Quarterly Activities and Cash Flow Report For The Period Ending 31 December 2022

Ionic Rare Earths Limited (“IonicRE” or “The Company”) (ASX: IXR) is pleased to provide its Quarterly Report for the period ending 31 December 2022. This report includes development activities at its 51% owned Makuutu Rare Earths Project (“Makuutu” or “the Project”) in Uganda and the Company’s 100% owned magnet recycling subsidiary in the UK, Ionic Technologies International Limited (“IonicTech”).

HIGHLIGHTS

• The Makuutu Rare Earth Project’s Environmental and Social Impact Assessment (ESIA) approved by Uganda’s National Environmental Management Authority (NEMA)
  
• Mining Lease Application progressed and expected to be finalised imminently, with award expected by the end of Q1 2023
• Retention Licence 00007 (Makuutu Western Zone) Renewal Approved – lodged and approved within two weeks – by Uganda’s Directorate of Geology Survey and Mines (DGSM)
• IonicRE receives ESG rating of “BB” from leading independent global platform – Digbee ESG^TM
  
• IonicRE was accepted as member participant of the United Nations Global Compact – the World’s largest corporate sustainability initiative
• Ionic Technologies Belfast facility fit out progressed on schedule with magnet recycling pilot plant producing over 5kg of Nd2O3 and Dy2O3 products as part of verification program processing NdFeB swarf
• Downstream Refinery study progressed, expected to be finalised in Q1 2023, with the US as the preferred location for the facility
• Engagements continue with governments, government bodies, and potential strategic partners interested in the unique appeal of the Makuutu basket of magnet and heavy rare earths to feed new emerging supply chains

Makuutu is one of the world’s largest ionic adsorption clay (IAC) hosted Rare Earth Element (REE) deposits comprising six licenses (see Figure 1) covering approximately 300 km² located 120 km east of Kampala in Uganda. The deposit stretching 37km is situated near high quality tier one infrastructure, and has the potential to provide western customers with a strategic alternative supply of heavy rare earth oxides to support the growth of manufacturing and industries critical to achieve net-zero carbon initiatives for 50 years and beyond.

Makuutu is being developed by Rwenzori Rare Metals Limited (“RRM”), a Ugandan private company which owns 100% of the Makuutu Project. IonicRE is a 51% owner of RRM and moving to 60% on completion of the Feasibility Study and Mining Licence Application (MLA) which is expected shortly. IonicRE also has the first right over the remaining 40% stake in RRM and Makuutu and is progressing discussions with partners on a transaction.

During the December quarter, IonicRE announced a major corporate milestone in the development of the Makuutu Rare Earths Project, with the Environmental and Social Impact Assessment (ESIA) being granted approval by Uganda’s National Environmental Management Authority (NEMA). This vote of confidence positions Makuutu as Uganda’s next mineral development project, and is set to unlock unprecedented social and economic benefit through mineral development.

The approval follows a 9-month assessment by NEMA culminating in two large public hearings with over 3,800 registered attendees demonstrating strong governmental and local stakeholder support.

In recognition of the flagship nature of this Project and its significance to the country’s development as enshrined in Uganda’s National Development Plan NDP-III, the certificate was awarded at a ceremony held in Kampala at NEMA’s headquarters (see Figure 2).

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