Ann: Excellent Preliminary Metallurgical Testwork at **anintha, page-9

The global vanadium market has been operating in a deficit position for the past five years (source: TTP Squared Inc), with a forecast deficit of 9,700 tonnes in 2017. As a result vanadium inventories have been in steady decline since 2010 and they are forecast to be fully depleted in 2017 (source: TTP Squared Inc). Significant production declines in China and Russia have exacerbated this situation, with further short term production curtailment expected in China as a result of potential mine closures resulting from impending environmental inspections.

The tightening supplies of vanadium are resulting in a global shortage, with prices appreciating dramatically in recent months. Reports out of China have indicated significant increases in the “spot” market for vanadium pentoxide in recent weeks, with trades completed at US$12.30 to US$13.00 per lb V2O5, a fourfold increase over the past 12 months.