Mr. Alex Holmes reports

NANO ONE ADVANCES GLOBAL LFP CATHODE STRATEGY AS DEMAND FROM ENERGY STORAGE, EV AND DEFENCE APPLICATIONS ACCELERATES

Nano One Materials Corp. has reaffirmed its strategy for meeting global demand for lithium-iron-phosphate (LFP) cathode active material. The company will seek to license its One-Pot process technology into regional markets through localized development companies that will be leveraged to establish regional partnerships. While the company's focus remains on its core market segments outlined below, it is also monitoring other emerging technologies, such as sodium-ion chemistries, with a view to potentially leveraging its supply chain experience in feedstock prequalification and circularity, including recycling.

"We no longer find ourselves alone in making the case for LFP cathode production outside of China -- G7 leaders, U.S. defence procurement rules and the International Energy Agency have all echoed it this year. Our job now is to convert that momentum-advancing Candiac and establishing DevCos that bring partners and project development funding together with our technology, building recurring licensing and services revenue. I expect these efforts to enhance shareholder value and support long-term growth," said Alex Holmes, chief executive officer of Nano One.

Global demand is localizing

LFP chemistries accounted for approximately 60 per cent of global lithium-ion battery cell demand in 2025 -- roughly 1.0 terawatt-hour -- and annual demand outside China is forecast to reach 2.1 terawatt-hours by 2035, equivalent to approximately 168 new LFP cathode plants with a capacity of 25,000 tonnes per annum each. LFP is the dominant chemistry in energy storage applications, accounting for more than 90 per cent of installations, with North American growth led by grid and AI (artificial intelligence) data centre storage and European demand led by battery electric vehicles (BEVs). BEV registrations across 17 European markets grew 33.7 per cent in the first half of 20263. The addressable LFP market outside China is estimated at approximately $8-billion to $10-billion annually in 2026, with the market forecast to grow to approximately $40-billion annually by 2035.

Governments are converting some of that demand into localization requirements. In the United States, the National Defense Authorization Act (NDAA) has placed restrictions on batteries from prohibited foreign entities starting in 2028, with the 45X manufacturing credit maintained at $35 (U.S.) per kilowatt-hour. The European Union and G7 are committed to diversified regional battery supply chains, while the IEA has warned that Chinese export controls announced in October, 2025, put downstream cell production capacity outside China at risk. Nano One's One-Pot process is designed for this environment -- it makes cathode materials directly from non-sulphate metals or oxides feedstock, bypassing the need to rely on China-dominated precursor cathode active materials. The technology also alleviates the need to manage certain byproduct waste streams that can prove difficult in some regions, creating an easier pathway to permitting.

Addressing cathode markets through DevCos

For each target market, Nano One plans to establish or participate in development company vehicles (DevCos) -- joint-venture-style entities created to advance development, finance, build and potentially operate LFP cathode plants. These DevCos will allow Nano One to pair its technology with regional partners, customers and capital. Rather than being a sole shareholder of a project, Nano One seeks to derisk the development and the financing of such projects by contributing technology, engineering and services while future consortium partners contribute construction capital and offtake. Going forward, each plant can be financed on its own merits -- a standard practice in industrial technology licensing that can allow for a more capital-light development model for the company, as well as providing the capacity to pursue multiple growth projects in different regions.

Under its design-one-build-many strategy, the company intends to license its One-Pot process technology through flexible adoption paths -- from a direct technology licence to a fully integrated package -- matched to each customer's needs. Nano One aims to earn licensing fees and royalties, complemented by support services across the plant life cycle, from pre-FID (final investment decision) development through construction and commissioning, ramp-up, and continuing operations and maintenance (O&M). The business model is intended to be prudent and repeatable: derisk each plant, keep the company's balance sheet capital light and grow recurring high-margin revenue as plants multiply.

Execution

On July 23, 2026, the company announced that detailed engineering on the Candiac capacity expansion was 85 per cent complete, with commissioning of the expanded approximately 800-tonne-per-annum production line currently targeted for the first half of 2027. The existing approximately 200-tonne-per-annum pilot line is already supporting customer sampling and product qualification. Small-volume commercial supply discussions are continuing with defence and energy storage customers, with initial commercial agreements targeted for the end of 2026.

Nano One expects to provide further updates on progress against this strategy in the coming months, including a dedicated update on its supply chain qualification initiatives and the establishment of its DevCo vehicles.

About Nano One Materials Corp.

Nano One is a process technology company changing how cathode active materials (CAMs) are produced for lithium-ion batteries. Nano One's platform is built on a portfolio of patented processes, decades of manufacturing know-how and modular plant designs that enable scalable, cost-competitive and easier-to-permit CAM production with resilient supply chains. The technology eliminates waste water and byproducts while enabling regionally sourced raw materials and reducing exposure to foreign supply chain volatility. Modular plants are designed with fewer steps to reduce capex (capital expenditures), energy and environmental intensity and to accelerate deployment, manufacturing and licensing. Product development and process optimization are based at Nano One's innovation centre in Burnaby, B.C., while piloting, demonstration and commercial production are based in Candiac, Que., supported by a team with more than 15 years of commercial cathode manufacturing experience supplying global cell manufacturers. Strategic collaborations with global partners including Sumitomo Metal Mining, Rio Tinto and Worley support Nano One's design-one-build-many growth strategy. Nano One has received funding support from the governments of Canada, the United States, Quebec and British Columbia.

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