Mr. Matthieu Bos reports

SRG AND C-ONE SIGN STRATEGIC COOPERATION AND INVESTMENT AGREEMENT C-ONE TO ACQUIRE 19.4% STAKE IN SRG SRG AND C-ONE TO SIGN ANODE MATERIAL ALLIANCE TO JOINTLY DEVELOP LARGE-SCALE ANODE MATERIAL FACILITY AND BECOME THE LARGEST ANODE MATERIAL SUPPLIER OUTSIDE OF CHINA C-ONE TO ASSIST SRG WITH DEVELOPMENT AND CONSTRUCTION OF LOLA GRAPHITE PROJECT THROUGH TECHNICAL COOPERATION AGREEMENT

Carbon One New Energy Group Co. Ltd. (C-One) has agreed to acquire a 19.4-per-cent stake in SRG Mining Inc. C-One is an innovative anode material industry leader and one of the lowest-cost anode material producers in China.

Under terms of the agreement, SRG will issue 28,222,380 common shares to C-One (or its designated affiliate) through a private placement at a price of 60 cents per share, yielding gross proceeds to SRG of approximately $16.9-million ($12.7-million (U.S.)).

SRG intends to use the proceeds for the advancement of the company's large-scale mine development project in the Republic of Guinea -- the Lola graphite project -- as well as to accelerate the development of an anode material plant in a country with access to markets in the European Union and North America, and for general working capital and corporate purposes.

On closing, C-One will own 19.4 per cent of SRG's issued and outstanding common shares, establishing C-One as one of SRG's largest shareholders. SRG's largest shareholder, La Mancha Fund SCSp, which acquired a 24.1-per-cent stake in SRG in 2022, will partially exercise its anti-dilution right, such that at closing both La Mancha and C-One come to own 19.4 per cent of SRG's enlarged issued and outstanding common shares.

Matthieu Bos, president and chief executive officer of SRG, commented that: "The investment allows SRG to benefit from C-One's extensive technical experience and globally recognized brand, to position SRG as a fully integrated producer of battery anode material. The development of this critical component of EV [electric vehicle] batteries will help the world meet its carbon-emission-reduction targets to combat climate change.

"The investment will allow SRG to advance the development of the Lola graphite project, as well as accelerate the development of a large-scale industrial facility to produce 100,000 tonnes per annum coated, spheroidized and purified graphite. We are confident that C-One shares our vision, and the vision of our shareholders, and has the experience to help us advance towards becoming a fully integrated anode material producer outside of China, creating value for SRG stakeholders in the Republic of Guinea, along with our international shareholders," added Mr. Bos.

"We are excited about our alliance with SRG," said Yue Min, chairman of C-One. "We share a common vision to develop one of the largest production facilities of high-quality and cost-competitive anode material outside of China to support the growing battery markets in Europe and North America, and we will jointly continue to lead the direction of anode materials, defining the new future of anodes," added Mr. Yue.

The transaction is subject to approval by the TSX Venture Exchange, other customary closing conditions, recordals and registration with certain Chinese regulatory agencies, as well as the Canadian government, namely pursuant to a voluntary notification filing pursuant to the Investment Canada Act. Completion of the transaction is expected to occur by Q1 2024. The common shares will be subject to a four-month-and-one-day hold period from the date of their issuance in accordance with applicable securities laws and the policies of the TSX Venture Exchange.

Upon closing of the private placement, SRG and C-One will enter into an investor rights agreement. Among its key provisions, C-One will have the right to nominate two directors -- one of whom will be independent -- to SRG's expanded eight member board.

Anode material alliance

C-One and SRG aim to develop a fully integrated source of battery anode material to supply the European and North American markets. The alliance between C-One and SRG will develop strategy to upgrade SRG and third party graphite concentrates that meet all of C-One's requirements and end-product specifications, while promoting industry-leading supply chain transparency and sustainability standards from mine-to-market. The location of the anode material alliance facilities will be in a mutually agreeable country that has free trade agreements with the key European and/or North American end-markets.

The SRG subsidiary that will own the anode material alliance will be 100 per cent owned and financed solely by SRG. C-One will provide all necessary engineering, intellectual property, qualification, construction and operating expertise to produce coated, spheroidized and purified graphite (CSPG). In addition, C-One will receive a marketing fee on all CSPG sales to its existing third party customers, such as Tesla, Samsung and CATL, as well as new third party customers in Europe and North America. C-One and SRG will share the future profits of the anode material alliance. The anode material alliance is expected to be governed by a governance agreement that is expected to be negotiated and signed once the strategy has been defined, the location has been finalized and the construction permits have been obtained.

C-One and SRG have agreed to transact exclusively with each other in relation to the anode material alliance for a period of seven years.

Technical co-operation agreement

C-One and SRG will work collaboratively to develop the Lola graphite project in the most capital and time efficient way. C-One will provide a turnkey engineering, procurement and construction (EPC) proposal to SRG for the development of the Lola project, leveraging its recent experience in the development of a large-scale mine and associated concentrator in China. The EPC proposal for the Lola graphite project will be delivered to SRG, for its sole consideration, within three months from the closing of the private placement.

Furthermore, SRG expects to significantly benefit from C-One's extensive experience in the production of CSPG as it progresses the anode material alliance. C-One will provide a turnkey EPC proposal to SRG for the development of the anode material alliance facilities.

About SRG Mining Inc.

SRG Mining is a Canadian-based mining company focused on developing the Lola graphite project located in the Republic of Guinea, West Africa. The Lola graphite project has proven and probable reserves of 41 million tonnes at a grade of 4.14 per cent graphitic carbon (Cg). SRG aims to develop a fully integrated source of battery anode material to supply the European and North American lithium-ion and fuel cell markets. With attractive operating costs, proximity to European end markets, and strong environmental, social and governance (ESG) credentials, the company is poised to become a reliable supplier while promoting sustainability and supply chain transparency. SRG is committed to generating sustainable, long-term benefits that are shared with the host countries and communities where it operates.

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