Sandfire Resources America Delivers Black Butte Copper PFS Upgrade with New Lowry Reserves, 12-Year Mine Life, High- Grade Production Profile and Stronger Project Economics
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17 E Main Street
PO Box 431
White Sulphur Springs, MT 59645
Tel: (406) 547-3466
Fax: (406) 547-3719
Web: www.sandfireamerica.com
Email: [email protected]
Sandfire Resources America Delivers Black Butte Copper PFS
Upgrade with New Lowry Reserves, 12-Year Mine Life, High-
Grade Production Profile and Stronger Project Economics
White Sulphur Springs, Montana – July 9, 2026 – Sandfire Resources America Inc. ("Sandfire
America" or the " Company") is pleased to announce the results of an updated Preliminary
Feasibility Study ("PFS") for the Black Butte Copper Project (the “Project” or “Black Butte Copper”)
that significantly enhances the Project's long-term value through the inclusion of the nearby Lowry
copper deposit (the "Lowry Deposit") in the mine plan. The updated PFS results position the Black
Butte Copper Project as one of the highest-grade undeveloped underground copper projects in the
United States.
PFS Update Highlights:
• Increased Revenue – The Project is forecasted to generate US$3.3 billion in gross revenue
and US$1.3 billion in pre-tax net cashflow during mine operations, based on a copper price
of US$4.70/lb.
• Stronger Economics – The Project has a pre-tax NPV8% of US$213 million (IRR=15.6%) and
a post-tax NPV8% of US$126 million (IRR=13.3%). Based on a copper price of US$6.00/lb
(which is close to the current spot price for copper ), pre-tax NPV8% increases to US$707
million (IRR=30.4%) with a post-tax NPV8% of US$516 million (IRR=26.3%).
• Reduced Unit Operating Costs – The addition of the high -grade Lowry Deposit to the
existing Johnny Lee Deposit (the “Johnny Lee Deposit”) is expected to lower unit operating
costs by US$2.28/tonne, while extending mine life by four years through the use of a more
cost-effective, mechanized long-hole stoping mining method in the Lowry Deposit, and by
realizing operational efficiencies through concurrent mining practices.
• Enhanced Cashflow Profile – Building on the previous release, the Project is forecasted to
deliver post-tax cashflow of US$476 million, an increase of US$122 million over the life of
the mine.
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• Increased Mine Life – The Project underpins an improved 12 -year mine life (which
represents a 50% increase over the initial 8 year mine life as indicated in the January 2026
PFS) and is designed to be mined at forecasted production totals of 1,445,000 dry metric
tonnes of copper concentrate containing 370,000 tonnes of copper metal over the mine’s
lifespan.
• Improved annual production – The average annual production is calculated to be ~31,000
tonnes of contained copper metal over a 12 year mine life at a direct operating cash cost
of US$2.68/lb.
• For the Johnny Lee Deposit, the Measured and Indicated Mineral Resource of 18.9 million
tonnes at 2.4% copper for 462,000 tonnes of contained copper and Inferred Mineral
Resource of 3.4 million tonnes at 1.9% copper for 64,000 tonnes of contained copper are
maintained.
• Using a Net Smelter Return cut off value of US$110/t , the Probable Mineral Reserves for
the Johnny Lee Upper and Lower Copper Zones are reported at 9.5 million tonnes of 2.9%
copper for 270,000 tonnes of contained copper.
• For the Lowry Deposit , located 3 k ilometers south-east of the Johnny Lee Deposit, a
Measured and Indicated Mineral Resource of 17.9 million tonnes at 1.4% copper for
248,000 tonnes of contained copper, and Inferred Mineral Resource of 13.7 million tonnes
at 1.1% copper for 151,000 tonnes of contained copper have been defined for the updated
PFS.
o The development of the Lowry Deposit remains subject to permitting and
regulatory approvals.
