NorthIsle Copper & Gold - Unlocking a Canadian Critical Metals Opportunity with World-Class Gold-Copper Asset

• NorthIsle Copper & Gold has a large copper and gold project in British Columbia with strong First Nations and government support due to existing infrastructure.
• The company plans to develop a starter mine at its Northwest Expo and Red Dog deposits to generate near-term cash flow while continuing to explore its larger resource.
• Recent drilling has identified high-grade gold and copper mineralization near surface, expanding the resource and opening up exploration potential.
• NorthIsle believes the dual exposure to gold and copper positions it well across market cycles, with gold providing a near-term catalyst and copper a long-term growth story.
• The company is well-funded after a recent $6.4 million oversubscribed financing and is moving forward aggressively with economic studies and permitting to advance the project.

North Island: The Critical Metals Opportunity

The global transition to electrification and decarbonization is expected to drive massive demand for critical metals like copper in the coming years. However, the long timelines and high capital costs associated with developing new copper mines have led to growing concerns about a looming supply deficit. In this context, NorthIsle Copper & Gold (TSXV:NCX) offers a compelling opportunity, with a large, advanced-stage copper-gold project located in a top mining jurisdiction with strong government and First Nations support.

Interview with President & CEO Sam Lee

A Unique Project in a Top Jurisdiction

NorthIsle's flagship North Island Project is located on Vancouver Island, British Columbia. The 50 km long property hosts several copper-gold porphyry deposits, including the Hushamu and Red Dog deposits which host combined Indicated resources of nearly 5 million ounces of gold and 3 billion pounds of copper. Importantly, the project benefits from extensive existing infrastructure, including paved roads, a deep water port, and a surplus of low-cost hydroelectric power.

"We've got roads, paved roads to go right into the project. We've got a town, Port Hardy, that is very, very much wanting and open to host all of the direct and indirect workers that would be coming through this project," explained CEO Sam Lee in a recent interview. "From a government's perspective, when they carve out billions of dollars for infrastructure build around critical metals, that gets you nothing. So they would naturally focus on areas that don't really need a massive upgrade in power and roads."

This existing infrastructure provides NorthIsle a significant cost and time advantage compared to more remote projects. The company has also built strong relationships with the local First Nations, signing consent agreements that provide a framework for consultation and economic participation. These agreements allowed NorthIsle to obtain drilling permits in just 16 weeks last year, compared to the 18-24 months it typically takes in B.C.

"As an entrepreneur, I would never be in a region, an area that didn't want a project to move ahead," said Lee. "We ended up going down the road of something quite unique, which is signing these consent agreements with these First Nation groups that essentially stipulate we need consent before we go through the permitting process."

A Phased Development Approach

While NorthIsle's 2021 PEA outlined robust economics for a large-scale, 22-year mining operation at North Island, with a $1.1 billion after-tax NPV and 19% IRR, the company has recently pivoted to a phased development approach. The plan is to first develop a smaller, higher-grade starter pit operation focused on the Red Dog and Northwest Expo zones, with the larger Hushamu deposit serving as a longer-term growth opportunity.

Recent drilling at Northwest Expo has outlined a near-surface zone of high-grade mineralization, including 96 m grading 1.42 g/t gold eq. and 87m grading 1.46g/t gold eq. The company recently published a maiden resource for Northwest Expo, comprising an Indicated resource of 1.2 million ounces gold and 243 million pounds of copper. Combined with Red Dog, Lee sees potential for an initial 10-12 year mine life producing over 100,000 ounces gold and 50 million pounds copper annually at a low strip ratio.

"If we can get this project to north of 100 million tons at grades of north of 7 grams per ton gold equivalent and a strip ratio that's sub-3, that is a pretty good project," said Lee. "It's going to be a compelling project from an IRR perspective."

By starting with a smaller operation, NorthIsle can significantly reduce upfront capital costs and accelerate the path to production and cash flow. This will allow the company to self-fund the continued exploration and permitting of the larger Hushamu deposit down the road.

Exploration Upside

While NorthIsle's existing resources are already among the largest in B.C., the company believes there is significant potential to further expand the resource through continued exploration. The focus in the near-term will be on drilling the untested areas between the Red Dog and Northwest Expo deposits, as well as stepping out to test the recently discovered Pemberton Hills target which returned long intervals of mineralization in initial holes.

The company is also conducting deep drilling to test for higher-grade zones at depth. Porphyry systems like North Island typically exhibit concentric zones of mineralization, with a higher-grade bornite-chalcopyrite core zone surrounded by a lower-grade pyrite halo. Some of the world's most profitable copper mines, like Grasberg and Oyu Tolgoi, are mined from these deep high-grade cores.

"What we're seeing in terms of copper, everyone believes in the long-term proposition," said Lee. "But what's happened recently is that the near-term trade has come into play because of the lack of supply and the supply disruption having a tremendous effect on smelters... So that's good news because it acts as a catalyst to the longer-term proposition."

