Fredonia Mining Inc. press release

Fredonia Mining Announces Positive PEA for EDM Highlighting 146,000 oz AuEq Annual Production, US$1.49 Billion NPV10 and 65% IRR

2026-08-31

TSXV - TSX Venture Exchange · Gold · Silver · Barium · Arsenic · Mercury · Antimony · Canada · Technical Studies

Updated Mineral Resource of 2.76 Moz AuEq Measured and Indicated + 1.09 Moz AuEq Inferred | Business Case for 183,000 oz AuEq Average Annual Production During First Five Years | 17+ Year Mine Life

TORONTO, Aug. 31, 2026 (GLOBE NEWSWIRE) -- Fredonia Mining Inc. (“Fredonia” or the “Company”) (TSXV: FRED) is pleased to announce the completion and results of a Preliminary Economic Assessment (“PEA”) and updated Mineral Resource Estimate (“MRE”) on its flagship 100%-owned El Dorado Monserrat (“EDM”) gold-silver project in Santa Cruz Province, Argentina.

EDM PEA Highlights

Significant production scale:average life-of-mine production of approximately 146,000 oz gold-equivalent (“AuEq”) per year over a 17+ year mine life, including approximately 183,000 oz AuEq per year during the first five years.1, 3, 4, 5

Updated Mineral Resource estimate:126 Mt of Measured and Indicated Mineral Resources grading 0.47 g/t Au and 12.66 g/t Ag and containing 1,932.7 koz Au and 51.460 Moz Ag (equivalent to 0.68 g/t AuEq and 2,758.6 koz AuEq)2. Separately, 74 Mt of Inferred Mineral Resources grading 0.31 g/t Au and 8.98 g/t Ag and containing 739.6 koz Au and 21.345 Moz Ag (equivalent to 0.46 g/t AuEq and 1,087.8 koz AuEq)1. Gold and silver grades were estimated independently. The Mineral Resource Estimate is supported by nearly 60,000 m of drilling and extensive surface work, including trenching and mapping, completed over more than 15 years of exploration.2, 6, 7, 8, 9

Mineral Resources within the operationalized PEA pit designs:The PEA mine plan for the Main Veins and La Herradura deposits includes 79.67 Mt of combined Measured and Indicated Mineral Resources grading 0.606 g/t Au and 16.10 g/t Ag (equivalent to 0.797 g/t AuEq)1and, separately, 44.10 Mt of Inferred Mineral Resources grading 0.474 g/t Au and 10.25 g/t Ag (equivalent to 0.596 g/t AuEq)1, all scheduled as process-plant feed. The PEA mine plan also includes 28.59 Mt of combined Measured and Indicated Mineral Resources grading 0.135 g/t Au and 5.98 g/t Ag (equivalent to 0.206 g/t AuEq)1and, separately, 18.45 Mt of Inferred Mineral Resources grading 0.141 g/t Au and 6.72 g/t Ag (equivalent to 0.220 g/t AuEq)1, all scheduled as intermediate-grade material to a separate uncrushed run-of-mine leach pad. Destination assignments and the related AuEq metrics are based on the adopted PEA metal prices of US$3,800/oz Au and US$45/oz Ag.1, 4Monserrat West and multiple additional veins containing high-grade intersections remain outside the current mine plan and offer potential to increase total tonnage inventory further.

Robust value:US$1.5 billion post-tax net present value at a 10% discount rate (“NPV10”) and 65% post-tax internal rate of return (“IRR”), with prices as indicated above.

Cost-competitive bulk mining operation: surface mineralization allows for conventional open-pit truck-and-shovel mining at a low overall waste-to-mineralized-material ratio of approximately 1.7:1 with processing assumed by heap leaching – based on initial test work and benchmarking with nearby operations – resulting in a cost-effective life-of-mine (“LOM”) cash cost of approximately US$1,630/oz AuEq.3, 4

Capital-efficient development:estimated initial capital of approximately US$346 million, comprising US$143 million for the mine fleet, US$91 million for the process plant and site infrastructure, and approximately US$112 million of additional pre-production items and initial working capital.

