ALBRIGHT METALS LTD - Capital/Financing Update 2018

ASX Announcement

5 July 2018

Copper and Nickel Mineral Resource at Gabanintha Vanadium Deposit

HIGHLIGHTS

Nickel and Copper Mineral Resource estimate for the Gabanintha Vanadium deposit reported by Australian Vanadium Limited.
Bryah Resources Limited holds the mineral rights to Nickel and Copper at Gabanintha.
Inferred Mineral Resource of 12.5Mt containing, inter alia, 659ppm Nickel and 222ppm Copper.

Bryah Resources Limited (“Bryah” or “the Company”) is pleased to advise that Australian Vanadium Limited (ASX:AVL) (“AVL”) has reported a maiden Nickel and Copper Mineral Resource estimate for the Gabanintha Vanadium deposit located in central Western Australia ( released by AVL to ASX on 5 July 2018 and herewith attached in full ).

An Inferred Mineral Resource of 12.5Mt containing, inter alia, 659ppm Nickel and 222ppm Copper has been reported by AVL. Bryah holds the rights to all minerals except Vanadium/Uranium/Cobalt/Chromium/Titanium /Lithium/Tantalum/Manganese & Iron Ore (“Excluded Minerals”). AVL retains 100% rights in the Excluded Minerals on the Gabanintha Project.

The base metal sulphide Mineral Resource is considered by AVL to be potentially economically recoverable following metallurgical test work. AVL states that the base metal sulphide mineralisation has consistently reported to the non-magnetic fraction during the separation of the vanadium bearing magnetite. This has effectively delivered a sulphide by-product for further concentration by flotation.

AVL is presently undertaking a Preliminary Feasibility Study on development of the Gabanintha Vanadium deposit.

Attachment: AVL ASX announcement dated 5 July 2018 (Resource Update for Gabanintha Vanadium Deposit including Cobalt, Nickel and Copper).

Address Level 1, 85 Havelock Street West Perth WA 6005 Tel: +61 8 9321 0001 Email: [email protected]

ASX Code: BYH Projects ABN: 59 616 795 245 Bryah Basin – Copper, Gold, Shares on issue: 56,350,120 Manganese Latest Share Price: $0.11 Gabanintha – Gold, Copper Market Capitalisation: $6.2M bryah.com.au

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For Further Information, please contact

Neil Marston

Managing Director

Tel: +61 9321 0001

About Bryah Resources Limited

In October 2017 Bryah Resources Limited was admitted to the official list on the Australian Securities Exchange (ASX). The Company is a copper-gold-manganese focused explorer with 2 projects located in central Western Australia, being the 718 km[2] Bryah Basin Project and the 202km[2] Gabanintha Project.

The Bryah Basin is host to the high-grade copper-gold mines at DeGrussa, discovered by Sandfire Resources NL in 2009, and at Horseshoe Lights, which was mined up until 1994. The Bryah Basin also has several historical and current manganese mines.

Bryah Resources Limited’s exploration strategy is:

to apply the best and latest exploration methods to evaluate the ground;
to use high resolution geophysics to identify deeper structures and potentially mineralised zones;
to drill test targets below the depth of previous drilling, and
to apply maximum funds on exploration activities.

At Gabanintha, Bryah holds the rights to all minerals except Vanadium /Uranium /Cobalt /Chromium /Titanium /Lithium /Tantalum /Manganese & Iron Ore (Excluded Minerals). Australian Vanadium Limited retains 100% rights in the Excluded Minerals on the Gabanintha Project

Competent Person’s Statement

See attachment.

Forward Looking Statements

This report may contain certain “forward-looking statements” which may not have been based solely on historical facts, but rather may be based on the Company’s current expectations about future events and results. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties, assumptions and other factors which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Readers should not place undue reliance on forward looking information. The Company does not undertake any obligation to release publicly any revisions to any “forward looking statement” to reflect events or circumstances after the date of this report, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.

Address Level 1, 85 Havelock Street Page 2 of 2 West Perth WA 6005

Tel: +61 8 9321 0001 Email: [email protected]

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ASX Announcement
Resource Update for Gabanintha Vanadium
Deposit including Cobalt, Nickel and Copper
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Highlights:

Total Mineral Resource revised to 175.5Mt at 0.77% vanadium pentoxide (V2O5) consisting of:
➢ Measured Mineral Resource of 10.1Mt at 1.11% V2O5,
➢ Indicated Mineral Resource of 24.0Mt at 0.63% V2O5, and
➢ Inferred Mineral Resource of 141.4Mt at 0.77% V2O5.
The revised Gabanintha Mineral Resource includes a distinct massive magnetite high-grade zone of 93.6 Mt at 1.00% V2O5 consisting of:
➢ Measured Mineral Resource of 10.1Mt at 1.11% V2O5,
➢ Indicated Mineral Resource of 4.9Mt at 1.09% V2O5, and ➢ Inferred Mineral Resource of 78.6Mt at 0.98% V2O5.

05 July 2018

ASX ANNOUNCEMENT

Australian Vanadium Limited

ASX: AVL FRA: JT7.F

ABN: 90 116 221 740

T: +61 8 9321 5594

F: +61 8 6268 2699

E: [email protected]

W: australianvanadium.com.au

Street Address:

Level 1, 85 Havelock Street West Perth WA 6005

Postal Address:

The Mineral Resource now includes an estimation of cobalt, nickel and copper:
➢ Initial Inferred Mineral Resource is 12.5 Mt at 206 ppm Co, 659 ppm Ni and 222 ppm Cu.
➢ Estimation of cobalt, nickel and copper content follows bench scale test work and generation of sulphide flotation concentrates containing 3.8% – 6.3% base metals including 1.54% – 2.02% cobalt, 1.36% – 2.58% nickel and 0.82% – 1.70% copper.
➢ The potential sale of a by-product cobalt, nickel and copper sulphide concentrate to increase revenue at Gabanintha.
Revised weathering profiles to include oxide, transitional and fresh zones supporting Pre-Feasibility Study (PFS) work.
Metallurgical test work completed with excellent and repeatable recoveries from transitional and fresh massive vanadium bearing magnetite.
Oxide test work indicates successful magnetic concentration options.
PFS base case nearing completion.
Further detailed work on PFS technical aspects and risk analysis to be ongoing until end of 2018.

