Mr. Joe Ovsenek reports

P2 GOLD ANNOUNCES POSITIVE GABBS UPDATED PRELIMINARY ECONOMIC ASSESSMENT WITH LIFE OF MINE PRODUCTION OF 1.86 MILLION GOLD EQUIVALENT OUNCES

P2 Gold Inc. has released results from a positive updated preliminary economic assessment on its wholly owned gold-copper Gabbs project located on the Walker Lane trend in Nevada. The updated PEA was prepared by Kappes, Cassiday & Associates (KCA) of Reno, Nev., with mineral resource and mining contributions from P&E Mining Consultants Inc. in accordance with National Instrument 43-101 -- Standards of Disclosure for Mineral Projects. An NI 43-101 technical report will be prepared and posted on P2 Gold's website and the company's profile on SEDAR+ within 45 days of the date of this news release.

PEA highlights:

• After-tax net present value (5-per-cent discount rate) of $292.2-million (U.S.) and internal rate of return of 17 per cent at $1,918 (U.S.)/ounce gold, $23.01 (U.S.)/oz silver and $3.73 (U.S.)/pound copper (spot metal prices);
• Total projected life-of-mine (LOM) revenue of $3.43-billion (U.S.) at spot metal prices over 13.4-year mine life;
• LOM gold equivalent production of 1.86 million ounces (79.1 million tonnes at 0.54 gram per tonne gold, 1.28 g/t silver and 0.27 per cent copper) at spot metal prices, with LOM production of 1,206,000 ounces of gold, 1,742,000 ounces of silver and 327 million pounds of copper;
• Average annual gold equivalent production of 139,000 ounces at spot metal prices;
• Estimated preproduction capital cost, including contingencies, of $277.7-million (U.S.) with payback of three years at spot metal prices.

"We have updated the Gabbs June, 2023, PEA to include the development of the sulphide mineralization in addition to oxide mineralization and an increase in the mining rate to six million tonnes per year to provide for the development of a mid-sized mine," commented Joe Ovsenek, president and chief executive officer of P2. "Life-of-mine production at Gabbs is now expected to be close to two million ounces of gold equivalent with average annual production expected to be close to 150,000 ounces of gold equivalent. The updated PEA contemplates heap leach processing as the first phase of operations for the initial five years to reduce upfront capital requirements and project risks. Heap leach operations will pay for preproduction capital and a significant portion of mill capital prior to the commencement of mill processing in year six. The Gabbs feasibility study, expected to be initiated soon, will focus on optimizing the mine plan and capex, evaluating contract mining, and completing additional metallurgy, which we believe will significantly increase the rate of return. What's more, Gabbs has considerable mineral resource expansion potential for both oxides and sulphides, which is why we expect Gabbs to be a long-life gold and copper mine."

The updated PEA is preliminary in nature, includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty that the updated PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The company has not defined any mineral reserves on the Gabbs project.

Economic sensitivities

Base case metals prices were established by the company reflecting the company's expectations for market conditions at the time of construction financing for the Gabbs project and to allow for a direct comparison with the Gabbs June, 2023, preliminary economic assessment (see news release dated June 29, 2023).

Mining and processing

Mining

The mineralized material will be mined by standard open-pit mining methods using an owner mining fleet of 136-tonne haul trucks and 15.3-cubic-metre hydraulic shovels, fine crushed using a system incorporating a jaw crusher, cone crushers and high-pressure grinding rollers (HPGR).

Processing

Heap leach

The Gabbs mineralized material is estimated to contain an average of 0.27 per cent copper based on the mine plan used for this updated PEA. A portion of this copper is cyanide soluble and is expected to be extracted in the heap leach circuit. The cyanide soluble copper has an effect on the cyanide consumption. A SART (sulphidization, acidification, recycling and thickening) plant that releases cyanide associated with the copper cyanide complex, allowing it to be recycled back to the leach process as free cyanide, is included. The resulting copper precipitate will be sold, bringing additional revenue to the project.

After the crushing circuit, the mineralized material will be agglomerated with cement and conveyor stacked on the heap leach pad in eight-metre lifts then single-stage leached with a dilute cyanide solution. The gold- and copper-bearing solution will be collected in the pregnant solution pond and pumped to the SART plant. Pregnant solution will be acidified with sulphuric acid, then copper will be precipitated as sulphides by the addition of sodium hydrosulphide. The precipitate will be thickened and filtered to produce a copper filter cake for shipment to a smelter. The barren solution from the SART plant will be processed in a carbon adsorption-desorption-recovery (ADR) plant to recover gold. The gold will be periodically stripped from the carbon using a desorption process. The gold will be plated on stainless steel cathodes, removed by washing, filtered, dried and then smelted to produce a dore bar.