Potential RIGI upside:a separate scenario applying a 25% income-tax rate and accelerated depreciation under Argentina’s Regimen de Incentivo para Grandes Inversiones (“RIGI”) results in an estimated post-tax NPV10 of approximately US$1.8 billion and IRR of approximately 82%. RIGI benefits are not included in the PEA base case and remain subject to project qualification and validation by an Argentine tax specialist.

Notes to the PEA Highlights:

1. For PEA mine planning and the reporting of in-pit and process-feed grades, AuEq was calculated using the formula AuEq (g/t) = Au (g/t) + Ag (g/t) × 0.01184, based on the adopted PEA metal-price ratio of US$45/oz Ag ÷ US$3,800/oz Au. This AuEq metric is calculated from in-situ head grades before the application of metallurgical recoveries and is used for mine-planning and process-destination purposes.

2. Gold and silver grades in the updated Mineral Resource estimate were estimated independently. For secondary Mineral Resource reporting purposes, AuEq was subsequently calculated from the independently estimated in-situ grades and based on metal prices of US$4,000/oz Au and US$70/oz Ag and assumed metallurgical recoveries of 85% for Au and 80% for Ag using the formula AuEq (g/t) = Au (g/t) + Ag (g/t) [(US$70/oz Ag × 80% Ag recovery) / (US$4,000/oz Au × 85% Au recovery)], resulting in an Ag-to-Au equivalency factor of 0.016471. Recoveries for the mineral resource estimate are supported by initial bottle-roll testwork, benchmarking and expert judgment. No payability assumptions were applied to the Mineral Resource AuEq calculation. Mineral Resource AuEq does not represent recovered or payable metal.

3. For PEA production and economic reporting, payable AuEq ounces are calculated from payable Au and Ag using the metal-price ratio described in Note 1 after applying metallurgical recoveries of 85% Au and 70% Ag to crushed/agglomerated heap-leach plant feed and 50% Au and 20% Ag to uncrushed run-of-mine leach-pad feed. These recoveries are preliminary planning assumptions supported by initial bottle-roll testwork, benchmarking and expert judgment and should not be interpreted as demonstrated recoveries. Additional representative metallurgical testwork is required.

4. The PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that the PEA will be realized. The tonnages and average grades presented as total scheduled process-plant feed are production-schedule metrics derived from Measured, Indicated and Inferred Mineral Resources contained within the preliminary operationalized PEA pit designs. They do not constitute a combined Mineral Resource category or a Mineral Reserve. No Mineral Reserves have been declared for the EDM Project. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

5. LOM payable production comprises approximately 2.476 Moz AuEq, consisting of approximately 1.993 Moz Au and 40.8 Moz Ag, calculated using the payable AuEq methodology described in Note 3. Over a 17+ year mine life, average payable production is approximately 146,000 oz AuEq per year, comprising approximately 117,000 oz Au/y and 2.41 Moz Ag/y. See also Note 4 above.

6. Mineral Resources are reported in situ and in metric tonnes.

7. The updated Mineral Resource estimate is reported at a base-case cut-off grade of 0.10 g/t Au.

8. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Inferred Mineral Resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as Mineral Reserves.

9. Totals may not add due to rounding.

Summary of PEA Results

| Indicator | Unit | Value | | ROM crush/agglomeration heap leach plant processing | Mtpa | 7.30 | | ROM uncrushed ore to leaching pile | Mtpa | 2.8 | | Metal Production – average mine-life | oz AuEq/a | 146,000 | | Gold average mine-life | oz/a | 117,000 | | Silver average mine-life | oz/a | 2,410,000 | | LOM revenue | US$M | 9,411 | | EBITDA | US$M | 5,369 | | Income tax | US$M | 1,649 | | Initial capital | US$M | 345.7 | | LOM capital | US$M | 686 | | Undiscounted free cash flow | US$M | 3,034 | | NPV at 10%, post-tax | US$M | 1,494 | | IRR, post-tax | % | 65 | | Discounted payback period (from start of construction) | periods | 1.9 | | Cash cost | US$/oz AuEq | 1,632 | | Mine life | years | 17+ (18 operating periods) |

