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EXPANDED CORPORATE FACT SHEET JUNE 15, 2017 SMY: TSX-V WWW.SEARCHMINERALS.CA TRANSFORMATIONAL ELEMENTS REEs are considered transformational because in small quantities they have a huge impact on the properties of the other materials they are blended with. For example they: • radically improve the strength, heat resistance and heat dissipation capabilities of metals and glass • can make magnets 40 times stronger • are used in glass to filter out harmful light frequencies • impact the color brightness of TV monitors, smart phones and tablets • are used in catalytic converters to reduce greenhouse gas emissions These remarkable properties underpin industry’s ability to miniaturize electronics and make certain REEs essential to development of permanent magnets and a variety of other components used in renewable energy, electric automobiles, defense systems, medical devices (such as MRI) and a wide range of consumer electronics. Search Minerals Inc. has been exploring for Rare Earth Elements (REEs) in SE Labrador since 2009 with considerable success. The FOXTROT Deposit on which a favourable Preliminary Economic Assessment (PEA) was completed in April 2016, was the first of what are now three important discoveries in a rapidly emerging Critical Rare Earth Element (CREE) District in SE Labrador. The other two major discoveries, Deep Fox and Fox Meadow, are similar in size and surface expression and hosted in the same geological sequences within the Fox Harbour Volcanic Belt. In February 2017, Search Minerals completed pilot plant metallurgical testing at SGS Laboratories in Lakefield, Ontario, Canada on material from the FOXTROT Deposit. This testing clearly demonstrated the ability to produce a high purity mixed rare earth oxide concentrate with uranium, thorium, zinc and iron impurities well below the maximum thresholds expected by refineries; a huge milestone for any rare earth element project. PILOT PLANT METALLURGICAL TESTING COMPLETED ON Southern Labrador Critical Rare Earth Element Deposit SIGNIFICANT EXPLORATION OPPORTUNITY These discoveries are the result of follow-up on twenty-three (23) original showings identified within a NW striking belt 70 km x 8 km that is controlled by Search Minerals. This work continues under the field supervision of Dr. Randy Miller, REE expert and V. P. Exploration. A significant exploration program has been developed for the 2017 field season which includes drilling the Deep Fox prospect. ABOUT THE NEW CRITICAL RARE EARTH ELEMENTS The new CREEs (their oxides termed by Adamas Intelligence of Sudbury, Ontario as “neo-CREOs”) include Neodymium (Nd), Praseodymium (Pr), Dysprosium (Dy), Terbium (Tb) and Lanthanum (La). This valuable subset of the full series of seventeen (17) REEs is considered critical due to high demand and/or constrained domestic supply. In its December 2016 Report, Adamas framed criticality in two dimensions: Importance to Clean Energy & Technology and Expected Surplus & Shortages. More specifically, the report referenced their use in permanent magnets found in wind turbines, electric vehicles and other clean energy technologies as the primary market driver. FOXTROT Project Location and Surrounding Showings Source: Adamas Intelligence, December 2016

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Page 1: PILOT PLANT METALLURGICAL TESTING COMPLETED ON …_2017.pdf · magnetic and gravity separation, grinding, and bubble flotation. This provides significant operational cost savings

EXPANDED CORPORATE FACT SHEET JUNE 15, 2017 SMY: TSX-V WWW.SEARCHMINERALS.CA

TRANSFORMATIONAL ELEMENTS

REEs are considered transformational because in small quantities they have a huge impact on the properties of the other materials they are blended with. For example they:

• radicallyimprovethestrength,heatresistanceandheatdissipationcapabilities of metals and glass

• canmakemagnets40timesstronger• areusedinglasstofilteroutharmfullightfrequencies• impactthecolorbrightnessofTVmonitors,smartphonesandtablets• areusedincatalyticconverterstoreducegreenhousegasemissions

These remarkable properties underpin industry’s ability to miniaturize electronics and make certain REEs essential to development of permanent magnets and a variety of other components used in renewable energy, electric automobiles, defense systems, medical devices (such as MRI) and a wide range of consumer electronics.