Mill

The run-of-mine (ROM) feed material to the mill will use the same crushing circuit as the heap leach facilities. The mill feed will be crushed to P80 6.3 millimetres (one-quarter inch) in a three-stage crushing circuit, with the third-stage an HPGR. The ore will be conveyed to a single-stage ball mill circuit. Sulphide and oxide mineralized material will be campaigned through the mill as the oxide material will not be treated in the flotation circuit. The milled sulphide product will be treated in a flotation plant to produce a copper concentrate suitable for sale. The flotation tailings and ground oxide material will be thickened, then direct cyanide leached to dissolve gold, silver and copper. The leached solids will be washed in a CCD circuit to remove the dissolved metals and cyanide. The dissolved copper and silver will be recovered from the CCD overflow solution in a SART plant as a copper/silver sulphide precipitate. Regenerated sodium cyanide from the SART plant will be recycled to the leach circuit. Gold in the SART plant barren solution will be recovered in an ADR plant and refined to produce dore bars. The CCD tails are treated in a cyanide destruction circuit, filtered and conveyed to a dry stack storage facility.

Opportunities:

• Low-grade stockpile -- evaluate alternatives for processing low-grade stockpile;
• Leased mining fleet -- evaluate leasing versus purchasing the mining fleet;
• Contract mining -- evaluate contract mining versus owner fleet;
• Mine plan -- optimize mine sequencing to increase return on capital and carryout geotechnical drilling to optimize pit slope angles;
• Stripping -- evaluate extent of alluvium in waste to reduce stripping cost;
• Mineral resource -- expand oxide and sulphide gold and gold and copper mineralization (zones remain open);
• Metallurgy -- complete additional test work to increase recoveries for oxide and sulphide mineralization and evaluate the use of HPGR for potential heap leaching of sulphide mineralization to increase recovery of free gold;
• Capital expenditure -- evaluate equipment alternatives to reduce capital costs.

Next steps

Additional metallurgical test work will be undertaken next to refine metallurgical recoveries for both the oxide and sulphide mineralization along with an evaluation of the depth of the alluvium and geotechnical drilling. Thereafter, feasibility-level studies will commence and will include an evaluation of contract mining versus an owner fleet (leased or owned), mine plan optimization and equipment alternatives. Timing of the metallurgical test work, drilling and feasibility-level studies will be dependent on the availability of funds.

Gabbs project 2023 mineral resource estimate

The June, 2023, updated mineral resource estimate (2023 MRE) was prepared by P&E based on four diamond drill holes and 27 reverse circulation drill holes completed by the company in 2021 and 2022 and 494 drill holes completed by prior Gabbs project operators between 1970 and 2011. The 2023 MRE is restated in this news release to include silver.

The main difference between the 2023 MRE and the February, 2022, mineral resource estimate (see news release dated Feb. 10, 2022) is the decrease in the oxide cut-off grade to 0.28 g/t gold equivalent from 0.35 g/t gold equivalent and an increase in the sulphide cut-off grade to 0.44 g/t gold equivalent from 0.36 g/t gold equivalent. As a result, oxide mineral resources have increased and sulphide mineral resources have decreased.

Oxide mineral resources at Gabbs consist of indicated mineral resources of 724,400 ounces of gold equivalent (30.6 million tonnes grading 0.49 g/t gold, 1.49 g/t silver and 0.27 per cent copper) and inferred mineral resources of 779,000 ounces of gold equivalent (33 million tonnes grading 0.53 g/t gold, 1.03 g/t silver and 0.23 per cent copper).

Qualified persons

The updated PEA was prepared by Carl E. Defilippi, RM, SME, of KCA, and Eugene Puritch, PEng, FEC, CET, and Andrew Bradfield, PEng, of P&E Mining Consultants of Brampton, Ont., each of whom is a qualified person as defined by National Instrument 43-101 and independent of the company and has reviewed and approved of the technical content relating to the updated PEA in this news release.

The 2023 MRE was prepared under the supervision of Mr. Puritch, PEng, FEC, CET, of P&E Mining Consultants, who is an independent qualified person, as defined by National Instrument 43-101. Mr. Puritch has reviewed and approved the technical contents of this news release relating to the 2023 MRE.

Ken McNaughton, MASc, PEng, chief exploration officer, P2 Gold, is the qualified person, as defined by National Instrument 43-101, responsible for the Gabbs project. Mr. McNaughton has reviewed, verified and approved the scientific and technical information in this news release.

About P2 Gold Inc.

P2 Gold is a mineral exploration and development company focused on advancing precious metals and copper discoveries and acquisitions in the western United States and British Columbia.

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