NI 43-101 Resource Estimate

The Mineral Resource Estimate (MRE) is predominately based on an unchanged geological model and methodologies utilized to calculate the 2021 MRE. The differences in the Current deposit relate to the incorporation of approximately 7,200 m of infill drilling within the Lower Bridge/Upper Beaver area and the corresponding reinterpretation of the infill drilling and incorporating updated metal prices and metallurgical and smelter recoveries.

The Thunder Bay North Project 2021 PEA, while based largely on MSO analysis in continuous mineralized material within the indicated mineral resource category, is preliminary in nature and includes an economic analysis that is based in part on Inferred Mineral Resources. Inferred mineral resources are considered too speculative geologically for the application of economic considerations that would enable them to be categorized as Mineral Reserves and there is no certainty that the results will be realized. Mineral Resources do not have demonstrated economic viability and are not Mineral Reserves. Table 1 and 3 shows the MRE grades and Table 2 and 4 shows the MRE contained metals.

Table 1: Thunder Bay North Resource Estimate – Grade Summary (Effective Date November 1, 2021)

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Table 2: Thunder Bay North Resource Estimate – Contained Metals (Effective Date November 1, 2021)

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Table 3: Thunder Bay North Resource Estimate – Grade Summary (Effective Date November 1, 2021)

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Table 4: Thunder Bay North Resource Estimate – Contained Metals (Effective Date November 1, 2021)

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Mineral Resource Estimate Notes

1.  Underground Mineral Resources were prepared in accordance with NI 43-101 and the CIM Definition Standards for Mineral Resources and Mineral Reserves (2014) and the CIM Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines (2019). Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. This estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues.
2. Underground Mineral Resources are based on a 2-year trailing price deck (table 2 above) as of September 30, 2021.
3. Resource excludes all material immediately below Current Lake, above a minimum crown pillar thickness of 20 m which is assumed to be not recoverable by underground methods.
4.  Minor variations may occur during the addition of rounded numbers.
5. Calculations used metric units (metres (m), tonnes (t) and grams/tonne (g/t)).
6. Assays were variably capped on a domain by domain basis.
7. Specific gravity was applied using Ordinary Kriging (OK) estimation.
8. Mineral Resource effective date November 1, 2021.
9. All figures are rounded to reflect the relative accuracy of the estimates and totals may not add correctly.
10. Reported from within a mineralization envelope accounting for mineral continuity.

Input Parameters for Resource Calculation Mining Cutoff Grade

The cutoff value used for the mineral resource for Current deposit is US$93/tonne (CA$121/tonne) insitu contained value and the Escape deposit is US$100/tonne (CA$130/tonne) insitu contained value. The cutoff value is calculated based on estimations as follows: direct mining operating cost, onsite milling operating cost, tailings management facility operating cost, indirect operating cost, G&A cost, onsite milling metal recoveries, offsite smelting metal recoveries, and smelter metal payable percentages.

Estimated operating costs, onsite estimated mill metal recoveries, offsite estimated smelting metal recoveries and estimated smelter payable percentages used for mineral resource cutoff grade calculations are summarized in Table 5. For resource cutoff calculation purposes, a mining recovery of 100.0% and 0.0% mining dilution were applied.

Table 5: Mineral Resource Estimate Cutoff Grade Calculation

Clean Air Metals expects to complete a mineral resource update in 2022 on the greater than 35,000 m of step-out and delineation drilling that has been completed on the Escape deposit since the January 20, 2021 resource statement. Much of the inferred material in the present PEA mine plan has been a focus of infill drilling activity as previously disclosed and is expected to convert to indicated mineral inventory. Continuity of mineralization has been also demonstrated geophysically (using the Magnetometric Resistivity (MMR) technique). The additional drilling is expected to support the use of the MSO algorithm in a prefeasibility study.

Mineral Resource Estimate Methodology

The Current deposit drill hole database is comprised of 171,465 m from 767 diamond drill holes completed between 2006 and 2021. The Escape deposit drill hole database is comprised of 49,383 m from 137 drill holes completed between 2008 and 2020.

The 3D geological modelling integrates assay and geological data collected from diamond core drilling; surface geologic mapping; airborne magnetic; and radiometric geophysical surveys.