Level 1, 85 Havelock Street West Perth WA 6005

Projects:

Gabanintha - Vanadium Blesberg,South Africa - Lithium/Tantalum Nowthanna Hill – Uranium/Vanadium Coates - Vanadium

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Australian Vanadium Limited (ASX: AVL, “the Company” or AVL”) is pleased to announce an updated Mineral Resource for its Gabanintha Vanadium Project near Meekatharra in Western Australia. The revised estimate has been conducted following a re-interpretation of the weathering profiles to include a transitional zone in addition to the oxide and fresh zones.

The updated Measured, Indicated and Inferred Mineral Resource is 175.5 million tonnes (Mt) at 0.77% V2O5 which includes a Measured and Indicated Mineral Resource of 34.1Mt at 0.77% V 2 O 5 . Table 1 includes a detailed updated Mineral Resource table and Appendix 1 includes a table of the Mineral Resource broken down by the oxidation category.

The revised Mineral Resource estimate includes a geologically distinct massive vanadium bearing magnetite high-grade zone that is the focus of economic studies. The Measured, Indicated and Inferred Mineral Resource estimate for the high-grade zone (HG10 in Table 1) is 93.6Mt at 1.00% V2O5 which includes 10Mt at 1.11% V 2 O 5 in the Measured Resource category, 4.9Mt at 1.09% V 2 O 5 in the Indicated Resource category and 78.6Mt at 0.98% V 2 O 5 in the Inferred Mineral Resource category.

The Mineral Resource of the high-grade zone has increased by 0.8Mt (0.9%) and the overall Mineral Resource has decreased by 5Mt (2.3%) of mainly low-grade material. These changes are due to a revised distribution of the regression-calculated density values resulting from a more detailed oxidation interpretation. The density relationships across all of the Gabanintha mineralisation are strongly correlated to the rock type and in the case of magnetite bearing rocks, the iron content.

There is high potential to convert Inferred Resources located along the Company’s 11km of strike length at Gabanintha (see Figure 1) to the Measured and Indicated categories with additional targeted drilling.

In addition, an Inferred Mineral Resource of 12.5Mt containing 202ppm Cobalt, 659ppm Nickel, 222ppm Copper[1] and 0.14% Sulphur has been estimated. The Inferred Mineral Resource is contained exclusively within the fresh massive high-grade zone (HG10) in Fault Block 20 of the resource model. (See Figure 2 – Panel images). The base metal sulphide Mineral Resource is considered to be potentially economically recoverable following metallurgical test work conducted by the Company. The base metal sulphide mineralisation has consistently reported to the non-magnetic fraction during the separation of the vanadium bearing magnetite. This has effectively concentrated sulphide minerals enabling further concentration by flotation methods, (see ASX release 22 May 2018: Cobalt added to Vanadium at Gabanintha and this report).

The revised Mineral Resource estimate, including the estimation of sulphide base metals content, provides an improved basis for the PFS currently being undertaken by the Company.

Management Comment

AVL’s Managing Director Vincent Algar said that the release of the initial cobalt, nickel and copper resource and modifications to the vanadium resource added confidence and reduced risk in the Gabanintha resource base. The addition of the key base metal values and important geo-metallurgical parameters to the resource model added significantly to the quality of the mine plan that will emerge from the PFS. The increased understanding and confidence strengthened Gabanintha’s position as a world-class vanadium project in the size, grade and metallurgical recovery parameters of the Mineral Resource.

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1 Nickel and Copper credits to Bryah Resources Limited (ASX:BYH)

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“This important revision to the Gabanintha resource further de-risks the foundations on which we can build an outstanding Australian project,” Mr Algar said.

“We have developed a unique understanding of the deposit, and our very strong vanadium team will enable us to utilise this knowledge as we advance the project. Our timing in respect to supplying the rising vanadium market looks to be ideal.”

“We will develop the metallurgical and economic aspects of the project in our PFS, looking to include the needs of potential steel industry offtake and that of the rapidly emerging Vanadium Redox Flow Battery Industry.”

Details of the current Mineral Resource estimate for Gabanintha are contained in this release. The information that refers to Mineral Resources in this statement was prepared and last revised under the JORC Code 2012 on 5th September 2017 by independent consultants Trepanier Pty Ltd and is compared in this ASX announcement in Table 3. Additional data and lithological interpretations have now been incorporated and modelled into a revised and updated resource estimate.

Activities focused on advancing Gabanintha towards feasibility

The release of the updated Mineral Resource statement supports the activities of the Company to advance the Gabanintha vanadium project. Key activities currently underway include:

A Pre-Feasibility Study under the management of Wood Mining and Metals, external consultants and members of the AVL technical team.
Initial metallurgical test work and process circuit design work are well advanced.
Work is ongoing on the geo-metallurgical understanding of the mineralised domains to support processing circuit design, performance prediction and mine scheduling.
Metallurgical test work has identified the opportunity to produce a base-metal rich sulphide (Co, Ni, Cu) concentrate by flotation from the non-magnetic tailings stream. Further work will be conducted to refine the resource opportunity, concentrate quality and economic benefit.
A detailed mining study including pit optimisation and a preliminary assessment of an initial mine schedule is well advanced.
Preparation is underway for ongoing optimization of the initial base case proposition.
Determination of environmental constraints to the project and progress towards completion of a Native Title Mining Agreement and approval of a Mining Lease.

The Company will also incorporate results from additional research it will be conducting on vanadium electrolyte for use in vanadium redox flow batteries (VRFB). The manufacture of electrolyte is a process that can be achieved as part of the processing of vanadium ore. It offers the Company an opportunity to value-add to the project and develop a greater presence in the VRFB market.

