VBX Limited Secures Bauxite Offtake and Investment Framework Agreement with Leading Chinese Aluminium Group

Strategic Location and Superior Low-Silica Bauxite Quality Drive Chinese Interest in Wuudagu

The Wuudagu bauxite project is situated on Wunambal Gaambera land, approximately 15 kilometres west of Kalumburu community in the Shire of Wyndham East Kimberley, northern Western Australia. Located about 270 kilometres northwest of Kununurra, the nearest regional hub, the site is accessible via a 563-kilometre road route from Kununurra. Its proximity to the coast—around 30 kilometres—facilitates efficient export logistics, a key advantage for global aluminium supply chains.

VBX Founder and Managing Director Ryan de Franck emphasized the project's competitive edge, stating, "Wuudagu's attractive low-silica product quality, efficient logistics, expanding scale, and northern Australian location are highly sought-after attributes for bauxite supply in the global aluminium sector." The low-silica specification reduces processing costs and enhances refining efficiency, making it particularly valuable. These qualities have attracted the Chinese Group, which is part of a major aluminium industry consortium seeking dependable, high-quality bauxite sources for its worldwide operations.

Framework Agreement Enables Non-Exclusive Negotiations for Investment and Offtake Rights

The Bauxite Offtake and Investment Framework Agreement outlines that VBX and the Chinese Group will negotiate on a non-exclusive basis the terms under which the Chinese Group may invest in developing and operating the Wuudagu mining and export facility. This non-exclusive approach preserves VBX’s flexibility to engage other investors and offtake partners while fostering a focused partnership with the Chinese Group. VBX retains all rights to future Wuudagu products, leveraging these rights to structure attractive funding solutions for project construction and commissioning.

The agreement centers on three commercial pillars: investment funding for mining operations, bauxite product offtake arrangements, and collaboration on additional bauxite projects. The anticipated offtake volume ranges from 2 to 3 million tonnes per annum, representing a significant long-term supply commitment underpinning project economics. Pricing will be based on an agreed bauxite reference price index with adjustments for product quality variations, aligning buyer and seller interests on market-based pricing while recognizing VBX’s premium low-silica product.

Investment Funding Contingent on DFS Outcomes and Mutual Agreement

The Chinese Group’s investment aims to cover a substantial portion of the construction and commissioning costs for Wuudagu, with the exact amount determined by the DFS results and mutual consent. This contingent model allows alignment of investment size with verified project viability and financial needs based on detailed engineering and economic analysis. The DFS, scheduled for mid-2026, will deliver comprehensive data on capital expenditure, operating costs, production timelines, and financial returns necessary to finalize investment terms.

Investment negotiations are planned within 90 days post-DFS completion, providing a defined timeframe for transitioning from framework principles to binding agreements. This timeline underscores both parties’ commitment to advancing the project efficiently once technical and economic parameters are established. Linking investment size to DFS outcomes ensures financing is appropriately scaled and grounded in validated data rather than preliminary estimates.

Definitive Feasibility Study Completion in Mid-2026 to Trigger Full Agreement Finalization

VBX is progressing toward the DFS completion for Wuudagu, expected by mid-2026. The DFS is a pivotal milestone, offering detailed engineering, technical, and economic analyses essential for finalizing investment and offtake deals with the Chinese Group. Over 6,000 metres of infill and exploration drilling completed in the latter half of 2025 has informed the DFS scope and resource definition.

A Pre-Feasibility Study completed in 2025 demonstrated strong economics based on an initial 10-year mine life. The DFS will provide higher confidence in capital and operating cost estimates, production schedules, and financial returns. Upon DFS completion, VBX and the Chinese Group are expected to finalize full-form agreements within a 90-day negotiation window, reducing execution risk by ensuring binding contracts reflect validated technical and economic data.

Takapinga Project in Northern Territory Included in Expanded Collaboration

In addition to Wuudagu, VBX and the Chinese Group plan to negotiate collaboration on exploration, development, and operation of other Northern Australian bauxite projects, notably VBX’s Takapinga project in the Northern Territory. This expanded partnership scope offers the Chinese Group access to additional bauxite resources and provides VBX with opportunities for joint development, investment, and offtake arrangements across a broader portfolio. Both Wuudagu and Takapinga hold further exploration potential, creating multiple development pathways under the framework.

