District Metals Corp. (TSXV: DMX) (FSE: DFPP) (‘District’ or the ‘Company’) is pleased to report that Bergslagen Metals AB (a 100% owned Swedish subsidiary of District) has received approval from the Bergsstaten (Mining Inspectorate) for the Viken nr 2 and 3 mineral license applications that covers the area to the south and north of the original Viken nr 1 mineral license application that encompasses 68% of the polymetallic Viken Deposit located in Jamtland County, central Sweden.

The Viken Deposit is the largest undeveloped Alum Shale vanadium-uranium-molybdenum-nickel-copper-zinc deposit in Sweden, and amongst the largest deposits by total historic mineral resources of vanadium and uranium in the world.

Highlights

The approved Viken nr 2 and 3 mineral license applications have increased the area of the Viken Property from 2,302 hectares (ha) to 9,367 ha.

Expansion of the Viken Propery to the south (Viken nr 2) and north (Viken nr 3), will allow the Company to target mineralized Alum Shale that has been tectonically thickened from 20 to 30 m by thrusting and folding up to 180 m.

Historical drill holes completed within the area of the Viken nr 2 and 3 mineral license applications returned grades and widths of mineralization that are consistent with drill results from within the Viken Deposit.

There is currently a moratorium on uranium mining and exploration that was imposed in 2018. The Swedish Government has a positive stance on re-evaluating and lifting the moratorium.

Garrett Ainsworth, CEO of District, commented: ‘The Viken Property now comprises three large mineral licenses (Viken nr 1 to 3) that are in good standing for the next three years, and cover the majority of the polymetallic Viken Deposit and its likely extensions to the north and south as evidenced by historic drill hole results.’

The Polymetallic Viken Deposit

The Viken Deposit is situated in the province of Jamtland, approximately 570 km northwest of Stockholm, Sweden. Infrastructure is well developed in the area with daily air service, as well as rail and truck freight services. Electrical power and modern communications are also readily available in the area.

The Geological Survey of Sweden (SGU) carried out work on the Alum Shales from 1977 to 1978 and drilled approximately 19 holes within and in the vicinity of the Viken Deposit. In 2005, Continental Precious Minerals Inc. (CPM) purchased mineral licenses that covered prospective Alum Shales where CPM drilled 26,293 m in 133 holes from 2006 to 2008 to delineate the Viken Deposit.

CPM retained P&E Mining Consultants Inc. to carry out a Resource Estimate and PEA in 2010 that resulted in the following historical estimate:

The Viken Deposit is a polymetallic shale resource contained within the Cambrian Viken Shale which regionally is referred to as the Alum Shale. The Alum Shale is enriched in metals such as vanadium, uranium, nickel, copper, zinc, and molybdenum. It occurs over a significant area in Sweden and is locally valued as a bituminous shale with recoverable hydrocarbons. The Alum Shale is regionally extensive in Sweden.

The stratigraphy across the Viken Mineral License application consists of upper Middle and Upper Cambrian age Alum Shale occurring as both in situ and fault detached blocks, with the latter having greater potential for economic mineralization due to imbrication of mineralized blocks. The Alum Shale is mostly exposed at surface and is underlain by Proterozoic granites and gneisses thrust Eastward over Archean granitic basement rocks. The thickness of the Alum Shale host rock has been tectonically thickened from 20 to 30 m by thrusting and folding during the Silurian to approximately 180 m.

Mineralization of potential economic significance is hosted in Middle and Upper Cambrian Alum Shale, with the Upper Cambrian age strata more enriched in vanadium and uranium than the Middle Cambrian3. Vanadium occurs within the lattice of a mica mineral named roscoelite. Uranium values are predominantly associated with sub-micron-scale uraninite crystals. Nickel, molybdenum, copper and zinc are present as sulphides.

About District Metals Corp.

District Metals Corp. is led by industry professionals with a track record of success in the mining industry. The Company’s mandate is to seek out, explore, and develop prospective mineral properties through a disciplined science-based approach to create shareholder value and benefit other stakeholders.

District is a polymetallic exploration and development company focused on the Viken and Tomtebo Properties in Sweden. The Viken Property covers 68% of the uranium-vanadium Viken Deposit, which is an asset with substantial exploration and development expenditures that resulted in the definition of large historic polymetallic resource estimates and positive economic studies in 2010 and 2014. The Viken Deposit is amongst the largest deposits by total historic mineral resources of uranium and vanadium in the world.

