Mr. Brent Nykoliation reports

NEXTSOURCE MATERIALS ANNOUNCES ROBUST FEASIBILITY STUDY RESULTS FOR MOLO MINE EXPANSION TO 150,000 TONNES PER ANNUM OF SUPERFLAKE GRAPHITE CONCENTRATE

NextSource Materials Inc. has released the results of a feasibility study for a mine expansion of its 100-per-cent-owned Molo graphite mine in southern Madagascar.

Highlights:

• Feasibility Study confirms highly attractive economics for a large-scale expansion of the Molo Mine and processing facility to a steady-state production rate of 150,000 tpa of graphite concentrate
• Estimated capital cost of US$161.7 million (including contingency), with pre-tax NPV8 of US$424.1 million and a pre-tax IRR of 31.1%
• Expansion significantly de-risked through application of NextSource's all-modular construction approach and sharing of infrastructure with existing operations
• Discussions with OEMs and battery manufacturers indicate robust demand for the Company's product

The FS considers an expansion to the Molo Graphite Mine's current Phase 1 production capacity of 17,000 tonnes per annum ("tpa") through the construction of an additional and standalone processing plant that increases the steady-state production rate to 150,000 tpa of SuperFlake graphite concentrate over a 25-year life of mine ("LOM"). The FS projects a capital cost of US$161.7 million resulting in a pre-tax NPV using an 8% discount rate of US$424.1 million and a pre-tax IRR of 31.1%.

The FS assumes the additional processing plant will be built adjacent to the current Phase 1 processing plant, presently in the ramp-up stage of production. The expansion will utilize the Company's unique, fully modular build approach used to construct its Phase 1 processing plant, which greatly reduced build time and associated costs in relation to conventional mine construction.

Craig Scherba, P.Geo., President, and CEO of NextSource commented:

"We are very pleased the FS confirms the strong financial potential of a larger scale operation and significant scalability of our Molo Graphite Mine to meet the robust market demand for flake graphite for use in electric vehicle batteries. This is especially timely given the recent announcement of export restrictions on flake graphite and graphite anode material from China. An expansion of this magnitude will position NextSource as a major global supplier and underpins our vertical integration strategy to offer an ample and secure supply of graphite flake for our planned battery anode facility, enabling direct supply to the electric vehicle battery market."

The production capacity of 150,000 tpa was established based on ongoing discussions with automotive manufacturers ("OEMs") and battery anode offtake partners, and on the expected demand forecasts for flake graphite that will need to be converted into spheronized and purified graphite ("SPG") and then into coated SPG ("CSPG") over the mid-term. CSPG is the final form of natural graphite required by OEMs to manufacture lithium-ion batteries for electric vehicles.

Ongoing discussions with numerous OEMs and battery anode offtake partners indicate market demand for CSPG over the long-term is expected to experience significant growth and could support additional expansions of the Molo's mine processing capacity.

The Company has not yet made a construction decision in respect to the expansion and will discuss the FS results with its strategic partners to determine the optimal timing and assess the funding options that are available with respect to this potential mine expansion.

RESULTS SUMMARY

The following summary highlights the financial metrics provided in the FS. All capital and operating costs estimates are prepared in line with a Class 3 estimate as per the American Association of Cost Engineers classification and are accurate to +/- 15 to 25%.

OPERATING COST SUMMARY

Based on discussions with our off-take customers, their preference is to purchase Molo graphite concentrate at the local Madagascar port at freight on board ("FOB") China prices. As such, operating costs ("OPEX") include the all-in FOB cost to deliver the graphite concentrate to the local port of Tulear.

MINERAL RESOURCE AND MINERAL RESERVE STATEMENTS

The FS includes the following mineral resource estimates for the Molo Graphite Mine, which remains open along strike and to depth.

The FS includes the following mineral reserve estimates for the Molo Graphite Mine:

METALLURGY

The FS is based on a full suite of metallurgical test work performed by SGS Canada Metallurgical Services Inc. in Lakefield, Ontario, Canada. These tests included lab and bench scale process development work, a bulk sample/pilot plant program, and metallurgical variability testing. The overall graphitic carbon recovery into the final concentrate is 88.1% and the mass pull to concentrate is 5.5%.

