KEY POINTS

* Co-operation and Access Agreement signed with Westgold Resources Limited (ASX: WGX) for access to excess water from Westgold Operations to support the Australian Vanadium Project.

* Letter of Agreement to progress to a formal agreement within 3 years.

* Potential benefits to arise from the agreement include:

→ Reduced groundwater and environmental impacts.

→ Substantial de-risking of the water volume and quality requirements.

→The opportunity to provide community benefits with new pipeline and road.

* Agreement indicates responsible and innovative management of water resources.

Australian Vanadium Limited (ASX: AVL) is pleased to announce that it has signed a letter agreement for co-operation and assistance for water access with Australian gold miner Westgold Resources Limited (“Westgold”) for AVL’s Australian Vanadium Project (“the Project”) south of Meekatharra, in Western Australia.

Westgold’s Meekatharra Gold Operations comprise several active and inactive mines south of Meekatharra (see Figure 1) located 25km to the west of the Australian Vanadium Project.

Continuous inflows into a number of these active and inactive pits and underground mines lead to the generation of significant amounts of water, surplus to Westgold’s requirements, which can be utilised in processing AVL’s vanadium ore.

In addition to the water access, the agreement provides a platform for friendly collaboration over access and the use of new and existing roads to move ore, materials and products within the companies’ tenements.

AVL’s Managing Director Vincent Algar comments, “AVL continues to derisk the Australian Vanadium Project. Securing access to sufficient quality water resources to use in the mining and Crushing Milling and Beneficiation Plant planned for the nearby Australian Vanadium Project is one of our highest priorities. Access to excess water flowing into Westgold’s pits allows us to progress the Project with increasing confidence. WA has limited high quality water resources, so innovative

collaborations such as this agreement with Westgold can assist both the EPA and DWER with their water management and environmental custodianship, whilst allowing this critical project to progress.”

Building strong relationships within both the mining and the local community is a key AVL strategy.

We have been working with Westgold through the Meekatharra Industry Group and through our shared sponsorship of the Stephen Michael Foundation, for which the companies and the Foundation received the inaugural AMEC (Association of Mining and Exploration Companies)

Community Award in December 2019. Having a relationship with an established mining company in the region enables us to draw on lessons they’ve learnt and the spirit of the agreement is to pursue an outcome that will be of benefit to both parties and the region.

The letter of agreement will progress to a formal agreement within three years, or would expire.

A prefeasibility study has previously estimated that the project could produce some 900 000 tons per year of magnetite concentrate, producing 22.5 million pounds of V2O5 a year, over an initial 17-year mine life.

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