Mont Royal Resources Ashram Rare Earth Project PEA Delivers CAD$2.03B NPV

Mont Royal Resources Confirms Ashram as a Major Long-Life North American Rare Earths Project

Updated PEA Delivers Post-Tax NPV of CAD$2.03B and 22% IRR Across a 30-Year Mine Life

Mont Royal Resources Limited (ASX: MRZ, TSXV: MRZL) has released an updated Preliminary Economic Assessment (PEA) for its 100%-owned Ashram Rare Earths and Fluorspar Project in Nunavik, Québec, Canada. The Mont Royal Resources Ashram rare earth project updated PEA results make a compelling case for one of North America's most significant undeveloped rare earth deposits.

The updated study, completed by Altris Engineering in accordance with NI 43-101 standards, confirms Ashram as a large-scale, long-life rare earth development with robust project economics, a competitive cost profile, and meaningful expansion optionality beyond the base case.

With a pre-feasibility study (PFS) targeted to commence in H2 CY2026, the company is moving with purpose toward the next stage of development.

Managing Director Nicholas Holthouse stated: "The updated PEA marks a major step forward for the Ashram Project, confirming a large-scale, long-life development with strong underlying economics and a clear pathway to advancement. The study has highlighted Ashram's combination of scale, favourable mineralogy and competitive cost profile, supporting its potential to become a meaningful long-term supplier of rare earth products into Western supply chains."

Key Economic Metrics at a Glance

The headline economics of the Mont Royal Resources Ashram rare earth project updated PEA results are summarised below:

The project carries an initial capital cost of CAD$1.23 billion (including a 30% contingency), with total life-of-mine capital expenditure estimated at CAD$1.605 billion.

Furthermore, the project is anticipated to qualify for approximately CAD$342 million in refundable Clean Technology Manufacturing Investment Tax Credits (CTM ITC), which are incorporated into post-tax cash flows.

A Production Profile Built for Scale

The Ashram Project is designed around a conventional open-pit operation with an initial nameplate throughput of approximately 1.8 million tonnes per annum (Mtpa), supported by a highly favourable strip ratio of just 0.4:1. This means very little waste rock needs to be moved relative to ore mined.

Production highlights over the 30-year mine life include:

• Average annual saleable REO production of approximately 17,466 tonnes
• Average annual NdPr (neodymium-praseodymium) production of approximately 4,035 tonnes
• Approximately 100 tonnes per year of dysprosium and terbium oxides (DyTb)
• Approximately 230 tonnes per year of yttrium oxide (Y₂O₃)
• Total life-of-mine saleable REO of approximately 510,000 tonnes

The 30-year mine plan uses only approximately 25% of the current global resource, highlighting substantial long-term expansion optionality.

Of the approximately 53 Mt of mill feed underpinning the production target, 93% is sourced from Indicated Mineral Resources, providing a high level of geological confidence in the near-term mine schedule.

Understanding the Preliminary Economic Assessment (PEA)

What Is a PEA and Why Does It Matter?

A Preliminary Economic Assessment (PEA) is an early-stage technical and economic evaluation of a mineral project designed to determine whether a project has sufficient economic merit to justify further, more detailed study.

Key characteristics investors should understand:

• Accuracy Range: PEAs are typically prepared to an accuracy range of ±50%, meaning actual costs and revenues could vary meaningfully from these estimates
• Resource Classification: A PEA does not constitute an Ore Reserve estimate under the JORC Code or NI 43-101
• Study Components: It combines inferred and indicated mineral resources, geological modelling, process engineering assumptions, and market pricing forecasts to build a financial model
• Development Pathway: A positive PEA outcome typically supports advancement to a Pre-Feasibility Study (PFS), conducted to a higher level of accuracy (typically ±25%)

Why Does Investment Significance Matter?

A PEA with strong economics signals that a project has the fundamental scale and economic characteristics to attract further investment and advance toward development. It represents an important de-risking milestone that increases confidence and broadens the potential investor and partner base.

Technical Terminology Explained

A Competitive Cost Structure

Ashram's cost profile is one of the study's standout features, supported by the deposit's low strip ratio, favourable mineralogy, and integrated processing strategy.

The relatively tight spread between C1 and AISC reflects the capital-efficient nature of the operation. The low strip ratio of 0.4:1 significantly reduces mining costs relative to comparable open-pit rare earth operations.

In addition, the production of a high-grade rare earth concentrate (approximately 30% REO) reduces the complexity and cost burden on the downstream hydrometallurgical refinery. Average annual operating costs are estimated at CAD$306 million, with total life-of-mine operating expenditure of CAD$9,178 million.

From Mine to Market: An Integrated Two-Stage Development Concept

The development strategy for Ashram is designed around a two-facility model that separates mining and concentration from downstream refining, improving logistics flexibility and reducing development complexity.

Stage 1: On-Site Mineral Processing Facility (Ashram, Nunavik)

• Conventional open-pit mining at 4,900 dry tonnes per day
• Crushing, grinding and flotation circuits producing approximately 190 tonnes per day of rare earth concentrate grading around 30% REO
• Filtered concentrate loaded into 20-foot containers and transported south via an intermodal logistics corridor

Stage 2: Hydrometallurgical Refinery (Saguenay, Québec)

• Located within the Port of Saguenay industrial area, with access to established industrial infrastructure and low-cost renewable hydroelectric power
• Processes approximately 69,500 tonnes per annum of flotation concentrate
• Produces approximately 33,800 tonnes per annum of Mixed Rare Earth Carbonate (MREC)
• Proven process route: acid bake, water leach, solvent extraction, oxalate precipitation and metathesis
• Thorium is fully and selectively extracted and managed in a separate, approved disposal pathway

The intermodal logistics corridor runs from Ashram via a 320km road link to Schefferville, connecting to existing rail infrastructure to Sept-Îles, and onward approximately 570km to Saguenay by road or marine transport along the St. Lawrence River.

