site supervision. The mandate also includes the development and implementation of a comprehensive health, safety and environmental (HSE) framework tailored to a hydrogen-integrated demonstration environment, incorporating permit-to-work systems, lifting and hot works controls, interface management, and incident reporting protocols.

In parallel, HD IS will support permitting workflows and regulatory engagement with local Icelandic authorities, maintaining compliance tracking systems and identifying all outstanding requirements ahead of commissioning.

The engagement of HD IS reinforces Syntholene's strategy of partnering with experienced, regionally embedded contractors to reduce project execution risk and accelerate project timelines. With established capabilities in Icelandic project delivery and familiarity with local regulatory frameworks, HD IS is expected to play a central role in bridging engineering design, site readiness and targeted construction phases as the company progresses toward commissioning.

The appointment of HD IS builds on Syntholene's broader development efforts in Husavik and aims to position the company to advance its demonstration program with a co-ordinated, safety-focused and execution-driven approach, laying the groundwork for future scale-up of its synthetic fuel production platform.

"We are very proud to have been selected as a partner by Syntholene Energy for this ambitious project in Husavik," stated Arni Rafn Gislason, chief executive officer of HD IS. "It is particularly exciting to be part of a project focused on innovation and the development of sustainable energy solutions. This project aligns well with our core strengths and our vision of building and operating infrastructure that supports the energy transition and the development of future industries in Iceland."

About Syntholene Energy Corp.

Syntholene is actively commercializing a new production pathway for low-cost clean fuel synthesis. The target output is ultrapure synthetic jet fuel, manufactured at 70-per-cent lower cost than the nearest competing technology. The company's mission is to deliver the world's first truly high performance, low-cost and carbon-neutral synthetic fuel at an industrial scale.

Founded by experienced operators across advanced energy infrastructure, nuclear technology, low-emissions steel refining, process engineering and capital markets, Syntholene aims to be the first team to deliver a scalable modular production platform for cost-competitive synthetic fuel, thus accelerating the commercialization of carbon-neutral e-fuels across global markets.

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