Mr. Adrian Smith reports

FIRST ATLANTIC NICKEL & COBALT HIGHLIGHTS G7 LEADERS' DECLARATION ON CRITICAL MINERALS: G7 NAMES NICKEL ONE OF ONLY TWO PILOT MINERALS FOR A NEW ALLIED TRACEABILITY FRAMEWORK, MOVES TO MOBILIZE EQUITY INVESTMENT AND OFFTAKE, AND ESTABLISHES A CRITICAL MINERALS RESILIENCE AND PRODUCTION ALLIANCE

First Atlantic Nickel & Cobalt Corp. has commented on the G7 leaders' Declaration on Securing Supply Chains for Critical Minerals, issued at the 2026 G7 Summit in Evian, France, on June 17, 2026.

The declaration names lithium and nickel as the first two pilot critical minerals for a new G7-wide traceability framework; commits G7 governments to mobilize equity investment, guarantees and offtake to close the investment gap before 2030; and establishes a new G7 critical minerals resilience and production alliance to co-ordinate financing, diversification and transparency across allied jurisdictions.

Nickel and cobalt are two of Canada's six priority critical minerals, singled out from a list of 312. Both are also designated as critical minerals in the United States, where nickel holds a dual energy-and-defence designation. First Atlantic's wholly owned Pipestone XL nickel-cobalt alloy project is located in Newfoundland, a G7 jurisdiction, and is being advanced as an allied source of awaruite, a naturally occurring nickel-iron-cobalt alloy.

Awaruite (Ni3Fe) offers a pathway to fully vertical critical mineral supply chains inside the G7. Because this sulphur-free, naturally magnetic alloy already exists in metallic form, magnetic separation and flotation can upgrade it directly into a high-grade concentrate of approximately 60 per cent nickel, without the smelting, roasting or high-pressure acid leaching that conventional processing requires and without the associated electricity demand, emissions and acid-mine-drainage risk. Awaruite concentrate can move directly into downstream battery refining, stainless steel, specialty alloys, aerospace and defence manufacturing. The company believes this pathway is directly relevant to the processing capacity the G7 is mobilizing to build outside any single dominant supplier.

The U.S. Geological Survey identified this advantage in its 2012 Mineral Commodity Summaries, "Awaruite, a natural iron-nickel alloy, is much easier to concentrate than pentlandite, the principal sulphide of nickel." Today, Chinese firms control roughly 75 per cent of Indonesia's nickel refining capacity, while Indonesia represents a growing share of the world's processed nickel and cobalt supply. According to the U.S. Geological Survey's 2026 Mineral Commodity Summaries for nickel, Indonesia alone accounted for approximately two-thirds of global nickel mine production in 2025, producing 2.6 million of the world's 3.9 million tonnes. Awaruite's simple magnetic-separation and flotation processing can produce a high-grade concentrate at the mine site for direct downstream use in stainless steel, EV (electric vehicle) battery refining, specialty alloys and other applications, offering a solution to constrained mid-stream smelting capacity in G7 countries.

On May 21, 2026, the company announced electron microprobe analysis by SGS Canada Inc. confirming that awaruite at the Pipestone XL project's RPM zone averages 77.62 per cent nickel and 1.69 per cent cobalt.

On June 15, 2026, the company announced a second large-scale awaruite discovery at the Alloy Max zone, where discovery hole XL-26-15 intersected visible awaruite over its entire 414-metre length and ended in open mineralization.

Key points:

1. Nickel is one of only two pilot critical minerals selected by the G7: The declaration commits the G7 to harmonized, interoperable traceability mechanisms beginning with two pilot critical minerals, lithium and nickel, before extending to five new minerals each year. The company believes this places nickel at the front of a multiyear allied effort to track, verify and prioritize trusted-source supply.
2. The G7 recognizes the need to mobilize equity investment, guarantees and offtake: The declaration recognizes that building processing and recycling capacity requires public and private capital, including equity investments, guarantees and offtake arrangements, and tasks G7 development finance institutions and export credit agencies with co-ordinating on critical minerals with the private sector. Canada and the United States are both G7 members and founding members of the Minerals Security Partnership.
3. The G7 targets processing capacity outside a single dominant supplier: The declaration commits members to building processing and industrial capacity to reduce dependence on a single supplier outside the G7. Awaruite's magnetic-separation pathway is designed to bypass the mid-stream smelting step entirely, addressing a processing bottleneck that has contributed to G7 reliance on smelting capacity in non-G7 countries.
4. A new G7 critical minerals resilience and production alliance: The declaration establishes a non-binding alliance, open to like-minded partners, to co-ordinate diversification and resilience across the entire supply chain. Canada is a G7 member and helped launch its predecessor, the Critical Minerals Production Alliance, under the 2025 Canadian G7 presidency.

