PFS improves on 2025 PEA with lower Phase 1 capital, lower operating cost, higher recovery and a faster 4.2-year payback over a 42-year mine life

Surge Battery Metals Inc. (TSX-V: NILI) (OTCQX: NILIF) (FSE: DJ5) is pleased to announce the results of the Pre-Feasibility Study for the Nevada North Lithium Project located in Elko County, Nevada. The Project is held by Nevada North Lithium LLC, a joint venture owned 67.5% by Surge and 32.5% by Evolution Mining Limited. The PFS was prepared by Fluor Corporation as lead engineer, with Independent Mining Consultants, Inc. responsible for the mine plan and Mineral Reserve estimate, RESPEC Company, LLC for the Mineral Resource estimate, and other independent consultants identified under “Qualified Persons” below. All figures are in United States dollars on a 100% Project basis unless otherwise stated.

The PFS contemplates an open-pit mine and on-site processing facility producing battery-grade lithium carbonate from high-grade lithium claystone ore. The Project will be developed in two phases. Phase 1 establishes the mine, a process plant with design capacity of approximately 55,900 tonnes per year of battery-grade lithium carbonate, a sulfur-burning sulfuric acid plant with on-site power generation and supporting infrastructure. Phase 2 doubles processing capacity, with production peaking at approximately 111,400 tpa and averaging approximately 92,250 tpa lithium carbonate over the life of mine.

PFS Highlights

• After-tax net present value (8% discount) of US$9.81 billion and after-tax internal rate of return of 23.6%; pre-tax NPV8% of US$11.55 billion and pre-tax IRR of 24.6%.
• After-tax payback of 4.2 years from the start of production.
• After-tax NPV8% remains positive across the full ±30% range of every variable tested, including approximately US$4.6 billion at a 30% lower lithium carbonate price (US$16,800/t).
• Phase 1 initial capital of US$2.77 billion, including US$442 million of contingency, based on an AACE Class 4 estimate (±25%) prepared by Fluor. Phase 2 expansion capital of US$2.35 billion.
• LOM average cash operating cost of US$4,719 per tonne lithium carbonate, approximately 10% below the US$5,243/t estimated in the 2025 PEA.
• Low mining cost of approximately US$380 per tonne lithium carbonate, only 8% of total cash operating cost, driven by a low waste-to-ore strip ratio of 0.88:1 and free-digging with no blasting planned in the main pit.
• Proven and Probable Mineral Reserve of 218.3 million tonnes at 3,928 ppm Li containing 4.56 million tonnes lithium carbonate equivalent (“LCE“), supporting a 42-year mine life, with no Inferred Mineral Resources in the PFS mine plan.
• LOM average production of approximately 92,250 tpa lithium carbonate, averaging approximately 105,000 tpa in Years 4 to 14 and peaking at approximately 111,400 tpa in Year 7.
• Overall process lithium recovery of 84.9%, up from 82.8% in the 2025 PEA, supported by metallurgical test work completed by Sepro Laboratories and Kemetco Research Inc.
• Battery-grade product demonstrated: lithium carbonate assaying 99.0% Li₂CO₃, produced from Project claystone during PFS metallurgical test work, was refined by Chemshift Technologies Inc. to a product of 99.95% Li₂CO₃, demonstrating a complete flowsheet from run-of-mine claystone to battery-grade product.

Management Commentary

Greg Reimer, President and Chief Executive Officer of Surge, stated: “This Pre-Feasibility Study is the product of a tremendous team effort, and it has been a pleasure working alongside the world-class engineers and scientists at Fluor, Kemetco, Sepro, Chemshift, IMC and RESPEC. Together, we have taken Nevada North from a promising claystone deposit to a project supported by a Mineral Reserve, Class 4 engineering and battery-grade lithium carbonate made from our own ore. The PFS demonstrates that the NNLP can become a competitive source of domestic lithium production for America’s growing battery industry. Providing not only jobs but over $11b in federal and state taxes and royalties. We look forward to working with our JV partner Evolution mining as we advance to Feasibility and a final investment decision.”

Summary of Key PFS Results

Table 1: Key PFS metrics (100% basis unless stated). Financial results in constant Q2 2026 US dollars, 100% equity financed, mid-year discounting, no escalation. Net present values are discounted to January 1, 2028, the first year of construction capital expenditure.

