Strategic Update, including new CEO Appointment

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014 (INCLUDING AS IT FORMS PART OF THE LAWS OF ENGLAND AND WALES BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR").

31 July 2026

Ferro-Alloy Resources Limited

(the "Company")

Strategic Update, including new Chief Executive Officer Appointment

Ferro-Alloy Resources Limited (LSE:FAR), the vanadium producer and developer of the large Balasausqandiq vanadium deposit in Southern Kazakhstan (the "Balausa Project"), is pleased to report significant progress in the development of its strategy to serve emerging demand for critical minerals and associated by-products.

Highlights

·    Appointment of Chief Executive Officer ("CEO")

o  Peter Secker, who has built and commissioned five greenfield mines has been appointed as CEO, effective from mid-October 2026, subject to final contract

o  Current CEO Nick Bridgen to become non-executive Deputy Chairman

·    US Government engagement

o  Applications submitted for funding following positive engagement with and invitations from multiple US government institutions seeking to secure critical minerals supply

·    Downstream partner discussions in US

o  Discussions underway with strategic partners to integrate ferro-vanadium production into the US steel and defence supply chain

·    Opportunity for high value rare earth yttrium production

o  Test work underway for yttrium by-production from the Balausa Project deposit, at low incremental capital and operating cost, given the substantial value potential of ex-China yttrium oxide prices

·    Carbon black substitute ("CBS") update - first sales order secured

o  Successful tests by an agricultural tyre manufacturer have led to an indicated initial 20 tonne order, collaboration ongoing for passenger car tyre formulations with Master Tyre

·    Existing operations strengthened - capacity increased and income secured

o  58% plant-capacity uplift achieved, new ferro-nickel revenue stream designed, US$2 million of product prepayments and a US$0.5 million non-dilutive government grant secured

Nick Bridgen, CEO of Ferro-Alloy Resources, said:

"I am confident that Peter Secker has the right skills and experience to lead the financing and construction of the Balausa Project; and after over 20 years development work with the Company, I look forward to my future role as non-executive Deputy Chairman.

The concentration of vanadium supply from China and Russia has highlighted the Balausa Project as being the only vanadium project with the scale and cost profile to meaningfully diversify supply of this designated critical mineral. Vanadium is essential to high-strength steel and to the aerospace supply chains of the United States and its allies.

In addition, vanadium flow batteries are increasingly being utilised to serve the high-capacity/long-duration energy storage markets, already reaching around 10% of overall vanadium demand. The overall vanadium market is expected to reach balance later this year with potential for price recovery shortly thereafter."

Sir Mick Davis, Chairman of Ferro-Alloy Resources, said:

"The Company has made significant progress in advancing the value potential of the Balausa Project, securing interest to support its development from major government-backed institutions. I look forward to seeing these initiatives advance further.

I would like to thank Nick Bridgen for his significant contribution to the Company, and to his continued support in achieving our objectives going forward in his new role as non-executive Deputy Chairman. I welcome Peter Secker to the role of CEO, effective from mid-October this year. Peter brings extensive financing and project development experience to the Company - key to progressing the next phase of development of the Company's flagship Balausa Project."

Appointment of Peter Secker as CEO

Peter Secker has been appointed CEO, expected to take effect from mid-October 2026 subject to final contract. Mr Secker brings over 40 years of international mining, development and project delivery experience, having played a key role in the financing, construction and commissioning of five significant greenfield mines into production across gold, titanium, lithium and bauxite, and having raised over US$2 billion of debt and equity.

His appointment reflects confidence in the outlook for development of the Balausa Project and provides the leadership and proven operational track record required to take the Balausa Project through its next phase of development and into production.

Nick Bridgen will step down as CEO to become non-executive Deputy Chairman from mid-October 2026.

US Government engagement

With the support of the Company's cornerstone shareholder, Vision Blue Resources, the Company has been engaged in discussions with strategic US government-backed policy and financing institutions, seeking to secure a vanadium supply chain. Vanadium is on the US, European and several other country's critical minerals lists and the Company believes there is greater recognition that the Balausa Project has the scale and low production cost profile to sustain support for growing global demand.

The Company has been invited to apply for financing with multiple US government departments. Initial applications have been submitted, with the objective of securing grant funding, or low cost debt and equity financing. An update will be provided on these initiatives, as appropriate.

