Mr. Harry Barr reports

METALQUEST MINING ANNOUNCES SECOND AND FINAL TRANCHE CLOSING

Metalquest Mining Inc. has closed the second and final tranche of a non-brokered private placement financing by issuing 1,963,760 non-flow-through units (NFT units) at a price of 17 cents per NFT unit for gross proceeds in the second tranche of $333,839.20 and an aggregate of $1,966,780.20 in all tranches. (Please see first tranche closing news release of Dec. 30, 2025.)

Chairman and chief executive officer Harry Barr stated: "We are pleased to announce the successful completion of the company's offering raising an aggregate of $1,966,780.20 in all tranches. We received demand in excess of the amount raised. While we appreciate the strong investor interest, we elected not to increase the financing -- doing so would have introduced unnecessary dilution at a pivotal stage in the company's growth trajectory."

The NFT units comprise one common share of the company and one-half of one share purchase warrant. Each whole warrant will entitle the holder thereof to purchase one additional common share of the company at an exercise price of 40 cents per share, for a period of two years from closing. The company did not pay any finder fees in connection with the second and final tranche closing.

The offering is subject to TSX Venture Exchange approval. All securities issued in connection with the final tranche closing are subject to a minimum four-month-and-a-day hold period expiring May 10, 2026, in accordance with applicable Canadian securities laws. proceeds of the NFT unit offering will be used for general working capital and exploration.

An existing insider and an existing control person of the company purchased an aggregate of 87,875 NFT units of the offering, which is considered a related party transaction within the meaning of Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The company is relying on exemptions from the formal valuation and minority shareholder approval requirements under sections 5.5(a) and 5.7(1)(a), respectively, of MI 61-101, as neither the fair market value of the NFT units to be purchased on behalf of insiders nor the consideration paid by insiders exceeds 25 per cent of the company's market capitalization. The company did not file a material change report 21 days prior to the closing of the offering as the details of insider participation were not known at that time.

Early warning disclosure

Prior to closing of the offering Mr. Barr was deemed to have control over, directly and indirectly, 13,450,510 common shares (4,387,954 held by New Age), 550,000 stock options and 4,796,572 share purchase warrants (2,653,714 held by New Age). Assuming the exercise of stock options and share purchase warrants held by Mr. Barr and New Age, Mr. Barr would be deemed to have control over, directly and indirectly a total of 18,797,082 common shares or approximately 47.41 per cent of the company's issued and outstanding common shares on a post conversion beneficial ownership basis.

After both tranche closings of the offering, whereby Mr. Barr purchased an aggregate 599,313 units, Mr. Barr is deemed to have control over, directly and indirectly, 14,049,823 common shares (4,387,954 held by New Age), 550,000 stock options and 5,096,229 share purchase warrants (2,653,714 held by New Age). Assuming the exercise of stock options and share purchase warrants by Mr. Barr and New Age, Mr. Barr would be deemed to have control over, directly and indirectly, a total of 19,696,052 common shares or approximately 38.46 per cent of the company's postoffering issued and outstanding common shares on a postconversion beneficial ownership basis.

Mr. Barr acquired the securities for investment purposes and has a long-term view of the investment and may, in the future, acquire and/or dispose of securities through the open market and/or private transactions or through the company's stock option plan as circumstances and market conditions may warrant.

This news release, together with Mr. Barr's corresponding early warning reports, which will be filed on SEDAR+, constitute the required disclosure pursuant to Section 5.2 of National Instrument 62-104 (Take-Over Bids and Issuer Bids) and Section 3.1 of National Instrument 62-103 (The Early Warning System and Related Take-Over Bid and Insider Reporting Issues). A copy of the early warning report, when filed by Mr. Barr, will be available under the company's profile on the SEDAR+ website.

About Metalquest Mining Inc.

Metalquest Mining owns 100 per cent of Lac Otelnuk and is working to develop one of the largest iron projects in North America. The Lac Otelnuk iron project is located in Quebec's Labrador trough and is approximately 165 kilometres by air northwest of the town of Schefferville and 1,200 km northeast of Montreal by air.

The Quebec government has transferred 100 per cent of the claims into Metalquest's name and management is accumulating a vast amount of technical data as approximately $120-million has been expended on the project to date. Going forward, one of the company's primary objectives will be to continue to work with Naskapi First Nation of Kawawachikamach with whom the company has an exploration and predevelopment agreement as of November, 2023. In June, 2025, MQM signed an agreement with AtkinsRealis, a world-class engineering services and nuclear company with offices around the world to conduct a comprehensive gap analysis of the historic 2015 feasibility study (FS) for the Lac Otelnuk iron project. The new studies will identify areas requiring updates to align the historic 2015 feasibility study with current market dynamics, regulatory frameworks, engineering best practices and environmental standards.

The initial phase of work, planned for winter/spring 2026, at the Superior iron project will comprise systematic ground truthing, detailed geophysical surveys and comprehensive environmental baseline studies. These programs are designed to enhance the geological model, refine the understanding of mineralized zones and delineate high-priority drill targets to support the next stage of exploration and project development.

The company also owns approximately 1.8 million shares and 2.5 million warrants of Canadian Copper (CCI) and two NSR (net smelter return) royalties totalling 1 per cent in the Murray Brook PEA (preliminary economic assessment) stage zinc-polymetallic deposit, situated in the famous Bathurst mining district, New Brunswick, Eastern Canada.

Canadian Copper Inc. has the right to purchase half of a 0.33-per-cent royalty for $1-million dollars and must pay Metalquest a preproduction cash payment of $1-million after the project goes into production. The company has indicated that it is completing a preliminary economic assessment on processing the Murray Brook deposit at the Caribou processing complex. Release date is expected in the first half of 2026. CCI recently secured a financing to acquire the Caribou complex. The Caribou process complex is approved and maintains all required operating permits. See CCI's website for further details.

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