Graphano Energy Ltd. announced results of the exploration drilling of Zone 3 on its 100% owned Lac Aux Bouleaux Graphite (LAB) Property in Quebec. A total of 25 drill holes were completed for a total of 1,779 metres. Given that surface mineralization was previously exposed during Graphano's trenching program intermittently along the length of Zone 3, most holes were shallow (less than 60 m) to test the immediate depth and thickness of the graphite mineralization.

Twenty-three holes were drilled to evaluate Zone 3 over a length of approximately 500 metres. One hole was drilled in Zone 8 and another one in Zone 4. Highlights of the drilling results are provided below. Very successful drill program with 15 of the 23 drill holes (65%) intersecting significant graphite mineralization over the 500 metre length of Zone 3 tested by this first phase of exploration drilling.

The mineralization outlined remains open for continued expansion. Results include: Drill Hole LB22-33 intersected 6.26% graphitic carbon (Cg) over 13.7 meters (m) starting at 14.0; (m) drilled depth, including 11.95% Cg over 4.7 m at 14 m; Drill Hole LB22-45 intersected 9.09% Cg over 8.0 m at 68 m; Drill Hole LB22-52 intersected 7.17% Cg over 9.0 m at 36 m; Drill Hole LB22-39 intersected 4.72% Cg over 11.6 m at 36.4 m, including 6.56% Cg over 6.6 m at 36.4m; Drill Hole LB22-34 intersected 5.82% Cg over 9.0 m at 38.0 m, including 6.25% Cg over 3.50 m at 38 and 7.28% Cg over 4 m at 43 m; Drill Hole LB22-32 intersected 6.28% Cg over 8.0 m at 18.5 m; Drill Hole LB22-48 intersected 9.53% Cg over 5.0 m at 19.5 m. Only a single drill hole completed to date, LB22-54, which intersected 4.12% Cg over 6.0 m at 26 m drilled depth which indicates significant potential for this virtually unexplored target. Based on airborne EM results the Zone 8 target has an approximate 1000 metre length requiring further exploration.

One method of evaluating and visually demonstrating the exploration significance of a drill program and thus the indicated economic potential is to calculate a drill hole's mineralized zone thickness multiplied by the zone's grade. The last column of the table on Figure 1 shows the thickness times metres values for LAB Zone 3 drill holes. The values greater than 25 (yellow highlight) are significant and those above 50 (red highlight) are very significant.

The exploration drilling to date seems to suggest that the relatively high-grade LAB graphite horizons are locally folded and structurally thickened, which can enhance the potential for economic mineralization. This is similar to the Lac des Iles (LDI) deposit that has been mined for over 30 years and is located immediately adjacent to Graphano's LAB property. Zone 3 on the Property is one of the eight target areas identified from the 2015 airborne high-resolution magnetic (MAG) and time-domain electromagnetic (TDEM) survey completed on the LAB property.

These targets were further explored through ground geophysical surveying and, prior to drilling, additional trenching and channeling sampling was performed to identify the best areas for drilling and orientation. The majority of drill holes completed on the Zone 3 target intersected near surface mineralized horizons ranging from 1.0 metres to 14 metres in thickness (core length) over a 500 m length, thus far by drilling. The graphite mineralization observed during the drilling is hosted within a sequence of marble, paragneiss and quartzites.

All drill core samples were bagged and tagged using best practices and were delivered to Activation Laboratories, Ancaster, Ontario, for sample preparation and analyses using laboratories' Code 4F-C Graphitic, analyzing C-Graphite (infrared) where the sample is subjected to a multistage furnace treatment to remove all forms of carbon with the exception of graphitic carbon; and C-Total (infrared). ACTLABS is an independent commercial, accredited ISO Certified Laboratory. The core samples also include field duplicates and blanks for quality control and quality assurance (QA/QC) purposes.