PFS Progress Update

Solid progress is being made on a robust PFS utilising a combination of in-house expertise and external consultants. The base case scenario is nearing completion and will be reported when available. This is the first step in a series of activities that will allow the Company to deliver a realistic and achievable study, supporting future investment decisions.

One of the aims of the PFS is to define a low-risk, low-cost process for production of high purity vanadium products. The Company has begun to build relationships with end users and interim product producers such as those making vanadium carbon nitride (VCN) and vanadium electrolyte for

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vanadium redox flow batteries. Testwork undertaken on the non-magnetic tailings has further identified potentially economically recoverable cobalt, nickel and copper that are being incorporated into the PFS.

The Company’s intention is to produce a high quality PFS with a well-defined process flowsheet and is focused on de-risking the project to allow future investment. The PFS will include a robust options study to assure that the most viable, lowest cost mining and processing operation is pursued. The Company is basing the study on conservative economic assumptions and proven technologies. The goal is to develop a vanadium operation that is low-risk, low-cost and profitable in all business conditions.

Detailed option analysis to maximise economic returns and reduce capital and operating costs will continue during 2018. Favourable outcomes will allow the Company to advance the project to a Definitive Feasibility Study.

Key focuses for the Company are minimising environmental impacts, identifying and mitigating process and project risks at an early stage, developing a clear pathway to a timely design and to build a world class, long-life vanadium operation.

2018 Mineral Resource Estimation (JORC 2012)

The updated Mineral Resource estimate has been conducted following a re-interpretation of the weathering profiles. The weathering profile re-interpretation was based on sectional interpretation of the base of complete oxidation and base of partial oxidation surfaces using loss on ignition (LOI) and magnetic susceptibility data, with additional SATMAGAN[2] analysis on some select samples in the highgrade zone (model zone 10). The SATMAGAN values are indicative of the amount of magnetite present in the rock and is a proxy for the degree of weathering. The relationship of SATMAGAN to LOI and magnetic susceptibility was used to increase confidence in the modelling of the weathering surfaces. In addition, Co, Ni, Cu and S were estimated. The potential exists for a sulphide concentrate as a revenue source following positive metallurgical testwork results.

The updated Mineral Resource estimate completed and reported in compliance with the JORC Code 2012 standard for the project incorporated 97% of the existing drilling data (see Table 2) including data from the Company’s 2009 and 2015 RC and diamond drilling programs. This included 233 RC and 17 Diamond Core holes for 20,086 metres over an 11 kilometre strike length at AVL’s Gabanintha vanadium, titanium and iron deposit. Of these, 16,287m were used in the grade estimate.

The estimation was carried out by Trepanier Pty Ltd, resulting in the estimation of Measured, Indicated, and Inferred Mineral Resources. All mineralised domains were constructed using geological information and considering a nominal cutoff for inclusion of above 0.4% V2O5 for the low-grade ore zones and above 0.7% V2O5 within the high-grade zone in the Mineral Resource estimate (see Table 1) for a total resource of:

175.5 million tonnes at 0.77 % V2O5 containing 1,348,300 tonnes of V2O5;
A discrete high-grade zone of 93.6 million tonnes at 1.00% V2O5 containing 936,000t V2O5
Discrete low-grade zones of 77.5 million tonnes at 0.50% V2O5 containing 384,000t V2O5.
Combined Measured and Indicated Mineral Resources of 34.1 million tonnes at 0.77% V2O5 in low and high-grade domains containing 263,000t V2O5, suitable to underpin a long life, low cost, high grade feed, open-cut mining operation.

2 SATMAGAN (Saturation Magnetic Analyser) is a laboratory method to determine the proportion of magnetic iron oxide (Fe3O4) present.

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Table 1 summarises the results of the current Mineral Resource estimate by High-Grade (HG), Low Grade domains (LG2-5) and Transported domains (Trans 6-8)

Table 1 Gabanintha Project – Mineral Resource estimate by domain and resource classification using a nominal 0.4% V2O5 wireframed cut-off for low grade and nominal 0.7% V2O5 wireframed cut-off for high grade (total numbers may not add up due to rounding

Zone	Classification	Mt	V2O5 %	Fe %	TiO2 %	SiO2 %	Al2O3 %	LOI %
HG 10	Measured	10.1	1.11	42.7	12.6	10.3	8.0	4.0
	Indicated	4.9	1.09	43.3	12.1	10.5	7.8	3.7
	Inferred	78.6	0.98	42.4	11.2	11.4	7.6	3.4
	Sub-total	93.6	1.00	42.5	11.4	11.3	7.6	3.5

LG 2-5	Measured	-	-	-	-	-	-	-
	Indicated	19.1	0.51	23.9	7.0	27.8	18.1	8.7
	Inferred	58.5	0.49	25.5	6.7	27.5	16.5	7.4
	Sub-total	77.5	0.50	25.1	6.8	27.5	16.9	7.7

Transported 6-8	Measured	-	-	-	-	-	-	-
	Indicated	-	-	-	-	-	-	-
	Inferred	4.3	0.65	28.1	7.2	24.7	16.7	8.5
	Sub-total	4.3	0.65	28.1	7.2	24.7	16.7	8.5

Total	Measured	10.1	1.11	42.7	12.6	10.3	8.0	4.0
	Indicated	24.0	0.63	27.9	8.0	24.2	16.0	7.7
	Inferred	141.4	0.77	35.0	9.2	18.5	11.5	5.2
	Sub-total	175.5	0.77	34.5	9.3	18.8	11.9	5.5

Table 2 Drilling at Gabanintha

Hole Number	Drill Type	Number of Holes	Metres

GRC001 – 090	RC	90	6,867
GRC091 – 147	RC	57	3,744
GRC148 – 158	RC	11	1,233
GDH901 – 909	DD	9	1,526
	*Sub-Total*	*167*	*13,370*
GRC159 – 221	RC	63	5,955
GDH 910 – 917	DD	8	761
	*Sub-Total*	71	*6,716*
	TOTAL	238	20,086

Note: The 2017 Mineral Resource Estimation excluded some older (pre-2007) RC holes (GRC001 to GRC017) due to uncertainty about assay quality assurance. This had minor impact on the wireframe estimations for volume and grade as more recent, better quality holes were drilled nearby. YRR refers to previous company name for AVL.

