Hannan Metals Ltd. — Management Reports 2021

Oct 19, 2021

HANNAN METALS LIMITED Chairman’s Report to the Shareholders

Dear Shareholders and Stakeholders,

On behalf of the Board of Directors, I would like to thank you, our shareholders and stakeholders, for joining our vision to open up search spaces in Peru’s new geological frontiers to find the next generation of large-scale global coppersilver and copper-gold deposits.

This year was a year of very positive change for the Company, all the while staying true to our core values of continuing to work alongside local stakeholders. Our social work has laid credible foundations that has allowed us to explore prospective areas that have not previously experienced systematic exploration.

With 2,154 sq km of mineral tenure, we are a top 10 concession holder in Peru, a country that is dominated by some of the world’s largest exploration and mining companies. Hannan is one of the few juniors to acquire such a significant land position. We are focussed on two new frontier areas in Peru. Both are in the sub-Andean zone which is characterized by highland jungle in the transition between the Cordillera and Amazon Basin.

Only a couple of years ago at San Martin in Peru, Hannan recognized the significant potential for large copper-silver deposits and aggressively staked a commanding tenure position. Over the last year the Company signed a groundbreaking US$35M earn-in and Joint Venture on one third of our ground holding at San Martin with the Japan Oil, Gas and Metals National Corporation ("JOGMEC"). JOGMEC is an independent administrative agency within the Japanese government which, among other things, seeks to secure stable resource supply for Japan.

The San Martin Project covers a new, basin-scale high-grade sediment-hosted copper-silver system that extends over 200 km x 100 km along the foreland region of the eastern Andes Mountains. Mineralization is geologically similar to the vast Kupferschiefer deposits in Eastern Europe. Sediment-hosted stratiform copper-silver deposits are among the two most important copper sources in the world, the other being copper porphyries.

Hannan’s second major project in Peru is Previsto, located 300 km south of the San Martin project. Here the Company is targeting Miocene age porphyry copper-gold in a back-arc setting in Central Eastern Peru. We consider the belt to be a potential new metallogenic province of Peru. Located far inboard of the conventional porphyry settings, the project shows regional similarities to deposits such as the large Bajo de Alumbera copper-gold porphyry in Argentina. The Company was a first mover in this district and controls over 1000 km2 of tenure. The first permits were granted in September 2021.

Hannan’s exploration programs are fully funded in 2021-22 with a Peru-wide exploration project budget of US$2.7M. At San Martin the focus is to continue to build a basin-scale project and work towards drilling in early 2022. At Previsto, the Company is permitting more detailed work including soil sampling, mapping and trenching as well as preparing for a high resolution airborne magnetic survey in 2022.

We believe Hannan is uniquely leveraged to make significant grassroots discoveries in two prospective, yet unexplored terrains in Peru. If successful, these will be compelling targets for the major gold and copper mining houses in the years to come.

I would personally like to take this time to thank all those involved in building Hannan during the year, from our shareholders old and new, our wonderful technical, social and corporate staff and contractors in Peru and Canada, and of course my fellow directors and our President, Lars Dahlenborg. We will continue to work hard, respectfully and in co-operation with our stakeholders and communities to create a valuable and sustainable opportunity for all participants.

We trust that you will continue to join us for the year ahead.

Sincerely,

“Michael Hudson”

Michael Hudson Chairman and CEO

Vancouver, British Columbia, Canada, October 13, 2021