DNI Metals Inc. Completes Purchase of a 2nd Graphite Property in Madagascar
Toronto, October 25, 2017 - DNI Metals Inc. (CSE: DNI) (OTC Pink: DMNKF) The new property, Madagascar claim number PE8904 (the 'Marofody' project), is a permit that allows for production, is good for 40 years, and can be extended (refer Figure 1 below & Table 1 following). With the addition of the new claims, DNI will have a contiguous mining tenement package comprising over 100 square kms.
Madagascar is known for large flake and high quality graphite; the vast majority of which is sourced from the central-eastern coastal area between Toamasina and Brickaville (refer Figure 1 left below). The project lies in a well-defined graphitic belt, which has been producing for over 50 years
Both claim packages have historical mine workings on them.
Infrastructure can be the key to any project. It is a significant advantage that the claims are 50kms by paved highway from Madagascar's main operating port at Toamasina.
Figure 1: Regional (left) & detailed (right) location plans for PE8904 'Marofody' Project tenement
To view an enhanced version of Figure 1, please visit:
http://orders.newsfilecorp.com/files/1803/29932_dni1bothenhanced.jpg
Marofody contains historical mining operations from the period of French colonial occupation (c1935) and recent Vendor exploration as confirmed the existence of strike and depth extensions to the historically exploited graphite zones. These zones are plotted on Figure 1-right above.
The purchase price for Marofody was U$1,650,000 cash.
DNI's management team, continues to assess Graphite Assets, around the world, with a focus on Saprolitic deposits.
Table 1: Mining Licenses in Madagascar:
| Licence Type | PRE | PR | PE (DNI License) |
| Licence Description | Artisanal Mining Licence | Exploration Licence | Mining Licence |
| Term of Validity | 8 Years | 5 Years | 40 Years |
| Renewal | 4 years — multiple | 3 Years x 2 | 20 Years - Multiple |
| Eligibility | Malagasy Nationals | All Local Entities | All Local Entities |
| Maximum Size (km2) | 100 | 1,000 | 1,000 |
| Rights Conferred | Exploration & Mining | Exploration | Exploration & Mining |
| Sale of Mineral Products | Yes | No | Yes |
| Restrictions | Maximum 20 Workers / No Mechanised Mining Operations (Artisanal Only) | No Commercial Mining Allowed | Full Commercial Mining Allowed |
| Environmental | Simple Preliminary Study (P.E.E.) | Simple Preliminary Study (P.E.E.) | Full Impact Study (E.I.E) |
About DNI Metals
Certain advisors and directors of DNI have significant operational experience at historical hard rock graphite mines in Canada (e.g. Ontario and Quebec) and Australia. Between them, they have built three (3) processing plants and designed two (2) others; all, which were shut down in the 1990,'s due to increased Chinese competition. Keith Minty, a director, previously worked at Cal Graphite near Kearny, Ontario.
It was our team's understanding of the high production and capital expenditure costs associated with so-called "hard rock" graphite mining that inspired DNI to search for saprolite-hosted graphite deposits.
Certain parts Madagascar and Brazil, produce graphite from weathered material called saprolite.
According to Dictionary.com, saprolite is described as:
"Soft, thoroughly decomposed and porous rock, often rich in clay, formed by the in place chemical weathering of igneous, metamorphic, or sedimentary rocks. Saprolite is especially common in humid and tropical climates. It is usually reddish brown or grayish white and contains those structures (such as cross-stratification) that were present in the original rock from which it formed."
DNI owns a commercially permitted, saprolite-hosted graphite deposit in Madagascar; located 50kms from the country's main seaport. The deposit is located less than two (2) kms from the paved national highway. DNI intends to develop the Vohitsara project, should the economic viability and technical feasibility be established. DNI has not yet established mineral resources or mineral reserves supported by a PEA or mining study (PFS or FS).
DNI has a graphite wholesale business, in which it buys and sells high quality graphite. This business has shown a steady increase in volume over the past year.
Steven Goertz (MAusIMM, MAIG), who is a qualified person, approved the technical disclosure in this news release.
DNI — Canadian Securities Exchange
DMNKF - OTC
Issued: 98,273,355
For further information, contact:
DNI Metals Inc. — Dan Weir, CEO 416-595-1195
DanWeir@dnimetals.com
Also visit www.dnimetals.com
We seek Safe Harbour. This announcement may include forward looking statements. While these statements represent DNI's best current judgment, they are subject to risks and uncertainties that could cause actual results to vary, including risk factors listed in DNI's Annual Information Form and its MD&A's, all of which are available from SEDAR and on its website.