DEFN.V · 2025-02-18 12:00:00

Defense Metals - Robust Economics from Wicheeda Rare Earth Deposit PFS

Economic Studies

Defense Metals - Robust Economics from Wicheeda Rare

Earth Deposit PFS

• The completion of the Pre-Feasibility Study establishes Defense Metals' Wicheeda Project as one of the most advanced undeveloped rare earth projects

in North America or Europe.

• The Wicheeda Project economics of pre-tax NPV at 8% of US$1.8 billion and IRR of 24.6% with after-tax payback of 3.7 years are robust.

• The breakeven price of NdPrO

for the project is US$67.60/kg (for IRR of zero). The operating cash breakeven price of NdPrO is US$37.42/kg.

• The Wicheeda Project will stand out in the Western rare earth industry as a result of the exceptional purity of its final product, which in turn will enable it

to secure a very high margin in the sector and ensure resilience, even in times of lower REE market prices.

VANCOUVER, BC

Feb. 18, 2025

/CNW/ - Defense Metals Corp. (

"Defense Metals"

or the

"Company"

; (TSXV: DEFN) (OTCQB:

DFMTF) (FSE:35D) is pleased to release the results of its independent Pre-Feasibility Study (PFS) concerning the on-going

development of its 100%-owned Wicheeda Rare Earth Element (REE) deposit located in

British Columbia

(BC),

Canada

All amounts herein are in

United States

dollars, unless otherwise stated.

Guy de Selliers

, Executive Chairman, stated:

"The positive results of our Pre-Feasibility Study confirm the strategic importance of the

Wicheeda Project at a time when

North America

and

Europe

are prioritizing economic resilience and supply chain security for critical

minerals.

"With NdPr being essential to electric vehicles, renewable energy, and advanced defense technologies, the Wicheeda Project

represents a unique opportunity to establish a reliable, Western-aligned supply of these vital materials, reducing reliance on foreign

sources and importantly helping to secure economic security.

"Our Wicheeda rare earth project is one of the most advanced in either

North America

Europe

that is not yet in production,

positioning it as a leading, near-term solution to meet the growing demands for Western-aligned supply chains.

"As we move forward, we remain committed to responsible development policies and practices, along with strong partnerships that

collectively will unlock the full economic and strategic value of this asset for all stakeholders and rightsholders."

Wicheeda Project PFS Highlights

Robust Economics

Pre-tax net present value (NPV) of

$1.8 billion

and after-tax NPV of

$1.0 billion

, at an 8% discount rate.

After-tax payback period of 3.7 years from the start of production.

Pre-tax internal rate of return (IRR) of 24.6%, and after-tax IRR of 18.9%.

Initial Capital Cost (CAPEX) of

$1.4 billion

Open-pit production of 15 years (excluding pre-production) feeding a 5,000 tonne per day (tpd) flotation concentrator.

Cash operating costs average

$37.42

/kg NdPrO (equivalent contained

) recovered.

Average operating margin of 71% (EBITDA / Revenue).

High-Grade REE Mineral Deposit Advantage

Defense Metals' Wicheeda REE deposit is located in a Tier 1 mining jurisdiction.

The Wicheeda Project has logistical and infrastructure advantages.

The project's reserves support a 15-year Life-of-Mine (LOM) with an average annual production of 31,900 tonnes (t) of Total Rare

Earth Oxide (TREO)

in concentrate, yielding approximately 5,200 t of TREO in a high-value mixed rare earth carbonate (MREC)

after the removal of cerium (Ce) and lanthanum (La).

Unique mineralogy of the Wicheeda REE deposit allows for the production of one of the highest-grade flotation REE mineral

concentrates in the world at exceptional recovery levels.

High-Grade Mineral Concentrate Advantage

LOM production of a high-grade flotation mineral concentrate, containing an average 50% TREO (dry basis) at 81% recovery over

the initial 8 years.

The mineral concentrate will be processed at Defense Metals' own hydrometallurgical and solvent extraction (SX) separation

process facilities.

High-Value Saleable Mixed Rare Earth Carbonate Product

All of the La and most of the Ce will be removed during the SX process, creating a value-added final MREC product.

The basket value of the MREC is derived from rare earth elements critical to high-growth permanent magnet applications;

neodymium and praseodymium (87.3 wt%), dysprosium, (0.6 wt%), and terbium (0.2 wt%) of contained TREO. Other minor REE

constituents are not considered in the basket value.

