AUSTRALIAN VANADIUM LIMITED — Capital/Financing Update 2016

Apr 12, 2016

13 April 2016

==> picture [92 x 76] intentionally omitted <==

ASX Market Announcements ASX Limited 20 Bridge Street Sydney NSW 2000

Notice of Shortfall

Australian Vanadium Limited (“the Company”) advises that the pro-rata non-renounceable entitlement issue pursuant to the Prospectus dated 9 March 2016, closed on 8 April 2016 ( Entitlement Issue or Offer ).

The Entitlement Issue offered, to eligible shareholders, one (1) new share for every three (3) shares held on the record date, at an issue price of $0.013 per new share. Each new share will receive one free attaching option exercisable at $0.02 on or before 31 December 2018.

Shares validly applied for pursuant to the Prospectus and the number of shortfall shares is summarised below:

	Number	Subscriptionamount at $0.013per share
Total Shares offered to eligibleshareholders	255,412,164	$3,320,358.13
Shares validly applied for under theProspectus	131,104,656	$1,704,360.54
Shortfall	124,307,508	$1,615,997.59

The Directors are pleased with the level of take-up in the current market environment and, in accordance with the ASX Listing Rules, may place the Shortfall on the same terms as the new shares offered pursuant to the Prospectus within 3 months of the closing date.

In accordance with ASX Listing Rule 6.22.2, the Company advises that the exercise price of unlisted options exercisable at $0.015 each and exercisable on or before 31 December 2015 will be adjusted to $0.014712 (1.4712 cents).

Yours faithfully

Neville Bassett Company Secretary

==> picture [539 x 53] intentionally omitted <==