Mr. Bernard Tourillon reports

INTERNAL TECHNICAL AND ECONOMIC STUDY INDICATES HPQ FUMED SILICA REACTOR'S ROBUST POTENTIAL AT COMMERCIAL SCALE

HPQ Silicon Inc. has completed an internal technical and economic study related to its proprietary fumed silica reactor (FSR) technology. The study was prompted by an inquiry from a participant in the fumed silica industry under NDA (non-disclosure agreement).

The study assessed the technical and economic viability of quickly scaling up the HPQ Silica Polvere's fumed silica reactor from the current 50 tonnes per year (tpy) pilot plant configuration to a 1,000 tpy commercial configuration, following the successful completion of the pilot plant testing phase.

The significance of this preliminary assessment lies in its confirmation of the technical feasibility of rapid scaling up to a 1,000 tpy FRS while preserving the best-in-class environmental advantages inherent in the FSR technology. Moreover, the study unveiled its robust economic potential, emphasizing potential EBITDA (earnings before interest, taxes, depreciation and amortization) margins three times higher than the industry average of 20 per cent, and a capital investment 93 per cent less than that required for building a conventional fumed silica plan.

"The shift of interest in our fumed silica offering, from the initial signing of our first NDA to explore the material commercial potential, to a current keen focus on the commercial scalability potential of our proprietary fumed silica reactor technology, marks another major step forward for HPQ Silica Polvere," said Bernard Tourillon, president and chief executive officer of HPQ Silica Polvere Inc. and HPQ Silicon.

Implementing an incremental commercialization strategy for HPQ Polvere fumed silica

To meet the anticipated demand for low-carbon fumed silica materials, HPQ Polvere's commercialization strategy is based on building a 1,000-tonne-per-year fumed silica reactor and scaling up capacity to meet demand with an additional 1,000 tpy fumed silica reactor.

To prepare the internal economic study, HPQ Polvere management used technology provider and equipment supplier PyroGenesis Canada Inc.'s rough order-of-magnitude study regarding the cost of building the first 1,000 tpy fumed silica reactor. HPQ management then used selling prices for the fumed silica, and potential operating costs from information derived from third party sources and publicly available data.

The salient points of the internal economic study indicate that the HPQ fumed silica reactor will have:

• Capex (capital expenditures) between $9 (U.S.) and $10 (U.S.) cost per kilogram (kg) of annual capacity;
• Energy consumptions between 10 kilowatt-hours and 15 KWh per kg of fumed silica;
• EBITDA margins between 60 per cent and 65 per cent;
• Payback period per 1,000 tpy reactor of around 1.7 years.

"HPQ Silica is uniquely positioned to be the sole provider capable of supplying the materials required to meet the increasing demand for low-carbon fumed silica products," added Mr. Tourillon. "This demand is anticipated to necessitate the deployment of numerous 1,000 tpy fumed silica reactors in the future."

While HPQ Polvere technology is the only ultralow-carbon footprint process, no green premium was used when calculating the selling price of the material used for the internal economic study.

"This table clearly shows that HPQ Polvere fumed silica reactor (FSR) has many disruptive advantages that can threaten traditional fumed silica manufacturing, and can be a significant opportunity for HPQ and its shareholders," continued Mr. Tourillon.

HPQ management plans to update and further validate these projections when more data are collected from an upcoming pilot plant testing phase later in the year. This will be achieved with the completion of an engineering cost and feasibility study that will be conducted by an independent party at the appropriate time.

About PyroGenesis Canada Inc.

PyroGenesis Canada, a high-technology company, is a leader in the design, development, manufacture and commercialization of advanced plasma processes and sustainable solutions that reduce greenhouse gases (GHGs) and are economically attractive alternatives to conventional dirty processes. PyroGenesis has created proprietary, patented and advanced plasma technologies that are being vetted and adopted by multiple multibillion-dollar industry leaders in three massive markets: iron ore pelletization, aluminum, waste management and additive manufacturing. With a team of experienced engineers, scientists and technicians working out of its Montreal office and its 3,800-square-metre and 2,940-square-metre R&D (research and development) and manufacturing facilities, PyroGenesis maintains its competitive advantage by remaining at the forefront of technology development and commercialization. The operations are ISO 9001:2015 and AS9100D certified, having been ISO (International Organization for Standardization) certified since 1997.

About HPQ Silicon Inc.

HPQ Silicon is a Quebec-based TSX Venture Exchange Tier 1 industrial issuer. HPQ is developing, with the support of world-class technology partners PyroGenesis Canada and Novacium SAS, new green processes crucial to make the critical materials needed to reach net-zero emissions.

HPQ activities are centred around the following four pillars:

1. Becoming a green low-cost (capital expenditures and operating expenditures) manufacturer of fumed silica using the fumed silica reactor, a proprietary technology owned by HPQ being developed for HPQ by PyroGenesis;
2. Becoming a zero-carbon-dioxide low-cost (capex and opex) producer of high-purity silicon (2N+ to 4N) using the company's Purevap quartz reduction reactor (QRR), a proprietary technology owned by HPQ being developed for HPQ by PyroGenesis;
3. Becoming a producer of silicon-based anode materials for battery applications with the assistance of Novacium;
4. HPQ Silicon affiliate Novacium is developing a low-carbon, chemical-base on-demand and high-pressure autonomous hydrogen production system.

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