Defense Metals has taken a focused and conservative approach to all costs and inputs to deliver a realistic and compelling PFS that it

believes maximizes the scope and scale of its Wicheeda Project over the long term.

The PFS incorporates an initial proven and probable mineral reserve estimate that supports a 15-year, open-pit mining operation

(excluding pre-production) that will produce ore feed for a 5,000 tpd flotation plant. The flotation plant will produce a high-grade REE

mineral concentrate that will feed hydrometallurgical and SX process facilities to produce a value-added MREC product.

Mark Tory

, President and CEO of Defense Metals, commented:

"We are thrilled to announce the successful completion of an

independent Pre-Feasibility Study for our Wicheeda Rare Earth Deposit, marking a major milestone in its development. The PFS,

conducted in collaboration with renowned global experts Hatch and SRK, demonstrates the strong potential of the Wicheeda Project

as a reliable and sustainable source of critical rare earth elements that are essential to advance energy technologies, manufacturing,

and defence applications.

"The high-grade mineral concentrate produced by the Wicheeda Project will undergo hydrometallurgical and solvent extraction

processing, and according to our flowsheet design will enable us to produce a high-value Mixed Rare Earth Carbonate product, due

to the substantial removal of lanthanum and cerium.

"With a pre-tax IRR of

24.6% and a pre-tax NPV of

US$1.8 billion

, our PFS confirms the robust economics this project has to offer.

These results position the Wicheeda Project as one of the most compelling rare earth projects in

North America

Europe

. Given the

increasing geopolitical tensions affecting rare earth supply chains, there is significant potential for rare earth prices to rise, further

enhancing Wicheeda's value and maximizing returns for our shareholders.

"Looking ahead, we will focus on optimizing the project's design to maximize operational efficiency and ultimately shareholder

returns. Additionally, we will engage with potential strategic partners to support the project's growth and development

"Now is the ideal time for a North American rare earth company to advance toward building a new mine and processing facilities. We

are moving forward with our regulatory engagement and continue to work closely with the project's Indigenous rightsholders to

expedite the approval process and bring this critical project to fruition."

___________________________

Neodymium-Praseodymium oxide (NdPrO) and Total rare earth oxide (TREO) equivalents are reported in this document by convention. In the final MREC product, the rare earths will be present as carbonates (RE

(CO

)

), and in the feed and

flotation concentrate they will be present in a variety of species. For reporting purposes, the rare earth content is converted to the oxide equivalent.

TREO accounts for all 15 rare earth oxides within the deposit; however, for financial modeling purposes only Nd, Pr, Tb and Dy are assigned economic value.

Wicheeda Project - Key Parameters

The project level financial analysis was performed on a

2025-dollar

basis without inflation.

Table 1 – Base Case Economics

Financial Metrics

Units

Base Case

Pre-tax NPV @ 8%

1,803

After-tax NPV @ 8%

992

Pre-tax IRR

24.6

After-tax IRR

18.9

Undiscounted After-tax Project Cashflow (LOM)

2,672

After-tax payback period from start of production

Years

3.7

Costs and Profit

Initial capital expenditure

1,440

Average annual operating cost

$M per annum

165

Average annual operating cost

$/kg NdPrO equivalent in MREC

37.42

MREC average price

$/kg NdPrO equivalent content in MREC

136.30

Life of mine gross revenue

9,030

Operating (EBITDA) margin

Production Metrics

Mine life (excluding pre-production)

Years

Maximum mining production rate

Mtpa

8.7

Life of mine strip ratio

Waste: Ore

3.3:1

Life of mine TREO grade

% TREO in mill feed

2.4

Life of mine flotation concentrate

Thousand tonnes per annum (ktpa) dry

62.5

Concentrate grade

% TREO (dry)

Life of mine NdPrO contained in MREC

ktpa NdPrO equivalent

4.4

Life of mine NdPrO % of TREO in MREC

% NdPrO equivalent

The PFS was conducted by Hatch Ltd. (Hatch) and SRK Consulting (

Canada

) Inc. (SRK). The Hatch and SRK Qualified Person (QP)

authors confirm that the Wicheeda Project PFS disclosure meets the standards established by the Canadian Securities Administrators'

National Instrument 43-101

– Standard of Disclosure for Mineral Projects (

NI 43-101

The effective date of the PFS is

February 7, 2025

, and the Company expects to file a NI 43-101 technical report relating to the PFS on

SEDAR+ within 45 days of this news release.