Search Minerals Inc. has been exploring for Rare Earth Elements (REEs) in SE Labrador since 2009 with considerable success. The FOXTROT Deposit on which a favourable Preliminary Economic Assessment (PEA) was completed in April 2016, was the first of what are now three important discoveries in a rapidly emerging Critical Rare Earth Element (CREE) District in SE Labrador. The other two major discoveries, Deep Fox and Fox Meadow, are similar in size and surface expression and hosted in the same geological sequences within the Fox Harbour Volcanic Belt. In February 2017, Search Minerals completed pilot plant metallurgical testing at SGS Laboratories in Lakefield, Ontario, Canada on material from the FOXTROT Deposit. This testing clearly demonstrated the ability to produce a high purity mixed rare earth oxide concentrate with uranium, thorium, zinc and iron impurities well below the maximum thresholds expected by refineries; a huge milestone for any rare earth element project.

PILOT PLANT METALLURGICAL TESTING COMPLETED ON Southern Labrador Critical Rare Earth Element Deposit

SIGNIFICANT EXPLORATION OPPORTUNITY

These discoveries are the result of follow-up on twenty-three (23) original showings identified within a NW striking belt 70 km x 8 km that is controlled by Search Minerals. This work continues under the field supervision of Dr. Randy Miller, REE expert and V. P. Exploration. A significant exploration program has been developed for the 2017 field season which includes drilling the Deep Fox prospect.

ABOUT THE NEW CRITICAL RARE EARTH ELEMENTS

The new CREEs (their oxides termed by Adamas Intelligence of Sudbury, Ontario as “neo-CREOs”) include Neodymium (Nd), Praseodymium (Pr), Dysprosium (Dy), Terbium (Tb) and Lanthanum (La). This valuable subset of the full series of seventeen (17) REEs is considered critical due to high demand and/or constrained domestic supply. In its December 2016 Report, Adamas framed criticality in two dimensions: Importance to Clean Energy & Technology and Expected Surplus & Shortages. More specifically, the report referenced their use in permanent magnets found in wind turbines, electric vehicles and other clean energy technologies as the primary market driver.

FOXTROT Project Location and Surrounding Showings Source: Adamas Intelligence, December 2016

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The FOXTROT PROJECT The Fox Harbour volcanic belt, which hosts the FOXTROT Project and numerous other FOXTROT-like prospects, offers excellent geological control as the mineralized host rocks occur in a well-recognized steeply dipping volcanic sequence trending in a NW direction. In addition, the mineralization is associated with both magnetic and radiometric anomalies, further improving exploration and development control.

The FOXTROT deposit has been delineated by over 70 drill holes, 20 channels, geological mapping and geophysics. The context of the mineralized zones is very well understood and the deposit is open at depth. In April 2016, independent consultants Roscoe Postle Associates Inc. (RPA) updated their Preliminary Economic Assessment (PEA) of the FOXTROT Project applying Search Minerals’ proprietary Direct Extraction Process. On that basis, Search is moving forward with the Environmental Assessment process with a view to mine development.

PRELIMINARY ECONOMIC ASSESSMENT

Revenue from FOXTROT is dominated by Nd (40%), Dy (30%), Pr (12%), Tb (8%); all elements projected to remain in supply deficit. The Life of Mine Plan outlined in the PEA indicates that 4.9 Mt of material containing an average of 1.17% Total Rare Earth Oxides (TREOs) could be mined over 14 years, including open pit mining for the first eight years and underground mining thereafter. Total production is projected to be 44,129 t of TREOs in a mixed rare earth precipitate. This equates to an annual production rate of 3,065 t/year of TREOs which according to 2016 projections provided by independent consultants Adamas Intelligence, is equivalent to 1.5% of the forecasted demand of 198,131 tonnes in 2025. (Admas Scenario 2)

