Atlantic Sapphire ASA: Incident in Atlantic Sapphire’s #Denmark facility

On Friday, July 9, 2021, Atlantic Sapphire Denmark A/S, a wholly-owned
subsidiary of Atlantic Sapphire ASA (the “Company” or “Atlantic Sapphire”), had
an incident in one of its saltwater growout systems. The other growout system in
the Denmark facility was unaffected.

The Company’s preliminary analysis, which remains subject to change, indicates
that maintenance work performed in the filtration system caused water quality to
quickly deteriorate, resulting in elevated mortality.

Atlantic Sapphire is continuously improving its operating procedures to ensure
that all actions taken by the farm operators do not pose a risk to the stability
of the systems, therefore impacting the fish. However, human error altered the
water levels in the RAS system and allowed previously stagnant water to flow
into the tanks. To minimize the risk of a similar incident reoccurring, the
Company has updated certain operating procedures and such changes will take
effect immediately.

Further, the system in question had a larger standing biomass than the growout
systems in the US (split in two). The Denmark facility had not been split in
two, because this modification was not practically possible with the farm fully
stocked with fish. Now this modification is possible and will be performed,
which will reduce the impact of future mortality events in a system.

Approximately 400 tons (HOG) of fish is expected to be lost, equivalent of
around 17% of annualized harvest volumes from the Denmark facility at steady
state production. The fish would have been harvestable in H2 2021. The direct
financial impact of the incident after expected insurance proceeds is estimated
to USD 3 million.