The Resource Base: Scale, Confidence and Upside

The Mont Royal Resources Ashram rare earth project updated PEA results are underpinned by an updated JORC Mineral Resource Estimate (MRE) released on 1 October 2025, which remains one of the largest undeveloped rare earth resource bases in North America.

Key resource characteristics include:

• Mineralisation dominated by monazite — a commercially favourable mineral for metallurgical recovery
• NdPr accounts for approximately 21% of TREO, reflecting a high-value magnet rare earth basket
• Meaningful contributions from critical heavy rare earths terbium (Tb) and dysprosium (Dy)
• Fluorspar (CaF₂) present across both resource categories as a potential future by-product credit
• Mineralisation remains open laterally and at depth, confirming resource expansion potential
• The BD-Zone was excluded from the current estimate pending further metallurgical test work, representing additional upside

The 30-year PEA mine plan draws on only approximately 25% of the total global resource, meaning the deposit's full potential remains largely untapped at the PEA stage.

Sensitivity Analysis: How Robust Are the Economics?

The PEA includes a single-variable sensitivity analysis, flexing key assumptions ±30% from the base case. Results confirm the project maintains meaningful positive NPV across a range of adverse scenarios.

The project's greatest sensitivity lies on the revenue side — REO basket price, recovery rates and payability factors each directly multiply into project revenue.

However, even under a 30% reduction in basket prices, the project retains a post-tax NPV of CAD$667 million, indicating a degree of economic resilience at the PEA level.

Market Positioning: Aligned With Structural Demand Trends

Ashram is entering development at a time when Western governments and industries are actively seeking to reduce dependence on Chinese rare earth supply chains. China accounted for approximately 77% of global rare earth mine production and approximately 90% of separation capacity in 2025.

Demand fundamentals for magnet rare earths are compelling:

• Global demand for magnet REEs (NdPr, Dy, Tb) is projected to grow at a CAGR of 8–12% through to 2050
• Key demand drivers include electric vehicles, permanent magnet wind turbines, robotics, semiconductors, aerospace and defence
• Structural supply deficits are anticipated, particularly for dysprosium and terbium — both present in the Ashram ore basket

PEA pricing was based on independent forecasts from Adamas Intelligence (Q1/Q2 2026 Rare Earth Pricing Quarterly Outlook). For context, key near-term pricing assumptions include:

The company's proposed MREC product is considered suitable for processing by North American and European rare earth separation facilities. No offtake agreements are currently in place, with engagement ongoing.

Upside Beyond the Base Case

The Mont Royal Resources Ashram rare earth project updated PEA results are deliberately conservative, capturing only a fraction of Ashram's total potential. Several value-adding opportunities sit outside the current study scope:

1. Fluorspar recovery circuit — Ashram hosts significant fluorspar mineralisation. A dedicated recovery circuit is excluded from the current flowsheet but is being advanced for inclusion in future studies, with potential to add meaningful by-product revenue.

2. BD-Zone inclusion — The BD-Zone, an additional REE-bearing unit, was excluded from the current MRE pending metallurgical evaluation. Successful test work could add to the resource base and mine plan.

3. Resource expansion drilling — Mineralisation remains open laterally and at depth. Additional drilling across the Eldor Carbonatite Complex, including the Mallard satellite target, could extend mine life well beyond 30 years.

4. Downstream and strategic partnerships — The company is actively engaging with potential offtake and strategic partners, with the Saguenay refinery concept providing a natural integration point for downstream value capture.

5. Infrastructure cost optimisation — A regional shared infrastructure strategy is being evaluated in collaboration with other mining projects, government agencies, and First Nations, which could reduce access road costs relative to the standalone assumption used in the PEA.

Pathway to Pre-Feasibility and Beyond

With the updated PEA now complete, Mont Royal has a clear sequence of workstreams planned to advance the project toward a Pre-Feasibility Study and beyond.

The PFS will be a critical value-creation milestone, lifting the study accuracy from ±50% (PEA level) to ±25% and providing a more robust basis for investment and financing decisions.

Permitting is expected to take several years and will span federal and Québec provincial frameworks, covering mine operations, the Ashram–Saguenay logistics corridor, and the downstream refinery. Early stakeholder engagement with Inuit, Naskapi and Innu communities is already underway.

Why Investors Should Watch Mont Royal Resources

Mont Royal Resources presents a rare combination of scale, jurisdiction quality, product basket relevance, and project stage for investors seeking exposure to the structural growth in rare earth demand.

The core investment case rests on several pillars:

• Scale: One of North America's largest undeveloped rare earth resources, with a 30-year mine life using only 25% of the total resource base
• Economics: Strong project returns with a post-tax NPV of CAD$2.03 billion and 22% IRR, supported by a competitive cost structure
• Product Mix: High-value magnet rare earth basket with meaningful NdPr content and critical heavy rare earths exposure
• Jurisdiction: Located in Québec, Canada — a tier-1 mining jurisdiction with established regulatory frameworks and community engagement processes

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