The advanced exploration stage Tomtebo Property is located in the Bergslagen Mining District of south-central Sweden and is situated between the historic Falun Mine and Boliden’s Garpenberg Mine that are located 25 km to the northwest and southeast, respectively. Two historic polymetallic mines and numerous polymetallic showings are located on the Tomtebo Property along an approximate 17 km trend that exhibits similar geology, structure, alteration and VMS/SedEx style mineralization as other significant mines within the district.

Contact:

Tel: (604) 288-4430

Cautionary Statement Regarding ‘Forward-Looking’ Information.

This news release contains certain statements that may be considered ‘forward-looking information’ with respect to the Company within the meaning of applicable securities laws. In some cases, but not necessarily in all cases, forward-looking information can be identified by the use of forward-looking terminology such as ‘plans’, ‘targets’, ‘expects’ or ‘does not expect’, ‘is expected’, ‘an opportunity exists’, ‘is positioned’, ‘estimates’, ‘intends’, ‘assumes’, ‘anticipates’ or ‘does not anticipate’ or ‘believes’, or variations of such words and phrases or statements that certain actions, events or results ‘may’, ‘could’, ‘would’, ‘might’, ‘will’ or ‘will be taken’, ‘occur’ or ‘be achieved’ and any similar expressions. In addition, any statements that refer to expectations, predictions, indications, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events. Forward-looking statements in this news release relating to the Company include, among other things, statements relating to the Company’s Viken nr 1, 2 and 3 mineral licenses to explore for vanadium, nickel, molybdenum, zinc, and other elements covering a portion of the polymetallic Viken Deposit located in Jamtland County, central Sweden; the Company’s planned exploration activities, including its drill target strategy and next steps for the Viken Property and the Company’s interpretations and expectations about the results on the Viken Property.

These statements and other forward-looking information are based on opinions, assumptions and estimates made by the Company in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that the Company believes are appropriate and reasonable in the circumstances, as of the date of this news release, including, without limitation, assumptions about the reliability of historical data and the accuracy of publicly reported information regarding past and historic mines in the Bergslagen district; the Company’s ability to raise sufficient capital to fund planned exploration activities, maintain corporate capacity and stability in financial and capital markets.

Forward-looking information is necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by the Company as of the date such statements are made, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to risks associated with the following: the reliability of historic data regarding the Viken Deposit and the Tomtebo Property; the Company’s ability to raise sufficient capital to finance planned exploration (including incurring prescribed exploration expenditures required by the Tomtebo Purchase Agreement, failing which the Tomtebo Property will be forfeited without any repayment of the purchase price); the Company’s limited operating history; the Company’s negative operating cash flow and dependence on third-party financing; the uncertainty of additional funding; the uncertainties associated with early stage exploration activities including general economic, market and business conditions, the regulatory process, failure to obtain necessary permits and approvals, technical issues, potential delays, unexpected events and management’s capacity to execute and implement its future plans; the Company’s ability to identify any mineral resources and mineral reserves; the substantial expenditures required to establish mineral reserves through drilling and the estimation of mineral reserves or mineral resources; the Company’s dependence on one material project, the Tomtebo Property; the uncertainty of estimates used to calculated mineralization figures; changes in governmental regulations; compliance with applicable laws and regulations; competition for future resource acquisitions and skilled industry personnel; reliance on key personnel; title matters; conflicts of interest; environmental laws and regulations and associated risks, including climate change legislation; land reclamation requirements; changes in government policies; volatility of the Company’s share price; the unlikelihood that shareholders will receive dividends from the Company; potential future acquisitions and joint ventures; infrastructure risks; fluctuations in demand for, and prices of gold, silver and copper; fluctuations in foreign currency exchange rates; legal proceedings and the enforceability of judgments; going concern risk; risks related to the Company’s information technology systems and cyber-security risks and risk related to the outbreak of epidemics or pandemics or other health crises, including the recent outbreak of COVID-19. For additional information regarding these risks, please see the Company’s Annual Information Form, under the heading ‘Risk Factors’, which is available at www.sedar.com. These factors and assumptions are not intended to represent a complete list of the factors and assumptions that could affect the Company. These factors and assumptions, however, should be considered carefully. Although the Company has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Also, many of such factors are beyond the control of the Company. Accordingly, readers should not place undue reliance on forward-looking statements or information. The forward-looking information is made as of the date of this news release, and the Company assumes no obligation to publicly update or revise such forward-looking information, except as required by applicable securities laws.