Bunker Hill Mining Secures Additional Financing for Mine Restart

Bunker Hill Mining Corp. ("Bunker Hill" or the "Company") (TSX-V: BNKR | OTCQX: BHLL) has secured additional financing to support the ongoing development of its Bunker Hill Mine restart project. The Company has drawn down on the $21 million standby facility provided by Sprott Private Resource Streaming and Royalty Corp. and is finalizing ongoing discussions with its strategic partners for potential offtake or similar financing for an additional $30 million. This new financing will help cover the increased capital requirements and ensure that profitable and sustainable operations may commence by the revised start date of Q2 2025.

The additional financing comes as Bunker Hill faces challenges from the loss of a specialist contractor and rising costs associated with inflation. The Company's revised plan now forecasts a total restart expenditure of $103 million, up from the previously forecasted $67 million and the $56 million in the 2022 Pre-Feasibility Study (PFS). The increased capital requirements are a result of input cost inflation, a filter press scope change, and the unexpected departure of a specialist contractor.

Input cost inflation has significantly impacted the project's cost structure, with the cost of skilled construction labor, specifically electricians, increasing by 53% over the last 12 months. Additionally, the cost of structural steel has increased by 40%, copper (a proxy for electrical fittings) by 40%, and concrete by 20%. The Company has been working round the clock to complete mechanical installation and commissioning, which are currently 64% and 98% complete, respectively.

The filter press scope change resulted in a more effective but expensive filter press, which passed the 90% engineering milestone in October 2024. The final cost forecast for this change increased from $10 million to $18 million. The unexpected departure of a specialist contractor conducting the auger-cast deep piers for the tailings filter press led to delays in the construction timeline, as securing and mobilizing a replacement contractor proved challenging.

The additional financing will help Bunker Hill complete the mechanical installation and commissioning of its processing plant, which is approximately 70% complete. This will enable the Company to restart operations and generate revenue more quickly. The new financing also allows Bunker Hill to complete the construction of its tailings filter press, ensuring that the mine will have an optimal system at restart, geared to serving the 1,800 tons per day plan.

In conclusion, the receipt of the fourth tranche from the Sprott Standby Facility, along with additional financing from strategic partners, enhances Bunker Hill Mining's liquidity and financial flexibility in the short term by addressing immediate expenses and working capital needs. In the long term, it supports the completion of critical projects, maintains exploration activities, and ensures the company's ability to achieve its strategic objectives. The delayed restart and increased capital requirements will likely impact the company's cash flow projections and the potential return on investment for shareholders, but Bunker Hill remains committed to ensuring that profitable and sustainable operations may commence by the revised start date of Q2 2025.