Ann: Quarterly Activities Report, page-2

Some extracts from the Dubbo/ASM discussion FYI;

Re the cleanmetals pilot plant in Daejeon, South Korea

The project has experienced minor disruptions due to theCovid-19 virus with the pilot plant now due for completion by the end of the current quarter"

"Commissioning of the pilot plant is scheduled for the second and third quarters of 2020, with the initialfocus on the production high value zirconium and hafnium metals. ASM has received interest in both potential future supply and partnership from a number of parties in South Korea and elsewhere. Theseparties are waiting on the successful pilot plant operation and production of metals. ASM believes theproduction of metals from this new green technology will be a catalyst for further discussions anddevelopment with potential strategic partners"

Re the business case and strategy

"ASM hosted an overseas delegation from a leading Japanese zirconium materials producer early in thequarter, with successful visits to Dubbo and ASM’s demonstration pilot plant at ANSTO, near Sydney.Follow up activities are now underway for further cooperation and development."

"During the March quarter significant progress was made in respect of the planned demerger of ASM.Dialogue with key regulators including the ATO, ASIC and the ASX in relation to the proposed transactioncontinued, with most details regarding aspects of the transaction structure, details around waivers anddeclarations being sought and various taxation matters largely resolved. This work is ongoing and readyto rapidly finalise.

Alkane’s Board remains committed to the demerger of ASM, but is reviewing the timing of the demergeron a month by month basis given the very turbulent market conditions. Internally within Alkane ASM isbeing treated as a separate entity managed by Mr Woodall as much as possible, with allocated budgetand resources. The Board will consider the transaction status and market conditions at its May Boardmeeting; however, management is currently working towards a timetable that would see ASM listed inin the third quarter of 2020. Execution of this timetable is dependent upon receipt of final regulatoryapprovals and waivers and final board approval."

So some not surprising slippage in the timeline with the technical pilot plant trial running in parallel with regulatory and financing activities. Hopefully all culminating in a Q3 demerger (and share allocation), announcement of the trial success and revised business case (updating that of 2018) and ideally some initial binding offtake deals and an equity partner. All good!