Comparison to the 2025 Preliminary Economic Assessment

The PFS supersedes the Preliminary Economic Assessment dated May 19, 2025 (technical report filed on SEDAR+ on July 24, 2025). The PFS incorporates the updated Mineral Resource Estimate announced May 14, 2026, a revised mine plan and Fluor’s Class 4 engineering and cost estimates. Nearly every major input from the PEA has been advanced to a materially higher level of definition. The mine plan now rests solely on Proven and Probable Mineral Reserves, the process flowsheet has been demonstrated end-to-end on Project claystone through a substantially broader and more detailed metallurgical program, and capital and operating costs are now based predominantly on engineered quantities and vendor pricing, with a significantly reduced reliance on factored estimates compared with the PEA. The improvements in recovery, operating cost and Phase 1 capital shown in Table 2 therefore rest on a considerably more rigorous technical foundation than the PEA. The PFS also adopts a more conservative production ramp-up than the PEA, with first-year production at approximately 29% of design capacity. The long-term lithium carbonate price assumption is unchanged at US$24,000/t.

Table 2: PFS versus 2025 PEA. The PEA included Inferred Mineral Resources; the PFS is based on Proven and Probable Mineral Reserves only, with no Inferred Mineral Resources in the mine plan.

Capital Cost Estimate

Fluor prepared an AACE Class 4 capital cost estimate (accuracy ±25%) with a base date of Q2 2026, using FEL 2 engineering deliverables, vendor budget quotations, engineered material take-offs, historical project data and Fluor unit rate and productivity databases. The estimate includes a US$75 million design development allowance to incorporate refinements identified in metallurgical test work completed in July 2026, primarily in the solid-liquid separation and leach residue filtration areas, and a US$50 million allowance for the electrical grid interface.

Table 3: Phase 1 initial and Phase 2 expansion capital cost estimate. Figures may not sum due to rounding.

Phase 2 expansion capital is estimated at US$2.35 billion, approximately 15% below Phase 1 initial capital, for an expansion that doubles processing capacity. Because Phase 2 replicates the Phase 1 process design, the Phase 2 estimate is built up from the Phase 1 Class 4 estimate, adjusted for synergies identified through a structured review of the Phase 1 work breakdown structure. Savings reflect improved construction productivity, reuse of Phase 1 engineering and execution, lower contingency, and shared site infrastructure and facilities. The financial model schedules Phase 2 construction to commence in the final pre-production year, with most of the Phase 2 expenditure (approximately US$1.88 billion) incurred in the first two years of Phase 1 operations and funded in part from Phase 1 cash flow. Total capital spent prior to first production, including the initial Phase 2 expenditure, is approximately US$3.24 billion. LOM sustaining capital is estimated at approximately US$1.65 billion, with closure and reclamation costs of approximately US$120 million carried separately.

Operating Cost Estimate

An AACE Class 4 operating cost estimate was developed from the FEL 2 process design criteria, mass balance, equipment list, operating organization model and production forecast. Reagent consumption was derived from the process mass balance, with unit pricing based on supplier quotations, owner market information and benchmark data from comparable lithium projects. Process plant and G&A labor costs are based on approximately 205 personnel for Phase 1, increasing to approximately 335 with Phase 2, benchmarked against Nevada mining and processing wages.

Table 4: LOM average operating costs. Excludes royalties, property taxes, transportation, sustaining capital and closure costs.

Reagent procurement and logistics represent approximately 64% of total operating costs and will be a key focus of optimization during the next phase of engineering.

Economic Analysis and Sensitivities

The economic analysis was completed using a discounted cash flow model on an annual, mid-year convention basis, assuming 100% equity financing. The model includes a transportation and handling allowance of US$45/t of lithium carbonate sold and a royalty allowance on production from ore mined on the private lands. Taxes modeled include U.S. federal corporate income tax (21%), the Nevada Net Proceeds of Minerals tax (5%) and property taxes. Closure costs of US$120 million are included. Over the LOM, the Project is expected to generate approximately US$11.4 billion in federal and state taxes, property tax, and royalties. The tax model, prepared with Mining Tax Plan LLC, applies percentage depletion, the foreign-derived intangible income deduction on the 80% of sales assumed to be exported, and the transferable Section 45X Advanced Manufacturing Production Credit, which phases out after 2033 and contributes approximately US$330 million in the first three years of production.

Table 5: After-tax IRR sensitivity to lithium carbonate price, operating cost, capital cost and sulfur price. The base lithium carbonate price of US$24,000/t ranges from US$16,800/t (−30%) to US$31,200/t (+30%).

Table 6: After-tax NPV8% sensitivity to lithium carbonate price, operating cost, capital cost and sulfur price.

Project value is most sensitive to lithium carbonate price and less sensitive to capital and operating costs. The Project maintains a positive after-tax NPV8% across the full ±30% range of every variable tested, and the after-tax IRR remains approximately 19% under a 30% increase in capital cost.

Mining

The PFS mine plan outlines a conventional open-pit, free-digging operation using backhoes, front-end loaders and 50-tonne haul trucks, with no blasting planned in the main pit. Over the LOM, the plan calls for mining approximately 411 million tonnes of total material, including 218.3 million tonnes of ore at an average grade of 3,928 ppm Li. Peak total material movement is approximately 16.8 million tonnes per year. The mine plan is based on a lithium cut-off grade of 1,250 ppm Li (diluted) and front-loads higher-grade material, with an average processed grade of approximately 4,340 ppm Li over the first ten years of operation.