The G7 selected nickel as one of only two pilot critical minerals

Under the heading "Transparency and traceability," the G7 leaders state: "Acknowledging ongoing work by the Organisation for Economic Cooperation and Development (OECD) and International Energy Agency (IEA), we are committed to working towards establishing harmonized, interoperable mechanisms aligned with our interests that ensure traceability and transparency regarding the origin of critical minerals. This would start with two pilot critical minerals -- lithium and nickel -- and aim to avoid undermining competitiveness or imposing excessive cost burdens. We will seek to extend the pilot to five new critical minerals each year, with particular attention given to rare earths."

Nickel and lithium were selected as the two pilot critical minerals to launch the G7's new traceability framework. The company believes this selection underscores the strategic priority allied governments place on verifying the origin of nickel from trusted jurisdictions, including Canada.

The G7 commits to equity investment, guarantees and offtake

Under the heading "Financing," the G7 leaders state: "We recognize that the development of industrial capacity, including processing and recycling, necessary for diversification, requires the mobilization of public and private capital, including equity investments, guarantees and offtakes. We recognize the increasing need for stable investment frameworks and for market transparency and valuation for the security of supply. This could incentivize financing of the critical minerals value chains to bridge the investment gap before 2030."

The declaration tasks G7 development finance institutions and export credit agencies with co-ordinating on critical minerals with the private sector. Canada and the United States are both G7 members and were among founding members of the Minerals Security Partnership. The company believes this reflects an emerging allied financing architecture for critical minerals projects in trusted jurisdictions, including nickel and cobalt projects.

The G7 stands against the weaponization of mineral dependence

In its opening, the G7 leaders state: "We express our grave concerns regarding the use of non-market policies and practices and economic coercion, including arbitrary export restrictions and retaliatory measures on critical minerals and their related dual-use items, all of which undermine economic security and resilience. We will work together with partners to reduce critical dependencies and ensure that attempts or threats to weaponize economic dependencies fail."

The reference to "dual-use items" is consistent with nickel's strategic importance to both energy supply chains and the defence industrial base. Pipestone XL is positioned to supply nickel and cobalt to downstream industries spanning batteries, stainless steel, specialty alloys, aerospace and defence.

New G7 critical minerals resilience and production alliance

Under the heading "Critical Minerals Resilience and Production Alliance," the G7 leaders state: "To achieve these objectives and ensure long-term co-ordination of our efforts, we establish a non-binding G7 Critical Minerals Resilience and Production Alliance, whose terms are annexed to this declaration. This initiative builds on the existing Critical Minerals Production Alliance and will be open to like-minded partners subject to the approval of participating countries."

The predecessor body was established under the Canada's G7 presidency in 2025. Australia, a G7 partner country, has also expressed support for the declaration. The company believes the new alliance may provide a durable, multiyear platform for longer-term co-ordination among allied countries on critical minerals supply chains, including nickel and cobalt projects in trusted jurisdictions.

Nickel and cobalt: Canada's priority minerals, now at the front of the G7 agenda

Of the 34 minerals on Canada's critical minerals list, the federal government has prioritized six: lithium, graphite, nickel, cobalt, copper and rare earth elements. Both nickel and cobalt are included in that priority group. In the G7 declaration, nickel is now one of only two minerals, alongside lithium, chosen to pilot the allied traceability framework.

The alignment is direct. Nickel is one of Canada's six priority critical minerals and is now at the front of the G7's traceability effort. First Atlantic's strategy is built around these same priorities: trusted-source supply, mid-stream processing, and allied co-ordination on financing and offtake.