PRELIMINARY EDM MINE OVERVIEW

The PEA contemplates a low-cost conventional open-pit truck-and-shovel mining and heap-leach operation, delivering average life-of-mine production of approximately 146,000 oz AuEq per year, including approximately 117,000 oz Au and 2.41 million oz Ag per year. Production is weighted toward the earlier years of the mine plan, averaging approximately 183,000 oz AuEq per year during the first five years and reaching approximately 193,000 oz AuEq in Year 3, before tapering to a low of approximately 100,000 oz AuEq in Year 14.

The preliminary PEA pit designs contain Mineral Resources scheduled to two processing destinations. Scheduled process-plant feed comprises 79.67 Mt of combined Measured and Indicated Mineral Resources grading 0.606 g/t Au and 16.10 g/t Ag and, separately, 44.10 Mt of Inferred Mineral Resources grading 0.474 g/t Au and 10.25 g/t Ag, all scheduled as process-plant feed. The preliminary PEA pit designs also include 28.59 Mt of combined Measured and Indicated Mineral Resources and, separately, 18.45 Mt of Inferred Mineral Resources scheduled as intermediate-grade material to a separate uncrushed run-of-mine leach pad. These production-schedule quantities do not constitute Mineral Reserves. These are supported by nearly 60,000 m of drilling and extensive surface work with trenching and mapping carried out over more than 15 years of exploration.

The scheduled Mineral Resources are contained within two preliminary operationalized pit designs: Main Veins, in the Northern Corridor, and La Herradura, in the Southern Corridor, located approximately 7 km from each other. The mine plan currently excludes the Monserrat West deposit due to a higher associated strip ratio; Monserrat West remains classified as a Mineral Resource and represents an opportunity for future evaluation at higher metal prices or under a revised development configuration.

The operationalized pit designs were developed from Whittle optimization shells at a revenue factor of 1.0 and incorporate access ramps, minimum mining widths, operational benches and practical pit geometries.

Mineralized material is classified into three destinations by AuEq grade: material below 0.13 g/t AuEq reports to the waste rock dumps, material between 0.13 and 0.35 g/t AuEq reports to the uncrushed run-of-mine leach pad, and material above 0.35 g/t AuEq reports to the crushing/agglomeration and heap-leach process plant.

The PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that the PEA will be realized. The tonnages and average grades presented as total scheduled process-plant feed are production-schedule metrics derived from Measured, Indicated and Inferred Mineral Resources contained within the preliminary operationalized PEA pit designs. They do not constitute a combined Mineral Resource category or a Mineral Reserve. No Mineral Reserves have been declared for the EDM Project. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

MINING METHOD

Conventional truck-and-shovel open-pit mining is supported by the geometry of the mineralized bodies and by the low strip ratios achievable in the early phases. The PEA assumes approximately 3.0 Mt of pre-stripping ahead of production – approximately five months of plant feed – representing approximately US$7.2 million of capitalized pre-strip cost at US$2.40/t.

The production schedule assumes approximately 75% of nominal plant capacity in Year 1 (approximately 5.48 Mt), increasing to 100% of nominal capacity (approximately 7.30 Mt per annum) from Year 2 onward with a total mine life of 17+ years.

INFRASTRUCTURE

Mine infrastructure remains conceptual and includes mine access and haul roads, waste rock storage facilities, the process plant, the principal heap-leach pad, the run-of-mine leach pad, solution ponds, mine services, workshops, fuel and explosives facilities, water and power systems, offices, accommodation, communications, security and environmental controls. This would be confirmed through further detailed studies. Sterilization drilling will be carried out to assist permanent infrastructure design, since the property remains subject to active exploration.