• Using a Net Smelter Return cut off value of US$110/t , the Probable Mineral Reserves are
reported at 4.7 million tonnes of 2.1% copper for 100,000 tonnes of contained copper ,
defined for the Lowry Middle and Lower Copper Zones.
• The Project maintains a construction capital cost estimate of US$474 million , consistent
with the January 2026 PFS.
The revised PFS confirms a s ignificant milestone for the Project, increasing combined Probable
Mineral Reserves to 14.3 million tonnes grading 2.6% copper , extending the forecasted mine life
by 50% from eight to t welve years, and delivering stronger project economics through a higher -
grade blended production profile. The Company intends to continue its efforts to optimize the mine
plan with the goal of improving operating efficiencies, increasing lon g-term cash flow generation,
and strengthening the Project’s overall value.
The PFS scope includes Mineral Resources and Reserves associated with the Johnny Lee Deposit
(the cornerstone deposit at the Black Butte Copper Project) and an updated Mineral Resource and
maiden Reserves Estimate for the Lowry Deposit, which is located approximately 3 kilometers
south-east of the Johnny Lee Deposit.
Together, the Johnny Lee and Lowry Deposits establish Black Butte Copper as one of the premier
high-grade underground copper development projects in the United States, further reinforcing its
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strategic importance as a future domestic supplier of responsibly produced copper at a time of
increasing demand for secure North American critical mineral supply chains.
The PFS has been prepared in accordance with National Instrument 43 -101 – Standards of
Disclosure for Mineral Projects (NI 43 -101) and includes Mineral Resources and Mineral Reserves
for the Johnny Lee Deposit and updated Mineral Resources and maiden Mineral Reserves for the
Lowry Deposit.
Sandfire America CEO, Lincoln Greenidge, commented:
“Today’s updated PFS marks a major milestone for Black Butte Copper, confirming Johnny Lee as
one of the highest-grade undeveloped underground minable copper deposits in the United States.
We have achieved this while meeting or exceeding the rigorous environmental and operational
standards of our Mine Operating Permit, reinforcing our commitment to responsible mining in
Montana.
Furthermore, the updated Mineral Resource estimate and new Mineral Reserve estimate for the
Lowry Deposit highlights significant growth potential beyond our initial 8-year mine life. Together,
these updates position the Black Butte Copper Project as a critical domestic copper asset when
secure U.S. mineral supply is paramount.
Our focus now turns to completing our strategic review with the expectation of moving closer to
building the mine. We remain dedicated to delivering long-term economic benefits to Meagher
County, Montana, and the United States as a whole, while driving meaningful value for our
shareholders.”
1. Black Butte Copper Project Overview
The Project consists of 7,684 hectares of fee simple lands and 1,040 unpatented mining claims on
U.S. Forest Service lands totaling 8,078 hectares, held by the Company through surface and mineral
leases. The Project is located in south-central Montana in Meagher County, which is 27 km north of
White Sulphur Springs.
Johnny Lee Deposit
The Johnny Lee Deposit was discovered by a joint venture between Cominco American Inc. and
Utah International in 1985. The Johnny Lee Deposit is comprised of two zones of mineralization:
• The Johnny Lee Upper Copper Zone (“JL UCZ”), which is situated at depths of 40m – 210m
below the surface.
• The Johnny Lee Lower Copper Zone (“JL LCZ”), which is situated at depths of 340m – 520m
below the surface.
A mine operating plan (“MOP”) application for the extraction of mineralized rock from both zones
of the Johnny Lee Deposit was submitted to the Montana Department of Environmental Quality
(“MT DEQ”) in December 2015. The application was deemed to be complete and compliant, and a
draft MOP permit was issued by the MT DEQ on September 18, 2017.
After a full Environmental Impact Statement process , a positive MT DEQ record of decision was
received on April 9, 2020, allowing for the development and underground mining of the Johnny Lee
Deposit to proceed. On August 14, 2020, the MT DEQ approved the bond posting and issued a final
Mine Operating Permit allowing the Company the right to commence Phase I Development surface
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construction at the mine site.
