Denarius Metals Announces First Quarter 2024 Results

Toronto, Ontario--(Newsfile Corp. - May 15, 2024) - Denarius Metals Corp. (Cboe CA: DMET) (OTCQX: DNRSF) ("Denarius Metals" or "the Company") announced today that it has filed its unaudited interim condensed consolidated financial statements and accompanying management's discussion and analysis (MD&A) for the three months ended March 31, 2024. These documents can be found on its website at www.denariusmetals.com and by reviewing its profile on SEDAR+ at www.sedarplus.ca. All financial figures contained herein are expressed in U.S. dollars unless otherwise noted.

Denarius Metals is an emerging metals producer with two mines, Zancudo in Colombia and Aguablanca in Spain, marching toward the start of production within the next 12 months. In March 2024, the Company graduated its listing to Cboe Canada followed by a change of its trading symbol to "DMET". The Company continues to trade on the OTCQX in the United States under the symbol "DNRSF".

In the first quarter of 2024, funded by cash on hand from the Convertible Debentures financing completed in October last year, Denarius Metals incurred total exploration and capital expenditures of approximately $2.9 million, including $2.3 million related to the construction and development activities at its Zancudo Project. In the first quarter of 2023, total exploration and capital expenditures amounted to $3.4 million, including $2.3 million for the exploration program at the Lomero Project and $0.8 million at the Zancudo Project.

Construction and development activities at the Zancudo Project remain on track while the Company waits for the approval of its Environmental Impact Study ("EIS") that will enable it to commence mining operations. Approval of the EIS is expected in the second quarter of 2024. Shipments of the processing plant equipment from China commenced in March and will be fully mobilized at the project site to facilitate installation and commissioning over the summer to be ready to start operations in the fourth quarter this year. In April 2024, Denarius Metals commenced a 10,000 meters infill drilling program to upgrade Inferred Resources to the Indicated category and to support future mine development.

The acquisition of a 50% interest in Rio Narcea Recursos, S.L. ("RNR") in late 2023 has become an important catalyst to build the Company's presence in Spain and to accelerate its creation of a long-life polymetallic producer leveraging the synergies between the Aguablanca and Lomero Projects. RNR's two primary assets include a 5,000 tonnes per day ("tpd") processing plant (the "RNR Plant") and the Aguablanca underground mine, one of the only mines in Spain able to produce both nickel and copper. RNR has both its mining and environmental permits in place. Application has been made for the permit for the water use concession which is expected to be received in the second half of 2024.

Denarius Metals announced the results of a Pre-Feasibility Study (the "Aguablanca PFS") on April 11, 2024 which supports the economic viability of the Aguablanca Project. The Company acquired its 50% interest in RNR for EUR 25.0 million (equivalent to approximately $27 million) cash, of which 10% was paid in 2023, 10% was paid in early April 2024 and the balance is scheduled to be paid in instalments over the remainder of 2024. As the operator of the Aguablanca Project, the Company will lead the activities on behalf of the joint venture over the balance of 2024 to re-start the RNR Plant and, upon receipt of the permit for the water use concession, to de-water and prepare the underground mine to commence production in early 2025. Using 50% of the RNR Plant's capacity, the Aguablanca PFS envisions a six-year mine life generating 43.2 million pounds of payable nickel and 34.6 million pounds of payable copper resulting in LOM net revenue of $480 million through the sale of approximately 406,359 tonnes of nickel-copper concentrates with an AISC of $4.04 per pound of payable nickel on a by-product credit basis. At long-term nickel and copper prices of $7.30 per pound and $3.50 per pound, respectively, the Aguablanca PFS generates solid returns with undiscounted after-tax project cash flow on a 100% basis of $105.7 million.

At the Lomero Project, just 88 km from Aguablanca, work is getting underway to prepare a preliminary economic assessment ("PEA"), expected to be completed by mid-2024, utilizing the other 50% capacity available at the RNR Plant. The Company also expects to commence its greenfield drilling campaign at the Lomero Project in the second half of 2024.

In Northern Spain, the Company is currently working on an updated Mineral Resource estimate ("MRE") at the Toral Project incorporating the 2023 drilling results to be followed by the preparation of a PEA later in 2024. Total cumulative funding provided by the Company to the Toral Project through the end of the first quarter of 2024 amounted to $2.9 million, up from $2.7 million at the end of 2023. Among the obligations to be able to exercise its First Option to acquire a 51% interest in the Toral Project under the agreement with Europa Metals Ltd. ("Europa"), the Company must spend a minimum of $4.0 million before the end of 2025.

Denarius Metals has continued its efforts this year to improve its liquidity to fund the investments required to advance its projects and bring the first two mines into operation within the next 12 months. Through two international tender processes completed thus far in 2024, Denarius Metals successfully arranged a long-term offtake contract for Zancudo's concentrate production with Trafigura Pte. Ltd. ("Trafigura"), a leading global commodities group, and arranged an additional $15.0 million to fund the completion of the construction and drilling programs now in process at the Zancudo Project. At the end of March 2024, the Company sold a 3% net smelter royalty ("NSR") to a syndicate of third-party private investors for total cash consideration of $5.0 million. The offtake arrangement with Trafigura also includes a $10.0 million prepayment financing that is currently being finalized and will be funded to the Company in instalments over the balance of 2024 as specified milestones are reached at the Zancudo Project.