PROCESSING

The PEA base case assumes an operator-owned centrally located processing facility comprising crushing, agglomeration, heap leaching, activated carbon adsorption, desorption, electrowinning and smelting, with a nominal capacity of 20,000 tpd. Intermediate-grade material is treated on a separate run-of-mine leach pad without crushing. Plant recoveries of 85% for gold and 70% for silver were adopted for the process plant, and 50% for gold and 20% for silver for the run-of-mine leach pad. These are preliminary planning assumptions supported by initial bottle-roll testwork, as well as benchmarking and expert criteria. Application of these assumptions to the production schedule results in approximately 146,000 oz AuEq per year average through mine life, including approximately 117,000 oz Au and 2.41 million oz Ag per year. Further metallurgical testwork – including representative variability, mineralogical and column-leach testwork – is planned to increase confidence in recoveries across mineralization types and depths. See notes to the PEA highlights 1, 3 and 4 above.

UPDATED MINERAL RESOURCE ESTIMATE

An updated mineral resource estimate was completed for the EDM Project, which includes 126.45 Mt in the Measured and Indicated categories at grades of 0.68 g/t AuEq (0.47 g/t Au, 12.66 g/t Ag) containing approximately 1.93 Moz Au, 51.46 Moz Ag and 2.76 Moz AuEq M&I. In addition, the Project hosts 73.89 Mt of Inferred Mineral Resources grading 0.46 g/t AuEq (0.31 g/t Au and 8.98 g/t Ag), containing approximately 0.74 Moz Au, 21.35 Moz Ag and 1.09 Moz AuEq. Gold and silver grades were estimated independently. See Notes to the PEA Highlights 2, 6, 7, 8 and 9 above.

The Mineral Resource estimate is effective August 17, 2026, and was prepared in accordance with the CIM Definition Standards incorporated by reference into National Instrument 43-101 – _Standards of Disclosure for Mineral Projects_(“NI 43-101”). Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

The Mineral Resource estimate consolidates block models for La Herradura, Main Veins and Monserrat West. Additional information regarding the estimation methodology, assumptions, data verification and material risks will be provided in the Technical Report.

