Mr. Peter Pascali reports

PYROGENESIS RECEIVES $2.3 MILLION PAYMENT UNDER EXISTING $25+ MILLION DROSRITE™ CONTRACT WITH SAUDI CLIENT

PyroGenesis Inc. has received $2.3-million ($1,628,772 (U.S.)) under PyroGenesis's existing $25-million-plus Drosrite contract with Radian Oil and Gas Services Company.

"The payment was received in accordance with a revised schedule amended over time to accommodate pressures on the client's operating cash flow resulting from its business expansion and the construction of a new purpose-built facility to house PyroGenesis's Drosrite systems," said P. Peter Pascali, president and chief executive officer of PyroGenesis. "With the original contract now fully paid, and with the recent deployment of the final four Drosrite systems at the new facility complete, we look forward to the future with Radian as the expansion of their existing facilities and customer base continues."

"The decision to agree to this extended payment plan was not made lightly, but we stood by it despite considerable criticism, confident that our long-term approach was the right one. This has been validated," said Mr. Pascali. "When Radian first placed its confidence in PyroGenesis and our technology, we were unknown in the region. We deeply value that opportunity and have demonstrated our commitment through flexibility and accommodations along the way. Long-term partnerships are built on patience, mutual respect and an understanding of the evolving business realities facing key clients in a rapidly growing industry. The trust and confidence that underpin our relationship with Radian have not only strengthened our partnership but have also helped open new doors for PyroGenesis throughout the region. On that note, we expect to announce a new partnership with a separate entity in the region over the coming weeks. As these new opportunities start to take shape, I'm confident that even those who doubted our approach will begin to see its value."

As previously announced, Radian Oil and Gas Services Company contracted for seven Drosrite aluminum dross recovery systems. The first three 5,000-tonne-per-year systems have been in full commercial operation since April, 2022, within a temporary facility, pending the engineering and construction of a new purpose-built plant.

As announced Oct. 15, 2026, the remaining four Drosrite systems under the contract are now installed and operational at the new plant. These four systems are comprised of two 5,000 TPY systems and two 10,000 TPY systems, which are the first 10,000 TPY systems to be deployed by PyroGenesis worldwide. The three original systems that were in operation at the temporary facility are now at the new facility. combined, the seven Drosrite systems can process up to 45,000 tonnes of aluminum dross per year.

"The receipt of these funds represents a positive development for PyroGenesis," said Andre Mainella, chief financial officer of PyroGenesis. "Given the extended period over which this receivable remained outstanding, the company had previously recognized provisions against its collectability. With payment now received in full, we expect the recovery to have a positive impact on our financial results, including the reversal of previously recognized impairment provisions, as applicable. The payment strengthens our cash position while demonstrating the value of maintaining long-term client relationships, even through challenging business circumstances."

PyroGenesis's Drosrite is a patented, cost-effective system that helps aluminum producers and recyclers recover valuable metal from the waste stream known as "dross" -- the residual byproduct generated when oxygen comes into contact with melted or molten aluminum, and solid impurities float to the surface to be skimmed off. The skimmed dross consists of as much as 80 per cent metallic aluminum blended with other contaminants, oxides, salts, fluxing agents and toxic impurities. Smelters typically lose anywhere from 2 per cent to 10 per cent of their total annual aluminum melt production due to dross. Dross has traditionally been either land-filled or reprocessed using harmful chemicals or salt. If processed correctly, valuable metals and chemicals within dross can be recovered and reused.

PyroGenesis's Drosrite system has modernized dross processing, introducing a method to recover up to 98 per cent of the aluminum in dross, at up to a 20-per-cent higher rate than some commonly used processes, with a lower operating cost, lower carbon footprint and energy consumption, and a higher return on investment -- all without the use of salt. The absence of salt in the Drosrite process allows for on-site dross processing and avoids the creation of hazardous solid salt cakes that have to be disposed.

Industry and market context

• Global aluminum usage, including both primary and recycled metal, rose from 82 million tonnes in 2016 to 100.8 million tonnes in 2024, with smelter output climbing from 59.9 million to 72.9 million tonnes over the same period.
• The growth in aluminum consumption has directly fuelled dross generation. Dross generation is expected to grow at 3 to 4 per cent annually, in line with rising aluminum demand.
• Approximately 4.78 million tonnes of aluminum dross was generated in 2024, with some sources suggesting up to eight million tonnes per year when dross from the myriad of smaller facilities and downstream operations are factored in.
• About 30 to 40 per cent of dross generation, especially from the secondary aluminum sector, continues to end up in landfills.
• Salt-free and higher-recovery processes such as PyroGenesis's Drosrite can reduce hazardous residues, raise metal yields and lower operating expenditure -- creating clear ROI (return on investment) where dross volumes are high.

About PyroGenesis Inc.

PyroGenesis leverages 35 years of plasma technology leadership to deliver advanced engineering solutions to energy, propulsion, destruction, process heating, emissions, and materials development challenges across heavy industry and defence. Its customers include global leaders in aluminum, aerospace, steel, iron ore, utilities, environmental services, military and government. From its Montreal headquarters and local manufacturing facilities, PyroGenesis's engineers, scientists, and technicians drive innovation and commercialization of energy transition and ultrahigh temperature technology. PyroGenesis's operations are ISO 9001:2015 and AS9100D certified, with ISO certification maintained since 1997. PyroGenesis's shares trade on the Toronto Stock Exchange (PYR), OTCQX (PYRGF) and Frankfurt (8PY1) stock exchanges.

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