US Downstream processing partnership discussions

The Company has been in discussion with potential strategic partners globally, to evaluate options for integrating ferro-vanadium production to supply the US steel and defence industries. These exploratory discussions include the potential for partnership, merger or integration with established industry participants.

Rare Earth Elements - high value yttrium opportunity

As identified in the Company's prospectus and related Competent Persons Report, the ore at the Balasausqandiq deposit is known to contain rare earth elements ("REEs"), as evidenced by historical analytical work conducted at the deposit as part of the Company's previous studies.

During the operation of the pilot plant, a process was under development for the recovery of REEs. However, at the time when the operation of the pilot plant was concluded, and at the outset of the feasibility study, low REE prices and the possibility for relatively low recoveries into leach solutions led the Company to omit the recovery of REEs from the final design process and to defer the test work requirements to a later date. Since the completion of the feasibility study, REE prices have increased considerably and, even at relatively low metallurgical recoveries, the potential value of the REEs by-product stream now looks attractive. The Company's technologists believe that with appropriate test work and some additional processes the originally planned recovery of REEs can be achieved.

REE grades

While no formal assessment has been made on a JORC Code (2012) basis for the content of REEs in the ore at Balasausqandiq, a significant body of work exists which provides a basis for estimating the overall content.

Historical REE assays were undertaken by Intertek (Australia) and TOO CentreGeoAnalysis Laboratories (Kazakhstan) on composite samples collected from the Company's own drilling programmes completed on Ore-Body 1, giving indicated grades of total REEs of around 330 grams per tonne, including 100 grams per tonne of high value yttrium. Assaying by SGS Canada Inc of the composite ore sample used for the feasibility study test work gave another estimate corroborating the earlier assay results.

Yttrium, given its concentration level within the ore and prevailing market price, is considered to be the most valuable element within the recoverable REE group. Collectively, the other REEs could also add further value to the Project, but have yet to be assessed for economic recovery.

No specific work has yet been completed to assess the recoverability into leach of yttrium, however, based on extrapolation of some early tests carried out, the Company could expect to recover around 40% of the yttrium content into leach in the planned vanadium extraction process, with low incremental capital and operating cost increases. Optimisation above this remains a possibility and test work will be carried out in due course.

Current market

The market for REEs is volatile and has recently been strongly affected by export licencing restrictions by China, which produces over 85% of the global output of separated REEs.

The current ex-China mid-market price of yttrium oxide is in the region of US$1,200/kg.

Potential economic effects

Initial indications are that the economic implications of REE recovery in the Project could be considerable. Using the grades of just yttrium oxide alone in the composite samples taken from the drilling campaign in 2012, the Company estimates that the in-situ value of the yttrium oxide at current spot prices and a life of mine of 20 years amounts to c. US$4.57 billion, equivalent to US$152 per tonne of in-situ ore. The other REEs could be expected to provide more value. From these figures, allowance must be made for metallurgical recovery, operating costs of extraction and the cost of further downstream processing. Whilst these are, as yet, unknown, the Company believes that there is potential for considerable further value.

Planned workstreams

The Company is in discussions with a US commercial entity and two European academic institutions to develop test work programmes to identify and validate methods to improve the recovery of the REEs contained within the Balasausqandiq ore and to separate out the economic REEs present.

Once the results of those programmes have been ascertained, the Company will consider whether a REE recovery section of the plant should be incorporated into the front-end engineering and design phase of the Project's development.

Carbon Black Substitute

The Company has continued to collaborate with a commercial tyre manufacturer Master Tyre on both of its CBS products for the purpose of identifying and testing economic and commercially optimal formulas for the substitution of carbon black with CBS in the production of rubber suitable for passenger car tyres.

Concurrently, the Company has been working with another tyre manufacturer that focuses on the production of agricultural tyres, which has successfully tested the Company's low carbon CBS product as a carbon black alternative. This customer has indicated that it will place an initial order for 20 tonnes of low carbon CBS.

Existing operations

Ferro-nickel

The catalysts that provide the main raw material for the existing plant contain vanadium, molybdenum and nickel. After extraction of the vanadium and molybdenum, the nickel remains in the tailings as a low-grade concentrate.

The Company has designed a project to install an electric arc furnace and associated equipment to produce ferro-nickel from this low-grade concentrate. Once installed, production is expected to be around 75 tonnes per month of ferro-nickel (25% nickel).

