Amala Foods Plc

("Amala" or the "Company")

Rare Earth Elements Potential Transaction Update

Amala Foods Plc (LON: DISH) is pleased to update the market as progress is made towards the execution of a Sale and Purchase Agreement (SPA), a transaction with Terra Rara UK Ltd that was first announced on 17 February 2022.  The Company expects to execute the SPA in the near term.

Highlights:

·   Terra Rara Uganda Limited increases footprint in Uganda with the granting of three additional exploration licenses in areas with Rare Earth Mineralisation (REE).

·    Work underway with a view to define a drill program.

The Company announced on 17 February that Terra Rara UK Ltd had two subsidiaries, Terras Raras De Angola Limitada ("TRAL") and Terra Rara Uganda Limited ("TRUL").

TRAL owns a 51% project interest in the Mungo Rare Earth Elements Project.  Further detail was previously announced on 10 March 2022.  TRAL has the option to increase its project interest to 70%.

TRUK owns an 80% interest in TRUL which has increased its footprint in Uganda with the granting of three additional exploration licenses.  The company now holds four exploration licenses covering over 330 square kilometres. The two licenses in the Nankoma area are contiguous to the ground owned by Ionic Rare Earths Limited (IXR), the Australian Stock Exchange listed explorer and developer which is developing the Makuutu Project. This is one of the largest Ionic rare earth projects outside of China with a globally significant JORC resource estimate of 315mt @ 650ppm Total Rare Earth Oxides (TREO). IXR are currently completing a Bankable Feasibility Study on Makuutu which is expected to confirm that it will be a low-cost producer with a long life of mine.

TRUL have already completed an aeromagnetic interpretation and a sampling campaign over its first license in the Nankoma area with the results confirming REE mineralization. The company will now acquire the aeromagnetic data for the recently acquired second license in the area and carry out interpretation of this data. At the same time the company will begin mobilization to carry out a detailed geophysical program over the two license areas with the goal of having the defined areas ready to be drilled within six months.  TRUL intends to increase its tenement holding in the highly prospective region.

In the Gulu Road region of Uganda the company have been granted two exploration licenses covering an area of over 230 square kilometres.  Based upon historical exploration data TRUL believe that the area has potential to host large scale REE mineralisation similar to that which IXR have proved in the Iganga region and the company plans to take advantage on being a first mover in this prospective area.

The current geopolitical turmoil and rising energy prices are likely to result in western economies accelerating the shift towards the "green economy" as they continue to seek to reduce their reliance on fossil fuels.  The electrification of the energy used to drive machinery is a key part of the energy transition and one of the most significant energy shifts in history.  Magnet metals are central to this transition and critical to manufacturing applications such as electric vehicles and wind turbines.  Provenance of critical rare earth materials will become significant factors in supply chains.  Prices of Praseodymium-Neodymium Oxide (NdPr) continue to rise driven by burgeoning demand and growing shortage of supply in China.

Gerard Kisbey Green, Executive Director of Tera Rara UK, commented:

"We are very pleased to have been granted over 330 square kilometres of exploration licenses in areas that are highly prospective for Ionic clay REE mineralization in Uganda. In less than 3 years IXR has grown to a market capitalization in excess of £100 million and we hope to mirror this success."

"Initial results from the licenses that lie contiguous to IXR confirm REE mineralization and being the first mover into the Gulu Road area should prove to be of significant advantage."

Aidan Bishop, Director, Amala Foods Plc, commented:

"As we close out the due diligence period, Amala Foods anticipates being in a position within the very near future of signing the SPA to acquire the entire issued share capital of Terra Rara UK Ltd and a complete rebirth of the listed vehicle. I am confident that following solid expressions of interest of finance provision in bringing this opportunity to fruition that shareholders in the company stand on the cusp of a new and exciting beginning".

Enquiries:

Jonathan Morley-Kirk, Non-Executive Chairman

[email protected]