Investor Presentation – 27 th May 2020 1
Disclaimer This presentation by Medallion Resources Ltd. (“the Corporation”) is for informational purposes only and does not constitute a solicitation or offer to sell securities. This presentation contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include, without limitation, statements based on current expectations or other assumptions that involve a number of risks and uncertainties. Forward-looking statements and information are not guarantees of future performance of the Corporation. Forward-looking information is subject to risks and uncertainties that may cause actual results, and the Corporation’s plans and objectives to differ materially from those expressed in the forward-looking information. Such risks and uncertainties are detailed in the Corporation’s public filings available on SEDAR. Actual results and future events could differ materially from those anticipated in forward- looking information. These, and all subsequent written and oral forward-looking statements are based on estimates and opinions of management on the dates that they are made and expressly are qualified in their entirety by this notice. The Corporation assumes no obligation to update forward-looking information, should circumstances or management’s estimates or opinions change. 2
Company Overview TSX.V: M DL / OTCQX : M LLOF $0.260 4,025,000 $0.220 $0.180 3,025,000 $0.140 2,025,000 $0.100 1,025,000 $0.060 $0.020 25,000 5/27/19 7/26/19 9/24/19 11/23/19 1/22/20 3/22/20 5/21/20 3
I nvestment Overview Medallion owns and develops proprietary technology to extract rare earth elements from an abundant by-product feedstock. This technology can first be applied entirely within the US, delivering the near-term foundation of a secure non-Chinese REE supply chain. • Rare earth elements are a key to emerging low carbon and defense technologies • “The Secret Ingredients of Everything” (National Geographic) • “The Oil of the 21st Century” (Forbes) • The world is entering a historic period of resource nationalism, trade conflict, domestic protection just as REE-heavy technology demand is accelerating • The US is under-represented in the REE supply chain. Only one part-Chinese owned miner in US that sends all material to China for finishing • >80% of the REE supply suitable for high strength permanent magnets is from China • Strong DoE and DoD interest and funding to develop near term industrially relevant REE supply • Medallion is developing a lower Cap-Ex, scalable and repeatable REE business model • Medallion technology targets feedstock rich in “ NdPr ” – the essential ingredient for lightweight and powerful rare-earth magnets • Medallion technology is low risk – based on technology used in the REE industry today 4
The M edallion Team Mark Saxon, BSc, Grad Dip - President & CEO. 30 years of experience, past 20 in public companies with a decade of experience in rare earth elements and other critical materials. Lead the company in the discovery of the Norra Karr REE project in Sweden. Donald M Lay, BSc - Advisor, Director. 20+ years of international experience in public and private venture-capital and project funding. Developed business and raised capital in technology and ag-bio processing fields. A number of successful investor exits. Kurt Forrester, PhD - Metallurgist. Chartered Chemical Engineer (CEng MIChemE) and Chartered Professional Metallurgist (MAusIMM CP(Metallurgy)). 15+ years as engineering consultant mining - process development, feasibility and EPCM. Expertise on commodities including precious metals, REEs and industrial minerals. David Shaw, PhD, PGeo - Director. Consulting Geologist, Director of First Majestic Silver (NYSE: AG), First Mining Finance (TSXV:FF), Great Quest Metals Ltd (TSXV:GQ), 30+ years in global exploration and mining finance. 5
Rare Earth Element Demand Rare Earth Elements (“REE”) are a set of metals essential for emerging technologies and defense. They are the “salt and pepper” of industry delivering specific and unique functions that are difficult to substitute. Each REE has different properties and end markets. 15% share 25% share 6% CAGR Nd Pr Dy Tb 6
Rare Earth Element Applications La (Lanthanum), Nd (Neodymium), Dy (Dysprosium), Tb (Terbium), Ce (Cerium), Sm (Samarium), Pr (Praseodymium), Eu (Europium), Y (Yttrium), and Gd (Gadolinium) 7