FOXTROT RESOURCE ESTIMATE

Classification Cut-off$NSR

Tonnage (Tonnes)

Dy (ppm)

Dy2O3 (ppm)

Nd (ppm)

Nd2O3 (ppm)

Pr (ppm)

Pr6O11 (ppm)

LREE %

LREO %

HREE %

HREO %

TREE %

TREO %

OPEN PIT

INDICATED $165 4,129,000 177 203 1,393 1,625 372 449 0.69 0.83 0.17 0.2 0.86 1.03

INFERRED $165 228,000 179 206 1,378 1,607 368 445 0.68 0.82 0.17 0.2 0.85 1.02

UNDERGROUND

INDICATED $260 3,263,000 209 240 1,602 1,868 429 518 0.78 0.94 0.19 0.23 0.97 1.17

INFERRED $260 1,730,000 201 231 1,602 1,868 430 520 0.8 0.96 0.19 0.23 0.99 1.19

TOTAL INDICATED 7,392,000 191 219 1,485 1,732 397 480 0.73 0.88 0.18 0.21 0.91 1.09

TOTAL INFERRED 1,958,000 199 228 1,576 1,838 423 511 0.79 0.94 0.18 0.22 0.97 1.17

Cautionary Statement: The preliminary economic assessment includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them to enable them to be categorized as mineral reserves and there is no certainty that the  preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have a demonstrated economic viability.

A COMPETITIVE PROPOSITION

The fact that the FOXTROT Deposit is road accessible and in close proximity to a deep-water port, provides significant capital and operational cost advantages in comparison to other projects.

Additionally, the Direct Extraction Process (Patent Pending) developed by Search Minerals’ Director and V. P. Metallurgy, Dr. David Dreisinger, provides the Company with additional operational cost advantages. This process requires less energy and utilizes fewer chemicals and fewer operational steps. Pilot plant testing which was completed in February 2017, exceeded recovery expectations.

PRELIMINARY ECONOMIC ASSESSMENTKEY ASSUMPTIONS AND FINANCIAL HIGHLIGHTS

$CDNPlant Capacity 1,000 tpd production rate (4.9 Mt over 14 years)

Pre Tax NPV10% and IRR $93 million and 22%

After Tax NPV10% and IRR $48 million and 16.7%

Payback Period Pre-tax 3.5 years , After-tax 4.4 years

Gross Revenue $1.713 billion (Life of Mine)

CAPEX Requirement$152 million for startup including a $33M contingency$57 million for underground funded from operations$23 million for mine closure funded from operations

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A SIMPLER, MORE ENVIRONMENTALLY FRIENDLY PROCESS

Search Minerals’ Direct Extraction Process (patent pending) eliminates the need for certain stages of conventional processing: including magnetic and gravity separation, grinding, and bubble flotation. This provides significant operational cost savings and environmental advantages. It is also a key reason why capital costs are low. The need for a wet tailings pond is also eliminated in favour of dry stacking of waste residue. Again, this is less costly and more environmentally friendly. During the remediation phase, the dry residue is returned to the open pit.

EXCELLENT PILOT PLANT TESTING RESULTS

For any REE development the ultimate test is whether you can cost effectively produce high purity rare earth oxide concentrate for further refining. It is a challenge that can absorb millions of dollars and take many years to accomplish. In February 2017 Search Minerals achieved this milestone, demonstrating the ability to produce a ~99% pure oxide concentrate with low impurity content. The process was successful in bringing iron, zinc and other impurities well below levels accepted by refineries. Unlike some other deposits in the world, the Foxtrot Deposit has no challenges associated with the presence of high levels of radioactive material such as uranium and thorium. These impurities fell well below levels accepted by refineries.

As well, the pilot plant enabled Search to further simplify its processing operation. Testing successfully demonstrated that less expensive sulfuric acid could be substituted for hydrochloric acid in the latter stages of the overall process, streamlining chemical requirements and reducing costs. The table below compares the recoveries from the January-February 2017 Pilot Plant Testing with those used in the April 2016 PEA for the Foxtrot Deposit. The elements referenced are the five neo-CREOs that Search estimates will comprise over 90% of the projected revenues from the Foxtrot Deposit.

