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Metalysis

16th Annual Mineral Sands Conference, Melbourne

March 2016

Dr. Kartik Rao - Director of Business Development

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Disclaimer

This presentation includes certain projections and forward-looking statements provided by the Company with respect to the anticipated future performance of the Company. Such projections and forward-looking statements reflect various assumptions and expectations of management concerning the future performance of the Company, and are subject to significant business, economic, political and competitive uncertainties and contingencies, many of which are beyond the Company’s control. Accordingly, there can be no assurance that such projections and forward-looking statements will be realised. The actual results may vary from the anticipated results, and such variations may be material. Each forward-looking statement or projection speaks only as of the date of that particular statement or projection. The Company, and its directors, officers and employees, make no representation or warranty in relation to whether such projections or forward-looking statements are achieved or realised and accept no responsibility and disclaim all liability in respect of the same.

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• Technology applicable, and practically proven, for a large number of elements across the periodic table

• Initial focus on Titanium and Tantalum, with a strong emphasis on Additive Manufacturing applications

• Small scale industrial production of Tantalum powder, and well-developed plans for installing titanium focused facility.

• Existing partnerships in the aerospace and automotive markets

• Proprietary, low-emission / low-cost process to produce a wide array of metal powders and novel alloys direct from natural and refined oxides (e.g. rutile sands)

• Based on University of Cambridge research, protected by 31 international patents

• Completing the value chain from ore to titanium powder at the lowest ‘all in’ cost

• Monetisation through licensing agreements

• Strategic partnerships to drive licensing pipeline

Multiple addressable

markets

Commercial Progress

Disruptive Technology

Business model

Executive Summary

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Shareholders

www.bhpbilliton.com

www.etf.eu.com

www.sevenspires.co.uk www.chordcapital.co.uk

www.djespirit.com

www.iluka.com https://woodfordfunds.com/

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Simple, Cost-effective, Greener Process

• Electrolytic process: highly efficient, proven and utilised extensively in metallurgy (Al, Mg).

• Relatively low temperature operation and lower energy consumption.

• Inexpensive components for electrolysis , cheap, and readily available: metal oxide cathode, graphite anode and molten salt.

• No toxic gases used: only by-product is CO/CO2.

• Powder feed to powder product: pre-alloyed or direct ore feedstock may be used directly.

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Metalysis spherical titanium powder

automotive turbocharger component

aerospace turbine guide vane SEM cross sectional

microstructure (guide vane)

Additive Manufacturing

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There is significant further value upside (above Titanium and Tantalum) with significant barriers to entry

31 live, published families of patents originally based on the FFC® approach

Patents covers multiple aspects of the process from:

Feedstock and oxide preparation

Reduction parameters

Cell design

Post processing

Bespoke ancillary services

Extensive know-how from c 500 man-years of work

Core patent has been filed in over 50 countries

A suite of next generation patents filed that deliver extended IP protection that goes out to 2032

Wide application across the periodic table

Combined IP now inclusive of portfolios from: -

Whilst focus and effort has initially been concentrated on Tantalum and Titanium – the process is effective on many elements across the periodic table and associated alloys

Polar Process®

EDO Process® FFC Process®

Wide Range of Applications

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Unconstrained Alloying • The vast majority of current alloys are produced by melting of the individual

constituents.

• However constraints such as contrasting melting & boiling points, and density differences can prove challenging.

• It is possible to co-reduce mixed oxides via the Metalysis process to form alloys.

70 Ti-30 Ta (bio-medical) 90 Ti-10 Mo (bio-medical)

Magnesium

Beryllium

Aluminium

Scandium

Titanium

Neodymium

Indium

Gadolinium

Dysprosium

Nickel

Molybdenum

Ruthenium

Rhodium

Hafnium

Tungsten

Rhenium

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New Alloys and New Markets

Combining elements through powder metallurgy to create novel alloys opens up new possibilities for markets and applications

The Metalysis process can be a key enabler for this process

Strength Corrosion

Temperature Modulus

Fatigue Shape Memory

Current

New

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The Technology: Titanium Powders

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R&D FACILITY COMPRISING OF 8 STATIONS & 2 DEVELOPMENT CELLS:

• Investigation of different product streams and pre-form types.

• Trialling of alternative electrode arrangements.

• Assessment of process parameters (time/temperature/current/voltage).

• Utilisation of in-process monitoring techniques.

• Materials of Construction testing and selection.

• Qualification of raw materials and support to quality control functions.

DEDICATED ANALYTICAL LABORATORY:

• Residual impurity analysis – gas fusion (O, N, C, S) & ICP-MS.

• Sample digestion facility (for ICP-MS).

• Electrical testing (capacitance & leakage current – tantalum specific).

• Microscopy suite (SEM) including associated sample preparation.