| Sector | Category | Tonnage (Mt) | Au (g/t) | Ag (g/t) | AuEq (g/t) | Contained Au (koz) | Contained Ag (Moz) | Contained AuEq (koz) | | La Herradura | Measured | 18.484 | 0.31 | 7.85 | 0.44 | — | — | — | | | Indicated | 15.093 | 0.30 | 8.08 | 0.43 | — | — | — | | | Measured + Indicated | 33.577 | 0.31 | 7.95 | 0.44 | 331.0 | 8.582 | 471.2 | | | Inferred | 6.975 | 0.21 | 4.81 | 0.29 | 47.1 | 1.079 | 64.9 | | Main Veins | Measured | 44.748 | 0.60 | 15.37 | 0.85 | — | — | — | | | Indicated | 43.827 | 0.49 | 13.51 | 0.71 | — | — | — | | | Measured + Indicated | 88.576 | 0.55 | 14.45 | 0.78 | 1,577.7 | 41.163 | 2,231.4 | | | Inferred | 64.052 | 0.33 | 9.13 | 0.48 | 679.6 | 18.802 | 989.2 | | Monserrat West | Measured | 3.059 | 0.18 | 12.67 | 0.39 | — | — | — | | | Indicated | 1.241 | 0.14 | 11.75 | 0.33 | — | — | — | | | Measured + Indicated | 4.301 | 0.17 | 12.40 | 0.37 | 24.0 | 1.715 | 51.7 | | | Inferred | 2.865 | 0.14 | 15.90 | 0.40 | 12.9 | 1.464 | 37.0 | | Consolidated Project | Measured | 66.292 | 0.50 | 13.15 | 0.72 | — | — | — | | | Indicated | 60.162 | 0.44 | 12.11 | 0.64 | — | — | — | | | Measured + Indicated | 126.454 | 0.47 | 12.66 | 0.68 | 1,932.7 | 51.460 | 2,758.6 | | | Inferred | 73.891 | 0.31 | 8.98 | 0.46 | 739.6 | 21.345 | 1,087.8 | | | | | | | | | | | | Notes: 1. Mineral Resources are reported in situ and in metric tonnes. 2. The Mineral Resource estimate is effective August 17, 2026. 3. The table reports Mineral Resources at a cut-off grade of 0.10 g/t Au. 4. Measured and Indicated Mineral Resources are combined where indicated. Inferred Mineral Resources are reported separately and are not added to Measured and Indicated Mineral Resources. 5. Average grades for combined Measured and Indicated Mineral Resources were calculated as tonnage-weighted averages. 6. Gold and silver grades were estimated independently. For secondary Mineral Resource reporting purposes, AuEq was subsequently calculated from the independently estimated in-situ grades and based on metal prices of US$4,000/oz Au and US$70/oz Ag and assumed metallurgical recoveries of 85% for Au and 80% for Ag using the formula AuEq (g/t) = Au (g/t) + Ag (g/t) [(US$70/oz Ag × 80% Ag recovery) / (US$4,000/oz Au × 85% Au recovery)], resulting in an Ag-to-Au equivalency factor of 0.016471. Recoveries for the mineral resource estimate are supported by initial bottle-roll testwork, benchmarking and expert judgment. No payability assumptions were applied to the Mineral Resource AuEq calculation. Mineral Resource AuEq does not represent recovered or payable metal. 7. Contained-metal figures for Measured + Indicated Mineral Resources and Inferred Mineral Resources are reported separately. Minor differences resulting from the displayed tonnage and grade values may occur because contained-metal calculations use unrounded underlying values. 8. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Inferred Mineral Resources are considered geologically too speculative to have economic considerations applied to them that would enable them to be categorized as Mineral Reserves. 9. Totals may not add due to rounding. | | | | | | | | |

PRINCIPAL OBJECTIVES, NEXT STEPS AND TIMELINES

The Company is focused on becoming the next operator in the region, delivering approximately 146,000 oz AuEq per year on average, supported by 2.8 Moz AuEq M&I (see the Updated Mineral Resource Estimate table and its accompanying notes) and 1.1 Moz AuEq Inferred. Management believes potential exists to expand the resource base further.

The current programme includes further infill drilling, as well as additional exploratory drilling on untested veins, continuing from September 2026 onward and adding accuracy and potential further tonnage to the inventory. This will be complemented by metallurgy, geotechnical and hydrology work, as well as environmental surveys required to support the environmental permitting process for ongoing exploration and development activities at EDM, targeted for the first quarter of calendar 2027. Stakeholder support is very strong for a fast-track process – particularly from the Provincial Government, which is focused on enhancing mining activity in the region.

Further mining, processing and infrastructure studies to PFS/FS level are planned throughout 2027, in support of a final investment decision and subsequent construction start-up.

Estanislao Auriemma, Chief Executive Officer and a significant shareholder of Fredonia, stated: “The PEA demonstrates the scale of EDM and the strength of the project on a realistic production ramp-up and a comprehensive initial-capital framework. Average production of approximately 146,000 ounces of gold equivalent per year over a 17+ year mine life, including approximately 183,000 ounces per year during the first five years, provides a compelling foundation for the next stage of development. With a post-tax NPV10 of approximately US$1.49 billion and a 65% IRR, we believe EDM combines scale, strong early production and capital efficiency in a way that is unusual for a project at this stage. Just as importantly, the current mine plan is based only on the Main Veins and La Herradura deposits, while Monserrat West and multiple additional mineralized veins and targets remain outside the present economic assessment. Our priority now is to continue increasing geological confidence, advance metallurgy and engineering, progress environmental and permitting work, and systematically evaluate the additional opportunities across the broader EDM property.”