[Ferro-Alloys.com] OVER 100% OF PHASE 1 PRODUCTION SUBJECT TO OFFTAKE MOUs

 HIGHLIGHTS

◆ VANADIUM RESOURCES LIMITED (ASX: VR8; DAX: TR3) (“VR8” or the “Company”) has entered into a Memorandum of Understanding (“MOU”) with Hunan Zhongxin New Materials Technology Co., Ltd. (“Zhongxin”) ◆ Zhongxin is a vanadium based high-end alloy material processing enterprise that integrates research and development, production and trade, with a customer base across the globe and annual production capacity of 13kt of vanadium based high-end alloy materials

◆ Similar to the recently announced MOUs with Panjin Hexiang New Materials Technology Co., Ltd (“Hexiang”)1 and Enerflow Technology Co., Ltd. (“Enerflow”)2, the MOU with Zhongxin provides for the sale of 4ktpa of vanadium pentoxide (V2O5) for an initial 5-year term, with an option to extend for a further 5 years

◆ The combined MOUs signed to date are in excess of the planned ~11ktpa V2O5 production planned for Steelpoortdrift’s Phase 1 operations3, and demonstrates the continued strong demand from China for reliable sources of vanadium supply

◆ In addition to the MOUs executed to date, VR8 remains in discussions with a variety of Chinese, Japanese, Korean and European end-users and traders as the Company seeks to secure binding offtake agreements to support project financing

Vanadium Resources Limited (ASX: VR8; DAX: TR3) (the “Company”) provides the following update for its world-class Steelpoortdrift Vanadium Project (the “Project”) in South Africa, consisting of the Steelpoortdrift Mine and Concentrator (“Steelpoortdrift”) and the Tweefontein Salt Roast Leach (“SRL”) operation (“Tweefontein”).

The Company is pleased to announce that it has signed a non-binding MOU for the offtake of V2O5 production from its Project with Zhongxin. The MOU provides for the supply of 4ktpa of V2O5 flake over a period of five years with an option for Zhongxin to extend a further five years.

The MOU provides a framework for further negotiations in relation to price, product quality and other offtake parameters. The MOU with Zhongxin represents a further ~37% of VR8’s planned annual average V2O5 flake production capacity of ~11ktpa4 from the initial Phase 1 operation of the Project.

The collective MOUs signed to date represent over 100% of the anticipated production from Phase 1. The specific tonnages in these MOUs represent an anticipated base level of demand from each of the parties, serving as a starting point for further negotiations. Should any or all of the MOUs progress into binding agreements, the final agreed-upon tonnage for each party’s offtake may vary.

The Company remains in discussions with a range of Chinese, Japanese, Korean and European end-users and traders for further offtake agreements. As these discussions continue, the Company will continue to explore the possibility of securing financing solutions with each of these potential offtakers that will optimise the projected Net Present Value of the Project for existing shareholders.

Commenting on the MOU, Mr John Ciganek, Chief Executive of VR8, said:

‘We are delighted to be entering into a further offtake MOU with another high-quality industry leader, Zhongxin, which has a production capacity of 13kt of vanadium based high-end alloy materials. With this MOU, VR8 now has over 100% of its Phase 1 production under MOUs. These MOUs play an integral role in the overarching funding process we have implemented, with the aim of securing debt financing and strategic equity investment for our world-class Steelpoortdrift Vanadium Project.

As announced in our recent March 2024 quarterly report, interest in the Project has increased following continued engagement with our financial adviser, GC Partners, and our debt adviser, HCF International Advisers. I look forward to keeping shareholders updated with further developments as they arise during this pivotal and exciting phase in the Company’s operations.’

Commenting on the MOU, Mr Jurie Wessels, Executive Chairman of VR8, said:

‘Together with Enerflow’s MOU, the MOU with Zhongxin represents potential offtake focused on the downstream potential of Vanadium. This interest confirms the growing market for Vanadium outside its traditional role as an additive to steel. This also demonstrates the possible advent of the long-expected change in demand metrics for Vanadium driven by VFBs and specialist alloy products.

Guided by this unexpectedly high level of market demand for offtake through several MOUs for more than 100% of our Phase 1 production plans, we are well positioned to convert these MOUs into binding offtake agreements that meet the requirements of our debt financiers.’

ABOUT ZHONGXIN

Hunan Zhongxin New Materials Technology Co., Ltd. was established in 2007 and is a vanadium based high-end alloy material deep processing enterprise that integrates research and development, production, and trade. It currently has more than 100 employees, total production capacity of 13,000 tons of vanadium based high-end alloy materials and has gained unanimous recognition from customers and industry across the globe. Zhongxin is a member of the Vanadium Industry Branch of the China Iron and Steel Industry Association, and it has the only vanadium alloy engineering technology research centre (provincial-level enterprise technology centre) in Hunan Province. Zhongxin also participated in the formulation of the national standard GB/T40301-2021 for vanadium trioxide in 2021.

• [Editor:tianyawei]