AVL Signed MOU With Enerox GmbH For Vanadium Offtake

KEY POINTS

AVL signs Memorandum of Understanding with CellCube vanadium redox flow battery

(VRFB) manufacturer Enerox GmbH.

VSUN Energy signs Value Added Reseller Agreement with Enerox GmbH.

 Extensive Memorandum of Understanding includes development of: Vanadium pentoxide offtake arrangements to support global VRFB sales by Enerox; A vanadium electrolyte facility in Australia to supply Enerox battery installations

and;

Assistance with arrangement of vanadium electrolyte leasing. Enerox GmbH is a global market leader of VRFBs based in Austria, with over 100

installations worldwide.

Australian Vanadium Limited (ASX: AVL, “the Company” or “AVL”) is pleased to announce that it has signed a Memorandum of Understanding (MOU) with Enerox GmbH (“Enerox”). Enerox is a global market leader of VRFB energy storage systems. Enerox designs, develops, manufactures, sells, installs, operates and maintains battery storage projects on a global level in the megawatt range, for grid-connected energy storage and offgrid/microgrid applications, under the brand name CellCube. The MOU establishes a cooperative environment to establish binding agreements for offtake of vanadium products from the planned Australian Vanadium Project at Gabanintha (“the Project”) to support global sales and services of Enerox’s well known VRFB product CellCube. Australian based sales of VRFBs will be supported by the development of a vanadium electrolyte blending facility by AVL. AVL will also assist Enerox with the arrangement of electrolyte leasing on project specific

demand?

In addition to the MOU, AVL’s 100% owned VRFB-focused subsidiary VSUN Energy has signed a Value Added Reseller (VAR) agreement with Enerox for the supply and installation of CellCube products and services in Australia.

Managing Director, Vincent Algar comments, “Through AVL’s subsidiary VSUN Energy we have developed a strong relationship with CellCube and have experience with the excellent quality of their

product. We are delighted to be able to broaden this relationship further, to include future supply of vanadium and vanadium electrolyte from the Australian Vanadium Project as the Project moves towards production. With Enerox developing ever larger VRFB projects around the world and in Australia, the secure supply of high-purity vanadium pentoxide will be crucial for further growth of this reliable energy storage technology as it builds its market presence.”

Alexander Schönfeldt, CEO of Enerox/CellCube comments, “I am very happy we are growing ourAustralian business with VSUN Energy as our local partner. Having 3 systems already in the region and taking the Covid situation into account, it is for us and our clients very important to have a trusted partner in Australia who is trained on our systems and who we have known for many years. For the increasing demand of long duration energy storage specifically in hot and remote areas, the Vanadium Redox-Flow technology in combination with renewables is the best solution. Having a local supply chain and value creation will be a major benefit for the people and business in Australia.”

The key terms of the MOU and the VAR agreement are:

 The MOU is non-binding.

Extensive Memorandum of Understanding includes development of: Vanadium pentoxide offtake arrangements to support global VRFB sales by Enerox; A vanadium electrolyte facility in Australia to supply Enerox battery installations and; AVL’s assistance with arrangement of vanadium electrolyte leasing.

One or more formal and binding agreements concerning the above matters are to be

finalised by the six-month anniversary of the MOU’s execution.

Each party must pay its own costs in relation to the MOU and any agreements

contemplated by the MOU.

The VAR agreement provides VSUN Energy with the non-exclusive right to market, sell and

install Enerox products in Australia.

The agreement does not preclude VSUN Energy from marketing VRFBs from other

suppliers, but provides protection for Enerox’s commercial information which will be

extended to other manufacturers in similar agreements.

The agreement is for a term of 2 years, with a 2-month notice period on either side for

termination.

The VRFB was invented in the 1980s by Emeritus Professor Maria Skyllas-Kazacos at the University of New South Wales (UNSW) where a CellCube VRFB has been installed. The battery’s characteristics mean that it is suited to stationary energy storage paired with renewable energy generation. The product is non-flammable and has the ability to provide almost unlimited cycles without degradation in performance. The power and energy can be scaled eparately, with the energy component provided by two tanks of vanadium electrolyte. This

simplifies the management of the battery’s charge.

The Enerox CellCube has been installed in many locations around the world, with an installation of a 10kW/100kWh system in Busselton by VSUN Energy being the second CellCube VRFB to be installed in Australia.

www.ferroalloynet.com