The electric arc furnace will be slightly oversized, enabling it to be utilised for the production of ferro-vanadium and ferro-molybdenum at a lower cost than using the current alumothermal method.

In the interim, the Company has entered into a contract to sell the stockpile of nickel concentrates held at the existing plant site to provide ongoing working capital for the plant. Ongoing processing will provide enough further material for the Company's own production of ferro-nickel.

Concentrate roasting efficiencies

The Company's technical department has developed a new process for the treatment of vanadium-bearing catalysts which significantly reduces both power consumption and cycle time. The existing pipe oven has already been modified and the new technology has been operating well for over a month. Plant capacity has been increased by around 58%. The actual capacity depends on the types of raw material being treated, with the easier-to-treat catalysts resulting in higher production, but with a corresponding increase in raw material cost.

Kazakhstan Science Fund grant

Following a competitive tender process, the Company has been awarded a new grant of US$500,000 by the Kazakhstan Science Fund. The purpose of the grant is to fund the installation of new equipment that will support the preparation of samples of CBS (40% carbon) for future customer industrial scale testing and commercial offtake negotiations. Once installed, the existing plant will be capable of producing up to 1,000 tonnes of high grade CBS sample. Under the terms of the funding, the Company is required to co-fund the grant with US$227,000.

Prepayment contracts

The Company has entered into two prepayment contracts for future sales of vanadium and molybdenum products from the existing plant for total gross proceeds of US$2 million.

Financing

As the market will be aware, the Company implemented a US$20 million Kazakh bond programme during 2023, of which US$18 million have been drawn. Some of the tranches of bonds issued under that programme fall due for repayment during the first half of August 2026 and the remainder at the start of October 2026.

Specifically, US$3 million must be repaid to the bondholders of Tranche 1 before 7 August 2026, US$5 million to the bondholders of Tranche 3 before 11 August 2026 and US$5 million to the bondholders of Tranche 2 before 2 October 2026.  The Company is planning to repay these tranches on the relevant due dates. With respect to Tranche 2, the Company is currently evaluating debt finance offers received to refinance this tranche and will announce the preferred option to the market in due course.     

ENDS

For further information, visit www.ferro-alloy.com or contact:

Notes to Editors

About Ferro-Alloy Resources Limited:

The Company's operations are all located at the Balasausqandiq deposit in Kyzylordinskoye Oblast in the South of Kazakhstan.

Balasausqandiq is a very large deposit, with vanadium as the principal product together with the CBS and several by-products. Owing to the nature of the ore, the capital and operating costs are very much lower than for other vanadium projects.    

The most recent mineral resource estimate for ore-body one (of seven) provided an Indicated Mineral Resource of 32.9 million tonnes at a mean grade of 0.62% vanadium pentoxide ("V₂O₅") equating to 203,364 contained tonnes of V₂O₅. In the system of reserve estimation used in Kazakhstan the reserves are estimated to be over 70 million tonnes in ore-bodies 1 to 5, but this does not include the full depth of ore-bodies 2 to 5, or the remaining ore-bodies which remain substantially unexplored. 

The grade of carbon in the deposit is over 8%. The carbon flows through to the tailings from where it is concentrated, in a simple low-cost operation, into a 40% carbon product, the CBS, that can be used in place of carbon black as a reinforcing filler in the making of rubber.

The Project will be developed in two phases, Phase 1 and Phase 2, with Phase 1 treating 1.65 million tonnes per year.

The results of the feasibility study, carried out principally by SRK and Tetra Tech, were announced in October 2025, showing a project net present value ("NPV") of US$748m and internal rate of return ("IRR") of 22%.  Since then, a preliminary re-estimation of the capital costs by Chinese engineers China National Chemical Engineering Sixth Construction Co., Ltd has been received, which would have the effect of increasing NPV to US$932m and IRR to 31%.

There is an existing concentrate processing operation at the site of the Balasausqandiq deposit. The production facilities were originally created from a 15,000 tonnes per year pilot plant, which was then expanded and adapted to recover vanadium, molybdenum and nickel from purchased concentrates.  Alongside this operation, there is a well-equipped laboratory and highly skilled technical team, who have already developed the technology that is being built into the feasibility study and is further developing and optimising processes needed for future vanadium and carbon operations. The plant will operate only when profitable concentrates are available and, when not operating as a production facility, will operate on an expanded basis as an R&D centre.