KEY POINTS:

* AVL signs Letter of Intent with Hebei Yanshan Vanadium and Titanium Industry Technology Research Co Ltd, a subsidiary of HBIS Group Chengsteel
* Chengsteel is currently the world’s third largest vanadium producer
* Potential purchase of AVL’s vanadium products and Project investment opportunities
* Consideration of technical services for the Australian Vanadium Project
* Letter of Intent confirms interest from both parties to discuss a binding purchase and sale agreement
* Letter of Intent is non-binding and sets terms for discussion
* AVL Managing Director and COO to visit HBIS in January, a visit to Western Australia by HBIS Vanadium executive management being planned

AVL has signed a Letter of Intent with Hebei Yanshan Vanadium Titanium to negotiate and sign a binding technical services and purchase agreement for AVL’s vanadium products.

The terms of the Letter of Intent include AVL providing a product sample to Yanshan Vanadium Titanium for testing. Product specifications, price and volume are to be determined through further discussion. The document is non-binding and sets out the structure for further discussions to be
undertaken. Managing Director, Vincent Algar and Chief Operating Officer, Todd Richardson are currently in Chengde, Hebei to progress technical and offtake discussions.

Through AVL’s online Data Room, Yanshan Vanadium Titanium has already started to undertake its due diligence of the Project and the Company.

AVL’s Managing Director, Vincent Algar, commented, “We were invited by Yanshan Vanadium Titanium to attend a conference in Hebei last year and to meet with the company. Discussions were productive and highlighted a desire by Yanshan Vanadium Titanium to become more involved in AVL’s Project. We are now visiting Chengde this month to further these discussions and move towards a formal agreement.”

Yanshan Vanadium Titanium is keen to assist with the processing design for the Australian Vanadium Project. The visit to Chengde will allow Mr Richardson to undertake technical discussions regarding potential improvements to the Project’s process, which Yanshan Vanadium Titanium believes could result in cost improvements.

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