Following a 2020 legal challenge to the Mine Operating Permit, on February 26, 2024, the Company
received a positive ruling by the Montana Supreme Court reversing a 2021 district court decision
and instructed the district judge to have the MT DEQ completely reinstate Tintina Montana Inc.’s
(a wholly-owned subsidiary of Sandfire America) Mine Operating Permit for Black Butte Copper.
The Montana Supreme Court granted the Company’s request for summary judgement allowing the
Company to move forward with construction of its underground copper mine. The Company won
on all counts in the Montana Supreme Court with a 5-2 decision upholding the 2020 decision of the
MT DEQ to allow responsible copper mining at the Project.
The MOP proposes underground mining of the Johnny Lee Deposit using a drift and fill mining
method and production of a copper concentrate by milling and froth flotation. Mill tailings will be
used for underground paste -fill support and the surplus deposite d in a double -lined cemented
tailings storage facility.
Lowry Deposit
The Lowry Deposit is located approximately 3 kilometers to the south -east of the Johnny Lee
Deposit. Copper mineralization is primarily hosted in the Lowry Middle Copper Zone
(“LMCZ”) and Lowry Lower Copper Zone (“LLCZ”), each surrounded by a lower grade “halo” of
copper mineralization.
The Lowry Upper Copper Zone (“LUCZ”) solely includes an Inferred copper resource. The LUCZ and
LLCZ are very similar in character to the JL UCZ and JL LCZ, respectively, and occupy similar
stratigraphic positions in the host Newland Formation. The LMCZ occupies a stratigraphic position
below the LUCZ and consists of breccia hosted mineralization most like the JL LCZ and LLCZ.
The Lowry Deposit has not yet been permitted through the MT DEQ. A permitting plan and initial
activities are ongoing in support of permitting the Lowry Deposit for inclusion into the MOP. Lowry
permitting is expected to be finalized within six years following commencement of the main Johnny
Lee access decline ( named the “Jerry Zieg Decline” in honor of the contributions made by Senior
Vice President of Exploration, Jerry Zieg, to the Project).
For further details about the Black Butte Copper Project, please go to the Sandfire Resources
America Inc. website at www.sandfireamerica.com.
2. PFS Update
The updated PFS builds on the Company's previously disclosed studies, including the December
2020 Feasibility Study and the January 2026 P FS. While prior studies focused primarily on the
permitted Johnny Lee Deposit, the current update incorporates a revised Mineral Resource and a
maiden Mineral Reserve estimate for the Lowry Deposit, together with updated geotechnical,
metallurgical, mine planning, and economic analyses. The updated mine plan and economic
assessment are based on Mineral Reserves from both deposits; however, development of the Lowry
Deposit remains subject to additional permitting and regulatory approvals. The Lowry deposit is not
scheduled to commence until seven years after the commencement of the Jerry Zieg Decline to
account for permitting timeframes.
Readers are referred to the Company’s previously released January 2026 PFS and supporting
technical reports for detailed information regarding the Johnny Lee Deposit. This announcement
highlights the incremental benefits to the Black Butte Copper Project a rising from the addition of
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the Lowry Deposit Mineral Reserves, including increased mine life, enhanced production profile,
and improved project economics.
2.1 Economic Analysis
The updated economic analysis is based on the Johnny Lee Deposit and Lowry Deposit Mineral
Reserves. The copper price assumption adopted for the base case is US$4.70/lb. from the start of
production.
The Project’s post-tax NPV at an 8% discount rate is estimated to be US$ 126M with an IRR of 13.3%.
Pre-tax NPV at an 8% discount rate is estimated to be US$213M with an IRR of 15.6%. Initial capital
costs are estimated to be US$474M, and sustaining capital is estimated to be US$180M. Cash Costs
are estimated to be US$2.68/lb of copper. The life-of-mine all-in sustaining cost (AISC) is estimated
to be US$3.04/lb of copper. Payback of start-up capital is achieved approximately four years from
commissioning.