The Current and Escape deposit block models were estimated using nearest neighbours (NN), inverse distance squared (ID2), inverse distance cubed (ID3), and ordinary kriging (OK) interpolation methods for global comparisons and validation purposes. The OK method was used for the MRE; it was selected over ID2, ID3, and NN as the OK method was the most representative approach to controlling the smoothing of grades.

Zonal controls were used to constrain the grade estimates to within each low grade and high grade wireframes. These controls prevented the assays from individual domain wireframes from influencing the block grades of one another, acting as a “hard boundary” between the zones.

Search orientations were used for estimation of the block model and were based on the shape of the modelled mineral domains. A total of three nested searches were performed on all zones. The search distances were based upon the variography ranges.

Search ellipsoids defined by metal modelled variograms, which range from 130 to 140 m in the major axis, 100 m in the minor axis, and 9 to 18 m in the vertical axis. The MRE was estimated with 3 m composites utilizing ordinary kriging and local varying anisotropy. The search radius of the first search was based upon the first structure of the variogram, the second search is approximately two times the first search pass and the third search pass is 1.5 times the initial search. Search strategies for each domain used an elliptical search with a minimum and maximum number of composites. Unestimated blocks were left as absent and not reported in the MRE.

Tables 6 and 7 below illustrate the sensitivity of the MRE to different cutoff grades for a potential underground operation scenario with reasonable outlook for economic extraction. The reader is cautioned that the figures provided in these tables should not be interpreted as a statement of Mineral Resources. Quantities and estimated grades for different cutoff grades are presented for the sole purpose of demonstrating the sensitivity of the resource model to the choice of a specific cutoff grade.

Mineral Resource Estimate

• The Mineral Resources were classified using the 2014 CIM Definition standards and the 2019 CIM Best Practice Guidelines and has an effective date of November 1, 2021. The updated MRE comprises a 14.6 million tonne Indicated Mineral Resource, averaging 8.12 g/t PtEq and an 8.1 million tonne Inferred Mineral Resource, averaging 4.07 g/t PtEq., reported at a cutoff insitu contained value of US$93/tonne for Current deposit and a cutoff insitu contained value of US$100/tonne for Escape deposit (Table 16). Figure 7 shows the PtEq (g/t) Grade-Tonne Curve.
• The current resource represents a 4.5% increase in the indicated material on a contained PtEq metal ounce basis in comparison to the prior January 20, 2021 MRE due to the estimation of 2021 7,500 m infill drilling within the Bridge/Beaver portion of the Current deposit. The infill drilling improved the continuity of medium and higher grade portions of the deposit.

Note: PtEq Grade = Total Metal Value in 1 Tonne ÷ Pt Price per Oz × 31.10348 g per Oz. For the MRE, total metal value includes 8 metals (Platinum, Palladium, Gold, Silver, Rhodium, Cobalt, Copper and Nickel)

Optimization Opportunities and Next Steps

Clean Air Metals has identified additional tradeoff opportunities at a prefeasibility level to enhance sustainability and overall project economics, including:

• Optimization of mineral processing, metals recovery, to potentially make rhodium and cobalt payable metals and to improve total playability of nickel.
• Negotiating competitive rather than Indicative smelter payable terms as project is de-risked and timeline to production reduced.
• Review of direct shipping and toll-milling options to local processor reducing capital intensity of mill concentrator and WSF construction.
• Reduction of PEA-level 20% contingency allowance.
• Sourcing refurbished rather than brand new OEM milling equipment.
• Exploration targeting yielded 1) detailed delineation of braided magma streams in the Beaver zone down plunge in the Current deposit, and 2) discovery of high grade massive sulphide deposits consistent with the Talnakh mineral deposit model, in structures beneath and in the feeder zone areas at the base of the Current and Escape magma conduit intrusions and along the conjoining Escape Lake Fault.

Table 6: Mineral Resource Sensitivity to Reporting Cutoff (Indicated)

Table 7: Mineral Resource Sensitivity to Reporting Cutoff (Inferred)

Figure 1: PtEq (g/t) Grade-Tonne Curve

Note: Equivalency formula can be viewed in the following Link (Click Here)