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Figure 1 Location Diagram of the Gabanintha Project.

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Comparison with 2017 Mineral Resource Estimation

The updated Mineral Resource has little impact on overall tonnage and Measured and Indicated Resource categories but does include domains for oxide (completely weathered), transitional (partially weathered) and fresh rock (no weathering). The degree of weathering determines the extent to which the high-grade vanadium domain can be beneficiated through magnetic separation prior to roasting. Work conducted by the Company has demonstrated vanadium recovery from oxide materials (see Section p18, this report). The Company has previously demonstrated successful magnetic separation of vanadium for transitional and fresh rock. The distinction and successful identification of the oxidation state of the ore is considered an important aspect in the resource definition and subsequent processing.

The principal differences between the 2017 mineral resource estimation and the current 2018 estimation are listed below:

Re-interpretation of the oxide, transition and top of fresh surfaces using magnetic susceptibility, LOI and SATMAGAN data.
Based on oxide coding changes, refinement of the bulk density assignment.
Estimation of cobalt, nickel, copper and sulphur values within the measured and indicated part of the deposit.

Table 3 Comparison Table 2018 and 2017 and 2015 Mineral Resource Estimates by Resource Category

		Mt	V2O5 %	Fe %	TiO2 %	SiO2 %	Al2O3 %	LOI %
Total 2018	Measured	10.1	1.11	42.7	12.6	10.3	8.0	4.0
	Indicated	24.0	0.63	27.9	8.0	24.2	16.0	7.7
	Inferred	141.4	0.77	35.0	9.2	18.5	11.5	5.2
	Sub-total	175.5	0.77	34.5	9.3	18.8	11.9	5.5

Total 2017	Measured	10.2	1.06	41.6	12.0	11.6	8.6	4.2
	Indicated	25.4	0.62	27.7	7.9	24.9	15.8	7.5
	Inferred	144.1	0.75	34.4	9.0	19.2	11.7	5.2
	Sub-total	179.6	0.75	33.8	9.0	19.6	12.1	5.4

Total 2015	Measured	7.0	1.09	43	12	10	8	3.4
	Indicated	17.8	0.68	28	8	23	16	7.7
	Inferred	66.7	0.83	37	10	17	11	4.1
	Sub-Total	91.4	0.82	35	10	18	11	4.8

Oxidation zone re-interpretation and changes to bulk density assignment

To feed into geo-metallurgical modelling for future mining and processing study work, the interpretation of the oxidation profile was refined into three zones – oxide, transition and fresh (See Figure 6 panel diagrams - oxidation). The previous reported Mineral Resource from 2017 was only coded into oxide and fresh. The re-interpretation was facilitated using geological logging, element assays, core photos, magnetic susceptibility logs plus LOI and SATMAGAN data. The need to achieve a better understanding of the oxidation boundaries is driven by the following factors:

Metallurgical test work indicates that the degree of oxidation directly affects the recovery of iron and vanadium.

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Higher levels of oxidation result in increased silica and alumina being retained in the resulting magnetic concentrate.
Process design criteria and plant optimisation, and
Mine scheduling to satisfy plant production capacity.

Based on the reinterpreted oxidation coding, the assignment of the bulk densities for the different zones was also reviewed and refined. Clear correlations of bulk density versus Fe2O3 were chosen as the most appropriate estimation methods of bulk density for the different parts of the oxidation profile. Details of the revised density assignment based on 313 bulk density measurements are outlined in Appendix 2, JORC Table 1, Section 2. The Table 1 in Appendix 1 shows the total Mineral Resource by oxidation state. Table 2 in Appendix 1 shows the high-grade massive magnetite zone reported by oxidation state.

Mineral Resource Estimation - Base Metals and Sulphur

On the 22[nd] May 2018 (see ASX release 22 May 2018: Cobalt added to Vanadium at Gabanintha), AVL announced the successful recovery of cobalt, nickel and copper in a sulphide concentrate, adding another saleable battery metal opportunity. To evaluate the available sulphide hosted base metal content (cobalt, nickel and copper), the updated resource model includes the estimation of these elements and sulphur in the fresh material.

An Inferred base metal Mineral Resource has been defined at Gabanintha containing 12.5Mt containing 202ppm Cobalt, 659ppm Nickel, 222ppm Copper and 0.14% Sulphur. The Inferred Mineral Resource is contained exclusively in the fresh massive high-grade magnetite zone (model zone HG10) in Fault Block 20 of the resource model. (See Fig 6 – Panel images). Due to a lower number of informing samples for the fresh zone, the classification of sulphide hosted base metal material in the resource is Inferred. The Inferred base metal resource is constrained to the high-grade massive magnetite zone in Fault Block 20, which is the area of the highest drilling density of holes that penetrate into fresh material. Table 4 below shows the sulphide hosted base metal material classified as Inferred Resources. The location of the Inferred base metal resource is indicated in Figures 2, 3, 4 and 6

The base metal sulphide mineral resource is potentially economically recoverable following metallurgical test work conducted by the Company. The base metal sulphide mineralisation has been found to consistently report to the non-magnetic fraction during the separation of the vanadium bearing magnetite, enabling further sulphide concentration by flotation.

Table 4 Gabanintha Project – Mineral Resource for sulphidic base metals (cobalt, nickel and copper) constrained to Domain 10 (high-grade vanadium domain) for Fault Block 20 fresh material

Zone	Classification	Mt	Co ppm	Ni ppm	Cu ppm	S %
High-grade	Measured	-	-	-	-	-
Fault Block 20	Indicated	-	-	-	-	-
Fresh material	Inferred	12.5	206	659	222	0.14
	Total	12.5	206	659	222	0.14

The continuity along strike and down dip of the sulphide hosted base metals is strongly supported by the geological model and the vanadium resource estimation model, but does not yet have the sample support in the fresh material of other fault blocks to allow further classification of mineral resources. The Company intends to conduct further exploration to increase and improve the definition of the base metal resource at Gabanintha.