First Atlantic believes the policy direction reflected in the G7 declaration is consistent with the company's broader strategy to advance a North American nickel-cobalt project capable of supporting downstream industries in the United States and Canada, including battery refining, stainless steel, specialty alloys, defence manufacturing and advanced industrial applications.

Awaruite: a smelter-free nickel-cobalt alloy

Awaruite is a naturally occurring, sulphur-free nickel-iron-cobalt alloy of approximately 77 per cent nickel. Because it already exists in metallic form, it can be processed into a high-grade concentrate of approximately 60 per cent nickel by magnetic separation and flotation (without smelting, roasting or high-pressure acid leaching) and sent directly to downstream battery-chemical refining or the manufacture of specialty alloys and stainless steel.

As stated in the August, 2025, report, From Rocks to Power: Strategies to Unlock Canada's Critical Minerals for Global Leadership in Energy Storage, EVs, & Beyond, from the Battery Metals Association of Canada: "Awaruite is not a sulphide nor an oxide nickel ore but a high-content native nickel-iron ore. Simple beneficiation processes after mining could provide 60-per-cent-nickel concentrate, ready for leaching for battery cathode purposes and would yield MHP [mixed hydroxide precipitate] as a byproduct. This process would bypass pyrometallurgy or early hydrometallurgy stages and be among the lowest carbon-intensive nickel production sites in the global nickel market."

The U.S. Geological Survey highlighted awaruite's potential in its Mineral Commodity Summaries 2012, stating: "The development of awaruite deposits in other parts of Canada may help alleviate any prolonged shortage of nickel concentrate. Awaruite, a natural iron-nickel alloy, is much easier to concentrate than pentlandite, the principal sulphide of nickel."

The absence of sulphur reduces the risk of acid mine drainage and certain permitting challenges commonly associated with sulphide mineralization, positioning awaruite to supply North American industries including stainless steel, electric vehicles, aerospace and defence.

Investor information

The company's common shares trade on the TSX Venture Exchange under the symbol FAN, the American OTCQB exchange under the symbol FANCF and several German exchanges, including Frankfurt and Tradegate, under the symbol P21.

Qualified person

Adrian Smith, PGeo, a director and the chief executive officer of the company, is a qualified person as defined by National Instrument 43-101. The qualified person is a member in good standing of the Professional Engineers and Geoscientists Newfoundland and Labrador (PEGNL) and is a registered professional geoscientist (PGeo). Mr. Smith has reviewed and approved the technical information disclosed herein.

About First Atlantic Nickel & Cobalt Corp.

First Atlantic Nickel & Cobalt is a critical mineral exploration company in Newfoundland and Labrador developing the Pipestone XL nickel-cobalt alloy project. The project spans the entire 30-kilometre Pipestone ophiolite complex, where multiple zones, including RPM, Alloy Max, Super Gulp, Atlantic Lake and Chrome Pond, contain awaruite (Ni3Fe), a naturally occurring magnetic nickel-iron-cobalt alloy of approximately 77 per cent nickel with no sulphur and no sulphides, along with secondary chromium mineralization. Awaruite's sulphur-free composition removes acid mine drainage (AMD) risks, while its unique magnetic properties enable processing through magnetic separation, eliminating the electricity requirements, emissions and environmental impacts of conventional smelting, roasting or high-pressure acid leaching while reducing dependence on overseas nickel processing infrastructure.

The U.S. Geological Survey recognized awaruite's strategic importance in its 2012 Annual Report on Nickel, noting that these deposits may help alleviate prolonged nickel concentrate shortages since the natural alloy is much easier to concentrate than typical nickel sulphides. The Pipestone XL nickel-cobalt alloy project is located near existing infrastructure with year-round road access and proximity to hydroelectric power. These features provide favourable logistics for exploration and future development, strengthening First Atlantic's role to establish a secure and reliable source of North American nickel production for the stainless steel, electric vehicle, aerospace and defence industries. This mission gained importance when the United States added nickel to its critical minerals list in 2022, recognizing it as a non-fuel mineral essential to economic and national security with a supply chain vulnerable to disruption.

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