Summary

Excerpt

Dear Sirs,

RE. CLAIM FOR DAMAGES UNDER THE ENERGY CHARTER, UNION LAW AND EUROPEAN LAW

1. We, the undersigned counsels, act for and on behalf of Aura Energy Limited, registered office and principal place of the company is Level 1, 34-36 Punt Road, Windsor Victoria Australia 3181 (the "Claimant" or the "Investor").

2. The Claimant is direct owner of the Swedish limited liability company Vanadis Battery Metals AB (former trade name Energy Sweden AB) (the "SPV") for its Swedish mining activities/businesses. The Claimant represents 100 % of all the total investment in the SPV.

3. Overall information on the Swedish uranium mining projects of the Investor (developed in the name of the SPV):

4. Kinderåsen Uranium Project: An exploration permit for Molybden (and thereby covering all minerals set out in Chapter 1 § 1 in the Minerals Act) is granted for the specific area Kinderâsen 1 in the municipality of Berg in the county of Jämtland. The permit is valid until 2020-02-02. It shall be noted that the municipality of Berg opposed to granting the SPV the permit.

5. Häggån Uranium Project: An exploration permit for Molybden (and thereby covering all minerals set out in Chapter 1 § 1 in the Minerals Act) is granted for the specific area Häggån in the municipality of Berg and Åre respectively in the county of Jämtland. The permit is valid until 2022-08-22. It shall be noted that the municipality of Berg opposed to granting the SPV the permit.

6. Bölåsen Uranium Project: An exploration permit for Molybden (and thereby covering all minerals set out in Chapter 1 § 1 in the Minerals Act) is granted for the specific area Bolasen 1 in the municipality of Berg and Åre respectively in the county of Jämtland. The permit is valid until 2020-02-02. It shall be noted that the municipality of Berg opposed to granting the SPV the permit.

7. Skallböle Uranium Project: An exploration permit for Molybden (and thereby covering all minerals set out in Chapter 1 § 1 in the Minerals Act) is granted for the specific area Skallböle 1 in the municipality of Berg and Åre respectively in the county of Jämtland. The permit is valid until 2019-01-20. It shall be noted that the municipality of Berg opposed to granting the SPV the permit.

8. Möckelåsen Uranium Project: An exploration permit for Molybden (and thereby covering all minerals set out in Chapter 1 § 1 in the Minerals Act) is granted for the specific area Möckelåsen 1 in the municipality of Berg and Åre respectively in the county of Jämtland. The permit is valid until 2019-01-20. It shall be noted that the municipality of Are opposed to granting the SPV the permit.

9. Koborgsmyren Uranium Project: An exploration permit for Molybden (and thereby covering all minerals set out in Chapter 1 § 1 in the Minerals Act) is granted for the specific area Koborgsmyren 1 in the municipality of Berg in the county of Jämtland. The permit is valid until 2019-01-23. It shall be noted that the municipality of Berg opposed to granting the SPV the permit.

10. The Investor has successfully developed, and continue to operate, a number of mining projects globally. The investments in the Sweden were made with regard to the favourable investment conditions for the uranium mining industry that existed in Sweden prior to 1 August 2018, and which could have been reasonably expected to last for a number of years to come. At the time of the events giving rise to the claim, the Investor owned a number of large uranium mining projects in Sweden.

11. The conflict between the Investor and the Swedish government was triggered by the summer 2018 decision of the Swedish Parliament to phase-out/ban uranium prospection and/or exploration in Sweden. It was the culmination of an intensive and controversial public debate driven by the green activists regarding inter alia uranium mining. Due to the measures taken by Sweden as per 1 August 2018, the Investor has been deprived of the benefit of its Swedish Uranium projects.

12. The new act adopted in Sweden as from 1 August 2018 was a complete game changer. All mining of uranium in Sweden was as from such period in time outlawed. The ban also applies to processing of residual uranium in existing tailings, and processing of uranium unearthed in conjunction with extraction of other minerals, e.g. iron, base metals and rare earth elements.

13. The Claimant alleges that its claim arises from a dispute under the Energy Charter ("ECT") article 26, and the European Union law and the European Convention of Human Rights.

14. The Claimant qualifies as an investor under ECT. The ECT protects the Claimant's investments in Sweden. All of the acts complained of occurred after the ECT entered into force for Sweden. Claimant's investments fall clearly within the definition of "Investment" in Art. 1(6) ECT.

15. These measures by Sweden have been taken, in the Investor's opinion, in a non- transparent and chaotic manner, undermining the Investor's reliance on Sweden and precluding any reasonable business planning. The contested measures: (i) were radical and unexpected, (ii) violated the legitimate expectations of the Investor, (iii) violated the obligation of Sweden to ensure stable and predictable legal and economic framework for long-term investments in the mining sector, (iv) violated the obligations of Sweden of transparency and candour towards the Investor, (v) were not taken in public interest, and indeed, they were taken against Sweden's legitimate public interest, (vi) were arbitrary, (vii) did not follow due process; (viii) were disproportionate, (ix) were discriminatory, and (x) they were not accompanied by the prompt, adequate and effective compensation.

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... The prohibited conduct includes:
- Actions that violate an investor's legitimate expectations in relation to the investment;
- Conduct that creates an unstable or unpredictable legal framework or business environment for the investment;
- Conduct that violates due process or results in a "denial of justice," including (but not limited to) improper judicial or administrative proceedings as well as governmental interference in such proceedings;
- Interference with a contractual relationship;
- Actions that treat an investor or an investment inconsistently, ambiguously, or with a lack of transparency;
- Failure to sufficiently notify an investor in advance of impending acts that will impact the investment;
- Actions that are discriminatory;
- Harassment or coercive conduct; and

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29. The Claimant hereby invites you to negotiations regarding the claim.

Stockholm 4th of November 2019

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