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Summary of Resource Estimate and Reporting Criteria

As per ASX Listing Rule 5.8 and the 2012 JORC reporting guidelines, a summary of material information used to estimate the Mineral Resource is detailed below, (for more detail please refer to Table 1, Sections 1 to 3 included below in Appendix 2).

Geology and geological interpretation

The Gabanintha deposit, located 40km south of the town of Meekatharra in Western Australia, is a layered intrusive body smaller than, but displaying similar characteristics to, the Igneous Bushveld Complex in South Africa. Some of the world’s most significant platinum, vanadium and chromite deposits are hosted by the Bushveld Complex.

The deposit is also similar to the Windimurra vanadium deposit and the Barrambie vanadium-titanium deposit located 260km south and 150km southeast of Gabanintha respectively. The mineral deposit consists of a basal massive magnetite zone (10m - 15m in drilled thickness), overlain by up to five magnetite banded gabbro units between 5m and 30m thick, separated by thin, very low grade mineralisation (<0.3% V2O5) waste zones. The sequence is overlain in places by a lateritic domain, a transported domain (occasionally mineralised) and a thin barren surface cover domain.

Eight mineralised domains were defined during the logging, interpretation and statistical modelling process which were composed of:

One high grade domain (split on oxide, transition and fresh boundary).
Four low grade domains (split on oxide, transition and fresh boundary).
One laterite domain, and
Two transported domains.

The north-northwest striking deposit is affected by a number of regional scale faults which offset the entire deposit (See Figure 1 – location diagram), breaking the deposit into a series of kilometre scale blocks. The larger blocks show relatively little signs of internal deformation, with strong consistency in the layering being visible in drilling and over long distances between drillholes (see sections in Figures 2-4). The total magnetic intensity geophysical image shows clearly the trace of the high grade massive magnetite zone, as well as the location of the faults. This image was used to guide the modelling of the mineralized domain layers and define the faults blocks which form the boundaries of the extrapolated domains (Figure 5).

Gabanintha differs from both the Barrambie and Windimurra deposits by the consistent presence along strike of the 10-15m thick basal massive magnetite zone and the higher overall grade of the Gabanintha deposit[1] . (Gabanintha 0.77% V2O5 overall[3] , Windimurra 0.48% V2O5 and Barrambie 0.63% V2O5[4] ). The grades observed in drilling allow extremely favourable comparison with other vanadium deposits globally.

3 Details of the current Mineral Resource estimate for Gabanintha are contained in this release. The information that refers to Mineral Resources in this announcement was prepared and first disclosed under the JORC Code 2004. Additional drilling in 2015 was incorporated and modelled into a revised and updated resource estimate to comply with the JORC Code 2012. The Gabanintha Mineral Resource was last revised in September 2017.

4 Details of the Barrambie Deposit from the NeoMetals website www.neometals.com.au, Windimurra Deposit information from the Atlantic Limited website www.atlanticltd.com.au

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The high-grade domain modelling focused on the discrete high-grade layer at the base of the westerly dipping mineralised package as well as defining several continuous low-grade mineralisation units above the main zone. The mineralised zones were modelled using a combination of geological, geochemical and grade parameters, focused on continuity of zones between drill holes on section and between sections.

The average strike of the high-grade domain is approximately 140-150º and generally dip 45º to 65º to the south-west, with the smaller and shallower (transported and lateritic) domains dipping 5º to 10º also to the south-west. Cross sections through the resource model showing drilling and grade interpolation are shown in Figures 2-4.

The high and low-grade domains are split by the base of complete oxidation and the base of partial oxidation, to define oxide, transition and fresh zones.

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Figure 2: Cross Section at Northing 7016120m Showing Drill Intercepts, High-Grade and Low-Grade Domains, Weathering Profiles

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Figure 3: Cross Section at Northing 7015735m Showing Drill Intercepts, High-Grade and Low-Grade Domains, Weathering Profiles.

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Figure 4: Cross Section at Northing 7015975m Showing Drill Intercepts, High-Grade and Low-Grade Domains, Weathering Profiles

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Figure 5: Oblique View Showing, High Grade Domain as broken up by Fault Blocks (labelled with black numbers to left of deposit) in relation to Total Magnetics. Drilling indicated by black points

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Figure 6: Collage image of Fault Blocks 17, 20 and 22 (left to right) showing a long section view of the Gabanintha deposit. The image shows the resource block model High Grade Massive Magnetite zone coloured by various parameters. The area selected is the location of the current Measured and Indicated Mineral Resources and the likely location of an open cut pit. The location of the Inferred Base Metal Resource (hosted in sulphide minerals) is shown in white outline on the relevant elements. The view is looking west, obliquely to the footwall of the deposit which trends southwest to northeast. North is to the right in all diagrams

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Drilling techniques and hole spacing

Diamond drill holes account for 12% of the drill metres comprising HQ and PQ3 sized core. RC drilling (generally 135 mm to 140 mm face-sampling hammer) accounts for the remaining 88% of the drilled metres. Three of the diamond holes have RC pre-collars (GDH911, GDH913, GDH916), otherwise all holes are drilled from surface. The higher density drilled areas of the deposit have approximately 80m to 100m spacing by northing and 25m to 30m spacing by easting. Outside the main area of relatively close spaced drilling (approximately 7015400mN to 7016600mN), the drillhole spacing increases to several hundred metres in the northing direction but maintains roughly the same easting separation as the better drilled area.