2.2 Mineral Reserves - Johnny Lee and Lowry Deposits
The Mineral Reserve for the Project was prepared in accordance with Canadian Institute of Mining
and Metallurgy and Petroleum (“CIM”) Definition Standards and will be supported by the updated
PFS.
A net smelter return (“NSR”) value was calculated for each block in a geological block model based
on metallurgical recovery, grade, price and payability factors. Mine design production shapes were
generated based on an NSR cut-off value of US$110/t (operating cost) . An NSR cut-off value of
US$45/t (incremental operating cost) was used to determine whether development material that
needs to be mined to access production shapes should be sent to waste, or processed. Detailed
mine designs were created with dilution and recovery factors applied, mineral resource
classification considered, and other modifying factors and economic viability tested. The combined
Probable Mineral Reserve for the Johnny Lee and Lowry Deposits are shown in Table 1.
Table 1 – Mineral Reserve for Johnny Lee and Lowry Deposits
Deposit Class Diluted Tonnes (Mt) Cu Grade (%) Contained Cu Metal (kt)
Johnny Lee
Proven - - -
Probable 9.5 2.9 270
Lowry
Proven - - -
Probable 4.7 2.1 100
Combined
Proven - - -
Probable 14.3 2.6 370
Notes:
1. The Qualified Person for the Mineral Reserve estimate is Shane McLeay FAusIMM.
2. All Mineral Reserves have been estimated in accordance with CIM definitions, as required under NI
43-101.
3. Mineral Reserves were estimated using a US $4.70 /lb. Cu price and NSR cut-off value s of
US$110/t (operating cost) and US$45/t (incremental operating cost).
4. Tonnages are rounded to the nearest 100 kt, metal grades are rounded to one decimal place, and
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metal tonnes are rounded to the nearest 10kt. All units are metric.
5. Rounding as required by reporting guidelines may result in summation differences.
6. Average LOM Metallurgical Recovery is 95% for JL LCZ, 78% for JL UCZ, 91% for the L MCZ, 94% for
the LLCZ, and 88% combined.
7. Johnny Lee Mineral Reserves are based on the Johnny Lee Mineral Resource, effective as of
November 5, 2025. Lowry Mineral Reserves are based on the Lowry Mineral Resource, e ffective as
of June 17, 2026.
8. Mineral Reserves are a subset of Mineral Resources.
The Mineral Reserves identified in Table 1 comply with CIM definitions and NI 43- 101 disclosure
standards. Detailed information on mining, processing, metallurgical, and other relevant factors
demonstrates, at the time of the update, that economic extraction is feasible. The updated PFS did
not identify any mining or metallurgical factors that may materially affect the estimates of the
Mineral Reserves or potential production. Further studies on the Lowry Deposit will be conducted
to understand po tential required changes to the Black Butte Copper Projects infrastructure to
support concurrent mining of both deposits. Table 2 below shows the Mineral Reserves broken out
by zone:
Table 2 – Mineral Reserves for the Johnny Lee and Lowry Deposits by Zone
Zone Class Diluted Tonnes (Mt) Cu Mined Grade (%) Mined Cu Metal
(kt)
JL UCZ Total
Proven - - -
Probable 6.7 2.2 150
Total 6.7 2.2 150
JL LCZ Total
Proven - - -
Probable 2.8 4.6 130
Total 2.8 4.6 130
LMCZ Total
Proven - - -
Probable 4.2 2.1 90
Total 4.2 2.1 90
LLCZ Total
Proven - - -
Probable 0.6 2.1 10
Total 0.6 2.1 10
Project Total
Proven - - -
Probable 14.3 2.6 370
Total 14.3 2.6 370
Notes:
1. Tonnages are rounded to the nearest 100 kt, metal grades are rounded to one decimal place, and
metal tonnes are rounded to the nearest 10kt. All units are metric.