Wicheeda Project Overview

Favourable Mineralogy Leading to Favourable Metallurgy

The Wicheeda REE deposit is characterized by three main REE-bearing lithologies: dolomite carbonatite (DC), which is the dominant

lithology, xenolithic carbonatite, and syenite. Limestone is the major waste rock lithology.

The predominant REE-bearing minerals are bastnäsite, monazite, synchysite and parisite. The coarse grain size of Wicheeda's REE

mineralization provides significant metallurgical advantages, allowing for enhanced mineral liberation and improved separation from

gangue minerals during comminution and increased flotation efficiency. These factors all support efficient and cost-effective REE

recovery and collectively lead to the production of a LOM high-grade REE concentrate (averaging 50% TREO) that contributes to the

Wicheeda Project's economic viability.

Mine Planning

Table 2 – PFS Mine Plan Summary

Mine Production Metrics

Unit

Pre-prod

Yrs 1-8

Yrs 9-15

LOM

Target Annual Throughput

Mt/a

1.8

Total Material Movement

11.2

65.2

33.3

109.7

Total Ore

0.1

14.6

10.8

25.5

Total Waste

11.0

50.0

21.6

84.2

Strip Ratio

waste: ore

77.0:1

3.5:1

2.1:1

3.3:1

Average Ore Grade

% TREO

2.32

2.80

1.92

2.43

Total Flotation Concentrate Produced

Mt dry

0.632

0.306

0.94

Design Flotation Concentrate Grade

% TREO

Average Flotation Plant Recovery

80.9

69.3

76.7

The Wicheeda Project will be developed as an open-pit mining operation. In the first eight years of ore production, near-surface, mostly

high-grade DC mineralization will be mined as indicated in the Figure 1 showing ore lithology over time. Mining rates will range from 4 to

9 million-tonnes per annum (Mtpa) over the 15-year mine life (excluding pre-production).

Figure 1 – Ore Processed per Year (CNW Group/Defense Metals Corp.)

Mined ore will be crushed at a facility near the pit and transported via conveyor to sustain a 1.8 Mtpa mill feed to the on-site flotation

plant. Waste rock will be placed in a waste rock storage facility (WRSF) adjacent to the pit.

The flotation plant will produce a high-grade rare earth mineral concentrate averaging 50% TREO. The flotation plant flowsheet

includes crushing, semi-autogenous and ball mill grinding, rougher and scavenger flotation and three stages of cleaner flotation at

elevated temperatures to produce a final flotation concentrate.

The Wicheeda Project envisages dewatering tailings using filter press technology and storing the filtered material in a filtered tailings

storage facility (FTSF) located west of Wichcika Creek. It will store both flotation tailings and hydrometallurgical residue, with a liner

system and water management pond to manage environmental impact.

The high-grade, filtered mineral concentrate will be transported off-site, approximately 45 kilometers (km) by truck, to

Bear Lake

for

hydrometallurgical and SX processing to produce a high-quality MREC product.

Hydrometallurgy with Lanthanum and Cerium Removal by Solvent Extraction

During hydrometallurgical processing, the flotation mineral concentrate will first undergo acid baking with concentrated sulphuric acid

(1.1 t/t concentrate) at about 300˚C, converting the rare earths into water-soluble sulphates, which readily dissolve during a subsequent

water leach process. The resulting leachate will then be purified before being sent to the SX unit for the removal of La and Ce to allow

production of MREC with enhanced economic value.

The SX operations will employ a single, standard solvent extraction circuit using an acidic extractant in a kerosene-based diluent: to

separate La and Ce from the other REEs.

The low-value La and Ce will largely be eliminated and separately precipitated and disposed of in a waste storage facility provided for

the hydrometallurgical process (with potential to be recovered should a market develop for these elements). The more valuable REEs

will be retained, including the magnet-metal REEs: praseodymium (Pr), neodymium (Nd), terbium (Tb) and dysprosium (Dy).

Table 3 – Hydrometallurgical Plant Metrics

Item

Unit

Yrs 1-8

Yrs 9-15

LOM

Flotation concentrate feed

ktpa

80.4

44.7

63.7

MREC production (TREO equivalent)

ktpa

6.3

3.8

5.2

NdPrO (equivalent)

ktpa

5.4

3.2

4.4

Heavy REO (equivalent)

ktpa

0.8

0.5

0.7

Hydrometallurgical Plant Recovery

% NdPrO

93.4

After the La and Ce are removed, the remaining REEs are precipitated as a MREC.

