5E Advanced Metals reports steady state operations, obtains tax exclusion

5E Advanced Materials is pleased to report progress at the Company’s Small-Scale Facility. Highlights: Operational focus and rigor at the 5E Boron Americas complex have improved production rates, overall product quality, and consistency; Improved operating rates have driven an increase in calcium content, expanding 5E’s commercial optionality regarding byproduct marketing; Entered into a definitive agreement with the California Alternative Energy and Advanced Transportation Financing Authority regarding a tax assistance program for capital equipment related to the production of lithium carbonate, with savings potential of nearly $900,000. Production rates at the Company’s 5E Boron Americas Complex have steadied and are currently maintained at one short ton per day with continuous improvement at the facility. The operations team has successfully programmed crystallization to operate in automatic mode such that distillation occurs based on feed concentration, improving both boric acid consistency and quality. Recently, the facility’s belt filter spray nozzle systems were optimized to maintain sulfur content below 100 ppm, exceeding customer specifications. The Company expects to begin removing metal salts and producing gypsum in the near term as calcium levels and metal salts have lagged boric acid leach rates. Calcium content has now increased to greater than 20,000 ppm, necessitating the production of a calcium-based by-product. As the Company assesses operating expenses and commercial scale engineering, the recovery solution after removing the calcium is expected to reinforce the confidence levels of solution feed profiles that inform raw material utilizations that drive OPEX. The Company continues to evaluate calcium chloride as a potential byproduct and has tested and produced highly concentrated samples of solution that are representative of what could be produced on a commercial scale. On October 16th, the Company entered into a definitive agreement with the California Alternative Energy and Advanced Transportation Financing Authority as part of the Sales and Use Tax Exclusion Program. California’s Department of Tax and Fee Administration administers a use tax of 7.75% on capital equipment. Under the Program, assistance is provided by CAEATFA such that any capital equipment attributable to lithium carbonate production is exempt from use tax, up to a limit of $11,473,423. The Agreement could potentially save the Company approximately $889,000 in capital costs.