AUSTRALIAN VANADIUM LIMITED — Capital/Financing Update 2017

May 24, 2017

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Highlights:

• AVL, VSUN Energy and GENiUX have signed a MOU to develop opportunities for both parties

• GENiUX works with real estate developers to embed clean technology infrastructure.

• Renewable energy storage solutions using VRB technology

25 May 2017

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: info@australianvanadium.com.au

Australian Vanadium Limited (ASX:AVL, “the Company” or AVL”) is pleased to announce that it has signed a Memorandum of Understanding, “MOU” with GENiUX Pty Ltd. GENiUX is an end-to-end real estate clean technology solutions business with a focus on creating sustainability and generating affordability. Part of its business is to work with residential, commercial and hospitality property developers to embed clean technology infrastructures into real estate developments, such as microgrid energy schemes, and generate annuity income streams for investors from that embedded infrastructure. AVL’s 100% owned subsidiary, VSUN Energy Pty Ltd offers solutions for energy storage using vanadium redox flow batteries (VRB).

W: australianvanadium.com.au

Street Address:

Level 1, 85 Havelock Street West Perth WA 6005

Postal Address:

Level 1, 85 Havelock Street West Perth WA 6005

Projects:

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

The agreement will allow for the companies to work together to find projects which will benefit from VRB technology to provide renewable energy for the occupants.

For further information, please contact:

Vincent Algar, Managing Director

+61 8 9321 5594

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About GENiUX Pty Ltd

GENiUX's key objective is to facilitate the improvement of affordability and sustainability in real estate to better the lifestyle of future generations that wish to inhabit the earth in a responsible way. In the process of future proofing real estate, we put people first and listen to their work, relaxation and lifestyle demands. This way, our community becomes the heart of our being.

GENiUX provides real estate design solutions. Through the application of clean technology integration, GENiUX delivers infrastructure to real estate development which reduces both the on-going operating costs of the building as well as the upfront capital required for installation. GENiUX's integrative sustainable solutions build assets across the clean technology categories of energy, transport, water, waste, materials, resources and smart living, for people's benefit and engagement, efficiency and long term care.

https://www.geniux.com.au/

About Australian Vanadium Limited

AVL is a diversified resource company with an integrated strategy with respect to energy storage, seeking to offer investors a unique exposure to all aspects of the vanadium value chain – from resource through to steel and energy storage opportunities as well as other energy storage metals exposure through the acquisition and evaluation of lithium/tantalum projects.

AVL is advancing the development of its 100%-owned, world-class Gabanintha vanadium project. The Gabanintha Vanadium Project is currently one of the highest-grade vanadium projects being advanced globally with existing Measured Resources of 7.0Mt at 1.09% grade V2O5, Indicated Resources of 17.8Mt at 0.68% grade V2O5 and Inferred Resources of 66.7Mt at 0.83% grade V2O5, a total of 91.4Mt, grading 0.82% V2O5 and containing a discrete high-grade zone of 56.8Mt, grading 1.0% V2O5 reported in compliance with the JORC Code 2012 (see YRR ASX Announcement 10 November 2015).

AVL has developed a local production capacity for high-purity vanadium electrolyte, which forms a key component of vanadium redox flow batteries (VRB).

AVL, through its 100%-owned subsidiary VSUN Energy Pty Ltd, is actively marketing VRB in Australia through a distribution agreement with world-leading flow battery manufacturer, GILDEMEISTER Energy Storage GmbH.

As part of its broader energy metals focus, AVL has also commenced a staged acquisition of a controlling 50.03% interest in the Blesberg Lithium-Tantalum Project in South Africa (see ASX Announcement 21 December 2016).

Competent Person Statement – Mineral Resource Estimation

The information relating to the Gabanintha Project 2015 Mineral Resource estimate reported in this announcement is based on information compiled by Mr John Tyrrell. Mr Tyrrell is a Member of The Australian Institute of Mining and Metallurgy (AusIMM) and a full time employee of AMC (AMC Consultants Pty Ltd). Mr Tyrrell has more than 25 years’ experience in the field of Mineral Resource Estimation. He has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and in resource model development 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. Tyrrell 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.

The information is extracted from the report entitled “Substantial high-grade vanadium resource highlights Gabanintha’s world-class potential” released to ASX on 10 November 2015 and is available on the company website at www.australianvanadium.com.au.

The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resource or Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. The company confirms that the form and context in which the competent person’s findings are presented has not been materially modified from the original market announcement.

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