Exploration Update for the Kjøli High-Grade Copper Project, Norway

VANCOUVER, June 28, 2021 - Capella Minerals Ltd. (TSXV: CMIL) (FRA: N7D2) (the "Company" or "Capella") is pleased to provide the following update on ongoing exploration activities at its 100%-owned Kjøli high-grade copper project in central Norway. Field activities are currently focused on the definition of specific drill locations within the 14 CARDS AI targets identified along strike from the former Kjøli copper mine (see Company News Releases dated May 5 and 10, 2021; Figure 1). Historical copper grades in the old Kjøli mine were reported to be 2.9% Cu¹.

Highlights

• Final drill targeting at Kjøli will be undertaken using a combination of geochemical (Ionic Leach) and geophysical (ground gravity and drone magnetic survey) techniques with demonstrated effectiveness in the discovery of copper-rich massive sulfide ("VMS") deposits. The initial focus will be on the 4 largest CARDS AI targets, each measuring 2+km in length, located immediately adjacent to, and to the NE of, the former Kjøli mine.
  
  
• A systematic Ionic Leach soil sampling program will be undertaken over the main CARDS AI targets with the objective of detecting geochemical anomalies associated with buried high-grade base metal mineralization.
  
  
• In parallel, a systematic ground gravity survey will be completed with the objective of differentiating higher density units (such as copper-rich massive sulfide deposits) from their host rocks. This will be the first time that the ground gravity geophysical technique has been employed at Kjøli.
  
  
• A high-resolution drone magnetic survey will also be completed over the 20km-long "prospective horizon" with the highest potential for copper-rich VMS discoveries. The survey has been designed to highlight the sulfide mineral pyrrhotite, which is intimately associated with the high-grade copper-zinc mineralization at Kjøli.
  
  
• Formal drill permitting for priority drill locations will be initiated as soon as results from the current work program have been received and evaluated.

Eric Roth, Capella's President and CEO, commented today: "Whilst the Kjøli project already has some clear "walk-up" drill targets - such as the impressive, undrilled massive sulfide outcrops with 2.2% copper (Figure 2) - this current program will allow us to complete our systematic evaluation of the property and ensure that we have an extensive pipeline of quality targets ready for drill testing. I am very much looking forward to completing this final phase of the drill targeting work and then moving as quickly as possible into the discovery drilling phase."

Figure 1. Recently expanded Kjøli mineral claim block together with CARDS AI copper-zinc VMS anomalies (red/magenta colours represent targets with >98% probability of +1% Cu).

Figure 2. Oxidized massive sulfide outcrop at the Kjøli project in which channel sampling returned 2.2% Cu.

About the Kjøli Copper Project

The Company's Kjøli copper-rich VMS project lies in the northern part of the Røros mining district, which saw copper production from a number of high-grade VMS deposits from the mid-1600's through until the mid-1980's. Kjøli represents a district-scale brownfields/greenfields exploration project covering the former Kjøli and Killingdal mining operations, together with approximately 20 km strike of underexplored but highly prospective stratigraphy for the discovery of new copper-rich VMS deposits. Access to the property is excellent, with the main Trondheim-Røros paved highway and railway line passing by the SW corner of the property. Hydroelectric power is also readily available within the broader Kjøli district.

The Company acquired its 100% interest in the Kjøli Project from EMX Royalty Corp (NYSE:EMX; TSXV:EMX) in late-2020.

Qualified Persons and Disclosure Statement

The technical information in this news release relating to the Kjøli project has been prepared in accordance with Canadian regulatory requirements set out in NI 43-101, and approved by Eric Roth, the Company's President & CEO, a Director, and a Qualified Person under NI 43-101. Mr. Roth holds a Ph.D. in Economic Geology from the University of Western Australia, is a Fellow of the Australian Institute of Mining and Metallurgy (AusIMM) and is a Fellow of the Society of Economic Geologists (SEG). Mr. Roth has 30 years of experience in international minerals exploration and mining project evaluation.

On Behalf of the Board of Capella Minerals Ltd.

"Eric Roth"

___________________________
Eric Roth, Ph.D., FAusIMM
President & CEO

About Capella Minerals Ltd

Capella is engaged in the acquisition, exploration, and development of quality mineral resource properties in favourable jurisdictions with a focus on high-grade gold and copper deposits. The Company's copper focus is currently on the discovery of high-grade VMS-type deposits within 100%-owned, district-scale land positions around the past-producing Løkken and Kjøli copper mines in central Norway. The Company's precious metals focus is on the discovery of high-grade gold deposits on its 100%-owned Southern Gold Line Project in Sweden, in addition to its active Canadian Joint Ventures with Ethos Gold Corp. at Savant Lake (Ontario) and Yamana Gold Inc. at Domain (Manitoba). The Company also retains a residual interest (subject to an option to purchase agreement with Austral Gold Ltd) in the Sierra Blanca gold-silver project in Santa Cruz, Argentina.

Field activities are ongoing on all projects, with the primary focus being to advance priority targets through the permitting process and onwards to drilling and discovery.

The Company also holds marketable securities in Cerrado Gold Inc. (TSXV:CERT; 833,334 common shares) and Ethos Gold Corp. (TSXV:ECC; 2 million common shares), providing Capella shareholders with indirect exposure to both exploration and operational success by these Companies.

Cautionary Notes and Forward-looking Statements
This news release contains forward-looking information within the meaning of applicable securities legislation. Forward-looking information is typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. Such statements include, without limitation, statements regarding the future results of operations, performance and achievements of Capella, including the timing, completion of and results from the exploration and drill programs described in this release. Although the Company believes that such statements are reasonable, it can give no assurances that such expectations will prove to be correct. All such forward-looking information is based on certain assumptions and analyses made by Capella in light of their experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. This information, however, is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Important factors that could cause actual results to differ from this forward-looking information include those described under the heading "Risks and Uncertainties" in Capella's most recently filed MD&A. Capella does not intend, and expressly disclaims any obligation to, update or revise the forward-looking information contained in this news release, except as required by law. Readers are cautioned not to place undue reliance on forward-looking information.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

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SOURCE Capella Minerals Ltd.