Lomiko Metals awarded $8.35 million grant from the US Department of Defense

Lomiko Metals Inc. has been awarded a Department of Defense (DOD) Technology Investment Agreement (TIA) grant of $8.35 million where Lomiko will match the funding over a period of 5 years, for a total agreement with the DOD of $16.7 million. The grant falls under Title III of the Defense Production Act and is funded through the Inflation Reduction Act to ensure energy security in North America. This grant funding is to strengthen and expand the industrial base for natural flake graphite in North America. This is one of the first agreements the DOD is granting in TIA funding to a Canadian management team and asset, at this stage of development. In addition, and concurrent to the grant awarded by the DOD, the Company has also been approved for funding of CA$4.9 million in a non-repayable contribution agreement from the Critical Mineral Research, Development and Demonstration (CMRDD) program administered by Natural Resources Canada with the total project cost being CA$6.6 million. The objective of the program is to pilot the proposed graphite upgrading process and convert La Loutre natural flake graphite into battery-grade anode material.

“To achieve these concurrent Canadian and American funding opportunities is a tremendous and exciting milestone moment for the Lomiko team and board, investors and partners,” says Belinda Labatte, CEO and Interim Chair of the board. “It’s a win for Quebec, Canada, and the United States as we approach this next phase of studies with an exceptional opportunity with the DOD and the Canadian government to build a collaborative, inclusive approach to responsible energy transition and supply chain resilience in North America.”

“Today’s investment in Lomiko Metals, Inc. will help advance supply chain resilience and create job opportunities in Canada – all part of our work to build a prosperous and sustainable Canadian economy that benefits everyone. We will continue to work with allies and industry to ensure the development of secure resources for a prosperous net-zero future,” says The Honorable Jonathan Wilkinson, Minister of Energy and Natural Resources.

The TIA is designed specifically to support the science-based continued research and development of the La Loutre graphite project in accordance with the vision and values of Lomiko and in accordance with all Canadian and Quebec regulations and processes. The TIA agreement entered into with the DoD is to complete three distinct phases of research and development work with independent experts and consultants over a 5-year period, as follows:

• Phase 1: Completion of a Pre-Feasibility Study (PFS) and baseline data collection
• Phase 2: Completion of metallurgical studies and bulk sample
• Phase 3: Completion of a Definitive Feasibility Study (DFS)
  

The U.S. grant and the Canadian contribution support science-based approaches for the responsible development of the La Loutre natural flake graphite in Quebec. The studies include integrating a decarbonized mine model and community-centered studies such as progressive reclamation. The Lomiko vision is to build a meaningful and inclusive critical minerals company of the future.

“Our greatest resource in critical minerals projects will always be the people we work and engage with,” says Labatte. “We welcome those who ask questions, as those create the opportunities to explore and innovate together to find solutions for energy transition and supply chain resilience. Lomiko looks forward to the next steps and continuing its responsive approach in Quebec.”

Lomiko will continue to engage with First Nations and with local communities with a direct presence in the field and with other communication mechanisms to provide detailed and thorough information. Lomiko provides detailed and thorough information on the website and will continue to use its website as the primary source for accurate information and for media inquiries: www.lomiko.com.

Critical minerals research, development, and demonstration program
The CMRDD funding is in the form of a contribution agreement, in which Natural Resources Canada will contribute CA$4.9 million over a three-year period. Lomiko will collaborate with established Canadian research groups, The objective of this project is to pilot the proposed graphite upgrading process to confirm technologies and conditions that are required to convert flake graphite into battery-grade anode material, achieving high purity levels of graphitic carbon content and low impurity levels. The project will demonstrate Canada’s leadership in processing quality graphite, support the development of Canada’s and Quebec’s domestic battery supply chain, and support employment opportunities for skilled trades in Quebec.

Global market conditions
This funding demonstrates the importance of developing supply chain resilience for natural flake graphite in North America. The United States is 100% import-dependent on graphite, and graphite is among the key priority critical minerals in Canada, with key competitive advantages for graphite specifically in Quebec. In December 2023, China declared its intention to implement export permits for certain graphite products to safeguard national security. It is widely known that graphite supply will be in shortage starting now, to accommodate the tremendous growth of the Electric Vehicle (“EV”) market, with the shortfall to increase to 8Mt by 2040, according to Benchmark Mineral Intelligence’s flake graphite forecast report.

Responsible developer operating within the Quebec and Canada Critical Minerals Strategy
Lomiko is a Quebec ECOLOGO-certified responsible graphite developer working within the Quebec Critical Minerals Strategy framework, which supports innovation and responsible development of projects such as Lomiko’s La Loutre natural flake graphite project.

The La Loutre Indicated Mineral Resources estimate holds 3.0 million tons of contained graphite at a grade of 4.59% as announced in the Company’s Mineral Resources Estimate technical report of May 29, 2023. This represents a 184% increase in Indicated Mineral Resources from the last resource estimate published by the Company in July 2021. The project is located within proximity to battery plant future production in Quebec and the United States.

The Quebec Critical Minerals strategy published by the Ministère de l’Énergie et des Ressources naturelles can be found here: https://cdn-contenu.quebec.ca/cdn-contenu/ressources-naturelles/Documents/PL_resume_critical_strategic_minerals.pdf. Lomiko is fully aligned with these goals and this funding directly promotes research and development to accomplish provincial mandates.

The Company will continue to actively engage in funding processes in Quebec and Canada and sees the U.S. grant and Canadian contribution as a significant catalyst for community-focused energy transition projects.