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Canada Nickel continues to demonstrate substantial improvement in metallurgical performance

Feb 15, 2022

Canada Nickel Company Inc. has announced further metallurgical results at its 100% owned Crawford Nickel Sulphide Project in Timmins which delivered what the company believes is the highest nickel sulphide concentrate grade from a locked cycle test.
The test results also confirm the newest flowsheet improvements, incorporated as part of metallurgical variability testing for the feasibility study, can deliver improved recoveries and improved concentrate quality.

Mark Selby, Chair and CEO said, “I am very pleased with the first two tests achieving nickel recoveries in excess of 60%. This latest test is further confirmation of both significant recovery and excellent nickel sulphide concentrate grades particularly from a low-grade sample. Results from this latest phase of testing are indicating that we can achieve grades of 40-50% for the high grade nickel concentrate, well above the current 35% target for this product. While we will test a broad range of samples during the upcoming phase of feasibility study work and expect a range of recovery results from 30% to 60+%, this
second locked cycle test further demonstrates the potential to deliver improvements in nickel recovery substantially higher than the 4-5 percentage point improvement in nickel recovery the Company is targeting for the feasibility study. Each percentage point of improvement in nickel recovery would yield a US$92 million improvement in the value of the NPV8% of the project, based on the Preliminary Economic Analysis (“PEA”) metrics.”

Mr. Selby continued, Additionally, the Company has continued to make further additions to its land holdings in the Timmins district and continues to make good progress with the strategic investor process for which the process is expected to be successfully concluded during the first quarter.. The Company has also set its date for its annual general meeting.”

Flowsheet Development program
A key focus of the feasibility study activities is the continued improvement in flowsheet performance given its potential to add significant value to the project, particularly as less than one year of work had been completed on the project before results of the PEA were announced on May 25, 2021. Since releasing the PEA, two phases of optimization work have been completed: Phase 1 focused on increasing recoveries, while Phase 2 has focused on increasing concentrate quality at increased recovery. The conditions and
flowsheet used in this test reflect optimizations for both concentrate quality and recovery.

This locked cycle test (“LCT”) used the optimized flowsheet which the company expects to take forward into the next phase of metallurgical testing for the feasibility study. The test was conducted at XPS Expert Process Solutions, a Glencore Company (“XPS”), and was the second LCT completed since releasing the PEA. The LCT was completed to measure the impact of flowsheet improvements made over the past eight months. The sample selected for testing was a lower grade heazlewoodite (Ni3S2) dominant sample which
also contained small amounts of awaruite (Ni3Fe). The head grades for the sample were 0.19% nickel, 0.07% sulphur, and 7.7% iron. This sample was selected to test the robustness of the current flowsheet on a lower grade sample from the deposit.

The flowsheet utilized in this test included changes to reagents, grind sizes, and position of magnetic separation in the flowsheet. No further details are being provided at this time as the Company believes these improvements are a proprietary competitive advantage.

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