Mr. Mazen Alnaimi reports

ARGEX TITANIUM PRODUCT COMPLETION

Argex Titanium Inc. has completed its tests on its pigment-grade titanium dioxide product (TiO2). The analyses were made in comparison with three of the major competitive commercial products in the market, and the company's TiO2 pigment meets or exceeds the standards of all of these in various tests required for commercial use.

External labs were validating the Argex results throughout the period.

The company will now focus on producing samples for clients, on average one to two kilograms of finished product per week, creating an inventory to be available for potential users. Management of Argex met with the top-potential clients at the TiO2 World Summit last week and generated a lot of interest for its product.

The process used to produce Argex TiO2 is the basis for engineering of a commercial plant, which will replicate the quality of the samples tested in comparison with other major suppliers in the market.

Engineering work on the planned technology centre will support the process technology in commercial licensing arrangements and is expected to be completed by the end of 2017, with project activity to commence at the beginning of the new year, pending financing.

Argex is in advanced discussions with a federal governmental agency specialized in supporting technological innovation to participate in the financing of the technology centre.

"Regarding the Argex process, all five islands have been mass balanced on multiple ore sources. Solvent extraction has been continuously operated for steady-state performance in 24-hour periods, and hydrolysis has been repeated more than 150 times. Calcination and drying have been repeatedly conducted at production process conditions, grinding produces the proper size range, and finishing is done with a reactor identical to that used by paint producers in their laboratories. Product quality has been verified by repeated analytical techniques on multiple samples," said Carroll Moore, chief operating officer of Argex Titanium.

"The development works and collaboration with external parties to achieve these milestones have been extensive, and we are gratified that we have proven the commercial application of the Argex process, the product quality being exactly comparable to the best available in the market today," said Mazen Alnaimi, chairman and chief executive officer of Argex Titanium. "With this database of results, there is no doubt in my mind that a commercial process design can be established, which will replicate the process developed in pilot scale at Valleyfield," he added.

James P. Berresse has resigned as a director of the company. Argex thanks Mr. Berresse for his valued contribution as a director. Argex's governance, nominating and compensation committee will commence a search to fill the vacancy on the board of directors.

Multiple test achievements:

• Every test comparison that was run in the pilot plant over the last 12 months was based on product specifications of two of the top-six pigment producers. Every comparison for size distribution and oil dispersion has been run against one or both of these materials.
• Standard specifications include composition, colour, TiO2 content, oil dispersion, loss on ignition (LOI) on final product and comparative morphology by scanning electron microscope (SEM).
• Argex has run American Society for Testing and Materials (ASTM) standard methods on its product for applicable methods for dry pigment analysis.
• The company has compared the morphology of its product against three of the top-six commercial products in SEM up to 100,000 magnifications. Such magnification is important because each particle can be visualized individually and evaluated on its characteristics, such as shape, sintering and deagglomeration. The company's product is equivalent to three of the top-six commercial products in SEM comparisons.
• The company has run its product in XRF and XRD at McGill University for composition, and this analysis has been validated in collaborator's laboratories. This provides impurity measurements and degree of crystallization to evaluate remaining anatase content. The conclusion is that the company's product is 100 per cent rutile.
• The company's product in oil dispersion is comparable and somewhat higher to two commercial products.
• On white colour, the company's product consistently measures higher than two commercial products in intensity, blue and yellow tint character, and is similar or higher in gloss.
• Depending on coating composition, the company's product is 92.5 to 95.0 weight per cent TiO2, which is within specification range. Commercial products on the market advertise a similar range of composition depending on application.
• On transmission electron microscopy tests (TEM), the company shows a coating depth of three to six nanometres, and the specified level is nominally five nanometres, which would be uniform on a perfectly spherical particle.
• The company's final product size range is smaller than two other commercial products. The company's mean size after milling is between 210 to 230 nanometres, which is the perfect range for masking in a paint formulation.
• The company's product meets or exceeds the quality of the major competitive products in the market. Paint testing is a secondary issue with respect to product quality and is a subjective test run by paint industry users. With this degree of analytical background on the company's product, there is no technical reason the material would not pass a standard paint test, and this will be verified in more than one lab in the next few weeks.

About Argex Titanium Inc.

Argex Titanium has developed an advanced chemical process for the volume production of high-grade titanium dioxide (TiO2) for use in high-quality paint, plastics, cosmetics and other TiO2 applications. The corporation's unique proprietary process uses relatively inexpensive and plentiful source material from a variety of potential vendors to produce TiO2, along with other valuable byproducts. Argex's process provides a significant cost and environmental advantage over current legacy TiO2 production methods.

We seek Safe Harbor.