Including Takapinga reflects the Chinese Group’s strategic intent to establish a diversified Australian bauxite supply base, benefiting from stable geology, regulatory frameworks, and export infrastructure. For VBX, this broader collaboration enhances the framework’s strategic value, potentially enabling multi-asset investment and offtake or advance payments to accelerate exploration and development. The framework remains flexible, allowing project-specific negotiation of investment, offtake, and payment terms.

Growing Bauxite Demand and Aluminium Industry Trends Support Project Advancement

Bauxite, the primary aluminium raw material, faces rising demand fueled by global megatrends. Refined into alumina and smelted into aluminium, it supports sectors including renewable energy, electric vehicles, energy transmission, packaging, and consumer goods. These sectors are expanding rapidly amid decarbonisation efforts and increasing demand for lightweight materials.

The company update projects aluminium demand growth of 30 million tonnes, a 29% increase from current levels. This robust outlook underpins the need for new bauxite sources offering high-quality products and efficient logistics like Wuudagu. The Chinese aluminium group’s commitment to investment and long-term offtake demonstrates confidence in both project-specific strengths and broader market fundamentals. For VBX, this demand trajectory validates the strategic development of Wuudagu and supports investor interest in funding construction and commissioning.

VBX’s Strategy to Retain Product Rights and Optimize Funding Terms

VBX has deliberately retained all rights to future Wuudagu products, using these rights to structure an attractive funding solution for project construction and commissioning. This contrasts with traditional financing models where upfront capital is exchanged for long-term offtake or product pledging. By negotiating funding and offtake as related but separate commercial elements, VBX aims to optimize investment size and terms while maintaining pricing and supply flexibility.

Managing Director Ryan de Franck stated: "VBX has made a conscious decision to retain all rights to future products produced at Wuudagu and to seek to use these rights to provide an attractive funding solution to construct and commission the Project." This strategy preserves optionality as market conditions evolve, allowing negotiation of investment and offtake terms based on current market and project economics at DFS completion. The framework’s non-exclusive negotiation structure supports this by enabling VBX to engage multiple potential partners while focusing primary discussions with the Chinese Group.

Company Profile and Development Stage Position VBX as Emerging Australian Bauxite Supplier

Founded in 2013, VBX Limited focuses on near-term development of high-grade, low-silica bauxite resources, positioning itself as a responsible Australian bauxite producer. The company aims to "unlock scalable assets to supply a rapidly growing market," reflecting its strategic role in the expanding global bauxite supply sector. VBX is committed to socially and environmentally responsible operations and strong relationships with Traditional Owners and local communities, aiming for lasting positive regional impact.

Wuudagu remains VBX’s flagship project, with extensive exploration and development activities completed. Key features include a flat orebody with low strip ratio, coastal proximity enabling efficient export, and confirmed low-silica bauxite quality, supporting economic viability. The 2025 Pre-Feasibility Study demonstrated robust economics based on a 10-year mine life. With the DFS due mid-2026 and a major Chinese aluminium group engaged in investment and offtake negotiations, VBX has advanced Wuudagu toward concrete commercial transaction discussions.

Counterparty Creditworthiness and Disclosure Confirmed in Framework Agreement

For ASX Compliance Update 02/25, VBX disclosed that the counterparty’s identity is not considered material to the price or value of VBX securities. The framework agreement contains all material information for assessing its impact and is not misleading by omission. It sufficiently describes the counterparty—a Hong Kong subsidiary of a major Chinese aluminium group—providing relevant market-sensitive details including standing and creditworthiness.

This disclosure reflects VBX’s view that the commercial substance—investment funding and offtake commitments from an established major Chinese aluminium group—provides adequate information for market participants despite withholding the specific corporate identity. The Chinese group’s status as a "major" player indicates strong market position, operational capability, and financial strength globally. For VBX shareholders and investors, the framework agreement represents a validated funding and offtake pathway with a creditworthy partner, even as certain commercial details remain confidential.