Sampling and sub-sampling techniques

Diamond core was quarter-core sampled at regular intervals (usually one metre) and constrained to geological boundaries where appropriate. Most of the RC drilling was sampled at one metre intervals, apart from the very earliest programme in 1998. Diamond core was drilled predominantly at HQ size for the earlier drilling (2009), with the 2015 drilling at PQ3 size.

RC drilling samples were collected at one metre intervals and passed through a cone splitter to obtain a nominal 2-5kg sample at an approximate 10% split ratio. These split samples were collected in prenumbered calico sample bags. The sample was dried, crushed and pulverised to produce a sub sample (~200g) for laboratory analysis using XRF and total LOI by thermo-gravimetric analysis.

Field duplicates, standards and blanks have been inserted into the sampling stream at a rate of nominally 1:25 for blanks, 1:11 for standards (including internal laboratory), 1:10 for field duplicates, 1:9 for laboratory checks and 1:74 for umpire assays.

Sample analysis method

All samples for Gabanintha were assayed for the full iron ore suite by XRF (24 elements) and for total LOI by thermo-gravimetric technique. The method used is designed to measure the total amount of each element in the sample.

Although the laboratories changed over time for different drilling programmes, the laboratory procedures all appear to be in line with industry standards and appropriate for iron ore deposits, and the commercial laboratories have been industry recognized and certified.

Samples are dried at 105[o] C in gas fired ovens for 18-24 hours before RC samples being split 50:50. One portion is retained for future testing, while the other is then crushed and pulverised. Sub-samples are collected to produce a 66g sample that is used to produce a fused bead for XRF based analysing and reporting.

Further SATMAGAN analysis was conducted on 461 archive pulp samples from 2015 RC drilling, at Bureau Veritas laboratory in early 2018, to further characterize the weathering profile. SATMAGAN measures the amount of iron present as magnetic species, such as magnetite, maghemite and kenomagnetite. The amount of iron present as magnetite or other magnetic species is directly proportional to the degree of rock freshness.

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Cut-off grades

The high-grade domain wireframe is defined by a nominal 1.0% V2O5 grade cut-off, with occasional intervals between 0.7% and 1.0% selected to ensure domain continuity. The wireframes for the lowgrade domains are based on a nominal 0.4% V2O5 grade cut-off and comprised of eight sub-domains. A similar approach is used as in the high-grade domain regarding selection of samples for sub-domain continuity, with samples below 0.4% V2O5 being occasionally selected within the domain. Everything encapsulated within the defined wireframes is reported in the resource tables.

Estimation methodology

Trepanier completed ordinary kriged estimates for V2O5, TiO2, Fe2O3, SiO2, Al2O3, Cr2O3, Co, Cu, Ni, S and loss on ignition (LOI) using Surpac™ software. Potential top-cuts were checked by completing an outlier analysis, but in this instance, no top-cutting was required. Variograms were completed for the estimated variables in the high-grade domain and the combined low-grade sub-domains. Grade estimates are keyed on the combined fault block and domain codes for the high-grade domain and the combined low-grade sub-domains. Domains 6, 7 and 8 were interpreted to be shallow, flat lying alluvial material and are estimated separately. Grade is estimated into parent cells with dimensions of 40 mN, 10 mE and 5 mRL with sub-celling allowed to ensure accurate volume representation of the wireframed mineralisation interpretation. All sub-cells are assigned the same grade as its parent.

The current estimate uses only bulk density measurements which include an additional 231 bulk density samples from the diamond core as determined by the Archimedes method. A total 313 bulk density measurements were used to calculate average densities. Samples were subdivided according to their position in relation to the ore zones and the oxidation surface. Correlation charts were created for each element, with a very strong positive correlation defined for bulk density and Fe2O3 content. From this analysis a regression was assigned based on the Fe2O3 grade of each block dependent on oxide code.

Classification Criteria

The estimate is classified according to the guidelines of the 2012 JORC Code as Measured, Indicated and Inferred Mineral Resource. The classification has taken into account the relative confidence in tonnage and grade estimations, the reliability of the input data, the Competent Person’s confidence in the continuity of geology and grade values and the quality, quantity and distribution of the drillhole and supporting input data.

In applying the classification, Measured Mineral Resource has generally been restricted to the oxide, transition and fresh portion of the high-grade domain where the drillhole line spacing is less than 80 mN to 100 mN. Indicated Mineral Resource is generally restricted to the oxide, transition and fresh high-grade and low-grade in the same area of relatively closely-spaced drilling. The remainder of the modelled zones to the north and south of the Measured and Indicated Resource with supporting drilling, mapping and geophysical data have been classified as Inferred Mineral Resource. The classification applied relates to the global estimate of V2O5 and at the reported cut-off grades only. At different V2O5 grade cut-offs, the applied classification scheme may not be valid.

Mining and metallurgical methods and parameters

Optimisation studies have commenced as part of the pre-feasibility study that is currently under way. They indicate open pit mining would be an appropriate mode of extraction through the fault blocks that have Indicated and Measured resources defined.

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Metallurgical testwork has identified four main types of mineralised high-grade material for processing, defined as oxide, transition, fresh and fresh with high sulphur. Metallurgical testwork (see ASX Releases; 20 February 2018, 24 April 2018), has demonstrated the basal high grade massive magnetite zone can be concentrated through levels of magnetic separation processes (oxide, transition and fresh) achieving varying degrees of recovery of vanadium and removing silica and alumina from the feed. The concentrates achieved are considered suitable for processing via industry standard roastleach processes to be confirmed by subsequent test work.

Potential recovery of base metals

The non-magnetic material separated from the fresh magnetite feed contain significant base metals in the silicate phase of the layered mafic intrusion. The Company has successfully extracted sulphide concentrate containing up to 6.3% base metals (cobalt, nickel and copper) from the non-magnetic tail produced when preparing the magnetic vanadium concentrate (See ASX announcement 22 May 2018). The sulphides are preferentially located in the interstitial silicate minerals of the magnetite rich layers.

