Mr. Mark Smith reports

NEBRASKA'S U.S. SENATOR DEB FISCHER AND CONGRESSMAN DON BACON SECURE $10 MILLION IN FEDERAL FUNDING FOR U.S. ALUMINUM-SCANDIUM MASTER ALLOY PRODUCTION

Niocorp Developments Ltd. is praising U.S. Senator Deb Fischer (R-NE) and U.S. representative Don Bacon (R-NE) for securing legislation in both the House and Senate versions of the fiscal 2024 National Defense Authorization Act regarding the strategic importance of scandium, as well as securing $10-million in federal funding to support commercial production of aluminum-scandium (AlSc) master alloy production in the United States.

"Through their positions in the Senate and House Armed Services Committees, Senator Fischer and Congressman Bacon are recognized as national leaders in U.S. defence policy in the Congress," said Mark A. Smith, chief executive officer and executive chairman of Niocorp. "They understand the strategic importance of establishing a domestic supply chain for scandium and aluminum-scandium alloys and their prospective importance to defence and essential civilian technologies.

"On behalf of the many thousands of Nebraskans who are stakeholders and supporters of the Elk Creek critical minerals project in southeast Nebraska, I want to thank Senator Fischer and Congressman Bacon for championing the scandium and aluminum-scandium master alloy that we intend to produce in Nebraska," he added. "Through the Elk Creek project, once sufficient project funding is obtained, Nebraska may very well become a leading scandium producer and could be in a position to help the U.S. Armed Forces take full advantage of the revolutionary performance benefits that scandium can deliver to air-, land- and sea-based systems."

In addition to pursuing construction and eventual commercial operations of the Elk Creek critical mineral project once sufficient project funding is obtained, Niocorp is also currently engaged in a phased commercialization effort to establish production of AlSc master alloy in the U.S.

The addition of scandium to aluminum alloys produces a much stronger alloy that reduces weight, increases strength and corrosion resistance, and makes the material weldable in transportation, aerospace, defence and other systems. AlSc master alloy, which generally contains 98 per cent aluminum and 2 per cent scandium, is used to introduce scandium into aluminum for the purpose of producing AlSc alloys, which generally contain a fraction of a percentage of scandium by weight. Niocorp's goal is to demonstrate the ability to make AlSc master alloy containing 2 per cent scandium by weight and as much as 10 per cent scandium by weight.

Niocorp is working with Boston-based Nanoscale Powders LLC to oversee pilot-scale testing of AlSc master alloy production at a facility operated by Creative Engineers in New Freedom, Pa. The effort recently produced scandium metal and is on track to produce its first ingots of AlSc master alloy in the coming weeks. Niocorp and Nanoscale are employing a proprietary process developed by Nanoscale that increases efficiency and reduces environmental impacts of AlSc production over traditional approaches. Nanoscale has already developed similar metallurgical processes that are being applied to the production of rare earth metals for other operators, which behave metallurgically in a fashion similar to scandium.

Recent Congressional directives regarding scandium

As a result of the advocacy of Senator Fischer and Congressman Bacon, the Senate and House National Defence Authorization bills contain the below directives regarding scandium.

1. FY 2024 House NDAA Committee report 118-125 (pages 225 and 226)

Aluminum-scandium master alloy production

The committee recognizes that China is a major producer of high-purity scandium oxide, which has many powerful applications in defence technologies, including strengthening and lightweighting defence and commercial aviation systems. As scandium oxide production is established in the United States, a missing supply chain component is the conversion of scandium from its oxide form to aluminum-scandium (AlSc) master alloy. This process step is required for utilization of United States-mined scandium by many defence applications. At present, production capacity of AISc master alloy is limited to one facility in the United States. The committee recognizes that the United States may soon become a major producer of high-purity scandium oxide by virtue of a proposed mine and mineral processing project in Nebraska. The committee recognizes the defence-wide importance of a vertical domestic supply chain for both scandium oxide and AlSc master alloy and the critical importance of both materials for the production of air-, land- and sea-based combat systems.

Aluminum-scandium master alloy production

The committee is aware that the rare earth element scandium has important defence and aviation applications when converted from its mined oxide form to an aluminum-scandium (AlSc) master alloy. The committee understands that the global production of scandium is currently dominated by China and Russia but that the United States is poised to become one of the world's largest producers of high-purity scandium oxide due to proposed private-sector domestic mine and mineral processing projects. Therefore, the committee directs the assistant secretary of defence for industrial base policy to provide a briefing to the House Committee on Armed Services not later than Dec. 29, 2023, describing the critical defence applications for AISc master alloy, a list of specific defence programs that require access to AISc master alloy, and recommendations to improve defence innovation and industrial base access to scandium oxide and AlSc master alloy.

2. FY 2024 Senate NDAA Committee report 118-11 (page 275)

Domestic manufacturing of strategic and critical materials

The committee recognizes the importance of having domestic and allied production, processing, and refining of strategic and critical materials necessary for defence requirements. Many of these materials, to include niobium, tantalum and scandium, predominantly, come from non-allied foreign countries. The committee supports continuing efforts by the Department of Defence to utilize authorities at its disposal, such as the Defence Production Act of 1950 (Public Law 81-774) and the industrial base analysis and sustainment program to create domestic capabilities for these strategic and critical materials. The committee encourages the department to continue its continuing efforts and to review the need for domestic production of niobium, tantalum and scandium and act on those requirements with existing authorities.

3. FY 2024 Senate Defence Appropriations Committee report 118-81 to accompany S. 2587, containing $10-million for aluminum-scandium master alloy production

About Niocorp Developments Ltd.

Niocorp is developing a critical mineral project in southeast Nebraska that will produce niobium, scandium and titanium. The company also is evaluating the potential to produce several rare earths from the Elk Creek project. Niobium is used to produce specialty alloys, as well as high-strength, low-alloy (HSLA) steel, which is a lighter, stronger steel used in automotive, structural and pipeline applications. Scandium is a specialty metal that can be combined with aluminum to make alloys with increased strength and improved corrosion resistance. Scandium is also a critical component of advanced solid oxide fuel cells. Titanium is used in various lightweight alloys, is a key component of pigments used in paper, paint and plastics, and is also used for aerospace applications, armour and medical implants. Magnetic rare earths, such as neodymium, praseodymium, terbium and dysprosium, are critical to the making of neodymium-iron-boron (NdFeB) magnets, which are used across a wide variety of defence and civilian applications.

We seek Safe Harbor.