Energy Surcharge Policy

Dear Valued Customer:

As you probably know, the price of natural gas is a significant component to our mining process and has a substantial impact on the production expenses at our plants.

To address major fluctuations in natural gas costs, we have updated our Energy Surcharge Program. An Energy Surcharge may appear as a separate line on your invoice, depending on the average price of natural gas.

Our primary kiln fuel source is natural gas, which is delivered to our plants via pipeline. These pipelines access gas from multiple distribution points. The price that EP Minerals pays for gas varies day to day based on supply and demand at these distribution points. We calculate a weighted average based on 33.33% share from each daily gas index (Sumas, Opal, Nymex/Henry Hub). We will have an Energy Surcharge when pricing exceeds $4.40/dTh. We may also charge an Emergency Energy Surcharge when pricing is below $4.40/dTH if absolutely necessary because of outside circumstances beyond our control.

We will provide you with the specific plant information and the related natural gas pricing in the charts below and will continually update that information.

The Energy Surcharge will be applicable to all products and calculated based upon the plant where your products are produced and shipped.


Vale and Lovelock Plants:

Natural Gas Average ($/DTh)

ESC ($7/ST)

ESC ($/MT)

ESC (EUR/MT)

4.40 - 5.39

7

7.71

5.63

5.40 - 6.39

14

15.42

11.26

6.40 - 7.39

21

23.13

16.88

7.40 - 8.39

28

30.84

22.51

8.40 - 9.39

35

38.55

28.14

9.40 - 10.39

42

46.26

33.77

10.40 - 11.39

49

53.97

39.39

11.40 - 12.39

56

61.68

45.02

12.40 - 13.39

63

69.39

50.65

13.40 - 14.39

70

77.1

56.28

14.40 - 15.39

77

84.81

61.91

15.40 - 16.39

84

92.52

67.53

16.40 - 17.39

91

100.23

73.16

Clark Plant:

Natural Gas Average ($/DTh)

ESC ($4/ST)

ESC ($/MT)

ESC (EUR/MT)

4.40 - 5.39

4

4.41

3.22

5.40 - 6.39

8

8.82

6.44

6.40 - 7.39

12

13.23

9.66

7.40 - 8.39

16

17.64

12.88

8.40 - 9.39

20

22.05

16.1

9.40 - 10.39

24

26.46

19.32

10.40 - 11.39

28

30.87

22.54

11.40 - 12.39

32

35.28

25.76

12.40 - 13.39

36

39.69

28.98

13.40 - 14.39

40

44.1

32.2

14.40 - 15.39

44

48.51

35.42

15.40 - 16.39

48

52.92

38.64

16.40 - 17.39

52

57.33

41.86

February 2021 Natural Gas Pricing

Date

Vale

Vale

Jackson

ESC Average (33.3% each)

Lovelock

Millen

SUMAS

OPAL

HENRY HUB

Malin

Transco

2/1/2021

2.62

2.65

2.68

2.62

2.65

2.72

2/2/2021

2.66

2.69

2.88

2.72

2.68

2.89

2/3/2021

2.81

2.88

3.24

2.95

2.86

3.33

2/4/2021

2.80

2.80

3.01

2.84

2.77

2.96

2/5/2021

2.81

2.84

2.99

2.85

2.85

2.94

2/6/2021

3.34

3.59

3.49

3.44

3.44

3.46

2/7/2021

3.34

3.59

3.49

3.44

3.44

3.46

2/8/2021

3.34

3.59

3.49

3.44

3.44

3.46

2/9/2021

3.43

3.40

3.40

3.37

3.38

3.24

2/10/2021

3.43

3.42

3.35

3.36

3.39

3.19

2/11/2021

4.45

4.41

3.76

4.17

4.15

3.70

2/12/2021

9.00

10.62

6.50

8.62

6.99

5.79

2/13/2021

14.17

94.65

6.12

37.93

5.77

5.57

2/14/2021

14.17

94.65

6.12

37.93

5.77

5.57

2/15/2021

14.17

94.65

6.12

37.93

5.77

5.57

2/16/2021

14.17

94.65

6.12

37.93

5.77

5.57

2/17/2021

15.50

81.84

11.32

35.86

10.20

18.39

2/18/2021

6.65

19.25

23.86

16.42

6.99

17.84

2/19/2021

3.90

5.58

8.56

5.95

4.00

6.00

2/20/2021

3.39

3.63

4.96

3.95

3.38

5.52

2/21/2021

3.39

3.63

4.96

3.95

3.38

5.52

2/22/2021

3.39

3.63

4.96

3.95

3.38

5.52

2/23/2021

2.89

2.82

3.16

2.93

2.79

2.83

2/24/2021

2.76

2.76

2.94

2.79

2.83

2.76

2/25/2021

2/26/2021

2/27/2021

2/28/2021

AVERAGE

5.94

22.84

5.48

11.31

4.25

5.33

We at EP Minerals thank you for your business and support and look forward to continuing to work with you.

Geoff Boucher
Vice President of Global Sales & Marketing
EP Minerals