PRICING

The LOM average selling price of US$1,191/t of concentrate (Real) used in the FS is the volume weighted average sales price for the various flake sizes and grades of SuperFlake graphite concentrate that are expected to be produced from the Molo Graphite Mine. Prices used are based on current market prices provided by UK-based, commodity price reporting agencies Benchmark Minerals Intelligence and Fastmarkets, who are recognized as leaders in providing independent and unbiased market research, pricing trends, and demand and supply analyses for the natural flake graphite market.

Current market prices in real US dollar terms were used through to 2028 and flatlined from that point forward over the rest of the LOM. A pricing premium for increased carbon grade was applied based on recent market trends for products exceeding 94% carbon. No other premiums were applied.

The FS does not consider any potential for downstream value-added processing of the flake graphite concentrate such as conversion into SPG and CSPG, thermal expansion for use in foils, and other specialty graphite applications.

TECHNICAL REPORT FILING

This FS will be filed under the Company's profile on SEDAR+ at www.sedarplus.ca and will be posted on NextSource's website at www.nextsourcematerials.com within 45 days of this news release.

DATA VERIFICATION

Data verification programs have included review of QA/QC data, re-sampling and sample analysis programs, and database verification. Validation checks were performed on data, and comprise checks on surveys, collar coordinates and assay data. Sufficient verification checks were undertaken on the database to provide confidence that the database is appropriate to support the technical information contained herein.

QUALIFIED PERSONS

The FS has an effective date of September 1, 2023 and was prepared by Erudite Strategies Ltd. ("Erudite") of South Africa, an independent engineering and consulting firm specializing in the mining and processing of commodities and battery materials and authored by the following "qualified persons" as defined under NI 43-101: Johann De Bruin, (Pr. Eng) (ECSA), Hector Mapheto, Pr.Eng. (ECSA), Schalk Pienaar, Pr.Eng. (ECSA) and Hercu Smit, Pr.Eng. (ECSA) (Erudite Strategies Ltd.), Philip John Hancox, PhD, Pr.Sci.Nat. and Desmond Subramani, Pr.Sci.Nat. (Caracle Creek International Consulting (Pty.) Ltd.), Oliver Peters, P.Eng. (PEO) (Metpro Management Inc.), Eugene de Villiers, Pr.Eng. (ECSA) (ECMA Consulting (Pty.) Ltd.), Nico Hamman, Pr.Tech.Eng. (ECSA) (Eco Elementum), Alkie Marais, M.Sc. (Geohydrology) (Geostratum Water Management Consulting), and Ruan Daffue, M.Sc.Eng. (Practara (Pty.) Ltd).

Scientific and technical information presented in this news release was reviewed and approved by the following FS "qualified persons" as defined under NI 43-101: Johann De Bruin, Pr.Eng. (ECSA), Hector Mapheto, Pr.Eng. (ECSA), Schalk Pienaar, Pr.Eng. (ECSA) and Hercu Smit, Pr.Eng. (ECSA) (Erudite Strategies Ltd.), Philip John Hancox, PhD, Pr.Sci.Nat. and Desmond Subramani, Pr.Sci.Nat. (Caracle Creek International Consulting (Pty.) Ltd.), Oliver Peters, P.Eng. (PEO) (Metpro Management Inc.), Eugene de Villiers, Pr.Eng. (ECSA) (ECMA Consulting (Pty.) Ltd.), Nico Hamman, Pr.Tech.Eng. (ECSA) (Eco Elementum), Alkie Marais, M.Sc. (Geohydrology) (Geostratum Water Management Consulting), and Ruan Daffue, M.Sc.Eng. (Practara (Pty.) Ltd).

About NextSource Materials Inc.

NextSource Materials Inc. is a battery materials development company based in Toronto, Canada that is intent on becoming a vertically integrated global supplier of battery materials through the mining and value-added processing of graphite and other minerals.

The Company's Molo Graphite Mine in Madagascar is one of the largest known and highest-quality graphite resources globally, and the only one with SuperFlake graphite. The Molo Graphite Mine has begun production, with Phase 1 mine operations currently undergoing ramp-up to reach its nameplate production capacity of 17,000 tpa of graphite concentrate.

The Company is also developing a significant downstream graphite value-add business through the staged rollout of Battery Anode Facilities capable of large-scale production of coated, spheronized and purified graphite for direct delivery to battery and automotive customers, outside of existing Asian supply chains, in a fully transparent and traceable manner.

NextSource Materials is listed on the Toronto Stock Exchange under the symbol "NEXT" and on the OTCQB under the symbol "NSRCF".

We seek Safe Harbor.