The advantage of the SX process is that a higher-quality, higher-value MREC product is produced, containing 87% NdPr oxide and 11%

heavy rare earth oxides including valuable Dy and Tb. Elimination of the La and Ce reduces the mass of MREC to be produced by a

factor of six without any loss of the valuable NdPr. This not only allows for transportation and separation cost savings but also creates

a more desirable product for downstream end users and REE separators.

_____________________________

For the purposes of this document, Heavy REO refers to the oxides of samarium (Sm), europium (Eu), gadolinium (Gd), terbium (Tb), dysprosium (Dy), holmium (Ho), erbium (Er), thulium (Tm), ytterbium (Yb), lutetium (Lu), and yttrium (Y). Only

Tb and Dy contributions were considered in the product value calculations.

Proximity to Existing Infrastructure

The Wicheeda REE deposit is approximately 80 km northeast of the nearby city of

Prince George, British Columbia

. The deposit

location provides excellent access to infrastructure, as the site is accessible via an all-weather gravel road that connects to British

Columbia Highway 97. Proximity to major B.C. Hydro hydroelectric power lines, a natural gas pipeline, and the Canadian National

Railway line further enhance the project's logistical advantages.

Prince George

(agglomerated population ~ 95,000) serves as a regional hub, supporting oil and gas, forestry, hydropower and mining

industries and offers a skilled workforce and essential services. Daily commercial air service is available between

Prince George

and

major Canadian international airports. Moreover, the port of

Prince Rupert

, the closest major North American port to

Asia

is located

about 500 km to the west and accessible by rail and road.

Power

The Wicheeda Project's power supply is expected to come from a new high-voltage transmission line (1L 365) located west of the

project site which connects to the B.C. Hydro 500 kV line. Cost estimates used in the PFS are based on industry benchmarks.

Transportation

Upgrading the existing forestry road from

Bear Lake

will facilitate access to the project site.

The Canadian National Railway (CNR) will be important in the supply of Wicheeda Project process plant reagents and consumables.

The CNR handles over 50% of all Canadian chemicals production and is the only rail carrier servicing three major petrochemical centers

North America

: the Alberta Heartland, the U.S. Gulf Coast and southwestern

Ontario

. The CNR line that passes through

Bear Lake

high-capacity rail line that also services the port facilities at

Prince Rupert, BC

Project Infrastructure

The mining project area exhibits a topography and geography ideally suited for development. The varied terrain provides opportunities

to minimize earthwork requirements and facilitates the development of a water management plan which maintains natural drainage

patterns.

Water Supply

All excess water at the mine site will be directed to the contact water pond at the processing plant for process water recirculation or

treatment and discharge.

Table 4 – Wicheeda Project Capital Expenditure Estimates

Category

LOM ($M)

LOM avg ($M/y)

LOM ($/kg NdPrO

equivalent in MREC)

Mining

537

35.8

8.09

Flotation Plant

724

48.3

10.91

Hydrometallurgical Facility

995

66.3

15.02

Concentrator & Hydrometallurgical Facility General & Administration

5.8

1.32

Mine Site Tailings

6.3

1.42

Hydrometallurgical Waste

1.4

0.31

Contact Water Pond

0.2

0.04

Mine Site Water Treatment

0.7

0.16

Hydrometallurgical Water Treatment

0.5

0.12

Total

2,479

165.3

37.42

Rare Earth Markets and Price Forecast

The Rare Earth Market

According to Adamas Intelligence Inc. (Adamas), global Neodymium-Iron-Boron (NdFeB) magnet consumption grew by 13% in 2023,

and projects demand will rise by 12% in 2024 to 231,371 t. This growth has been largely driven by passenger and commercial electric

vehicles (EV) traction motors, wind power generators and consumer electronics.

Adamas reports that the magnet industry, which relies on Nd, Pr, and, for high-end applications, Dy and Tb, is the largest consumer of

rare earths by volume, accounting for 49% of global demand in 2023. However, in value terms, rare earth permanent magnets have

long been the dominant market. In 2023, magnet applications represented over 95% of the total rare earth market value.

Looking ahead, Adamas projects that global demand for NdFeB magnets will increase at a compound annual growth rate of 8.7% to

reach 606,792 t by 2035 and 881,396 t in 2040. The expected greatest demands driving growth come from robotics, advanced air

mobility, commercial EV traction motors and passenger EV traction motors, reinforcing their critical role in advanced technologies and

the energy transition.

Rare Earth Prices

Rare earth prices have been highly volatile in recent years, driven by growing demand for energy and mobility technologies, the COVID

pandemic, as well as geopolitical factors.