2. Rounding as required by reporting guidelines may result in summation differences.
3. Mineral Reserves were estimated using a US $4.70 /lb. Cu price and NSR cut -off values of
US$110/t (operating cost) and US$45/t (incremental operating cost).
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2.3 Johnny Lee Deposit - Mineral Resource Estimate
The updated Mineral Resource estimate for the Johnny Lee Deposit has been prepared under the
supervision of Berkley Tracy, P. Geo (PGO#3024) of SRK Consulting (U.S.), Inc . (“ SRK”), an
independent Qualified Person (“QP”) as defined in NI 43-101.
The Johnny Lee Mineral Resource estimate remains unchanged from the previously reported
mineral resource estimate. Readers can refer to the January 2026 PFS for a detailed discussion of
the estimate and methodology.
2.4 Lowry Deposit - Mineral Resource Estimate
The updated Mineral Resource statement for the Lowry Deposit is summarized in Table 3. The
Mineral Resource statement is supported by recent updates to geological modeling, resource
estimation, and mineralogy with recovery assumptions in addition to historic drilling, analyses, and
studies. The Lowry Deposit is deeper and has a lower density of drilling than the Johnny Lee Deposit.
Mineralization is hosted in two distinct zones of > 1.2% Cu mineralization:
• Lowry Middle Copper Zone (LMCZ)
• Lowry Lower Copper Zone (LLCZ)
A total of 73 drillholes have been used for the PFS update for the Lowry Deposit Mineral Resource.
No drilling has been completed in the Lowry area since 2023. Drillhole intersection spacing in the
LMCZ ranges from 10 – 100 m.
The LMCZ is hosted by broad zones of dolomitic breccia in interbedded pyrite layers, conglomerate,
carbonaceous shale, dolomitic shale and dolomite. Many of the drillholes that intersected the
LMCZ were stopped-short of the LLCZ; consequently, drillhole spacing in the LLCZ is larger than that
of the LMCZ, ranging from 50 – 200m. The LLCZ occurs below the Volcano Valley Hanging Wall with
the mineralized base following the Volcano Valley Footwall Zone. The LLCZ is hosted by interbedded
shale, conglomerate, and pyrite beds.
Lowry mineralized intercepts from seven drillholes of the 2021–2022 drilling campaign were used
to generate a composite metallurgical sample within the LMCZ and a separate composite within
the LLCZ. Selected samples were sent to the Base Metal Labs in Kamloops , Canada for rock
characterization and recovery testing.
The LMCZ composite sample generated a 91% copper recovery with the LLCZ yielding a 94%
recovery. For the Lowry Deposit, metallurgical recovery was previously assigned using the mean
copper recovery of 86% from prior test work across the deposit. Based on the new test work, the
increased recovery values of 91% for the LMCZ and 94% for the LLCZ were used in the
current calculation of NSR cut-off values.
Mineral Resource classification was assigned to the Lowry Deposit block model by the QP based on:
• Geological knowledge
• Continuity of Cu grade within mineralized zones
• Thickness of the mineralized zones
• Confidence in the underlying data, including logging, assay, and physical testing
• Spatial continuity as determined through variography for Cu and recovery data
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• Kriging quality variables, including kriging efficiency, slope or regression, average distance
to samples, and estimation run pass
Blocks within the LUCZ, LMCZ and LLCZ have been categorized consistent with the CIM definitions
and guidelines. A combination of block scripting and manual smoothing with polylines was used to
apply the appropriate block classification of Mineral Resource categories.
Mineral Resources for the Lowry Deposit have been calculated and reported using an economic NSR
cut-off value (“ NSR CoV”), as estimated in the resource block model. The Mineral Resource
statements are supported by drilling, analyses, geological modelling, and metallurgical studies that
determined updated recoveries. The deposits have been classified into Measured, Indicated, and
Inferred Mineral resources, as per CIM definitions.