Technical Development Facilities

R&D CELLROOM

DEVELOPMENT CELLS

ICP-MS INSTRUMENT

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Titanium Product Development

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10

2

01

1

20

12

2

01

3

PIGMENT PRE-FORM PRODUCT

SPONGE

SUBSTITUTE POWDER

SPONGE

SUBSTITUTE

HONEYCOMB HONEYCOMB

PIGMENT PRE-FORM

BEAD

PIGMENT

GRANULE

POWDER

DIRECT ORE POWDER 3D PRINTING POWDER

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Metalysis has been working on developing a new titanium alloy that would enable low cost titanium to become a mass market commodity.

Iluka Resources

• Feedstock development

• Synthetic rutile has been identified as a suitable feedstock

University of Sheffield

• Alloy characterisation

• Downstream consolidation

• Alloy modelling

GKN

• Additive manufacturing trials and alloy characterisation

• Manufacturing envelope

Others

• Testing of two further derivatives, an alpha-beta alloy for general structures

• A beta alloy with a low modulus for spring applications

Ti-alloy Development

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DIRECT ORE POWDER

HIP’ed BILLET

409

430

316

303

2205 (DUPLEX)

2507 (DUPLEX)

RUTILE

ASTM 1

ASTM 2

ASTM 3

ASTM 4

ASTM 5

MIL

0

100

200

300

400

500

600

700

800

900

1000

0 200 400 600 800 1000

ULT

IMA

TE T

ENSI

LE S

TREN

GTH

(M

Pa)

YIELD STRENGTH (MPa)

() stainless steel grades; () titanium grades; () Metalysis rutile – tested to BS EN 2002-1:2005

MIL = MIL-DTL-46077G – Department of Defense, Detail Specification, Armor Plate, Titanium Alloy, Weldable

Metalysis rutile possesses a tensile strength:

• greater than commercially pure grades (ASTM 1 – 4) of titanium

• is equivalent to a weldable armour plate for defence applications

• is ca. 80% that of Ti-6Al-4V (ASTM grade 5) at this stage

Metal Powder Directly From Ores

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powder morphology microstructure from cell

microstructure post SPS microstructure post SPS microstructure post SPS

2 wt% Al addition 5 wt% Mo addition

Metal Powder Directly From Ores

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pigment derived titanium powder

rutile derived titanium powder

The relationship between the titanium product and the feed holds for a range of particle size diameters and feedstock types.

() pigment TiO2; () natural rutile; () synthetic rutile

PROPERTY PIGMENT RUTILE

Oxygen (wt%) 0.2 – 0.4 0.15 – 0.4

Apparent Density (g/cm3) 2.71 2.76

Tap Density (g/cm3) 2.92 2.95

Hall Flow (sec) 23 22

Spherical Titanium Powder

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Metalysis spherical titanium powder

automotive turbocharger component

aerospace turbine guide vane

SEM cross sectional microstructure (guide vane)

Additive Manufacturing

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Uses of Powder

0 20 40 60 80 100 120 140 160 180 200 220 240 260

particle diameter (mm)

MIM

GDCS

SLM

EBM

LMD

CIP

HIP

Hot Isostatic

Pressing

Cold Isostatic Pressing

Laser Metal Deposition

Electron Beam Melting (Arcam)

Cold Spray

Selective Laser

Melting

Metal Injection Moulding

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STRATEGY & MARKETS

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Initial Focus on Two Core Products • Metalysis has chosen to focus initially on two metals, tantalum and titanium

• Tantalum is the initial entry market as it is specialist, low volume and high margin

• High value metal - annual volumes of 2,000 tonnes

• Mainly produced by the Hunter process

• Substantial margin opportunities – a viable business in its own right

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Initial Focus on Two Core Products • Metalysis has chosen to focus initially on two metals, tantalum and titanium

• Tantalum is the initial entry market as it is specialist, low volume and high margin

• High value metal

• All titanium is produced by the Kroll process

• Current market size is constrained by the cost of the metal, poised to expand rapidly if the cost can be lowered

• A significant value opportunity

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Titanium Processing Costs

Titanium ore

TiO2 pigment

Metalysis Process

Titanium powder could replace mill products and enables near net shape production and 3D printing

Ti powder

Mill products Billet

Ingot

Kroll sponge

TiCl4

Spherical powder

Metalysis powder

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Routes to component

Titanium ore

Ti powder

Mill products

Billet

Ingot

Kroll sponge

BTF of 4:1 to 40:1

• New manufacturing methods are beginning to gain traction.

• The drivers are not just cost but increased functionality, tailoring, and reduced lead times.

• Traditional supply chain is still geared towards standard mill products.

• Novel powder production techniques could have a large role to play in accelerating the adoption of new manufacturing techniques.

