Toro to demerge Non-Core Assets including Dusty Nickel Project and Yandal Gold Project

Perth-based uranium development and exploration company Toro Energy Limited (ASX:TOE) (“Toro” or the “Company”) is pleased to advise its intention to demerge its portfolio of non-core assets including its nickel, gold and base metal assets in Western Australia, subject to all requisite approvals.

Highlights

• Strategic review of asset portfolio to maximise shareholder value
• Toro anticipates an in-specie distribution to existing shareholders
• Lead manager for IPO of demerged company to be finalised soon
• Toro to be solely focused on uranium development opportunities

The Lake Maitland Scoping Study produced attractive financial metrics demonstrating a stand-alone project highlighted by:

• Pre tax NPV8 of A$610m, 41% IRR based on $70/lb U3O8 price, $0.70 AUD:USD
• Modest capex of USD189m (including 20% contingency) with a 2.5 year payback
• Low opex - Life of mine C1 costs of US$23.10/lb U3O8 and AISC US$28.02/lb U3O8
• EBITDA of $1,768.6M for the life of the mine

A very significant increase in the value of Lake Maitland is an anticipated outcome of the soon to be completed update of the Lake Maitland Scoping Study,

Recent work continues to highlight strength of Uranium assets

Toro recently reported that planning was well advanced to commence a near-term drilling programme that would deliver potential ore to the pilot plant that is currently in design for the Wiluna project and that a refresh and update of the Lake Maitland Scoping Study (first completed in 2022) is currently underway to evaluate financial outcomes using the latest more favourable commodity pricing and exchange rare guidance.

In addition, the Company announced that improving uranium market dynamics have allowed Toro to lower the cut-off grade and expand the stated uranium (U3O8) and vanadium (V2O5) resources at the Lake Way and Centipede-Millipede deposits by up to 25% U3O8.

Given the Company’s strategic focus on the development and recent positive developments of the Wiluna Uranium Project, the value of its nickel, gold and base metal exploration assets is not currently reflected in Toro’s share price. The Board considers these assets should now logically sit in a separately listed vehicle specifically focused on progressing their exploration and development.

Management commentary

Toro’s Executive Chairman, Richard Homsany said:

“With the strong financial metrics highlighted by the Lake Maitland Uranium Scoping Study, and the expected transformational increase in NPV following a soon to be completed refresh, we believe it is the right time to consider demerging our non-core projects to allow Toro to focus solely on expediting the development of our globally significant uranium assets.

Toro believes a demerger and anticipated IPO of the demerged company provides a compelling opportunity to unlock the considerable underlying value of these highly prospective nickel, gold and base metals assets, while allowing Toro to aggressively pursue the development of its world-class Wiluna Uranium Project.

The considerable amount of work completed to date by our team has demonstrated that the Lake Maitland Deposit, which is part of the Wiluna Uranium Project, is viable as a stand- alone operation with incredibly attractive financial metrics. There is significant potential upside in combining the other deposits - Lake Way, Millipede and Centipede - with Lake Maitland thereby unlocking greater value for shareholders.”

NewCo strategy and proposed transaction

Toro believes an IPO of its demerged company (“NewCo”) creates a new exploration driven, energy and base metals business with a portfolio of valuable assets located in a Tier-1 mining jurisdiction.

Any demerger is expected to be conducted by way of an equal capital reduction in Toro and an in- specie distribution of its shares in NewCo to Toro shareholders in compliance with applicable ASX Listing Rules including Rule 11.4.1(a). Upon completion of any demerger, existing Toro shareholders will have a significant interest in NewCo, which is expected to attract strong investor interest. Toro shareholders are also expected to be afforded a priority offer as part of any IPO, with an intention to seek an ASX listing for NewCo.

Investors are cautioned that although the application for admission of NewCo to the official list of ASX is intended to occur after the implementation of any demerger, there can be no certainty as to the timing of when such application will be made or that any such application will be successful. Any application by NewCo to admission of the official list of ASX will be subject to satisfying the requirements of ASX. Investors are further cautioned that due to the early-stage nature of the intended demerger no information about the structure of the demerged entity is as yet concluded or available.

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