Australian Vanadium Quarterly Activities Report

Australian Vanadium Limited (ASX: AVL, the Company or AVL) is pleased to present the company's quarterly activities report for the period ending 30 September 2023.

Proposed merger with Technology Metals Australia

• Australian Vanadium Limited (ASX: AVL, the Company or AVL) and Technology Metals Australia Limited (ASX: TMT) have agreed to merge via a proposed Scheme of Arrangement, under which AVL will acquire 100% of the TMT shares on issue.
• The combination of AVL and TMT will create a leading Australian vanadium developer through the consolidation of two adjoining projects across one orebody.
• If the Scheme is approved and implemented, existing AVL shareholders will hold ~62% of the combined group and existing TMT shareholders will hold ~38% of the combined group.
• The merger is intended to be completed by February 2024.

Australian Vanadium Project

• The Company continues to progress activities to develop the Australian Vanadium Project.
• A water licence for the proposed processing plant at Tenindewa was approved.
• A new option agreement to purchase land for the proposed processing plant site was signed.
• Access agreements for haulage road and water pipeline route were signed.

Vanadium in energy storage

• Construction of AVL’s vanadium electrolyte manufacturing facility commenced and is on track for completion this calendar year.
• Regional energy provider Horizon Power purchased its first vanadium flow battery from AVL’s wholly owned subsidiary, VSUN Energy Pty Ltd.

Corporate

• No lost time injuries or reportable environmental incidents were recorded during the quarter.
• Successful completion of a $15.7 million institutional placement concurrently announced with the proposed merger between AVL and TMT.
• Cash position of $32.5 million as at 30 September 2023, including restricted cash of $0.4 million and proceeds from the institutional placement.

Management Comment

CEO, Graham Arvidson comments, “The last quarter has been particularly busy for AVL from both a project and corporate perspective. We announced the proposed combination of Australian Vanadium and Technology Metals Australia which, if successful, would be transformational for both companies and the wider Australian vanadium landscape. The companies recognise that the consolidation of AVL and TMT’s adjoining projects with a contiguous orebody provides a unique opportunity for the combined group to realise material operational and corporate synergies which will be advantageous for both sets of shareholders. An integration team consisting of members of AVL and TMT has been formed to assess the optimal development and processing pathway and the transaction will create the leading ASX listed vanadium developer and a world-class asset of scale, located in a tier-1 mining jurisdiction.

In conjunction with the proposed merger, AVL completed a $15.7 million institutional placement and we were pleased with the strong support shown from both existing and new institutional investors, including major shareholder Resource Capital Funds. The support highlights the growing investor interest in the vanadium sector, with AVL well positioned to benefit from the clean energy transition and ongoing electrification of energy supplies requiring storage solutions. The placement ensures that the combined group will be well-funded to progress its integration strategy, as well as its go- forward development.

During the quarter we also announced commencement of construction of AVL’s first vanadium electrolyte facility. AVL aims to become a trusted supplier of vanadium electrolyte within Australia and the electrolyte plant provides an ideal opportunity for the Company to test and further mature its systems and processes that will ultimately underpin the larger Australian Vanadium Project. We look forward to providing further updates to shareholders as activities progress.”

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