Mr. John Karagiannidis reports

QIMC ADVANCES NEW SALEM PROGRAM FOLLOWING INTEGRATED INTERPRETATION OF MULTI-COMPONENT SOIL-GAS ANOMALY, CUMBERLAND BASIN, NOVA SCOTIA

Quebec Innovative Materials Corp. has provided an update on its New Salem zone following the recent release of soil-gas geochemical results from its Cumberland basin project in Nova Scotia.

Continuing internal analysis and integration of geochemical data continue to support the continuity of the previously reported soil-gas anomaly, including methane, associated C2-C4 hydrocarbons and helium, across the surveyed section. The data set supports the company's working interpretation of a laterally continuous multicomponent soil-gas anomaly interpreted to reflect a potential underlying gas system that warrants follow-up exploration. All samples were independently analyzed by GeoFrontiers Corp. (Texas) using gas chromatography methods, providing external verification of analytical results.

These results represent an important step in advancing the New Salem zone toward priority target delineation, additional geophysical and geochemical work, and drill targeting.

Building on these results, the company is advancing to the next phase of exploration, which will include densification of soil-gas sampling together with targeted geophysical surveys, including gravity, magnetic and seismic methods. These activities are designed to refine subsurface interpretation and further constrain the structural and geological controls associated with the observed anomaly.

Management commentary

"The integration of our geochemical results with regional geological and structural data at New Salem marks an important step in advancing our interpretation of the area. The consistency of the multicomponent soil-gas anomaly -- including methane, C2-C4 hydrocarbons and helium -- across the survey corridor supports our decision to advance to the next phase of work.

"Densified sampling and targeted geophysical surveys are expected to help refine our subsurface model, improve our understanding of the anomaly's structural context and support the delineation of priority exploration targets. The Cumberland basin remains underexplored, and we believe this phased approach provides a disciplined framework for evaluating its potential," John Karagiannidis, chief executive officer.

Discovery highlights:

• Approximately 450-metre multicomponent C1-C4 soil-gas anomaly defined within a broader approximately 1.5-kilometre survey corridor;
• Program advancing to densified soil-gas sampling and targeted geophysical surveys, including gravity, magnetic and seismic methods;
• Multicomponent gas and helium signatures are being evaluated in the context of interpreted structural trends to refine priority exploration targets.

Advancing interpretation and program expansion

Following completion of the initial soil-gas survey, Quebec Innovative has initiated an integrated interpretation program combining geochemical results with regional geological and structural data sets.

Preliminary interpretation indicates that the anomaly may be spatially associated with mapped and interpreted fault structures within the western Cumberland basin. While further work is required to evaluate and refine these relationships, the current data set provides a working framework to guide follow-up exploration.

To advance this work, the company is expanding its exploration program to include densified soil-gas sampling along priority sections together with targeted geophysical surveys. These activities are expected to enhance subsurface resolution, support structural interpretation and help delineate priority exploration targets for subsequent phases, which may include drilling.

Natural gas exploration strategy for the western Cumberland basin -- Prof. Marc Richer-Lafleche

Quebec Innovative's exploration program aims to evaluate a vast region of Nova Scotia, extending more than 1,500 square kilometres into Cumberland county. Despite its size, the western Cumberland basin, including the New Salem and Apple River sectors, remains essentially unexplored. Even in the more central parts of the basin, recent discoveries of strong hydrogen anomalies in the Little Forks-Springhill and Southampton areas indicate that the basin's overall energy potential is still poorly constrained.

With the exception of coal, which has been extensively documented by both government and industry, data on hydrogen, natural gas and condensate potential in Cumberland county remain sparse. To guide future exploration, it is essential to distinguish the geological processes that control hydrogen generation and migration from those governing conventional hydrocarbons.

Naturally occurring hydrogen

High hydrogen concentrations have been identified in two principal domains:

1. The Cobequid Highlands-Cumberland basin transition zone, where Precambrian to Devonian basement rocks are dissected by long-lived, polyphased dextral strike-slip faults and overlain by Carboniferous sedimentary units (R2C2 model).
2. The central Cumberland basin (for example, Little Forks-Springhill-Southampton), where verticalized structures associated with diapiric salt tectonics deform the Carboniferous sequence.

In both settings, deep crustal fractures and anisotropies, generated either by wrench faulting or salt tectonics, likely form vertical migration pathways for hydrogen. These structures may explain the elevated hydrogen concentrations observed in the 2025 soil-gas surveys and in the 2026 drilling at West Advocate. Over all, the hydrogen system appears to involve a deep, basement-derived source and vertically oriented fracture corridors that channel hydrogen toward the near-surface environment.

Conventional natural gas and condensates

Exploration for natural gas and condensates requires a model aligned with established hydrocarbon systems in the Maritimes. Previous work compiled in the assessment of oil and gas potential, Windsor and Cumberland basins (NSDOE OFR 2017 03), synthesis report highlights several key elements relevant to the Cumberland basin.