Adamas has developed a Base Case pricing scenario that accounts for supply-demand modeling and expects that the future of rare

earths demand (at least in the case of, Nd, Pr, Dy and Tb) will be more robust, more resilient and less sensitive to price than demand

of the past and present, which is still largely driven by consumer and legacy automotive applications.

Adamas believes that from 2032 through 2040 Defense Metals could expect to receive a price for its MREC equal to 95% of the rare

earth oxide value it contains (value based on

China

domestic prices, excluding VAT).

Adamas expects the price of NdPr oxide to increase from an average of

$63

/kg this year to

$70

-110/kg in the late-2020s. In a rational

market, it would expect these price increases to induce investment in new production capacity. However, owing to the long lead times

to develop new rare earth supplies and the lack of advanced, financially committed projects in the pipeline today, Adamas sees

potential for pervasive deficits to push prices above required inducement levels (estimated at

$100

-150/kg in the long term).

Given the high amounts of NdPr in the final MREC after removing Ce and La, the average MREC price per kg for the Wicheeda Project

$70.4

/kg of MREC, which is the equivalent of

$116.5

/kg of contained TREO and the equivalent of

$136.3

/kg of contained NdPrO.

Financial Analysis

The expected project cashflows were modelled using a simple discounted cash-flow model. A discount rate of 8% was used. The

model uses nominal cashflows and costs and is configured for annual periods. An exchange rate of

1.40 CAD

/USD was used for

reporting any CAD values used in the PFS. A constant price of

$133

/kg NdPrO was applied and is based on the Adamas long term

forecast.

Table 6 – Cash Flow Summary

Item

Undiscounted LOM ($M)

Undiscounted Unit Average

($/kg NdPrO equivalent in MREC)

Discounted LOM ($M)

Gross Revenue

9,030

136.33

4,536

Operating Costs

(2,479)

(37.42)

(1,208)

Product Transportation

(26)

(0.39)

(13)

Royalties

(90)

(1.36)

(45)

EBITDA

6,435

97.15

3,269

Changes in Net Working Capital

(80)

Initial Capital Cost

(1,440)

(21.74)

(1,275)

Sustaining Capital Cost

(133)

(2.01)

(70)

Closure and Reclamation Bond Cost

(430)

(6.50)

(41)

Royalty buy-out

(1)

(0.01)

(1)

Pre-Tax Cash Flow

4,431

66.90

1,803

BC Mineral Tax

(604)

(9.12)

(269)

Corporate Tax

(1,155)

(17.44)

(542)

After-Tax Cash Flow

2,672

40.33

992

The PFS estimates total LOM taxes paid of

$1.8 billion

including

$604 million

to the Province of

British Columbia

and

$1.2 billion

to the

Government of

Canada

, implying an estimated tax rate on taxable income of approximately 40%.

Sensitivity Analysis

NPV @ different discount rates

Table 7: NPV sensitivity to discount rate

Discount rate (%)

5 %

8% (base)

10 %

15 %

Pre-tax NPV ($M)

2,582

1,803

1,403

694

After-tax NPV ($M)

1,514

992

722

242

NPV and IRR sensitivity to the itemized factors are illustrated in the graphs which follow:

MREC price (substantially NdPr)

CAPEX

OPEX

Figure 2 – NPV Sensitivity (CNW Group/Defense Metals Corp.)

Figure 3 – IRR Sensitivity (CNW Group/Defense Metals Corp.)

Defense Metals evaluated pricing reports from Adamas and Argus Media (Argus). The Company believes it was more appropriate to

use Adamas for comparability with peers who have used the same pricing methodology. This includes MP Materials Corp. which

reference the Adamas pricing in their

February 22, 2024

, EDGAR filing in relation to technical report for their Mountain Pass mine.

Argus had two scenarios, the incentive price scenario was 6.8% higher than Adamas base case pricing and the conservative case was

18.3% lower than the Adamas base case pricing.

Environmental, Social, and Regulatory Engagement

Defense Metals is committed to maintaining high environmental, social, and governance (ESG) standards while responsibly progressing

the development of the Wicheeda Project. The regulatory jurisdiction has embedded standards relating to the environmental

assessment and permitting processes that align with ESG principles, including the consideration of climate change in project planning

and impact assessment, biodiversity assessments, social impact evaluation and stakeholder engagement and rightsholder consultation.

Many critical baseline studies have been initiated to ensure a background understanding of environmental, social and cultural values.

