Mr. Sean Cleary reports

STRATEGIC RESOURCES UPDATES PROGRESS ON PORT SAGUENAY IRON PELLET PLANT

During the last quarter of 2023 Strategic Resources Inc. completed initial rounds of discussions with iron ore traders and potential strategic partners regarding its plans for a four-million-tonne-per-annum (mtpa) iron ore pellet plant at Port Saguenay. Based on the initial feedback on the pellet project, the company has decided to prioritize the construction of a four mtpa iron ore pellet plant at Port Saguenay in Quebec. Accordingly, consulting engineering firm BBA was retained in Q4 2023 to study and update capital and operating costs for the larger pellet plant. It remains on track to deliver results in Q1 2024, building on the December, 2023, indicative EPC (engineering, procurement and construction) cost estimate from Metso Corp. for the supply of the larger pelletizer unit.

Based on the above, the company's utility needs for its first phase of operations have been substantially reduced for both natural gas and electricity. Strategic had been granted electrical contracts under an older regime and has been working collaboratively with Hydro-Quebec and the provincial government to align on the best actions as the existing electrical contracts for the BlackRock project came up for renewal. Accordingly, the company has decided to release its old electrical contracts with Hydro-Quebec and forgo the associated letters of credit for electricity at the BlackRock project. Through this process, the company intends to recover surplus working capital into its treasury which can be used to advance the project. The company plans to obtain a revised electricity contract in accordance with the new system established by the government of Quebec, co-ordinated by Hydro-Quebec and the government of Quebec. It is expected that this process would be completed as part of the construction timeline. Hydro-Quebec and the government of Quebec continue to be supportive of projects at Port Saguenay, including the recently announced port development plans (see Strategic's Dec. 12, 2023, news release) and investment of $111-million toward the port's conveyor system.

Strategic continues to work alongside the local, provincial and federal governments, the port authority, as well as local populations and indigenous groups to develop the BlackRock project. To date, the company and its major shareholders have made significant investments toward the development of this important project in Quebec, which will help to reduce carbon emissions for the steel and foundry industries in North America and Europe.

About Strategic Resources Inc.

Strategic Resources is a critical mineral exploration and development company focused on high-purity iron and vanadium projects in Canada and Finland. The company is developing its flagship BlackRock project, which is a fully permitted and ready-to-construct mine, concentrator and metallurgical facility (which includes a pellet plant and direct reduced iron furnace) located at a seaport in Quebec with full access to the St. Lawrence Seaway. The company's head office is in Montreal, Que.

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