Mr. Matthew Keevil reports

TRILOGY METALS CLOSES US$35.6 MILLION STRATEGIC EQUITY INVESTMENT BY THE U.S. DEPARTMENT OF WAR

Trilogy Metals Inc. has completed the previously announced strategic equity investment by the U.S. Department of War.

The investment, totalling approximately $35.6-million (U.S.) across transactions with Trilogy Metals and South32 Ltd., is being deployed in full to advance exploration and development of the Upper Kobuk mineral projects (UKMP) in northwestern Alaska. The UKMP asset portfolio, which encompasses approximately 190,929 hectares and hosts both the high-grade Arctic polymetallic deposit and the Bornite carbonate replacement (copper-cobalt) deposit, is being advanced by Ambler Metals LLC. Ambler Metals is a 50/50 joint venture operating company equally owned by Trilogy and South32.

For more information on the transaction, see Trilogy's news release dated Aug. 28, 2026.

Use of proceeds and next steps

Trilogy Metals and South32 have each committed the full proceeds of the DOW investment to Ambler Metals to advance exploration and development of the UKMP.

The DOW has committed to work in good faith to help facilitate financing required for construction of the proposed 211-mile, industrial-use-only Ambler Road in co-ordination with the State of Alaska and the Alaska Industrial Development and Export Authority (AIDEA), which holds the project.

Closing follows two significant federal permitting milestones for the Arctic project -- the April, 2026, filing of a Clean Water Act Section 404 permit application with the U.S. Army Corps of Engineers, and the May 15, 2026, acceptance of the Arctic project as a covered project under Title 41 of the Fixing America's Surface Transportation Act (FAST-41), which established a transparent, enforceable permitting timetable published on the federal permitting dashboard.

Early warning disclosure

Based upon the daily average Canadian-dollar/U.S.-dollar exchange rate quoted by the Bank of Canada as of the date hereof, the consideration of $17,827,787 (U.S.) for the transaction between the DOW and South32 is equivalent to approximately $24.7-million (Canadian), or $3.01 (Canadian) per share.

Prior to the closing of the transaction, South32 had beneficial ownership of or control and direction over 18,595,311 common shares of Trilogy, representing approximately 10.7 per cent of the issued and outstanding common shares of Trilogy on a non-diluted basis. As a result of and immediately following the transaction, South32's beneficial ownership, control and direction were reduced to 10,379,741 common shares of Trilogy, representing approximately 6.0 per cent of the issued and outstanding common shares of Trilogy on a non-diluted basis as of the date hereof.

South32 advises that the common shares of Trilogy were disposed of pursuant to the definitive agreements for investment purposes. Pursuant to the definitive agreements, for a period of 10 years following closing, the DOW will have the option to purchase 6,161,678 common shares of Trilogy from South32 at a price of one U.S. cent per share subject to certain terms and conditions, and South32 will be obligated to hold such shares at all times during that period and to sell them to the DOW upon exercise of the option. In addition, South32 may, depending on market and other conditions, increase or decrease its beneficial ownership of Trilogy's securities, whether in the open market, by privately negotiated agreements or otherwise, subject to a number of factors, including general market conditions and other available investment and business opportunities. South32's head office is located at Level 2, 100 St. Georges Terrace, Perth, Western Australia, 6000, Australia.

This disclosure is provided under the early warning system under applicable Canadian securities laws, which also requires an early warning report to be filed containing additional information with respect to the foregoing matters. A copy of the early warning report will be available on SEDAR+ under Trilogy's issuer profile and may be obtained upon request from South32 by contacting Ben Baker at 61-403-763-086.

About Trilogy Metals Inc.

Trilogy Metals is a metal exploration and development company holding a 50-per-cent interest in Ambler Metals, which has a 100-per-cent interest in the Upper Kobuk mineral projects (UKMP) in northwestern Alaska. On Dec. 19, 2019, South32, a globally diversified mining and metals company, exercised its option to form a 50/50 joint venture with Trilogy Metals. The UKMP is located within the Ambler mining district, which is one of the richest and most prospective known copper-dominant districts in the world. It hosts polymetallic volcanogenic massive sulphide (VMS) deposits that contain copper, zinc, lead, gold and silver and carbonate replacement deposits (which have been found to host high-grade copper and cobalt mineralization). Exploration efforts have been focused on two deposits in the Ambler mining district -- the Arctic VMS deposit and the Bornite carbonate replacement deposit. Both deposits are located within a land package that spans approximately 190,929 hectares. Ambler Metals has an agreement with Nana Regional Corp. Inc., an Alaska native corporation, that provides a framework for the exploration and potential development of the Ambler mining district in co-operation with local communities. Trilogy Metals' vision is to develop the Ambler mining district into a premier North American copper producer while protecting and respecting subsistence livelihoods.

We seek Safe Harbor.