Additional environmental, social and cultural studies will be completed to provide project design refinements and advance environmental

assessment and permitting processes.

Defense Metals and the McLeod Lake Indian Band (MLIB) have signed a Co-Design Agreement, formalizing their partnership to

integrate MLIB's perspectives into all project phases, from technical and engineering considerations to social and environmental

planning. Defense Metals is committed to ongoing collaboration with rightsholders and stakeholders, prioritizing their interests and

working towards consensus.

The Wicheeda Project is vital to

British Columbia's

transition to clean energy. Defense Metals maintains close communication with the

BC Critical Minerals Office, a government body that fosters the province's critical mineral sector. Through this relationship, Defense

Metals is provided with dedicated regulatory process assistance and possible funding support.

Mineral Reserves and Resources Estimates

Mineral Reserves

The mineral reserve estimate for the Wicheeda Rare Earth Element Deposit has been prepared for Defense Metals as part of the 2025

Pre-Feasibility Study (PFS). This mineral reserve estimate has been prepared in accordance with the Canadian Institute of Mining,

Metallurgy and Petroleum (CIM) Definition Standards on Mineral Resources and Mineral Reserves adopted by CIM Council in

May

2014

The mineral reserves respective of the open pit are based on Measured and Indicated mineral resources that have been identified as

being economically extractable and which incorporate mining losses and mining waste dilution. The mineral reserves include 25.5 million

tonnes (Mt) of mineable ore from one open pit at an average grade of 2.43% TREO. The mineral reserve includes variable mining

dilution, and it is calculated after 1% ore loss.

A summary of the surface mineable mineral reserves by rock type and reserve classification is shown in Table 8.

Table 8 – Summary of the Mineral Reserves (as of February 7, 2025)

Mineral Reserve

Rock Type

Tonnes

TREO

ppm

Proven

Dolomite Carbonatite

5,377

2.97

1,152

3,135

Limestone

2.01

858

2,359

Syenite

1.45

582

1,681

Xenolithic Carbonatite

258

1.74

700

2,060

Total

5,688

2.90

1,127

3,074

Probable

Dolomite Carbonatite

12,178

2.86

1,122

3,071

Limestone

139

1.39

563

1,600

Syenite

639

1.25

503

1,483

Xenolithic Carbonatite

6,820

1.42

585

1,717

Total

19,775

2.30

913

2,543

Total

Dolomite Carbonatite

17,554

2.89

1,131

3,091

Limestone

150

1.44

585

1,655

Syenite

681

1.26

508

1,495

Xenolithic Carbonatite

7,078

1.44

589

1,730

Total

25,462

2.43

961

2,661

Mineral Reserves Notes:

• The effective date of the Wicheeda Rare Earth Element Deposit Mineral Reserve is February 7, 2025.

• Dollar values herein stated are United States Dollars (US$)

• Mineral Reserves are reported assuming the prices provided from Adamas listed below:

• NdPr Oxide 132.70 $/kg REO

• Tb

1362.83 $/kg REO

• Dy

442.48 $/kg REO

• Mineral Reserves are defined within the final pit design guided by pit shells derived from the optimization software, GEOVIA Whittle™

•

Cut-off grade is based on the value factors generated in each block. The revenue and related costs vary based on the composition of different elements

in each block

. Value of a block is the revenue generated in that block minus the related processing and G&A operating costs.

• The base mining costs are assumed to be $5.00/t. The mining costs vary based by the bench and depth of the pit. The average mining costs for the life

of mine is calculated to be $5.26/t mined.

• Processing costs consist of flotation plant cost at the mine site and a hydrometallurgical/solvent extraction (hydrometallurgical) plant that is off the mine

property. The operating cost of the flotation plant is $27.60/t milled and the hydrometallurgical plant operating cost is $1,164.4/t of concentrate treated.

• General and administration costs of the mine site is $3.67/t for ore milled.

• Tailings management and storage cost is $6.55/t of ore.

• Off-site cost (transportation) is $87.76/t of precipitate products produced.

• Processing recovery is calculated using the following formula:

• Flotation recovery for TREO = -11.183*TREO^2 + 67.831*TREO - 20.42194%. For ore above 3% TREO, the flotation recovery is set to 82.4%. For grade

less than 0.32% TREO, the flotation recovery is set to 0.0%.

• Flotation recovery for TREO then is multiplied by 0.995, 0.996, 0.734, 0.636 for Pr, Nd, Tb, Dy respectively to calculate the respective flotation recovery

for each element.

