Battery Mineral Resources Looks to Near Term Copper Production in Chile

• The recent rejection of Chile's proposed new constitution is seen as positive for mining companies like BMR. Changes will likely now happen through a more measured legislative process.
• BMR is focused on restarting production at its Punataki mine. Recent drilling increased resources, supporting the restart plan.
• BMR aims to fund the $20-25M restart through non-dilutive financing such as prepay, royalties, and debt. Goal is cash flow in 6-8 weeks.
• Good time to acquire assets in Chile. BMR looking to ramp up quickly from 40-50M EBITDA at Punataki to 80-100M with an acquisition.
• Cobalt, graphite, lithium projects provide future pipeline. Focus now on getting Punataki producing, then will turn attention to other assets.

About Battery Mineral Resources

Battery Mineral Resources Corp. (BMR) is a Canada-based mineral exploration company focused on the acquisition, exploration and development of battery mineral deposits in North and South America. The company's flagship asset is the Punitaqui copper mining complex in Chile, a past producing copper mine that was recently acquired out of insolvency. BMR aims to restart production at Punitaqui in the near term to establish cash flow that can be used to fund expansion and development of the company's portfolio of battery mineral exploration projects. Beyond the Punitaqui mine, BMR has additional copper exploration targets within the Punitaqui area. The company also holds cobalt and graphite focused projects in Ontario, Idaho and South Korea as well as lithium brine targets in Nevada.

Interview with Martin Kostuik, CEO of Battery Mineral Resources

Near Term Copper Production Critical for Funding Portfolio Advancement

In a recent interview, BMR CEO Martin Kostuik highlighted the strategic importance of restarting near term copper production at the company's Punitaqui mine in Chile. Kostuik explained that bringing the mine back into production will provide significant cash flow for the company, transforming BMR from a pure exploration company to a cash flowing producer.

The Punitaqui mine is a past producing asset that was operated successfully for 9 years by major mining company Glencore. BMR acquired the mine out of insolvency and sees an opportunity to leverage the existing infrastructure and relatively modest capital requirements to return the mine to production in the near term. Kostuik estimates the company will need between $20-25 million to fund the restart, depending on working capital requirements.

Crucially, BMR is focused on securing funding for Punitaqui restart through non-dilutive sources rather than raising equity. The company is considering prepayment funding via an offtake agreement, royalty financing and private debt. Securing non-dilutive funding for the restart is key, as Kostuik estimates Punitaqui could generate $40-50 million in annual EBITDA production for BMR once the mine is back up and running. This would represent a transformational increase from zero EBITDA currently.

Resource Update Provides Key Foundation

An updated mineral resource estimate for Punitaqui announced in September 2022 will provide the foundation for BMR's restart plans. The updated estimate includes 6.2 million tons of indicated resources and 3.1 million tons inferred resources. This update was the result of a 9 month, 33,000 meter drill program focused on defining resources around the existing mine infrastructure.

With resources now quantified, BMR will finalize its restart plans including detailed mine design, scheduling and economic analyses. The company will look to announce secured funding for the restart within the next 2 months. Kostuik remains confident the restart can be funded with $20-25 million based on the updated resources.

Significant Blue Sky at Punitaqui and Across Portfolio

Apart from restarting the existing mine, BMR sees significant expansion potential at Punitaqui. The recent drilling added resources at 3 new target areas that were never mined previously. With the main deposit open at depth and laterally, Punitaqui provides meaningful near-term blue sky potential.

Looking across BMR's broader portfolio, the company holds a pipeline of battery mineral focused projects that can be advanced once cash begins flowing from the Punitaqui mine. These include cobalt and graphite projects in Ontario, Idaho and South Korea as well as lithium brine projects in Nevada. While Punitaqui remains the immediate focus, BMR plans to direct cash flow from the mine towards advancing these earlier stage exploration assets.

Favorable Macro Backdrop for Copper

Restarting the Punitaqui copper mine is timed favorably with copper prices at decade highs in 2022 on the back of significant supply and demand tightness. Wood Mackenzie forecasts a over 5 million ton annual copper supply deficit by 2030, which bodes well for battery mineral developers like BMR looking to bring new sources of supply online. Tightness in copper markets is expected to persist with demand growth from renewable energy, EVs and electrification trends globally. Bringing Punitaqui back online fits well with the backdrop.

Conclusion

With near term plans to restart copper production at its past producing Punitaqui mine, BMR represents a unique copper developer story. The modest capital requirements to restart Punitaqui leveraging existing infrastructure provides a clear path to transform BMR into a cash flowing copper producer in a favorable price environment. Cash flow generation from the mine is key to advance and derisk BMR's pipeline of battery mineral exploration assets. Non-dilutive funding planned for the restart limits equity dilution. As BMR executes on its strategic plan over the next 6-12 months, investors should gain greater clarity on the company's transition to a cash flowing producer.