QUANTUM GRAPHITE LIMITED — Regulatory Filings 2014

Jan 2, 2014

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VALENCE INDUSTRIES LIMITED

60 Hindmarsh Square, Ground Floor Adelaide South Australia 5000 AUSTRALIA

17 December 2013

Mr Nathan Bartrop Senior Adviser Listings Compliance ASX Compliance Pty Ltd 20 Bridge Street SYDNEY NSW 2000

By email Nathan.Bartrop@asx.com.au

Dear Sir

Applications for Renewal of Retention Licence 66 and Retention Licence 67

We refer to the criteria for listing of Valence Industries Limited and the request for a statement regarding the status of the retention licences held by the company. Currently Valence Industries Limited holds two retention licences through its wholly owned subsidiary Strategic Energy Graphite Pty Ltd. Those retention licences are designated and registered as Retention Licence 66 and Retention Licence 67.

The Company made application in 2011 for the renewal of both Retention Licence 66 and Retention Licence 67. A response on the status of the request for renewal was not received by the Company until September 2013.

The Company has discussed the process of renewal with the Department and has been advised that the applications to renew the Retention Licences are being processed subject to the submission of some additional detail on the program of work to be scheduled for the areas the subject of the Retention Licences.

The Company has now worked closely with the Department on the content of the additional detail sought by the Department and the Company anticipates that it will receive the renewals of each of the Retention Licences during January 2014 after the Department personnel return from the Christmas break.

Yours sincerely,

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Christopher S. Darby Managing Director & CEO Valence Industries Ltd.

www.valenceindustries.com

ASIA PACIFIC I NORTH AMERICA I EUROPE

ABN 41 008 101 979