Mineral Reserve and Mineral Resource Estimates

The Mineral Reserve estimate, prepared by IMC with an effective date of July 28, 2026, is summarized below. The PFS mine plan contains no Inferred Mineral Resources.

Table 7: NNLP Mineral Reserve estimate (effective date July 28, 2026). Mineral Reserves are reported in accordance with the CIM Definition Standards (2014) at a cut-off grade of 1,250 ppm Li (diluted), derived at a lithium carbonate price of US$16,500/t LCE. Lithium is converted to LCE using a factor of 5.323. The mining dilution and mining losses are incorporated within the model. Figures may not sum due to rounding.

The Mineral Resource estimate, prepared by RESPEC with an effective date of May 1, 2026, is summarized below. Mineral Resources are reported inclusive of Mineral Reserves.

Table 8: NNLP Mineral Resource estimate at a 1,250 ppm Li cut-off grade (effective May 1, 2026). Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

Notes:

(1) Prepared by RESPEC under the supervision of Nathan Forsythe, C.P.G., in accordance with the CIM Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines and reported in compliance with NI 43-101.
(2) Resources are constrained by an optimized pit shell; block grades were interpolated using the inverse distance squared method in Hexagon MinePlan 3D.
(3) The 1,250 ppm Li cut-off grade reflects an operating cost of US$82.43/t processed, lithium recovery of 84.9% and a lithium carbonate price of US$20,000/t.
(4) A Li to Li₂CO₃ conversion factor of 5.323 was used.
(5) Figures may not sum due to rounding.

Processing

The process flowsheet has been designed to produce battery-grade lithium carbonate on site from lithium-bearing claystone. Key process stages include:

• Ore preparation and attrition scrubbing to disperse the clay and liberate the lithium-bearing fines;
• Gravity beneficiation using centrifugal concentrators and hydro-classifiers to reject coarse, low-grade gangue ahead of leaching;
• Sulfuric acid leaching, followed by solid-liquid separation and residue filtration;
• Solution purification, including magnesium sulfate crystallization, followed by lithium carbonate precipitation and refining to battery-grade product; and
• An on-site sulfur-burning sulfuric acid plant whose waste heat generates most of the site’s power requirements, supplemented by a grid connection.

The PFS flowsheet is supported by metallurgical test work covering each stage of the process. Sepro completed beneficiation test work on the PFS Master Composite (4,352 ppm Li), including batch testing of approximately 1.9 tonnes in a pilot-scale Falcon C400 centrifugal gravity concentrator, recovering 96.7% of the lithium to leach feed at an upgraded grade of 5,079 ppm Li while rejecting approximately 70% of the calcium. Kemetco then completed a full hydrometallurgical program on beneficiated material from the Sepro pilot circuit. Sulfuric acid leaching extracted more than 93% of the lithium at the PFS design acid addition. Following impurity removal and magnesium sulfate crystallization, Kemetco produced a lithium carbonate assaying 99.0% Li₂CO₃, then refined it with Chemshift of Calgary, Alberta to a battery-grade product of 99.95% Li₂CO₃, as announced on September 15, 2026. A continuous pilot program planned for FEL 3 will test recovery, reagent and energy performance on a larger scale.

Infrastructure and Location

The Project is located in northeastern Elko County, Nevada, approximately 140 km (87 miles) northeast of Elko and 74 km (46 miles) north of Wells, at an elevation of approximately 6,000 feet. The site benefits from regional access via the Wells / US-93 / I-80 corridor and sits within an established mining region with access to skilled contractors, transportation routes and mining support services. Bulk reagents are expected to be delivered primarily by truck, with regional transload arrangements for high-volume reagents to be defined through a formal logistics study during FEL 3. High-voltage electrical transmission lines are located near the Project, and the PFS contemplates a new interconnection to connect the site to the regional grid.

The PFS estimates water demand of approximately 3,280 acre-feet per annum for Phase 1, comprising approximately 2,960 AFA of process plant raw water and approximately 320 AFA for mine dust suppression, increasing to approximately 6,240 AFA at full build-out with Phase 2. A preliminary process water balance indicates plant raw water demand may be higher than the PFS design basis; water consumption and water-reduction options will be refined during FEL 3. NNL is actively advancing its groundwater right applications through the State of Nevada water rights permitting process administered by the Nevada Division of Water Resources. The applications filed to date cover approximately the water demand estimated for Phase 1, and NNL expects to secure water rights sufficient for Phase 1 operations through this process. The Phase 2 balance is expected to be secured through additional appropriations, acquisition or lease of existing water rights, and beneficial use of pit dewatering water.