Hydrocarbon source rocks

The basin is expected to contain lacustrine shales and coal-rich units capable of generating gaseous hydrocarbons. The lacustrine organic-rich shales source should occur at depth (Horton Gp) within structural lows where burial conditions favoured thermogenic gas and condensate generation. A major challenge in western Cumberland is the absence of deep drilling to confirm the presence and maturity of these source rocks. However, multiple independent lines of evidence, including regional geological analogues, organic geochemical data, burial and thermal modelling, and soil-gas anomalies in New Salem, strongly support the presence of organic-rich, thermogenically mature Horton group lacustrine shales at depth. Demonstrating the existence and quality of these source rocks remains a critical step in evaluating the basin's hydrocarbon potential.

Migration pathways, reservoirs and seals

A network of faults cutting through the sedimentary succession may have facilitated hydrocarbon migration into overlying sandstone and conglomerate potential reservoirs. Structural traps may have formed through anti-clines and normal faults associated with salt tectonics, creating favourable conditions for hydrocarbon accumulation.

Regional seals could likely be provided by younger Cumberland group shale units while evaporite formations within diapiric zones offer highly effective impermeable barriers, further enhancing the potential for hydrocarbon entrapment.

Exploration strategy in the Cumberland basin -- Prof. Richer-Lafleche

In a frontier basin with no prior drilling, the most effective approach is a staged, risk reducing strategy integrating remote sensing, geology, geochemistry, geophysics and targeted drilling. Multidisciplinary subsurface investigations allow rapid delineation of priority zones, reducing exploration costs by limiting the extent of high-cost methods such as deep seismic reflection and drilling. The strategy proposed for western Cumberland draws inspiration from the INRS program in the Lower St. Lawrence, which evaluated hydrocarbon potential across more than 5,000 square kilometres in the Temiscouata region.

Methodology

Proposed exploration will proceed in four phases.

Phase 1: regional remote sensing and potential field geophysical data analysis:

• GIS integration of satellite data and other governmental spatial data (multispectral imagery, DEM and lidar);
• Interpretation and modelling of regional magnetic and gravity data to define basin architecture, depth to basement and major structural trends.

Phase 2: mobile geophysics and soil-gas geochemistry

Field teams will deploy:

• Drone-based surveys (multispectral imagery for detection of hydrocarbon-related geobotanical anomalies and thermal imaging), high-resolution lidar measurements and high-resolution magnetometric surveys;
• ATV-based surveys (mobile ground-level magnetometry, gamma spectrometric radiometry and TDEM conductivity);
• Ground gravity surveys;
• Soil-gas sampling for C1-C4 hydrocarbons, hydrogen and helium.

Soil-gas geochemistry is the fastest and most direct method for detecting active hydrocarbon systems as it confirms whether deep thermogenic gases are migrating upward, something geophysics alone cannot establish.

Priority areas identified from these data sets will be selected for geoelectrical tomography and audiomagnetotelluric detailed surveys to image subsurface faults and folds concealed beneath Quaternary cover.

Phase 3: high-penetration geophysics

This phase focuses on deep subsurface imaging to evaluate structural anisotropies associated with potential traps and reservoirs or evaluation of fault-related gas migration corridors:

• High-power TDEM surveys using INRS equipment capable of injecting high voltages and amperages (550 volts, 150 amperes) into kilometre-scale loops, achieving investigation depths of up to five km;
• 2-D seismic reflection surveys and localized 3-D seismic grids to support future drilling decisions.

Detection of deep circular polarization anomalies will be used to optimize the detection of natural gas and condensate reservoirs. High-resolution deep seismic is essential in natural gas exploration because it provides a reliable way to image deep subsurface structures that control hydrocarbon migration, trapping and reservoir geometry.

Phase 4: drilling program

The last phase of the work involves synthesizing the data to proceed with the first stage of diamond drilling, which is essential to obtain data for the basin modelling stage, and to assess whether the local conditions in the basin allow the migration and trapping of hydrocarbons.

A diamond drilling campaign (less-than-or-equal-to-two-kilometre depth) will obtain core samples to evaluate reservoir porosity and permeability, characterize the presence of sealing rock units, and test for shallow to intermediate level natural gas targets within the Cumberland group.

About Quebec Innovative Materials Corp.

Quebec Innovative is a North American exploration and development company advancing a portfolio of natural hydrogen and critical mineral projects. The company is advancing its district-scale hydrogen exploration model across Quebec, Ontario and Nova Scotia (Canada) and Minnesota (United States), leveraging its proprietary R2G2 framework developed in collaboration with INRS. Quebec Innovative is committed to sustainable development, environmental stewardship and innovation, with the objective of supporting clean energy and decarbonization initiatives.

We seek Safe Harbor.