Assays Tonnage (000s)

Dy (ppm)

Nd(ppm)

Pr (ppm)

Tb(ppm)

FOXTROT

Indicated (PEA) 7,392 191 1,485 397 33

Inferred (PEA) 1,958 199 1,576 423 34

DEEP FOX WIDTH

Channel 14-01 5.96m 286 2,156 567 48

Channel 14-01 17.50m 241 1,893 507 41

FOX MEADOW

Channel C16-02 3.48m 244 1,478 363 41

Channel C16-04 7.61m 197 1,089 284 33

SURFACE EXPRESSION WIDTH LENGTH

FOXTROT Mostly 5m-14m Approx. 400m

DEEP FOX Mostly 7m-30m Approx. 500m

FOX MEADOW Currently 3m-8m Currently Approx. 500m

Pilot Plant Test Results Comparison with 2016 PEA

Element Extraction (%)Pilot Plant Tests

Extraction (%)Used in 2016 PEA

Neodymium 85% 78.5%

Praseodymium 86% 77.6%

Dysprosium 68% 73.7%

Terbium 71% 73.6%

Lanthanum 86% 77.3%

Deep Fox Channel Sample Comparison with Pilot Plant

Element Extraction (%)Deep Fox

Channel Sample

Extraction (%)Pilot Plant Tests

Neodymium 90.8% 85%

Praseodymium 90.5% 86%

Dysprosium 81.3% 68%

Terbium 82.5% 71%

Lanthanum 88.5% 86%

THE DEEP FOX PROSPECT

Located just 12 km from the Foxtrot deposit and just 2 km from the town of St. Lewis, Deep Fox represents the Company’s second important discovery in the District. It is similar in strike length but with significantly wider mineralized zones at surface (up to 30 m. Mineralized channel sample assays are approximately 15% higher grade than those at Foxtrot. Making this discovery that much more intriguing, are the high rare earth element recoveries achieved from a channel sample extracted from Deep Fox.

FOX MEADOW DISCOVERY

• 11kmwestofPortHopeSimpson• SimilarsurfacestrikelengthasFOXTROT• Mineralizationupto30mwideand500mlong• Existsinatreedandtillcoveredarea;moredifficulttoexplore• MineralizedchannelsampleassaysaresimilartoFOXTROT

The next phase in development of the Foxtrot Deposit will involve sending samples of the rare earth concentrate to refineries for testing. This will provide greater certainty regarding separation costs and help to advance discussions with potential strategic/offtake partners.

Search is extremely excited to be planning a significant drilling program for Deep Fox. This is expect to begin in July during the 2017 field season in SE Labrador.

This channel sample taken at Deep Fox for bench testing assayed 1.59% TREEs.

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This Corporate Fact Sheet (“Fact Sheet”) includes certain “forward-looking information” and “forward-looking statements” (collectively “forward-looking statements”) within the meaning of applicable Canadian and United States securities legislation including the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included herein, without limitation, statements relating the future operating or financial performance of the Company, are forward-looking statements.

Forward-looking statements are frequently, but not always, identified by words such as “expects”, “anticipates”, “believes”, “intends”, “estimates”, “potential”, “possible”, and similar expressions, or statements that events, conditions, or results “will”, “may”, “could”, or “should” occur or be achieved. Actual future results may differ materially. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made and are based upon a number of assumptions and estimates that, while considered reasonable by the respective parties, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors, both known and unknown, could cause actual results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements and the parties have made assumptions and estimates based on or related to many of these factors. Such factors include, without limitation, the risk that the Company is not able to find further funding, have further exploration success or find a suitable joint venture partner or offtake partner. Readers should not place undue reliance on the forward-looking statements and information contained in this presentation concerning these times. Except as required by law, Search Minerals Inc. does not assume any obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.

