May 22, 2015

Dear Shareholder:

During the last year, the case for development of commercial-scale “naturally occurring stainless steel” nickel-iron alloy targets – in the form of the mineral, awaruite – found continued support. Indonesia – the historical source of more than half of China’s unprocessed lateritic nickel ore imports- stood firm on its January 2014 ban on unprocessed nickel ore exports. This intensified market attention on the long-term fundamental scenario for nickel, and brought forward in time consensus forecasts of substantial and growing nickel supply deficits, with 2015 market balance perhaps sustained by reported Chinese stockpiling ofnickel ores during 2013, in anticipation that the Indonesian ban would be enforced. Nonetheless, the addition of political risk, in the form of the Indonesian ban, to the mix of other known longer-term supply risks – i.e., declining grades and quality, shortage of projects under development, etc. – serves to enhance the positioning of awaruite deposits as a new long-life, low-risk source of nickel for world markets.

During the past year, the Company’s flagship Decar project (“Decar” or “the Project”) passed a critical additional milestone towards proof of concept as to the commercial acceptability of products produced from mineralized material at Decar. In April 2014, the Company announced positive results from a direct market test of awaruite concentrates produced from a bulk sample from the Project. Each of the six potential consumers participating in the test indicated satisfactory technical success in their analysis and test processing of the concentrates, which had never before been presented to potential offtakers for evaluation. The majority also provided indicative commercial terms for the purchase of such concentrates.

Key results from the tests are as follows:

  • All participants achieved satisfactory technical results from their analysis and testing of the samples of Decar concentrates provided, and judged the product technically acceptable.
  • Successful treatment of the concentrates was demonstrated as both blending feed to conventional ferronickel production configurations and as direct feed to stainless steel production, the latter after agglomeration with a reducing agent. Very high rates of recovery and accountability were noted across the various processes assessed.
  • Commercial feedback indicated the potential to achieve payability for nickel in awaruite concentrates in the range of 85% to more than 95% of the London Metal Exchange (“LME”) nickel price, depending on end use and prevailing nickel price, with no credits for iron or chromite. This indicative revenue realization compares with the 2013 Preliminary Economic Assessment’s assumed 75% of LME payable for nickel in concentrates.

While it should be noted that both technical results and commercial indications are preliminary and subject to confirmation following further testing and analysis, the fundamental conclusions to be drawn from this market test are that a concentrate produced from Decar material can be successfully treated in existing ferronickel and stainless steel plants and that there is an available market for the product among consumers of nickel.

Despite the passing of this key threshold in the Decar proof of concept, 2014 also introduced uncertainty around the ongoing participation of Cliffs Natural Resources Inc. (“Cliffs”), currently a 60% owner and operator of the Project. In August 2014, following a proxy battle, Cliffs’ Board of Directors and management were replaced. Cliffs subsequently informed First Point that, as a function of a change in strategy, nickel having been designated as non-core, its entire interest in Decar was to be put up for sale. First Point continues to engage with Cliffs to understand the potential impact on the Decar project and to explore all available opportunities to maximize First Point’s participation in the Project’s continued advancement. As of the date of this letter, no sale transaction in respect of Cliffs’ stake in the Decar Project has taken place.

Limited exploration efforts on First Point’s 100%-owned portfolio also continued during 2014, primarily focused on the Mich property, near Whitehorse in the southern Yukon Territory. Results of the two-hole, 870 metre program, released in November 2014, provided encouraging confirmation of the property’s potential to host a significant nickel-iron alloy mineralized system. A follow-up drilling campaign is on hold pending a review of funding alternatives.

In summary, the major milestone passed during the past year at Decar – demonstrating technical and commercial acceptability of concentrates produced from our target nickel-iron alloy mineralization- has been overshadowed by the uncertainty around Cliffs’ exit from the Project. We look forward to resolving that issue in 2015 and driving further progress at Decar in the coming year. Prudent management of your Company’s cash on hand during 2015 will be a priority, as we work to add value to both Decar and the 100%-owned properties into 2016.

Finally, First Point is proud to acknowledge the January 2015 induction of Dr. Peter Bradshaw, a co-founder of the Company and the current Chairman of the Board, into the Canadian Mining Hall of Fame. We congratulate Peter on this fitting tribute to his career-long body of work as a leader in exploration geology, a pioneer in mining industry engagement with indigenous peoples, and an innovator in research partnerships between industry and academia.

Your continued support and enthusiasm of the Company are much appreciated.

/s/ James S. Gilbert

James S. Gilbert
President & CEO