Project Execution and Schedule

The Project is planned to be delivered under an Engineering, Procurement and Construction Management model. The PFS adopts an accelerated execution schedule that assumes FEL 3 commences in Q4 2026, followed by an expedited final investment decision and permitting Record of Decision. The schedule provides for approximately 53 months from FEL 3 notice to proceed to mechanical completion, followed by approximately six months of commissioning and start-up, with first production targeted for the second half of 2031. The schedule is subject to permitting, financing and a final investment decision.

Opportunities and Next Steps

Building on the PFS, NNL intends to advance the Project directly into FEL 3 engineering and a Feasibility Study, supported by the 2026 drill program, to further de-risk the Project and support a final investment decision. In addition to advancing engineering definition, the PFS identifies several opportunities to enhance Project value, which will be evaluated during FEL 3:

• Reagent procurement and logistics optimization, which together represent approximately 64% of operating costs;
• Trade-off studies on counter-current decantation wash and recovery, evaporation and crystallization configuration, and steam, power and water-recovery integration;
• Optimization of Phase 2 timing and scope;
• Early engagement of Tier 1 vendors for long-lead equipment, including the sulfuric acid plant and crystallizer/evaporator packages; and
• Pre-assembly and modularization strategies to reduce field labor and improve construction productivity.

Technical Report

A technical report prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects supporting the PFS will be filed on SEDAR+ (www.sedarplus.ca) and on the Company’s website within 45 days of this news release. Readers are encouraged to read the technical report in its entirety, including all qualifications, assumptions and exclusions relating to the PFS. There are no known factors that would materially affect the PFS results beyond those disclosed in this news release.

Qualified Persons

The PFS was prepared by or under the supervision of the following independent Qualified Persons, as defined by NI 43-101, each of whom has reviewed and approved the scientific and technical information in this news release relating to the portions of the PFS for which they are responsible: Kevin Martina, P.Eng., Fluor – process, capital and operating costs, metallurgical testing, recovery methods, infrastructure; Kirk Hanson, P.E., KH Mining LLC – economic analysis; John Marek, P.E., IMC – Mineral Reserves and mining methods; Nathan Forsythe, C.P.G., RESPEC – geology, Mineral Resources, sample preparation and data verification; Paul Axelrod, P.E., Axelrod, Inc. – tailings; Robert Pratt, P.E., Call & Nicholas, Inc. – waste rock and pit slope stability; Bill van Breugel, P.Eng., SGS – market studies; Kyle Brangers, CPG, GSI – environmental studies, permitting and closure.

The Qualified Persons have verified the data underlying the information in this news release for their respective areas of responsibility, including RESPEC’s review of drilling, sampling, assay and QA/QC data and site visit on November 4 and 5, 2025; Fluor’s review of the Sepro, Kemetco and Chemshift test reports and laboratory results; and IMC’s review of the block model and mine plan inputs. No limitations were placed on the verification. Further details will be included in the technical report.

Alan J. Morris, MSc, CPG, of Spring Creek, Nevada, Geological Advisor to the Company and a Qualified Person as defined under NI 43-101, has reviewed and approved the technical content of this news release. Mr. Morris is not independent of the Company.

About Evolution Mining

Evolution Mining is a leading, globally relevant gold miner. Evolution operates six mines, comprising five wholly owned mines – Cowal in New South Wales, Ernest Henry and Mt Rawdon in Queensland, Mungari in Western Australia, and Red Lake in Ontario, Canada, and an 80% share in Northparkes in New South Wales.

About Surge Battery Metals Inc.

Surge Battery Metals Inc., a mineral exploration company, is at the forefront of securing the supply of domestic lithium through its active engagement in the Nevada North Lithium Project. The Project focuses on development of high-grade lithium energy metals in Nevada, USA, a crucial element for powering battery electric storage and electric vehicles. With a primary listing on the TSX Venture Exchange and a listing on the OTCQX Market, Surge Battery Metals Inc. is strategically positioned as a key player in advancing lithium exploration.

About Nevada North Lithium, LLC

Nevada North Lithium, LLC, jointly owned by Surge Battery Metals Inc. (67.5%) and Evolution Mining Limited (32.5%), owns the Nevada North Lithium Project southeast of Jackpot, Nevada, about 74 km north-northeast of Wells, Elko County. The first four rounds of drilling at the Project identified a strongly mineralized zone of lithium-bearing clays occupying a strike length of more than 4,700 meters and a known width of greater than 2,000 meters. The Project’s updated Mineral Resource estimate, filed June 30, 2026, reports a pit-constrained Measured and Indicated Resource of 657.5 Mt grading 3,007 ppm Li, containing an estimated 10.5 Mt LCE, at a cut-off grade of 1,250 ppm Li.