ALTECH BATTERIES LTD — Capital/Financing Update 2014

Sep 10, 2014

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11 Septemb e r 2014

FOCUS ON HPA PRODUCTION FOLLOWING TECHNICAL REVIEW

Highlights

• A M MG focusin g on becomin g a producer o f High Purity A lumina (HP A )

• C o mpleted technical review of optimisation testwork and integrated pl a nt study

• R e affirmed technical viability o f producing H PA product f rom low-impurity aluminou s clay deposit

• Pr o ven, robust a cid leach process suited t o producing H P A

• G r owing global d emand for HPA for LEDs, semiconduct o rs, phosphor and industria l applications

Australia Mi n erals and Mining Group L imited (ASX: AKA) (“AMMG”, “Company”) is please d to announc e it has a clear strategy an d focus on b ecoming a h igh purity alumina (HPA ) producer. In his first m ajor undert a king since h is appointment as Managing Director last m onth, Mr Ig g y Tan, a highly experience d mining exe c utive and ch e mical engine e r, has conduct e d a technic a l review of t h e previous A MMG testwork, proposed process flow design and integrated pl a nt study to rea f firm the tech n ical viability o f producing H PA from th e Company’s s ubstantial al u minous clay resources near Meckering, W estern Austr a lia.

HPA Production Strategy

The review c oncluded tha t most curren t HPA produc e rs are using an expensiv e and highly p r ocessed fee d stock mater i al such as alu m inum metal t o produce 99.99% HPA qu a lity product. AMMG are one of only tw o companies in the world t h at publicly report that they c a n produce 99.99% HPA pr o duct directly from an ore f e ed stock, su c h as aluminous clay. (Figure 1).

Figure 1 – AMMG HPA Process Vs Traditional HPA Production

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Australian Minerals and Mining Group Limited 3 Bay Road AB N 45 125 301 20 6 Claremont, West e rn Australia 601 0 Australia

Telephon e : +61 8 9389 5557 Facsimile: +61 8 9389 5510 Website: www.ammg.c o m.au

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The main ad v antage of th i s strategy is t hat AMMG a r e utilizing an abundant, lo w -cost alumin o us clay ore feedstock whi c h has already been purified and process e d by natural weathering processes over many millio n s of years. As a result, t h e direct ore fe e d contains v e ry low levels of impurities including iron, titanium, so d ium, calcium , potassium and magnesiu m . The main im p urity is insol u ble silica whi c h can be ea s ily filtered ou t during the processing, lea v ing the solu b le alumina.

By contrast, bauxite ore used to pro d uce alumina and alumin u m metal contains around 22% iron c o mpared to t h e aluminous c l ay feed stoc k at Meckeri n g, which co n tains 0.7% i r on impurities (See Table 1). The rec e ntly complet e d Integrated S t udy OPEX and CAPEX fi g ures has de m onstrated t h at this relati v ely pure ore feedstock su p ports AMM G 's business ca s e to produce a high value, high margin product at significantly lo w er operating and capital c osts than other global HPA c ompetitors.

Table 1 – Typical Analysis of Ore Feed Stock

		Bauxite Darling Rang (Typical)* e	Ca Pro nadian HPA ject (Typical)	Ca Pro nadian HPA ject (Typical)	AMMG Clay ** Aluminous (typical)
	Al2O3 (% )	34.5		22.77	3 0.5
	SiO2 (% )	21.5		53.29	5 6.3
	Fe2O3 (% )	21.2		8.36	0.7
	TiO2(% )	2.00		0.98	0.7
	K2O (% )	0.24		3.41	0.2
	CaO (% )	0.015		0.65	0.1
	NaO (% )	0.005		1.42	0.1
	MgO (% )	0.01		1.67	0.1
	LOI(%)	18.1		-	-

Geochemical and min e ralogical characte r istics of bauxites, D arling Range, W e stern Australia, Applied Geochemistr y ** H P* A Plant Feed

Processing Technology

The HPA pr o cess to be e mployed is a hydrochloric acid leach ( H CL) process with gas ind u ced crystalli z ation and a c id recovery. T h e main adv a ntage of this technology i s the simple r e covery of acid, which is r e used at the f ront end of t h e process, the r eby reducing operating costs. The HCL process is a conventional, proven and r obust chemi c al process that has been ar o und since th e early 1980’s .

The HCL pr o cess works particularly w ell with AM M G’s aluminous clay deposits at Meck e ring due to the unique l o w impurity alu m inous clays, which allow the Compan y to produce a very pure alumina pro d uct. HPA is able to attr a ct premium pri c es in a growing global ma r ket, driven b y the massiv e growth in th e use of LED s , semicondu c tors, phosph o r, industrial ap p lications as w ell as sapphi r e glass in m o bile phones a nd portable t a blet devices.

HCL Process Technology – The Right Time

As mentioned previously, the HCL pro c ess employe d by AMMG i s well establi s hed technolo g y developed since the ea r ly 1980’s. In t h e 1980’s, d e mand for HPA (>99.99%) was negligib l e compared t o today, so t he processin g technology to produce HP A never adva n ced to comm e rcial scale p r oduction.

Today HPA is used for synthetic sa p phire glass p roduction u s ed in LEDs, the latest g eneration of smart phon e s, semiconductors, plasma screens, lithiu m batteries and optical devi c es. Sapphir e glass has a number of physical attribut e s that make it s uitable for a w ide range of end markets including its h ardness and resistance to physical da m age, scratchi n g and chemical erosion.

