Strategic Metals Ltd Advances its Division Mountain Project with a Scoping Study and a Preliminary Economic Assessment
Strategic Metals Ltd Advances its Division Mountain Project with a Scoping Study and a
Preliminary Economic Assessment
Vancouver, B.C. – August 20, 2026 – Strategic Metals Ltd (TSX-V: SMD) (“Strategic”) is pleased
to release two reports concerning it s wholly owned Division Mountain Coal Project (“Division
Mountain”), located in south-central Yukon, 90 km north of Whitehorse. Division Mountain hosts
a road-accessible, measured resource totalling 52.5 million tonnes of High V olatile “B”
Bituminous coal and other unquantified, but drill confirmed coal occurrences. Strategic, through
a wholly owned subsidiary – Yukon Energy Solutions (“YES”) – is exploring the potential to
develop one or more coal -fired power plant (s) using coal from an open pit mine at Division
Mountain, to alleviate a growing shortage of electricity in Yukon.
Yukon has an isolated power grid that has traditionally been supplied by three hydroelectric
facilities. However, in recent years these facilities have not been able to keep pace with growing
residential, service and mining demand, especially in winter months. Some electricity is produced
by solar and wind facilities, but these green energy sources have constraints due to Yukon’s high
latitude location and unreliable weather. Increasingly, the local utilities have had to use diesel and
liquefied natural gas (“LNG”) generators to make up the shortfall in electrical demand. The diesel
and LNG used in these generators is purchased from outside the territory and trucked to Yukon,
resulting in expensive electrical rates, outflow of capital and significant increases in truck traffic
on highways. Yukon’s small population and limited industrial base make construction of capital-
intensive energy projects (such as large hydro projects or small modular reactors) impractical.
Realizing that Yukon is faced with using imported diesel and LNG to satisfy its growing electrical
demand, Strategic and YES decided to evaluate the possibility of using locally sourced coal as an
alternative fuel for generating electricity. Accordingly, it engaged Allnorth Consultants Limited,
an independent engineering group based in Vancouver, BC, to prepare two reports: one - a scoping
level evaluation looking at the viability of constructing one, 100 MW or two 50 MW power plants
and the other - a Preliminary Economic Assessment (“PEA”) to design and evaluate potential for
an open pit coal mine to supply the power plant(s). The production rates of the power plant(s) and
mine studied in the PEA were selected on a preliminary basis - sizing will be refined as discussions
progress with utilities and mining companies, the end-users of electricity or coal.
The Division Mountain deposit contains enough measured resources to supply a 100 MW plant
for about 105 years and could be scaled to provide larger annual production if necessary. Strategic
and YES envision coal as a medium-term solution to Yukon electrical demand issues and as such
asked that the power plant(s) be designed for a 30-year life.
The scoping study report is entitled New Coal Fired Power Plant Concept Study Division
Mountain and is dated July 28, 2026. It looked at construction and operating cost s of coal-fired
power plant(s) located adjacent to an open pit mine and calculated a cost for electrical generation.
It also compiled data concerning electrical generation in Yukon using diesel and LNG as fuels.
The report concluded that a 100 MW coal fired plant could potentially produce commercially
viable electricity at a cost of $0.20/kWh and that two 50 MW plants could produce electricity at a
cost of $0.22 /kWh. The projected rates are both lower than costs estimated for LNG ($0.23 -
0.26/kWh) and diesel ($0.33/kWh). Costing in the report utilized current pricing from North
American suppliers and noted that significant reductions could result if equipment was purchased
from European or Asian suppliers or if used equipment was obtained. The report also pointed out
that a coal-fired plant could produce potentially valuable co-products, notably hot water for heating
purposes and fly ash for use in the construction industry. Emissions of carbon dioxide (CO2) from
the designed coal-fired plant would be higher than those from LNG or diesel generation, but if the
hot water was used to heat buildings, greenhouses or other structures, this use could result in
significant carbon credits that could bring the effective coal-fired CO2 emissions below those of
LNG or diesel. Other emissions from the designed coal -fired plant are well below permissible
discharge levels and compare favourably with those from LNG and diesel. The scoping report is
available for viewing on YES’s website www.yukonenergysolutions.com.
Carbon capture and sequestration technology offers potential for further very significant reductions
in emissions from the proposed coal-fired power plant(s), but this technology was not included in
the power plant study. Discussions are now underway regarding possible use of carbon capture
and sequestration at Division Mountain.