BTF of 2:1

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The Titanium market TITANIUM MINERALS

Production 7,000ktpa – no capacity issue

BILLETS / MILL PRODUCTS Production 165ktpa

By-

pro

du

cts

TITANIUM SPONGE Production 172 ktpa

TITANIUM INGOT / SLAB Production 174 ktpa

TITANIUM POWDER Injection/pressing/ALM Production ca. 3-5 ktpa

FERROTITANIUM + ALLOYS Production 75ktpa

• Australia • South Africa • Canada • China

• China • Japan • Russia • Kazakhstan

• USA • China • Russia • Japan

1) Roskill 2015 2) Metalysis Management

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The Kroll Process

2Mg(l) + TiCl4(g) → 2MgCl2(l) + Ti(s) [T = 800–850 °C]

1) Roskill

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Sponge Producers

1) Roskill

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Sponge Producers - 2014

China 38%

Japan 22%

Russia 24%

Kazakhstan 5%

USA 7%

Ukraine 4%

China 38%

VSMPO, Russia 23%

Osaka, Japan 13%

Toho, Japan 9%

Timet, USA 7%

UKTMP, Kazakhstan

5%

ZMTC, Ukraine 4%

Solikamsk, Russia

1%

1) Roskill, 2015

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Additive Manufacturing 3D printing is the umbrella term typically used to describe the process of building a three dimensional object from a digital design, by depositing layer upon layer of a material, usually plastics and polymers, to gradually “grow” an object. This term is widely used in the media and typically refers to consumer, desktop-based digital printing using plastics and other non-metallic materials.

The term Additive Manufacturing, AM, is a more recent umbrella term used to describe industrial printing processes that typically produce metal components.

AM VALUE CHAIN

Material AM Systems Service Bureau / Production

• Creation of metal powder with high purity.

• Powder typically sold by AM system suppliers.

• Greater volume sales will encourage entry of large metals companies.

• System providers usually produce powder bed fusion systems.

• Low levels of vertical integration.

• Recurring revenues mainly from powder sales.

• Production carried out by OEMs or contract/specialised manufacturer.

• OEMs gaining capability through acquisitions, e.g. GE purchase of Morris Technologies.

1) EOS 2) Roland Berger Report, 2013 3) Arcam 4) 3TRPD

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Advantages of Additive Manufacturing Weight Reduction

Material Saving

Other Advantages

Elimination of Production Steps • Traditional manufacturing processes typically require multiple

process steps from raw material, such as ingots and mill products, to final component.

• Each process steps is combined with a QA assessment before being passed on.

Elimination of Tooling • A major attraction for using AM to manufacture parts is the ability

to increase production rate without a proportional supply chain infrastructure investment.

• Such investments have to be made for the traditional foundry processes as well as the hard metal machining centres.

Part Consolidation • AM can consolidate assemblies into one part, even complete

assemblies with embedded moving parts is possible. • GE have brought into production a fuel nozzle, now a single

component made by AM, onto the LEAP jet engine that used to made out of 20 parts.

Design Freedom • AM can produce parts with complex geometries and internal

structures that would be impossible to produce previously. • This allows greater functionality of components.

• Complex parts, optimised for weight reduction create a significant business case for OEMs.

• Conventional seat buckles weighs ~155g. • An equivalent titanium buckle designed with AM weighs ~70g • For an Airbus A380 (all economy seating) a total saving of 72.5 kg. • Over its lifetime, saves 3.3 million litres of fuel, or ~€2 million.

• Traditional titanium manufacturing processes typically generate lots of scrap, characterised by the “buy-to-fly (BTF)” ratio (amount of material procured versus material in the final component).

• AM allows OEMs to reduce BTFs from an average of 9:1 to 2:1. • Example above shows aircraft bracket (left) with BTF of 8:1 being

produced by AM (right) with a BTF of 1.5:1.

1) US Dept. of Energy 2) Roland Berger Report, 2013 3) Airbus Innovation 4) GE

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Titanium In Perspective…

1) South African Titanium, MSc Thesis, Willem van Tonder 2) Roskill 2013 and 2015 3) Dr. C Nappi, International Aluminium Institute, 2013

Steel 1.5 Btpa $1,100 B

Aluminium ~40 Mtpa $90 B

Stainless Steel ~33 Mtpa $110 B

Titanium ~170 ktpa $10 B

Magnesium ~1 Mtpa $10-20 B

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Future Titanium Markets

Historic price development in Aluminium

Historic volume development in Aluminium

Source: USGS, European Aluminium Association

Halving the price of Aluminium during the recent past has lead to significant growth in the sales of primary Aluminium

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Summary • Metalysis has developed a unique technology originally based on the FFC® Process invented at the University of

Cambridge, UK.

• Capable of producing metal powders for a range of niche and volume markets, including aerospace, electronics, bio-medical, petro-chemical and automotive.

• Metalysis has developed a technology to produce an alloyed titanium powder directly from rutile.

• Such powders can be used to 3D print components for a range of applications where complexity and functionality are prized.

• The market for metal powders is growing rapidly and is set to continue as end-users qualify and gain confidence in the 3D printing process.

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