Denarius Metals reported a net loss of $11.1 million ($0.18 per share) in the first quarter of 2024 compared with a net loss of $3.1 million ($0.11 per share) in the first quarter of 2023. The 2024 net loss includes $9.6 million of non-cash charges, including an $8.3 million loss on financial instruments and $1.2 million of accretion of a financial liability. The 2023 net loss included a $1.9 million non-cash charge for accumulated foreign currency translation adjustments related to its disposition of the Guia Antigua Project.

Offering of Gold-Linked Convertible Debenture Units

On April 29, 2024, and as updated on May 13, 2024, the Company announced a brokered best efforts private placement (the "Offering") by a syndicate of agents (the "Agents") to raise up to CA$20 million to fund the Aguablanca Project and for general corporate purposes through the issuance of gold-linked convertible debenture units (the "Units"). Each Unit will consist of the following:

• 1,000 12% per annum gold-linked senior unsecured convertible debentures ("New Debentures") of the Company; and,

• 500 common share purchase warrants of the Company, with each warrant entitling the holder to purchase one common share of the Company at a price of CA$0.60 per common share at any time on or before that date which is 36 months after the closing date.

The Agents have an option, exercisable in full or in part, up to 48 hours prior to the closing of the Offering, to sell up to an additional 3,000 Units for additional gross proceeds of up to CA$3.0 million.

The New Debentures are non-callable and mature and become payable in full five years from the date of issuance ("Maturity"), unless otherwise converted, prepaid or accelerated in accordance with their terms. The Debentures will bear interest at 12% per annum, paid monthly in equal instalments in cash.

Commencing June 30, 2025, and at the end of each quarter thereafter, the Company will pay a gold premium on the principal amount of the New Debentures in cash. The gold premium will be calculated as a percentage equal to 25% of (i) the amount, if any, by which the London P.M. Gold Fix on the quarterly measurement date exceeds $2,000 per ounce (the "Floor Price") divided by (ii) the Floor Price.

At any time prior to Maturity, the New Debentures are convertible at a holder's option into common shares of the Company at a conversion price of CA$0.60 per share.

Certain insiders of the Company have indicated their interest to participate in the Offering. As the number of securities issuable to Related Persons (as defined under Cboe Canada's policies) of the Company in the Offering, when added to the number of securities issued to Related Persons of the Company in the private placement of convertible debentures completed in October 2023, is more than 10% of the current total number of issued and outstanding common shares (the "Outstanding Shares"), calculated on a non-diluted basis, the Company requires approval from shareholders representing a majority of the Outstanding Shares held by disinterested shareholders to proceed with the Offering. The Company intends to satisfy Cboe Canada's shareholder approval requirement by obtaining a written resolution signed by holders of at least 50% of the holders entitled to vote thereon.

The closing of the Offering, which is subject to shareholders and regulatory approvals, is expected to occur on or about May 23, 2024.

About Denarius Metals

Denarius Metals is a Canadian junior company engaged in the acquisition, exploration, development and eventual operation of polymetallic mining projects in high-grade districts.

In Spain, the Company owns a 100% interest in the Lomero Project, a polymetallic deposit located on the Spanish side of the prolific copper rich Iberian Pyrite Belt, and a 50% interest in Rio Narcea Recursos, S.L., which has the rights to exploit the historic producing Aguablanca nickel-copper mine, including a 5,000 tpd processing plant, located in Monesterio, Extremadura, Spain, approximately 88 km NW from the Lomero Project. The Company is also carrying out an exploration campaign on the Toral Zn-Pb-Ag Project located in the Leon Province, Northern Spain pursuant to an option and joint-venture arrangement with Europa Metals Ltd. pursuant to which it can acquire up to an 80% ownership interest in Europa Metals Iberia S.L., a wholly-owned Spanish subsidiary of Europa which holds the Toral Project.

In Colombia, Denarius Metals is carrying out construction activities at its 100%-owned Zancudo Project, which includes the historic producing Independencia mine, to develop production and cash flow commencing in 2024 through local contract mining and commencing a drilling program on the Zancudo deposit which remains open in all directions.

Additional information on Denarius Metals can be found on its website at www.denariusmetals.com and by reviewing its profile on SEDAR+ at www.sedarplus.ca.

No U.S. Offering or Registration

This news release does not constitute an offer to sell, or the solicitation of an offer to buy securities in any jurisdiction, including the United States, other than the provinces and territories of Canada. The securities being offered pursuant to the Offering have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "US Securities Act"), or the securities laws of any state of the United States. Such securities may not be offered or sold in the United States or to, or for the account or benefit of, any U.S. Person (as defined in Regulation S of the US Securities Act) or person in the United States except in a transaction exempt from or not subject to the registration requirements of the US Securities Act and applicable state securities laws.

Cautionary Statement on Forward-Looking Information

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to anticipated business plans or strategies, including construction activities and timing to commence mining operations at the Zancudo Project, receipt of the water use concession at Aguablanca, completion of the Trafigura financing, exploration programs, re-start of operations and timing to commence production at the Aguablanca Project, mine lifespan of Aguablanca, potential integration of the Aguablanca and Lomero Projects, drilling campaign at the Lomero Project, preliminary economic assessments, the Offering, regulatory and Cboe Canada approvals, the receipt of shareholders' approval and the use of proceeds of the Offering. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Denarius Metals to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated April 25, 2024 which is available for view on SEDAR+ at www.sedarplus.ca. Forward-looking statements contained herein are made as of the date of this press release and Denarius Metals disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

For Further Information, Contact:

Michael Davies
Chief Financial Officer
(416) 360-4653
investors@denariusmetals.com

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