August 8, 2016

President’s Letter to Shareholders

Dear Fellow Shareholders,

What an exciting year 2016 has proven to be. Staying true to our goals, we are closer to becoming North America’s only near term and ethically sourced primary cobalt producer. As mentioned in our May 29, 2015 Letter to Shareholders: “We are in the midst of a positive perfect storm.” Mainly driven by the rechargeable batteries sector, especially the electric vehicles market, cobalt supply and demand balance is beginning to tighten up. The forecasted growth in cobalt demand for the next five to ten years will be tremendous.

Formation Metals Inc. recently rebranded into eCobalt Solutions Inc. Our new direction encapsulates both internal and external changes that have taken place during the past couple of years. The rebrand accurately reflects the current and future direction of the Company as a strong player in the renewable energy and electric vehicle sectors. The Idaho Cobalt Project (ICP) will be a key player in this market especially for battery producers who are sourcing near term, high purity, and ethically sourced cobalt salts for rechargeable batteries. At eCobalt we are:

“committed to providing a unique opportunity for consumers to acquire an ethically sourced, environmentally sound, transparent supply of battery grade cobalt salts, essential for the rapidly growing rechargeable battery and renewable energy sectors, produced safely and responsibly in the United States.”

To meet this goal, we have made some significant progress over the past 16 months and these include the following:

• May 8, 2015- a Preliminary Economic Assessment (PEA) was filed on the ICP with NPV of US$113 million discounted at 8.5%, IRR of 24.07%, with a 12.5 year mine life after pre-production;
• Q2 2015- the Company commissioned metallurgical test work to determine the viability of producing cobalt sulfate heptahydrate, a material used in the cathode of rechargeable lithium ion batteries. By December 8, 2015 the initial bench test production of cobalt sulfate heptahydrate crystals from ICP ore samples were completed;
• March 3, 2016- results from the final metallurgical test work on bench test production of cobalt sulfate heptahydrate crystals were completed. The Company also disseminated Requests for Proposals to commission a feasibility study to numerous qualified engineering firms. This coincided with the overall strengthening of the resource markets;
• March 2016- The Company began to advertise on InvestorIntel, an independent investor resource website, that has created a lot of awareness in the technology metals sector including cobalt. In addition, Dundee Securities Ltd. was engaged to lead the marketing and the financing of the feasibility study on the ICP. These factors significantly contributed to the strengthen share price performance:
• June 1, 2016- the Company announced the successful closing of an oversubscribed private placement with net proceeds of CDN $4.4 million;
• June 21, 2016- commissioning of the Feasibility Study was awarded to Micon International and SNC-Lavalin. Micon was already familiar with the ICP, acting as due diligence engineers for lenders in the 2011 financing. SNC has experience in cobalt hydrometallurgical solvent extraction; and
• July 6, 2016- the Company engaged Red Cloud Klondike Strike Inc., as capital market advisors to further grow the awareness of the ICP.

The next 6 to 12 months will be a crucial time for eCobalt as we pursue to complete the Feasibility Study and capital financing including offtake arrangements to restart construction on the ICP. We have a dedicated Management team and Board of Directors. It is going to be an exciting time for eCobalt Solutions Inc., and I want to thank you, our shareholders, for your continued support.

eCobalt Solutions Inc.

“J. Paul Farquharson”

J. Paul Farquharson
President & CEO

If you would like further information or wish to sign up for email updates please contact us at:
eCobalt Solutions Inc., 1810 – 999 West Hastings Street, Vancouver, BC, V6C 2W2
Tel: 604-682-6229 - Email: [email protected]– Web: ecobalt.com

As used in this press release, “feasibility study” simply means a study report with the type of information and documentation typically required by financial institutions for the purposes of evaluating and financing projects similar to the ICP as described under AACE guidelines for a Class 3 estimate. For greater certainty, the use of the word “feasibility study” does not guarantee that the ICP is one that will secure project financing.

Cautionary Statement on Forward Looking Statements

This news release contains “forward-looking statements” within the meaning of applicable Canadian securities legislation. Statements in this news release pertaining to expected finance completion date are forward-looking statements. These forward-looking statements are based on assumptions and address future events and conditions and are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Such projections are and will inevitably always be dependent on assumptions about future mineral prices and development costs which will be subject to fluctuation due to global and local economic and industry conditions. Further information regarding risks and uncertainties which may cause results to differ from those contained in forward-looking statements is included in filings by the Company with securities regulatory authorities and is available at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Although the Company has disclosed that the Idaho Cobalt Project remains the sole, near term, environmentally permitted, primary cobalt deposit in the United States and offers a unique potential for North American consumers to secure an ethically sourced, environmentally sound supply of battery grade cobalt chemicals, there is no guarantee that the Company will attain commercial production of such cobalt chemicals for use in the rechargeable battery sector. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws.

The statements contained in this news release in regard to eCobalt Solutions Inc. that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including eCobalt Solutions Inc.’s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to eCobalt Solutions Inc. as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.