Mr. Dean Hanisch reports

FOCUS GRAPHITE HIGHLIGHTED IN PRIME MINISTER CARNEY'S HISTORIC CLEAN ENERGY AND CRITICAL MINERALS ANNOUNCEMENT; COMPLETES LAC KNIFE ELECTRICAL DESKTOP STUDY

Focus Graphite Inc. has highlighted the government of Canada's recognition of infrastructure supporting the company's 100-per-cent-owned Lac Knife graphite project in Prime Minister Mark Carney's Aug. 17, 2026, announcement advancing clean-energy and critical-mineral infrastructure across the Labrador Trough.

The government of Canada identified Focus Graphite's Lac Knife infrastructure initiative among four strategic predevelopment projects supported and financed through Natural Resources Canada's (NRCan) First and Last Mile Fund (FLMF), describing the planned road and electrical connection as supporting the development of battery and energy-storage technologies required by Canada and its allies.

The recognition follows Focus's June 3, 2026, announcement that it secured $1,378,700 in non-repayable federal funding to advance engineering, environmental, permitting, indigenous engagement and feasibility activities for Lac Knife's road and electrical infrastructure. The funding represents approximately 50 per cent of eligible project costs.

Focus has now completed an independent electrical infrastructure desktop study prepared by Norda Stelo Inc., identifying a preferred pathway for connecting Lac Knife to Quebec's hydroelectric grid.

"Lac Knife's recognition within the prime minister's announcement reinforces the strategic importance of bringing Canadian critical mineral projects and their enabling infrastructure forward," said Dean Hanisch, chief executive officer of Focus Graphite. "We are already turning that support into tangible progress. With both our access-road and electrical desktop studies now complete, we are identifying meaningful infrastructure efficiencies relative to the 2023 feasibility study. The preferred electrical strategy provides a pathway to significantly reduce power-related capital requirements while connecting Lac Knife to Quebec's clean hydroelectric grid. We are grateful for Canada's continued support."

"Infrastructure and access to power remain key constraints for mine development, with direct implications for capital, execution and timelines," said Jason Latkowcer, vice-president, corporate development, of Focus Graphite. "Canada's investment in energy and critical-mineral infrastructure is helping define a clearer development pathway for Lac Knife. Advancing that work reduces development uncertainty and provides a stronger basis for future capital allocation and evaluation by potential strategic, financing and other investment partners."

"Critical minerals are essential to Canada's economic prosperity, security and sustainability, and we are proud to advance Canadian mineral supply chains as a part of the historic Churchill Falls and Labrador Trough announcement," said Tim Hodgson, Minister of Energy and Natural Resources. "As a part of this nation-building initiative, through our First and Last Mile Fund, Canada is advancing the infrastructure we need to unlock projects like Lac Knife and strengthen Canada's critical minerals value chain. This is how your federal government is working with industry to build a stronger, more competitive critical minerals sector; create opportunities for indigenous and local communities; and deliver minerals Canada and our allies need for clean technologies, advanced manufacturing and defence applications."

Preferred Hydro-Quebec connection strategy

Norda Stelo evaluated seven potential electrical supply scenarios against technical feasibility, constructability, cost, environmental considerations and execution requirements. The study identified a direct connection to Hydro-Quebec's three-phase, 34.5-kilovolt distribution grid as the preferred solution, with the connection extending across public lands to the Lac Knife property.

The preferred configuration would require approximately 30.7 kilometres of electrical infrastructure, consisting of the upgrade of approximately 3.17 kilometres of existing single-phase line to three-phase service and the construction of approximately 27.5 kilometres of new three-phase distribution line extending to the project. The new distribution line would largely follow established corridors, including the Hydro-Quebec transmission corridor, Highway 389 and the project's planned access-road corridor.

Under this approach, Hydro-Quebec would construct the principal distribution infrastructure on behalf of Focus, reducing the company's direct construction and co-ordination requirements while also placing responsibility for associated environmental permitting and long-term maintenance of the distribution line with Hydro-Quebec.

Potential capital savings relative to 2023 feasibility study

The preferred strategy also creates an opportunity to significantly reduce the power-related capital requirements contemplated in Lac Knife's 2023 feasibility study update (FSU).

The 2023 FSU included $19.9-million in initial capital for power and communications infrastructure, within total estimated preproduction capital of approximately $236.9-million. The Norda Stelo study identified several factors that could reduce these requirements. These include reducing the anticipated length of new power-line construction from approximately 50 kilometres to approximately 27.5 kilometres, eliminating the need for additional infrastructure at Hydro-Quebec's Normand substation, and identifying that certain power-line construction costs contemplated in the FSU may have been overestimated. The study also identified the potential for Hydro-Quebec to construct the distribution line at its standard per-kilometre cost.

Based on the assumptions evaluated in the Norda Stelo study, the preferred strategy is estimated to have the potential to reduce Focus's direct power-related capital requirements by more than 50 per cent relative to the power infrastructure assumptions contained in the 2023 FSU. This estimate is preliminary, is based on a desktop-level assessment and should not be interpreted as an updated capital cost estimate for the project. Any actual reduction will depend on Hydro-Quebec's final connection requirements and cost responsibilities, detailed engineering, and the scope of remaining on-site electrical infrastructure. There can be no assurance that the estimated reduction will be realized.

Next steps

Focus intends to continue working with Hydro-Quebec and its engineering consultants to advance the preferred connection strategy, confirm technical requirements and define future cost responsibilities.

The electrical work is being advanced alongside the company's access-road planning, environmental permitting, engineering and indigenous engagement programs under the federally supported FLMF initiative.

Natural graphite is designated as a critical mineral in Canada and is used across battery, energy-storage, defence and advanced-material applications. Focus continues to advance Lac Knife through engineering, environmental, permitting and indigenous engagement activities.

Qualified person

The technical content disclosed in this news release was reviewed and approved by Rejean Girard, PGeo (Quebec), president of IOS Geosciences Inc., a consultant to the company, and a qualified person as defined under National Instrument NI 43-101.

About Focus Graphite Inc.

Focus Graphite is building an integrated graphite platform to supply the industries shaping the future. Through the development of world-class graphite resources, advanced processing technologies and higher-value advanced materials, the company is positioning itself to support battery, defence, advanced manufacturing and other strategic industries across North America and allied markets.

The platform is anchored by the company's two 100-per-cent-owned graphite assets in Quebec. Lac Knife is one of North America's highest-grade feasibility-stage graphite deposits, while Lac Tetepisca is one of the largest identified graphite resources globally. Together with strategic technology partnerships and government-supported innovation initiatives, these assets provide the foundation for a secure, scalable and increasingly integrated graphite supply chain.

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