Deep Sea Minerals Issues Regulatory Disclosure Clarifications After BCSC Review of Subsea Exploration Plans

NOAA Application Status and Regulatory Process Clarifications

Deep Sea Minerals’ wholly owned U.S. subsidiary, American Deep Sea Minerals Corp., submitted an exploration licence application under the Deep Seabed Hard Mineral Resources Act for the Clarion-Clipperton Zone in the Pacific Ocean. On May 26, 2026, NOAA determined the application was in substantial compliance with regulatory requirements. An amended application addressing NOAA’s supplemental requests was filed on July 17, 2026. The company emphasized that this substantial compliance determination is not a licence nor an authorization to begin offshore operations.

Before NOAA can issue an exploration licence, the application must undergo a full compliance determination, federal-agency consultations, antitrust review, public comment periods, certification, and environmental impact assessments including draft and final statements and public hearings. Based on current information, Deep Sea Minerals expects NOAA may issue a licence around Q4 2027, though this timeline is uncertain and dependent on regulatory and environmental review outcomes.

Cook Islands Exploration Licence Application and Governmental Timing Uncertainties

Deep Sea Minerals established a wholly owned subsidiary, Deep Sea Minerals (Cook Islands) Limited, to pursue an exploration licence within the Cook Islands exclusive economic zone. The company has not yet formally submitted this application but plans to do so between Q3 2026 and Q1 2027. The Cook Islands Seabed Minerals Authority has indicated it does not intend to accept new formal applications until after the upcoming Cook Islands election and parliamentary approval of additional designated licence areas.

The Cook Islands application will undergo a multi-stage review involving the Seabed Minerals Authority, an independent licensing panel, the responsible minister, and Cabinet approval. Submission and approval timing depends on political developments, licensing availability, and government designation of exploration parcels. There is no guarantee that either the U.S. or Cook Islands applications will be approved or that licences will be granted on acceptable terms.

Company Business Model and Future Operational Plans

Deep Sea Minerals focuses on subsea mineral exploration and development, targeting critical mineral supply through acquisition and exploration of deep-sea assets. The strategy targets jurisdictions with polymetallic nodule deposits containing metals vital for defense, industrial manufacturing, clean energy, advanced electronics, and AI supply chains. These seabed resources remain largely undeveloped and are increasingly subject to global policy, scientific, and regulatory attention.

The company currently holds no mineral rights or operational authority in any exclusive economic zone or international waters and has not initiated offshore operations. It does not own proprietary subsea mining technology or marine equipment and plans to rely on qualified third-party technology providers, marine contractors, and independent environmental and scientific consultants for future offshore activities. Commercial production revenues, if realized, may take up to 10 years after concession grants.

Correction of Unsubstantiated Promotional Claims and Marketing Engagements

Between February 26 and July 10, 2026, promotional materials distributed by Capital Gain Media Inc., Exvera Communications Inc., Global One Media Group Pte. Ltd., Investor News Inc., Stockhouse Publishing Ltd. (The Market Link), and The Wall Street Analyst, LLC included statements about the company’s regulatory progress and market position. Deep Sea Minerals acknowledged some promotions omitted necessary facts or contained unsubstantiated claims.

Problematic claims included assertions that Deep Sea Minerals was among few public companies receiving NOAA’s substantial compliance determination; projections of critical minerals demand attributed to the International Energy Agency without source details; historical commodity pricing without attribution; forward-looking timelines for first polymetallic nodule cargo delivery lacking material assumptions; incorrect statements about The Metals Company Inc.’s licence status; and unverified resource estimates for polymetallic nodules.

Source Attribution and Data Clarifications

The company clarified that projected critical minerals demand references the International Energy Agency’s "Global Critical Minerals Outlook 2024." Historical commodity prices for copper, cobalt, and others derived from publicly available Trading Economics data. Resource estimates for the Clarion-Clipperton Zone come from the U.S. Geological Survey, while Cook Islands estimates reference a March 22, 2023 report prepared for the Cook Islands Seabed Minerals Authority.

