MAGONTEC LIMITED — Capital/Financing Update 2021

Mar 17, 2021

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18 March 2021 Company Announcements Office Australian Securities Exchange Limited 20 Bridge Street, Sydney NSW 2000

Magontec Limited Suite 1.03, Level 1 46A Macleay St Potts Point NSW 2011 Australia Ph: +61 2 8084 7813

Dear Sir/Madam

Qinghai Salt Lake Magnesium (QSLM) QSLM Production, Restructuring and Refinancing Plans

QSLM, the owner and operator of the electrolytic magnesium facility at Golmud in Qinghai province, have notified Magontec that planning has commenced in preparation for the recommencement of production from 1 of the 6 dehydration lines at the Qinghai magnesium facility.

We understand that new funds have been made available to commence this activity, although no detailed schedule for its performance has been provided at this time.

The financial and corporate re-structure of QSLM remains unresolved. However, as noted in the Magontec Annual Report released on 26[th] February, we understand that there are a limited number of companies seeking approval from the Qinghai provincial and Chinese national authorities to invest in QSLM and that one of these candidates is likely to be confirmed in the near future.

At the recently concluded National Party Conference in Beijing, the President of China, Xi Jinping, met with Qinghai party officials to discuss, among other issues, the development of the Qinghai Salt Lake project. The President was quoted as saying that he “encouraged Qinghai to intensify efforts to build a world-class Salt Lake industrial base and foster an economic system featuring green, low-carbon and circular development.”

We will keep shareholders informed of developments.

Yours sincerely,

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Nicholas Andrews Executive Chairman Magontec Limited

Nicholas Andrews, Executive Chairman of Magontec Limited has authorised the release of this document to the market on 18 March 2021