Well-Funded to Advance

NorthIsle is well-funded to advance the North Island project after raising $6.4 million in an oversubscribed private placement in December. The financing was led by prominent resource funds like Greenstone, Fiore, and Franklin Templeton, and issued shares at a premium to the market price. The company currently has over $70 million in cash, sufficient to fund the planned drilling and economic studies through 2024.

"Dilution is a very important denominator, because you could grow fast on the numerator from a growth perspective, but if you keep on over diluting yourself, that dollar per share value doesn't grow as quickly," explained Lee. "That is something we've been entirely focused on. It's easier said than done when you're in an environment where no one's going to give you money. But we have been so successful and blessed with this core group of cornerstone shareholders that have supported us in rough times."

The Path Forward

With funding in place, NorthIsle is focused on aggressively advancing the North Island project in 2024. Key upcoming catalysts include:

• Continued drilling to expand resources and test new targets
• Metallurgical test work to optimize process design
• Completion of trade-off studies for the starter pit option
• Filing of a Notice of Project Readiness to initiate the EA process
• Negotiation of an economic participation agreement with First Nations
• Completion of a pre-feasibility study on the starter pit option

NorthIsle offers investors a unique opportunity to gain exposure to rising copper and gold prices through a large-scale, advanced project in a top mining jurisdiction. By focusing on the development of a starter operation at Red Dog and Northwest Expo, the company can fast-track the path to production while retaining exposure to the larger, longer-term resource at Hushamu. With a strong technical team, supportive partners, and a healthy cash balance, NorthIsle is well-positioned to create significant value for shareholders as it continues to systematically advance this exciting project.

The Investment Thesis for NorthIsle Copper & Gold

• Exposure to Rising Copper and Gold Prices: NorthIsle offers dual exposure to rising copper and gold prices through its large resource base. Copper demand is expected to surge in the coming years due to electrification and decarbonization trends, while gold provides a hedge against inflation and economic uncertainty.
• World-Class Asset in a Top Jurisdiction: The North Island project is among the largest copper-gold deposits in Canada, located in the mining-friendly jurisdiction of British Columbia. The project benefits from extensive existing infrastructure and strong government and First Nations support, reducing permitting risk.
• Fast-Track to Production: By focusing on developing a starter mine at the Red Dog and Northwest Expo zones, NorthIsle can significantly reduce capital costs and development timelines compared to a larger operation. This phased approach allows the company to generate near-term cash flow to fund ongoing exploration and development.
• Exploration Upside: With over 34,000 hectares of prospective ground, NorthIsle has significant potential to expand the existing resource through continued drilling. The recent high-grade discoveries at Northwest Expo and Pemberton Hills underscore the potential for new discoveries across the largely unexplored property.
• Proven Management Team: NorthIsle is led by a strong technical and capital markets team with a track record of creating shareholder value. CEO Sam Lee was previously a partner at Haywood Securities where he financed over a billion dollars of mining projects.
• Well-Funded Through Major Catalysts: After raising $6.4 million in late 2023, NorthIsle has sufficient cash to fund its planned work program through 2024. The company is positioned to deliver a steady stream of catalysts as it advances engineering studies and permitting.

Macro Thematic Analysis

The global energy transition is expected to drive significant demand growth for copper in the coming years. Copper is a critical metal used extensively in electric vehicles, renewable energy systems, and electrical infrastructure. At the same time, a lack of new discoveries and long development timelines for copper mines has led to concerns about a looming supply deficit.

According to S&P Global, copper demand from the energy transition is forecast to nearly double from 2020 to 2035, rising from 2.1 to 3.7 million metric tons. By 2050, demand could reach 5.5 million metric tons, representing nearly 20% of total demand. On the supply side, there are few new copper projects in the near-term development pipeline, and existing mines are facing declining grades and reserve depletion. This has led many analysts to forecast a growing supply gap starting in the mid-2020s.

In this context, NorthIsle CEO Sam Lee believes the company is ideally positioned to capitalize on rising copper prices: "Everyone believes in the long-term proposition of copper... But what's happened recently over the last four months is that the near-term trade has come into play because of the lack of supply. We've seen supply disruption having a tremendous effect on smelters, with treatment charges approaching zero. So that's good news, because it acts as a catalyst to the longer-term proposition."

Key Takeaways

NorthIsle Copper & Gold offers investors exposure to a large-scale copper-gold resource in a top mining jurisdiction. By focusing on a phased development approach starting with a high-grade starter pit, the company can fast-track the path to production while preserving the option to expand to a larger operation over time. With a strong management team, supportive partners, and a healthy cash balance, NorthIsle is well-positioned to unlock the value of this world-class asset as it advances through major catalysts in 2024-2025.