• Hydrometallurgical recovery for Pr, Nd, Tb, Dy are 0.932, 0.935, 0.802, 0.734 respectively.

• A 95% payability has been applied to the final hydrometallurgical product.

• Mining dilution varies based on the mining zone. The average mining dilution is calculated to be 2.9%, for the ore delivered to the mill. Tonnages reported

as ore includes dilution.

• A 1% ore loss has been applied to the total reserve in each bench.

• Figures are rounded to the appropriate level of precision for the reporting of mineral reserves. Due to rounding, some columns or rows may not sum as shown.

• The overall strip ratio (Waste:Ore - the amount of waste mined for each tonne of ore) is 3.34.

• The mineral reserve is stated as diluted dry metric tonnes.

• The mine plan underpinning the mineral reserves has been prepared by SRK Consulting (Canada) Inc.

• The TREO grade encompasses 15 rare earth elements present in the deposit

• The estimate of Mineral Reserves may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues.

The Qualified Person, Dr.

Anoush Ebrahimi

, does not know of any legal, political, environmental, or other risks that could materially

affect the potential development of the mineral reserves. Dr. Ebrahimi personally inspected the Wicheeda Project on

October 26, 2021

Mineral Resources

The Mineral Resource estimate for the Wicheeda Rare Earth Element Deposit has been prepared for Defense Metals

as part of the 2025 Pre-Feasibility Study (PFS). This Mineral Resource estimate has been prepared in accordance with the CIM

Definition Standards adopted

May 2014

The Mineral Resources stated below are constrained within an optimized pit shell to satisfy Reasonable Prospects of Eventual

Economic Extraction (RPEEE) requirements. The Mineral Resources include 29.2 Mt of Measured + Indicated resource at an average

grade of 2.27% TREO and 5.5 Mt of Inferred resource at an average grade of 1.42% TREO. No mining dilution has been incorporated

into the Mineral Resources stated below. The Mineral Resources are stated inclusive of Mineral Reserves.

A summary of the surface mineable Mineral Resources by rock type and Resource classification is shown in Table 9.

Table 9 – Summary of the Mineral Resources (as of February 7, 2025)

Mineral Resource

Rock Type

Tonnes

TREO

ppm

Measured

Dolomite Carbonatite

5,350

2.99

1161

3158

Limestone

1.99

851

2347

Syenite

1.41

561

1635

Xenolithic Carbonatite

300

1.64

662

1952

Total

5,720

2.90

1128

3079

Indicated

Dolomite Carbonatite

12,020

2.90

1139

3117

Limestone

160

1.41

573

1639

Syenite

1,280

1.08

445

1340

Xenolithic Carbonatite

9,980

1.32

549

1623

Total

23,430

2.12

846

2374

Measured + Indicated

Dolomite Carbonatite

17,370

2.93

1146

3129

Limestone

170

1.46

593

1688

Syenite

1,330

1.09

450

1352

Xenolithic Carbonatite

10,270

1.33

552

1633

Total

29,150

2.27

901

2512

Inferred

Dolomite Carbonatite

570

2.67

1072

2883

Limestone

210

1.51

603

1650

Syenite

1,480

0.92

408

1251

Xenolithic Carbonatite

3,240

1.43

589

1717

Total

5,500

1.42

590

1709

Mineral Resources Notes:

• CIM (2014) definitions were followed for Mineral Resources.

• The Qualified Person for the MRE is Doug Reid, P.Eng., EGBC (23347), an SRK employee.

• The effective date of the Mineral Resource is February 7, 2025

• Dollar values herein stated are United States Dollars (US$)

• Mineral Resources are reported assuming the prices listed below (a 15% uplift was applied to the Reserve prices):

• NdPr Oxide 132.70 $/kg REO

• Tb

1567.26 $/kg REO

• Dy

508.85 $/kg REO

• Mineral Resources are defined within a pit shell derived from the optimization software, GEOVIA Whittle™

•

Cut-off grade is based on the value factors generated in each block. The revenue and related costs vary based on the composition of different

elements in each block

. Value of a block is the revenue generated in that block minus the related processing and G&A operating costs.

• The base mining costs are assumed to be $4.50/t. The mining costs vary based by the bench and depth of the pit. The average mining costs for

the life of mine is calculated to be $4.74/t mined.

• Processing costs consist of flotation plant cost at the mine site and a hydrometallurgical/solvent extraction (hydrometallurgical) plant that is off the

mine property. The operating cost of the flotation plant is $27.60/t milled and the hydrometallurgical plant operating cost is $1,164.4/t of concentrate

treated.