Statements about U.S. commercial seabed mining authorizations were based on analysis of recent U.S. regulatory developments; however, no commercial recovery permits have yet been granted. While Deep Sea Minerals believes it is among few publicly traded companies to receive NOAA’s substantial compliance determination, other companies in different jurisdictions or those not required to disclose may also have received such determinations.

Removal of Promotional Videos and Updated Content Following BCSC Directive

At the BCSC’s request, Deep Sea Minerals directed service providers to remove four promotional videos: "Deep Sea Minerals: Why Seabed Mining Is Now an Investable Sector" (April 28, 2026) produced via The Market Link; "Deep Sea Minerals ($SEAS | $DSEAF): The Emerging Commercial Reality of Seabed Mining" (April 30, 2026) via Global One Media Group; and two investor interviews dated May 1, 2026, and March 3, 2026, via Investor News Inc.

The company also instructed Investor News to revise the March 3, 2026 investor interview description. These actions aimed to comply with securities regulations concerning promotional disclosures and to address concerns about insufficient disclosure that promotions were company-sponsored or contained unsupported claims.

Material Assumptions and Forward-Looking Regulatory Timeline Guidance

Forward-looking statements about regulatory timelines rely on assumptions including favorable operating conditions, receipt of necessary approvals and permits, ongoing U.S.–Cook Islands cooperation, Cook Islands’ intent to grant licences, availability of marine contractors and equipment, and financing on acceptable terms. The company assumes NOAA will require no further information to determine full compliance and that regulatory steps will proceed as outlined in the amended annual information form.

Risks include NOAA potentially not granting full compliance, delays or denials of Cook Islands applications, geopolitical or policy changes affecting licensing, and the company’s ability to meet financial and technical requirements. Investors should review the amended annual information form for full details on assumptions, risks, and uncertainties.

Industry Overview and Polymetallic Nodule Resource Estimates

Polymetallic nodules on deep-sea floors contain manganese, nickel, cobalt, and copper—critical for clean energy, manufacturing, and defense technologies. The Clarion-Clipperton Zone and Cook Islands exclusive economic zone are known for significant nodule concentrations. According to referenced sources, the Clarion-Clipperton Zone holds an estimated 21 billion tonnes of nodules, and the Cook Islands zone about 6.7 billion tonnes. These are resource estimates, not formally classified as mineral reserves.

The subsea mineral industry operates within evolving international, national, and environmental frameworks. The U.S. Deep Seabed Hard Mineral Resources Act grants NOAA regulatory authority over subsea exploration in international waters. Coastal nations with exclusive economic zones have developed or are developing domestic regulatory regimes emphasizing environmental protection, scientific study, and stakeholder consultation alongside exploration and potential development.

Risks and Regulatory Challenges Specific to Subsea Operations

Deep Sea Minerals’ business is speculative and faces significant risks including limited operating history, uncertain nodule quality and grade, and commercial feasibility challenges. Public opposition, NGO lobbying, and geopolitical disputes may affect regulatory environments and licence acquisition.

Additional risks involve reliance on third-party technology and marine contractors, uncertainties in nodule processing, exposure to natural hazards and weather, potential asset expropriation, foreign operational risks, and commodity price volatility. Continuation depends on securing financing and regulatory approvals, which are not guaranteed.

Investment Considerations and Forward-Looking Statement Disclaimers

Investors should recognize that forward-looking statements about licence issuance, regulatory outcomes, and offshore activity commencement are based on estimates and assumptions that may prove inaccurate. There is no assurance that these assumptions or expectations will materialize. Known and unknown risks may cause actual results to differ materially.

While the NOAA substantial compliance determination marks progress, it does not authorize offshore operations or guarantee licence issuance. Prospective investors should review the company’s amended and restated annual information form dated July 27, 2026, available on SEDAR+, for detailed information on assumptions, risks, milestones, and operational requirements. Currently, Deep Sea Minerals holds no mineral rights or operating authority and has not commenced offshore operations.