The Company carried out metallurgical testwork on three high-vanadium grade magnetite samples for the recovery of both a magnetic concentrate and a sulphide concentrate. Sample 2 Fresh (Fr) (25kg) and sample 7 Fresh (Fr) (25kg) and a bulk-composite (90kg containing equal parts of fresh samples 1, 3, 4, 5, 6, 7, 8, 9 10) were used in the evaluation.

Each sample was ground to P80 106 µm and underwent wet magnetic separation using a low intensity (1500 Gauss) magnetic separation drum. The non-magnetic stream was dried, sub-split and provided feed for bench-scale sulphide flotation testwork.

Table 6 compares magnetic separation and flotation test data for the three samples. The flotation concentrate chemistry presented represents analysis of the first rougher or cleaner concentrate in open circuit testwork and so provides an indication of the potential chemistry of a sulphide concentrate.

A summary of the key findings from the sulphide recovery testwork are outlined below;

The flotation results demonstrate the potential to generate a sulphide concentrate containing 4 to 6% combined colbalt, nickel and copper from massive magnetite material proposed as feed to the Gabanintha vanadium recovery process.
Preliminary mineralogy work indicates the cobalt in the flotation concentrate is hosted in solid solution in pyrite (Co)FeS ₂ and in the cobalt nickel mineral, Siegenite (CoNi ₂ S ₄ ).
There is reasonable potential to further improve the concentrate quality in the samples tested as with other fresh massive iron mineralisation with high cobalt grade in the non-magnetic fraction.

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Table 6: Sulphide recovery testwork - magnetic separation and flotation test data

	Fresh Magnetite Sample	Fresh Magnetite Sample	Fresh Magnetite Sample
	Sample 2	Sample 7	Bulk Composite
Feed Grades1
V2O5%	1.34	1.23	1.09
S %	0.19	0.23	0.17
Co ppm	240	260	210
Ni ppm	940	1020	740
Cu ppm	230	280	180
Magnetic Stream V2O5Grade (%)	1.44	1.37	1.36
Non Magnetic Stream Mass Recovery (%)	10.2	12.5	25.7
Non Magnetic Stream Grades1(%)
S %	1.63	1.58	0.68
Co %	0.13	0.13	0.05
Ni %	0.18	0.21	0.09
Cu %	0.07	0.10	0.04
Flotation test reference	2 Fr 4113/2	7 Fr 4113/3	BC 4113/2
Flotation Concentrate1Grades (%)
S %	26.5	31.0	31.5
Co %	1.71	2.02	1.54
Ni %	1.61	2.58	1.36
Cu %	0.82	1.70	0.94
Total Base Metals in Cleaner Concentrate1(%)	4.14	6.30	3.84

1 Feed and non-magnetic stream grades are calculated based on measurements of the downstream product streams

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High Grade Magnetite Oxide Recovery Test Work

The updated resource estimate includes a classification of oxide material. This material consists of rocks in which the magnetite has variably been oxidized to hematite and maghemite. No loss of the vanadium content has occurred during weathering.

Due to its less magnetic nature, the response to low intensity magnetic separation (LIMS) is lower and further higher intensity magnetic techniques are required to separate the vanadium bearing iron minerals. A summary of preliminary benchscale testwork results on five oxide samples (average calculated head grade of 1.23% V2O5) is outlined below and presented graphically within Figure 7.

Highlights of Magnetic Tests on Oxide Samples

a weighted average concentrate grade of 1.38% V2O5, 52.7% Fe, 15.2% TiO2, 3.28% Al2O3 and 1.70% SiO2.
an average mass yield of 37.5%.
a weighted vanadium recovery of 45.3%.
concentrate grades of up to 1.47% V2O5 (Sample 23) and 1.40% V2O5 (Sample 20 and 21).
the specific gravity of the magnetic concentrate generated from Sample 24 was measured at 4.05.

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Figure 7 V2O5 recovery and concentrate grade for magnetic separation tests on oxide high grade metallurgical samples

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Competent Person’s Statement

The information in this report that relates to Exploration Results and Exploration Targets is based on and fairly represents information and supporting documentation prepared by Mr Brian Davis (Consultant with Geologica Pty Ltd). Mr Davis is a shareholder of Australian Vanadium Limited. Mr Davis is a member of the Australasian Institute of Mining and Metallurgy and has sufficient experience of relevance to the styles of mineralisation and types of deposits under consideration, and to the activities undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Specifically, Mr Davis consents to the inclusion in this report of the matters based on his information in the form and context in which they appear.

The information in this report that relates to Mineral Resources is based on and fairly represents information compiled by Mr Lauritz Barnes, (Consultant with Trepanier Pty Ltd) and Mr Brian Davis (Consultant with Geologica Pty Ltd). Mr Davis is a shareholder of Australian Vanadium Limited. Mr Barnes and Mr Davis are members of the Australasian Institute of Mining and Metallurgy and have sufficient experience of relevance to the styles of mineralisation and types of deposits under consideration, and to the activities undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Specifically, Mr Barnes is the Competent Person for the estimation and Mr Davis is the Competent Person for the database, geological model and site visits. Mr Barnes and Mr Davis consent to the inclusion in this report of the matters based on their information in the form and context in which they appear.

Competent Person Statement – Metallurgical Results

The information in this statement that relates to Metallurgical Results is based on information compiled by independent consulting metallurgist Brian McNab (CP. B.Sc Extractive Metallurgy), Mr McNab is a Member of The Australasian Institute of Mining and Metallurgy. Brian McNab is employed by Wood Mining and Metals. Mr McNab has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which is undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.

Mr McNab consents to the inclusion in the report of the matters based on the information made available to him, in the form and context in which it appears.

Details of the current Mineral Resource estimate for Gabanintha are contained in this release. The information that refers to Mineral Resources in this statement was prepared and first disclosed under the JORC Code 2004. Additional drilling in 2015 was incorporated and modelled into a revised and updated resource estimate to comply with the JORC Code 2012. The Gabanintha Mineral Resource was last revised under the JORC Code 2012 on 5th September 2017 by independent consultants Trepanier Pty Ltd and is compared in this ASX announcement in Table 3. Additional data, particularly metallurgical, sulphide and base metal assays as well as revised interpretations of lithological, weathering profile and density data have now been incorporated and modelled into a revised and updated mineral resource estimate.