• General and administration costs of the mine site is $3.67/t for ore milled.

• Tailings management and storage cost is $6.55/t of ore.

• Off-site cost (transportation) is $87.76/t of precipitate products produced.

• Processing recovery is calculated using the following formula:

• Flotation recovery for TREO = -11.183*TREO^2 + 67.831*TREO - 20.421940%. For ore above 3% TREO the flotation recovery is set to 82.4%.

For grade less than 0.32% TREO the flotation recovery is set to 0.0%.

• Flotation recovery for TREO then is multiplied by 0.995, 0.996, 0.734, 0.636 for Pr, Nd, Tb, Dy respectively to calculate the respective flotation

recovery for each element.

• Hydrometallurgical recovery for Pr, Nd, Tb, Dy are 0.932, 0.935, 0.802, 0.734 respectively

• A 95% payability has been applied to the final hydrometallurgical product.

• Bulk density is assigned by lithology.

• No mining dilution has been applied.

• Mineral Resources are reported inclusive of those Mineral Resources converted to Mineral Reserves.

• Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

• Figures are rounded to the appropriate level of precision for the reporting of mineral Resources. Due to rounding, some columns or rows may not sum

as shown.

• The TREO grade encompasses 15 rare earth elements present in the deposit

• The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other

relevant issues.

The Qualified Person,

Douglas Reid

, does not know of any legal, political, environmental, or other risks that could materially affect the

potential development of the mineral Resources. Mr. Reid personally inspected the Wicheeda Project on

October 31

and

November 1,

2024

Pre

Feasibility Study Review Webinar

Defense Metals will be hosting a webinar to discuss the results of the Wicheeda Project PFS during which members of the Defense

Metals' leadership team will be on the call. Participants will be able to submit questions or e-mail them in advance to

[email protected]

Date:

February 19, 2025

Time:

1:00 p.m. ET

10:00 a.m. PT

Link:

https://us02web.zoom.us/webinar/register/WN_BLHdzFqsSyufX1r2jYrFhQ

Qualified Persons – PFS Contributors

The Wicheeda Project PFS was conducted by independent representatives of Hatch and SRK (the PFS Contributors), each of whom is

a Qualified Person (QP) as defined by the Canadian Securities Administrators'

National Instrument 43-101 -

Standards of Disclosure

for Mineral Projects.

The PFS contributors prepared or supervised the preparation of information that forms the basis of the PFS disclosure in this news

release.

Each of the QPs is independent of Defense Metals and has reviewed and confirmed that this news release fairly and accurately

reflects, in the form and context in which it appears, the information contained in the respective sections of the Wicheeda Project PFS

report for which they are responsible. The affiliation and areas of responsibility for each QP involved in preparing the PFS are provided

as follows:

Hatch QPs:

Metallurgical review, process design and operating cost estimates:

Jeff Adams

for Hydrometallurgical

Joe Paventi for mine site flotation plant

Process plant and associated infrastructure cost estimates – Gerry Schwab

Financial analysis and market study –

Stefan Hlouschko

SRK QPs:

Mineral resources estimate –

Doug Reid

Mineral reserves, mine design and scheduling –

Anoush Ebrahimi

Mine costing –

Bob McCarthy

Tailings storage facilities – Ignacio Garcia

J.R. Goode, P.Eng., a consultant to the Company and a QP as defined in NI 43-101, reviewed and approved the metallurgical and

process design information in this news release.

About Defense Metals Corp. and its Wicheeda REE Deposit

Defense Metals Corp. is focused on the development of its 100% owned, 11,800-hectare (~29,158-acre) Wicheeda REE deposit that

is located on the traditional territory of the McLeod Lake Indian Band in

British Columbia, Canada

The Wicheeda Project, approximately 80 kilometres (~50 miles) northeast of the city of

Prince George

, is readily accessible by a

paved highway and all-weather gravel roads and is close to infrastructure, including hydro power transmission lines and gas pipelines.

The nearby Canadian National Railway and major highways allow easy access to the port facilities at

Prince Rupert

, the closest major

North American port to

Asia

For further information, please visit

www.defensemetals.com

or contact:

Alex Heath

Senior Vice President, Corporate Development & Interim CFO

Tel: +1 604-354-2491

Email:

[email protected]

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture

Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Statement Regarding "Forward-Looking" Information

This news release contains "forward looking statements" or "forward-looking information" (collectively, "Forward-Looking Statements")

← Back to feed