The second report is entitled NI 43-101 Preliminary Economic Assessment Technical Report –
Division Mountain Property with an effective date of August 17, 2026. This report calculated the
coal resource, designed an open pit mine and processing plant capable of supplying 500,000 tonnes
of clean coal/year for 30 years, and estimated capital and operating costs for such a mine . The
mineral resource was estimated by Tom Becker as previously reported by Strategic on December
11, 2025. The PEA was authored by Michael Allen, P.Eng who is an independent Qualified Person
as defined by National Instrument 43-101. The reader is cautioned that m ineral resources are not
mineral reserves and do not demonstrate economic viability.
The PEA report concluded that clean coal could be delivered to the power plant at an average
operating cost of $52/tonne and that mining could be done with an average stripping ratio of 3.5:1
waste to run-of-mine coal. Capital cost for the mine is $122 M including a $20.3 M contingency.
The 100 MW power plant has an estimated fixed cost of $11.2 M per year and a variable cost of
$6.4 per MWh or $4.8 M per year, which together with the cost of the coa l equates to an average
total operating cost of $ 52/MWh. Capital cost for the power plant and related infrastructure ,
including construction of a camp and a transmission line connecting the power plant to the grid, is
$856.6 M with a contingency of $ 113.6 M. Total capital cost is $978.6 M, including total
contingencies of $133.9 M. The cash flow model also includes $20 M for a reclamation bond.
Analysis indicates that project economics are highly sensitive to both electrical sales price and the
discount rate. For the Base Case capital cost scenario with a discount rate of 8%, the project
achieves an after -tax IRR of approximately 8% at an electrical sales price of approximately
$194/MWh, excluding any applicable carbon taxes.
Carbon taxes have not been included in this base case calculation because there is uncertainty as
to what the rates will be in the future and it is possible that CO2 emissions from a plant at Division
Mountain could be substantially reduced or eliminated through cogeneration off-set credits and/or
use of carbon capture and sequestration technology. If the project were subject to full carbon taxes,
the average electrical sales price would rise to $292/MWh with an 8% IRR at a discount rate of
8%.
The National Instrument 43-101 Technical Report for the PEA has been filed on SEDAR+ at
www.sedarplus.ca on the same day as this release and is also available for viewing on YES’s web
site www.yukonenergysolutions.com.
“Strategic and YES feel strongly that the Division Mountain Project offers Yukon an economically
and environmentally viable alternative to expensive imported hydrocarbon fuels for electrical
power generation”, stated Doug Eaton, President and CEO of Strategic. “Electrical generation
using Division Mountain coal could result in lower electrical bills for residential and industrial
users, eliminate tenuous supply chains and outflow of capital related to importation of diesel and
LNG, and lead to greater self-sufficiency for food supply if hot water from the coal-fired plant is
used to heat greenhouses and other infrastructure. Strategic and YES look forward to establishing
strong partnerships that will advance this vision and thus promote security and growth in Yukon.”
Technical information in this news release has been reviewed and approved by Strategic’s Vice
President Exploration, Jackson Morton, P.Geo., a qualified person as defined under the terms of
National Instrument 43-101.
About Strategic Metals Ltd.
Strategic is a project generator with 16 royalty interests, 14 projects under option to others, and a
portfolio of approximately 80 wholly owned projects that are the product of over 50 years of
focussed exploration and research by a team with a track reco rd of major discoveries. Projects
available for option, joint venture or sale include drill-confirmed prospects and drill-ready targets
with high-grade surface showings and/or geochemical anomalies and geophysical features that
resemble those at nearby deposits
Strategic has a current cash position of approximately $5 million and large shareholdings in several
active mineral exploration companies including 32% of Broden Mining Ltd., 30.4% of GGL
Resources Corp., 28% of Rockhaven Resources Ltd., 15.5% of Silver Ra nge Resources Ltd., and
4.3% of Trifecta Gold Ltd. All these companies are engaged in promising exploration projects.
Strategic also owns 15 million shares of Terra CO2 Technologies Holdings Inc. (“Terra”), a private
Delaware corporation developing a cost -effective alternative to Portland cement, which recently
broke ground on its first low -carbon cementitious materials facility in Cleburne Texas following
the closing of a US$124.5M financing.
ON BEHALF OF THE BOARD
“W. Douglas Eaton”
President and Chief Executive Officer
For further information concerning Strategic or its various exploration projects please visit our
website at www.strategicmetalsltd.com or contact:
Corporate Information
Strategic Metals Ltd.
W. Douglas Eaton
President and C.E.O.
Tel: (604) 688-2568
Investor Inquiries
Richard Drechsler
V .P. Communications
Tel: (604) 687-2522
NA Toll-Free: (888) 688-2522
http://www.strategicmetalsltd.com
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 release.
This news release may contain forward looking statements based on assumptions and judgments of
management regarding future events or results that may prove to be inaccurate as a result of exploration
and other risk factors beyond its control, and actual results may differ materially from the expected results.