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In just the s m art phone s e ctor, compa n ies like Appl e and Huwei h ave announ c ed their inte n tion to use sapphire scrat c resistant gla s s (made fro m HPA) for their next gen e rations of smartphones. A p ple’s $578 m illion invest m ent in sapphi glass technology compan y GTAT, sugg e sts that Apple is committe d to using sa p phire in all it s future iPhon e s.

Sales of S m artphones gl o bally are estimated to e x ceed 1 billion annually b y 2016. Similarly, the $1 3 B annual li g ht emitting dio d e (LED) mar k et continues to grow with more lighting, display, sig n s, TVs and m otor vehicle s moving to t h e much energ y efficient LEDs, and is forecast to ke e p growing at >60% annu a lly from 201 3 to 2015, le a ding to rob u st growth in de m and for HP A .

The Global H igh-purity Al u mina market was valued a t 19,040 tonn e s in 2014 an d is expected to increase t o 48,230 tonn e by 2018, gro w ing at a CA G R of 27.89 % according to Technavio Research[1] .

Prices for HPA

As a result of the demand from the ele c tronics and t e chnology industries for ve r y pure produ c t, the price o f the high pur i ty alumina is also exponential with incre a sing product purity (See F igure 3). The cost to ac h ieve the hig h purity alumi n a product req u ires extensiv e processing, quality contr o l and techn o logy to achi e ve these ver y tight specifi c ations. AM M G believes tha t because th e ir process ta k es it straigh t from a very pure ore to s tart with, the processing c osts should b e much cheap e r.

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Figure 3 – Typical Product Prices Range
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Right Place, Right Time, Right Feedstock, Right Technology

Mr Tan said, “We have a r obust and pr o ven processi n g technolog y with enormous potential f o r producing H PA. Our foc u s is on movin g away from m inerals expl o ration to bec o ming an HP A producer. We are in th e right place a t the right ti m e with the righ t feedstock a n d the right te c hnology.”

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Ref 1 Technavi o Global High P u rity Alumina Ma r ket 2014-2018.

For m ore information, please contact:

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Corporate Media Contact Iggy Tan Tony Da w e Man a ging Director Consulta n t Australia Minerals & M ining Group Li m ited PPR Tel (office): +61 8 93 8 9 5557 Tel (offic e ): +61 8 9388 0 9 44 Em a il: info@ammg.c o m.au Email: to n y.dawe@ppr.co m .au

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About AMMG (ASX: AKA)

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AMMG is aimi n g to become th e world’s leadin g supplier of hig h purity alumina (HPA) (99.99% A l2O3) which is the m a jor source material for scratch-r e sistant Sapphir e glass, used in the next genera t ion of iPhones and p o rtable tablet de v ices. HPA is a lso used in the production of LED’s, lighting d e vices, abrasives, ceramics and a gro w ing range of in d ustrial and tec h nological proce s ses. The global HPA market is approximately 25,000tpa and is expected to double ov e r the coming de c ade.

Current HPA p r oducers are usi n g an expensive and highly proc e ssed feed stoc k material such a s aluminum me t al to produce H P A quality product. AMMG are one of only two co m panies in the w o rld that can pro d uce 99.99% H P A product direc t ly from an ore f e ed stock, such as aluminous cl a y. AMMG has util i zed well establi s hed chemical processing techn o logy to extract HPA from its 1 0 0%-owned, low impurity alumin o us clay deposit at Meckering, in W estern Australia.

The Company h as produced t e st quantities of 9 9.99% HPA pr o duct and is no w advancing a Bankable Feasibi l ity Study to de v elop a commer c ial production facil i ty. AMMG is a chemical proce s sing company using proven tec h nology and pro c esses to create a high margin p roduct to meet the growing global d emand for the n ext generation of electronics, tel e communication and industrial pr o ducts.

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Forward-looking Statements

This announceme n t contains forward-looking statement s which are identifi e d by words such as ‘anticipates’, ‘fo r ecasts’, ‘may’, ‘wil l ’, ‘could’, ‘believes’, ‘estimates’, ‘targ e ts’, ‘expects’, ‘plan’ or ‘intends’ and othe r similar words that involve risks and u ncertainties. Indic a tions of, and guidelines or outlook on , future earnings, d i stributions or finan c ial position or perfor m ance and targets, e stimates and assu m ptions in respect o f production, price s , operating costs, results, capital expe n ditures, reserves a nd resources are a lso forward looking st a tements. These statements are base d on an assessme n t of present econ o mic and operating conditions, and on a number of assu m ptions and estimates regarding future e v ents and actions t h at, while considered reasonable as at the date of this an n ouncement and ar e expected to take place, are inherently subject to signific a nt technical, busines s , economic, comp e titive, political and s ocial uncertainties and contingencies. Such forward-looking statements are n ot guarantees of f u ture performance a nd involve known and unknown risks, un c ertainties, assumpt i ons and other imp o rtant factors, many of which are beyon d the control of our C ompany, the Directors and managem e nt. We cannot and do not give any assur a nce that the result s , performance or a c hievements expressed or implied by the forward-looking s t atements containe d in this announcem e nt will actually occur a nd readers are ca u tioned not to place undue reliance on t h ese forward-lookin g statements. Thes e forward looking st a tements are subject to various risk fact o rs that could cause a c tual events or resu l ts to differ materiall y from the events or results estimated, e xpressed or anticip a ted in these statem e nts.

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