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Vanadium Market Developments

Demand for Vanadium for use in steel products and more recently use in vanadium redox flow battery technology is undergoing a rapid rise at the present time. This has led to a significant price increase from all-time lows in 2015 to ten-year high pricing at the time of writing. This increase beyond the long-term average prices is currently being driven by a number of factors:

Long term supply disruption (particularly South African) after long low price and demand periods;
Changes to usage of vanadium in China rebar;
Limited or slow new mine production, and
Chinese smelter environmental shutdowns.

AVL, as a potential vanadium producer, recognises the importance of the steel markets, but is also actively seeking to link the use of its products to the rise of this globally significant use of vanadium battery technology.

AVL recently signed an MOU with a Chinese producer and developer of Vanadium Carbo-Nitride (VCN) products, a rapidly growing industry in China focused on the consumption of vanadium for inclusion into rebar steel. Recent changes to official requirements in the increased use of vanadium micro-alloyed steel are driving a new market for VCN

AVL has continued to advance its opportunities in the VRFB market by forming relationships with key players. The Company has formed a battery focused subsidiary, VSUN Energy Pty Ltd, which is developing the VRFB market in Australia. Opportunities focus on a range of sectors including residential, businesses, off grid opportunities, utilities, agriculture and electric vehicle charging stations.

The rapid acceleration in the development of renewable energy projects on a global scale is being accompanied by rapidly growing interest and need for grid and off-grid storage technologies. The uptake of VRFB technology along with other storage technologies could have a significant effect on the vanadium market, as the use of V2O5 electrolyte is a large component (up to 50% of current cost) of the battery units. Research is also being undertaken into the use of vanadium, with its unique ability to transfer electricity without conducting heat, in other battery types such as lithium.

The unique characteristics of VRFBs, specifically their scalability, long lifespan cycles and the use of one battery element, make them a strong candidate to earn up to 30% of the growing energy storage market, which is expected to grow from a current 0.4GW to 40GW in just the next 7 years.

For further information, please contact:

Vincent Algar, Managing Director +61 8 9321 5594

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APPENDIX 1

Mineral Resource Table. Classification by Interpretation of Oxidation State.

Table 1 Gabanintha Project – Mineral Resource estimate by oxidation profile and resource classification using a nominal 0.4% V2O5 wireframed cut-off for low grade and nominal 0.7% V2O5 wireframed cut-off for high grade (total numbers may not add up due to rounding)

Zone	Classification	Mt	V2O5 %	Fe %	TiO2 %	SiO2 %	Al2O3 %	LOI %
Oxide	Measured	2.5	1.11	41.3	12.9	10.6	9.1	4.7
	Indicated	5.7	0.53	23.8	7.3	26.8	18.5	9.8
	Inferred	18.4	0.66	30.8	8.1	22.4	14.5	7.3
	Sub-total	26.7	0.67	30.3	8.4	22.3	14.9	7.6

Transition	Measured	3.7	1.09	41.8	12.6	11.1	8.5	4.2
	Indicated	8.3	0.54	25.0	7.2	27.1	17.5	8.5
	Inferred	23.8	0.71	33.2	8.8	20.4	12.6	6.0
	Sub-total	35.8	0.71	32.2	8.8	21.0	13.3	6.4

Fresh	Measured	4.0	1.12	44.4	12.5	9.5	7.0	3.3
	Indicated	9.9	0.76	32.7	9.2	20.2	13.3	5.8
	Inferred	99.1	0.80	36.2	9.6	17.3	10.7	4.6
	Sub-total	113.0	0.81	36.2	9.6	17.3	10.8	4.7

Total	Measured	10.1	1.11	42.7	12.6	10.3	8.0	4.0
	Indicated	24.0	0.63	27.9	8.0	24.2	16.0	7.7
	Inferred	141.4	0.77	35.0	9.2	18.5	11.5	5.2
	Total	175.5	0.77	34.5	9.3	18.8	11.9	5.5

Table 2.Gabanintha Project – High Grade Massive Magnetite zone (Model Zone 10 only) Mineral Resource estimate by oxidation profile and resource classification using nominal 0.7% V2O5 wireframed cut-off for high grade (total numbers may not add up due to rounding)

Zone	Classification	Mt	V2O5 %	Fe %	TiO2 %	SiO2 %	Al2O3 %	LOI %
Oxide	Measured	2.5	1.11	41.3	12.9	10.6	9.1	4.7
	Indicated	0.3	1.10	43.1	12.2	10.7	7.6	4.3
	Inferred	5.4	0.98	41.4	11.4	12.3	8.4	4.0
	Sub-total	8.2	1.02	41.5	11.8	11.8	8.6	4.2

Transition	Measured	3.7	1.09	41.8	12.6	11.1	8.5	4.2
	Indicated	0.5	1.09	42.2	12.4	10.9	8.8	4.7
	Inferred	10.7	0.99	42.4	11.4	11.6	7.7	3.6
	Sub-total	14.8	1.02	42.2	11.7	11.4	7.9	3.8

Fresh	Measured	4.0	1.12	44.4	12.5	9.5	7.0	3.3
	Indicated	4.2	1.08	43.4	12.1	10.4	7.7	3.5
	Inferred	62.4	0.98	42.5	11.2	11.3	7.5	3.3
	Sub-total	70.6	0.99	42.7	11.3	11.2	7.5	3.3

Total	Measured	10.1	1.11	42.7	12.6	10.3	8.0	4.0
	Indicated	4.9	1.09	43.3	12.1	10.5	7.8	3.7
	Inferred	78.6	0.98	42.4	11.2	11.4	7.6	3.4
	Total	93.6	1.00	42.5	11.4	11.3	7.6	3.5

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