Grid Metals Receives Positive Engineering Study; Primero Report Outlines Viability and Costs of Reconfiguring True North Mill for Lithium Processing

TORONTO, ON / ACCESSWIRE / October 25, 2023 / Grid Metals Corp. (TSXV:GRDM)(OTCQB:MSMGF) ("Grid" or the "Company") is pleased to announce the receipt of a scoping-level mill reconfiguration study (the 'Study') completed by Primero Group for the True North Mill located in Bissett, Manitoba. The Study examined the viability and costing of reconfiguring the existing True North gold mill in order to process lithium ore from Grid's Donner Lake property to produce a saleable lithium concentrate. The Primero Study outlined best-in-class capital intensity and quantified operating costs, giving Grid the confidence to move forward with the mill lease. As a result of the positive findings, Grid is proceeding with the lease agreement with 1911 Gold Corporation - the owner of the True North Mill. Grid's objective of entering into the lease is to be one of the next producing lithium companies in North America.

Background and Primero Mandate

Grid retained Primero Group, a global leader in lithium process engineering, in July 2023 to complete a scoping-level review of reconfiguring the existing mill to produce spodumene concentrate from Donner Lake feed. The mandate included:

• Developing a processing flow sheet for the mill based on a new round of concurrent metallurgical testwork and determining overall viability of the mill reconfiguration
• Developing a modified plant layout
• Determining electrical power requirements and an equipment list for the mill
• Determining capital ('capex') and operational ('opex') expenditure costs for the mill
• Generating a conceptual mass balance for the lithium spodumene processing circuit
• Estimating the scope and cost for a feasibility level study for the mill reconfiguration

Highlights of the Study include:

• Mill capacity was estimated at 450,000 tonnes per annum (' tpa') of lithium feed for the production of spodumene concentrate, assuming 90% mill availability. This compares favourably to the stated nominal annual capacity of the current mill configuration of 475,000 tonnes. Note that the current mineral resource estimate at the Donner Lake property, announced on July 18, 2023, is 6.8 million tonnes grading 1.39% Li₂O.
• An optimal grind size of 125 microns was determined (see testwork below). Existing mill grinding capacity was not considered a constraint on throughput.
• Initial capex for the mill reconfiguration is estimated at C$50 million which includes a 30% contingency. This includes capex relating to crushing, grinding, mica flotation, magnetic separation, spodumene flotation, concentrate handling, and tailings handling. Existing infrastructure and utility connections will be used. Capex includes the addition of magnetic separation and mica flotation circuits required to produce a marketable spodumene concentrate.
• The processing cost was estimated at C$34.81/t processed and G&A was estimated at C$17.73/t processed. This equates to total milling costs of C$316.14/t spodumene concentrate produced. Labour and reagents made up 42% and 32%, respectively, of the processing cost. Primero has identified opportunities to reduce G&A costs.
• Primero recommended a value engineering phase to complete further trade-off studies and optimization of the True North Mil for a cost of C$400,0000.
• Primero gave an estimate for an Engineering, Procurement and Construction Management ('EPCM') study at a feasibility-level design at approximately C$1.6 million.

Testwork Program Completed to Support Primero Study