Rare Earth Element Supply in 2020 Due to multi-decade investment, REE supply is dominated by Chinese interest. Disruption/constriction at any point disrupts the entire value chain for all customers except Chinese due to the integration of the supply chain. CONCENTRATE MIXED OXIDE COMPONENT PURE OXIDE PRODUCT MAGNET METAL ALLOY ORE CHINA - 80% 85% 90% JAPAN, KOREA, GERMANY, UK AUSTRALIA (MYANMAR, VIETNAM BRAZIL, US) • Chinese companies invest in REE projects globally with off-take agreements for products early in the supply chain • Control of critical raw materials in the up-stream delivers control of the down- stream (massive businesses incl defense) • Despite having natural resources, the US and Europe play no significant role in production or processing of up-stream REE materials • Industrial security requires raw material security. Multiple suppliers in down- stream sector does not mitigate supply chain risks for US’s largest companies 8
M omentum is Building in Sector The move to ensure supply chain security for US industry and defense has never been stronger. REE supply is becoming recognized in media and Departments of Defense and Energy as a key vulnerability. WASHINGTON ― The Pentagon has proposed legislation that aims to end reliance on China for rare earth minerals critical to the manufacturing of missiles and munitions, hypersonic weapons and radiation hardened electronics, by making targeted investments. The proposed legislation would raise spending caps under the Defense Production Act to enable government to spend up to $1.75 billion on rare earth elements in munitions and missiles and $350 million for microelectronics. It would also eliminate caps when it comes to hypersonic weapons. The proposal, obtained by Defense News, was offered earlier this month for inclusion in the annual defense policy bill Congress has been drafting. “ To me, this is the biggest thing that has happened to rare earths in a decade ,” Jeffrey Green, a defense industry consultant and advocate for government intervention on rare earth materials, said Monday. “The policy shift is the government is realizing t hey have to put serious bucks into this .” https://www.defensenews.com/congress/2020/05/18/pentagon-legislation-aims-to-end-dependence-on-china-for-rare-earth-minerals/ 9
NdPr – The Essential Feed for M agnets 20,000 tonne per annum NdPr shortfall in <5 years At mid-2020 there are NO new projects funded for construction mining project start up time • NdPr is the essential raw material for high strength permanent magnets • Lynas Corp (ASX: LYC) is the only significant NdPr producer outside China • All new hard rock projects for NdPr are pre-development and unfunded. These require substantial Cap-Ex ($250 million - $2B) and are at least 3-5 years away from production • NdPr has no current substitute for high performance magnets. US does not produce NdPr or high strength magnets Source: UBS, USGS and public filings 10
M edallion - Starting W ith the End in M ind Medallion has focused its research and development on extracting NdPr from the mineral monazite. Monazite is one of two REE-rich minerals that supply today’s magnet industry. Medallion’s proprietary technology is particularly suited to monazite recovered from mineral sand mining. • While there are many REE projects Global REE Occurrences (USGS) globally, each have a unique set of minerals that require an individual flowsheet • In contrast, monazite concentrated from mineral sands is a homogeneous feedstock, that has allowed Medallion to develop a transferable processing technology • Medallion has developed proprietary processing expertise in monazite, typically the richest For NdPr mineral in NdPr Bastnasite REECO 3 F 70% REE 5-10% NdPr Monazite (REE,Th)PO 4 65% REE 15-25% NdPr 11
M edallion – M onazite Enriched M ineral Sands Mineral Sands enriched in Monazite (USGS) Mineral sand deposits are collections of heavy minerals deposited by water. They are processed by some of the worlds largest mining • Mineral sand deposits are distributed across the globe, often in companies to extract heavy coastal locations. Mining of these deposits is focused on value from minerals zircon, other minerals, not monazite, which is stockpiled as future resource rutile or or sold to China as a by-product. ilmenite. • The Medallion process can gain value from this abundant feedstock The heavy mineral monazite will be $ $ To stockpile stockpiled or or to China GRAVITY SEP sold to China Zircon Rutile Monazite 12
M edallion – M onazite Enriched M ineral Sands Southern USA 13
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