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Champion Iron Acquires The Pointe Noire Pelletizing Facility and Enters into MOU with an International Steelmaker to Evaluate the Production of Direct Reduction Grade Pellets

Press Release

MONTRÉAL, May 17, 2022 – Champion Iron Limited (TSX: CIA) (ASX: CIA) (OTCQX: CIAFF) (“Champion” or the “Company”) is pleased to announce that it has entered into a definitive purchase agreement (the “Purchase Agreement”) for the acquisition, via a wholly-owned subsidiary of Champion, of the Pointe Noire Iron Ore Pelletizing Facility located in Sept-Iles, Québec (the “Pellet Plant”). Additionally, Champion announces that it has entered into a Memorandum of Understanding (the “MOU”) with a major international steelmaker (the “FS Partner”) to complete a feasibility study to evaluate the re-commissioning of the Pellet Plant and produce Direct Reduction Grade Pellets (the “Feasibility Study”).

Located directly adjacent to the port facilities that Champion currently uses, the Pellet Plant, which was commissioned in 1965 with an original pelletizing nameplate capacity of 6 million tonnes per annum, was put on care and maintenance in 2013. The Purchase Agreement was entered into by a wholly-owned subsidiary of Champion and provides for the acquisition of the Pellet Plant from Société Ferroviaire et Portuaire de Pointe-Noire S.E.C. (“SFPPN”) for a cash consideration of $2.5 million, upon satisfaction of certain conditions precedent. In addition to the cash consideration, the SFPPN and the region stand to receive additional economic benefits as Champion considers re-commissioning the Pellet Plant. Benefiting from its industrial site, strategic location adjacent to Pointe Noire’s deep-water berth and train unloading infrastructure, the Pellet Plant could provide a relatively rapid opportunity for commercial production. The Pellet Plant is expected to require significant investments prior to re-commissioning, including structural work, rehabilitation and enhancement of existing equipment, to maximize productivity and energy efficiencies while minimizing its environmental impact.

The MOU sets out a framework for Champion and the FS Partner to collaborate to complete the Feasibility Study, which is expected to be completed in 2023. Subject to positive findings and results of the Feasibility Study, the MOU outlines a framework for a joint venture to produce direct reduction grade iron ore pellets for sale to third parties, including the FS Partner (the “Project”). Pursuant to the Purchase Agreement, Champion is required to comply with various undertakings in connection with the Pellet Plant, including a commitment to design and operate the Project using exclusively green energy sources including electricity, natural gas, biofuels or renewable energy as main power sources. The Feasibility Study will evaluate the investments required to re-commission the Pellet Plant while integrating up to date pelletizing and processing technologies.

Champion’s CEO, Mr. David Cataford, said: “The proposed acquisition of the Pellet Plant represents a strategic opportunity for our Company to further deploy its vision to contribute to the green steelmaking supply chain. Our local support, high-purity iron ore products, access to world class infrastructure and operational track record, enabled us to attract a major international steel producer for a potentially significant large-scale project in Québec. This project, together with other opportunities for organic growth, aim to create a positive impact for local communities and represents an additional step to unlock the region’s full potential, including additional product processing and transformation, as demand for high-purity iron ore products rises globally.”

All dollar figures stated herein are expressed in Canadian dollars

For additional information on Champion Iron Limited, please visit our website at: www.championiron.com.

This press release has been authorized for release to the market by the CEO of Champion Iron Limited, David Cataford.

For further information: Michael Marcotte, CFA, Senior Vice-President, Corporate Development and Capital Markets, 514-316-4858, Ext. 128, [email protected]

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