InvestmentPitch Media Video Discusses South Star Battery Metals' Proposed Earn-In for Graphite Project in Alabama's Graphite Belt - Video Available on Investmentpitch.com

Vancouver, British Columbia--(Newsfile Corp. - November 5, 2021) - South Star Battery Metals (TSXV: STS) (OTCQB: STSBF), a Canadian battery metals project developer, focused on the selective acquisition and development of near-term production projects in the Americas, agrees to key terms of a proposed earn-in to the Ceylon Graphite Project in Alabama. The Project, which covers approximately 500 acres in Coosa County, Alabama, is located on the northeast end of the Alabama Graphite Belt.

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The agreement with Hexagon Energy Materials Limited (ASX:HXG) and U.S. Critical Minerals, a U.S. privately-held exploration company, will allow South Star to earn-in up to 75% of the Project, subject to execution of the final terms of a formal agreement and the customary closing conditions, included TSX Venture Exchange approval. Hexagon currently owns 80% of the Project with U.S. Critical Minerals and a small group of individuals owning the remaining 20%.

The Project, an historic mine active during World Wars I and II, targeted friable outcropping graphite mineralization which averaged approximately 3% to 5% graphite carbon. The surface mineralization, contained in graphite host rock, was mined historically with shovels and excavators without the need for drilling and blasting.

A comprehensive preliminary exploration program and bench-scale process have been completed by Hexagon. 29 trenches totalling 2,769 linear metres were dug to a maximum depth of approximately 2 metres, with 765 samples analyzed. 100 tonnes of bulk ore samples were collected with 10 representative samples tested at GIRCU Laboratory in Guangzhou, China. The testing indicated a traditional crush/grind/floatation concentration circuit achieved grades of approximately 96% to 97% with approximately 86% recoveries.

Richard Pearce, South Star's CEO, stated: "This is another important step towards creating a multi-asset, diversified battery metals company. We are potentially bringing on the next project in the pipeline in another important jurisdiction for the sector. The geology and processing flow sheets are very similar to our Brazil graphite asset, and we believe we can leverage our commercial relationships and technical experience to scale the project into near-term production. The infrastructure is excellent with access, energy, and the Mobile port facility near-by. The Southeast corridor of the US is transforming itself into an electric vehicle hub, and the Project in Coosa County is right in the middle of the action. The Project is on private land, and we believe the permitting and licensing efforts should be fairly straight-forward. I am very excited to be working with our partners on moving this Project forward in the coming years."

Merrill Gray, Hexagon's Managing Director, added: "South Star is an experienced graphite project developer and operator with significant technical resources and the ambition to move this expertise into North America. This earn-in deal could accelerate the Ceylon Graphite project's development, unlocking value for Hexagon and allowing the company to focus on the progression of our core Australian projects, in Hydrogen and Nickel, growing our energy materials portfolio beyond Ceylon Graphite."

Under the terms of the agreement, South Star will complete drilling, resource estimation, and analysis needed to produce a NI 43-101 compliant Preliminary Economic Assessment within 3 years of signing the final agreements, which is expected to be completed during November. South Star must fund an annual minimum expenditure of CAD$250,000 to a total minimum expenditure of CAD$750,000, during the earn-in period. For a period of 6 months following the exercise of the 75% earn-in option, assuming South Star exercises its option, the vendors individually have the right, but not the obligation, to sell their remaining 25% interest for CAD$250,000 in South Star shares. For additional terms of the agreement, please refer to the company's latest news release.

It should be noted there is currently no domestic U.S. production of natural graphite, which is designated as a critical mineral, with applications in the defence industries along with high-tech, energy-storage and industrial applications. Benchmark Intelligence forecasts natural flake graphite to be in a supply deficit starting in 2025.

The company, through a series of wholly owned subsidiaries, owns 100% of the Santa Cruz Graphite Project. Santa Cruz has at-surface mineralization in friable materials, and successful large-scale pilot-plant testing has been completed. Located in Brazil, South Star's Santa Cruz Graphite Project is the first of a series of industrial and battery metals projects that will be put into production. Brazil is the second-largest graphite-producing region in the world with more than 80 years of continuous mining. With excellent infrastructure and logistics, South Star is moving towards Phase 1 production planned for Q4 2022, pending financing.

South Star has joined the Critical Materials Institute as an affiliate member.

The shares are currently trading at $0.225. For more information, please visit the company's website, www.SouthStarBatteryMetals.com. Investor Relations is handled by Cathy Hume, CEO of CHF Capital Markets, who can be reached at 416-868-1079 ext 251 or by email at cathy@chfir.com.

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