BUSINESS STRATEGY AND NEXT STEPS

Our strategy is to leverage breakthrough processing technology and district-scale resources to attract experienced strategic partners who can make capital investments and bring additional development expertise. Collectively we will optimize production, sales cycles and return to shareholders.

MANAGEMENT AND BOARD MEMBERSJim Clucas, Executive Chairman, Director

Former INCO CFO. Founder of International Nickel Ventures Inc.

Greg Andrews, President & CEO, DirectorB. Comm. Finance, University of Calgary; extensive planning & management experience.

Dr. Randy Miller, V. P. ExplorationPh.D. Geology, University of Toronto; extensive experience exploring for and studying REEs.

Dr. David Dreisinger, V. P. Metallurgy, DirectorProfessor and Industrial Research Chair in Hydrometallurgy at UBC. Internationally acomplished processing expert.

Matthew Anderson, CFO B. Comm. from McGill University; obtained CA designation in 2008.

Dr. Jim Patterson, DirectorPh.D. Geologist. Economic and exploration consultant for 40 years.

Roberto Giannetti da Fonseca, DirectorCEO Kaduna Consulting Group. Advisor to 50+ Brazilian multinationals

Leo Power, DirectorMBA, MOGS, ICD.D, Director - Canada Fluorspar, Executive Chairman-Barite Mud Services.

Dr. Andrew Furey, Advisory Board MemberOrthopedic Surgeon, CEO-Team Broken Earth, Director-Canada Fluorspar.

Barry Girling, Advisory Board Member Mining corporate finance and management expert - 30 years.

SEARCH MINERALS INC. JUNE 15, 2017

Listing TSX-V: SMY

Head Office Vancouver, British Columbia

Share Price Range (52 week low - high) $0.06 - $0.10

Market Capitalization $11,343,327

Shares Outstanding 151,244,356

Warrants 33,809,143

Options 9,065,000

Fully Diluted 194,118,499

Bank Royal Bank of Canada

Auditors Mao & Ying LLP, CPA

CONTACT USCorporate Enquiries Investment EnquiriesGreg Andrews Paul M. SnowPresident and CEO Investor RelationsTel: 604 998-3432 ext. 2 Tel: 709 753-0794E-mail: [email protected] E-mail: [email protected]

Search Minerals – Intends to develop the District and manage the processing facility and open pit operations with selected contractors.

Strategic Partner/Joint Venture Partner – Would finance the Bankable Feasibility Study needed to fully assess the opportunity to build the mine and processing facility.

Offtake Partner – Would contract to purchase the individual Rare Earth Oxides and/or Rare Earth Elements produced, strengthening the ability to project finance.

Search Minerals

Strategic / Joint Venture Partner Off-take Partner

SMY: TSX-V

Updated  PEA  Report    Completed  Feb.  2016    

2016   2017   2018   2019  

Metallurgy  Pilot  Plant  TesCng  Completed  Feb.  2017  

Feasibility  Study  

PermiEng  -­‐  Environmental  Impact  Statement  

Engineering  

Make  ConstrucCon    Decision  and  Build    

Low cost to bankable feasibility and construction decision to develop the mine and processing plant.

•  Total LOM production is 44,129 tonnes of TREO averaging 3,065 tonnes per year over 14 years.

•  LOM production includes 7.095 million kg of neodymium oxide (Nd2O3), and 0.836 million kg of dysprosium oxide (Dy2O3).

ConCnued  Partner  Development      Joint  Venture,  Off-­‐take,  Equity  investment  

1                      |    Corporate  PresentaCon    |    SMY:  TSX-­‐V    |    searchminerals.ca    |  March  2016    

2020   2021  

Cautionary Note: The Company has not prepared a feasibility study in relation to this project and therefore, the time line to production decision is subject to increased risk and uncertainty.

ProducCon    Mixed  Rare  Earth  Oxides