Hypromag Achieves Further Technical Milestones

HYPROMAG ACHIEVES FURTHER TECHNICAL MILESTONES AS PILOTING RAMPS UP IN ADVANCE OF COMMERCIAL RARE EARTH MAGNET PRODUCTION IN THE UK, GERMANY AND USA

London / Vancouver: June 16, 2025 - Mkango Resources Ltd. (AIM/TSX-V: MKA) ("Mkango") and CoTec Holdings Corp. (TSXV: CTH; OTCQB: CTHCF) ("CoTec") are pleased to provide a technical update for HyProMag Limited ("HyProMag") and its ongoing advanced pilot programme for the scale-up and roll out of Hydrogen Processing of Magnet Scrap ("HPMS") technology to produce domestically sourced and short-loop recycled rare earth magnets with a minimal carbon footprint in the UK (2025), Germany (2025) and United States (2027).

The ongoing advanced pilot programme at the University of Birmingham is proceeding in parallel with development of the commercial scale plant at Tyseley Energy Park in Birmingham, UK.

HPMS technology was developed by the Magnetic Materials Group at the University of Birmingham ("UoB"), underpinned by approximately US$100 million of research and development funding. HPMS has major competitive advantages over other rare earth magnet recycling technologies, which are largely focused on chemical processes but do not solve the challenges of extracting magnets from end-of-life scrap streams and only produce rare earth oxides or mixed rare earth carbonates, which require further processing. HyProMag provides the solution, producing a value-added, magnet product for direct sale to domestic customers across multiple jurisdictions.

Over the course of the previous 12 months, HyProMag has made significant technical progress to support its efforts in optimising design criteria, processing different NdFeB scrap feed materials and producing recycled, low carbon, commercial, magnets of different technical grades. To date, the University of Birmingham Pilot plant has produced over 3,500 magnets of commercial grade from various waste streams. Sample magnets have been provided to commercial partners for extensive testing and product verification and will support continued off taker due diligence over the coming 12 months for the UK, Germany and U.S. businesses.

Recent progress and technical milestones for HyProMag include the following:

• Further optimisation of HPMS for different NdFeB scrap sources - HPMS continues to demonstrate very effective removal and recycling of magnets from electric motor rotors, where they are embedded in laminated stacks of transformer steel. HyProMag is engaging with multiple parties in this sector to provide pre-processing and recycling solutions, as well as in other sectors such as e-bikes, medical devices and professional audio units.
• Hard disk drive (HDD) magnets continue to be an important feedstock for HyProMag with HPMS now succesfully demonstrated on at least 18 different morphologies of HDDs and commercial grade N45M and N42M magnets produced from the liberated HPMS powder. These and other magnets produced via HPMS from other scrap sources, ranging in grade from N48 remanence and UH coercivity, are currently being tested in a wide range of applications, including automotive, audio and others.
• In collaboration with ZF Automotive and UoB, HyProMag has recently supplied magnets for prototype testing in automotive ancillary applications which were successfully tested by ZF, with performance nearly identical to magnets made from virgin materials as indicated in the recent press article: https://www.engineerlive.com/content/recycling-and-reusing-motor-magnets.
• As a key partner in the Securing Critical Rare Earth Materials ("SCREAM") project, GKN Automotive was instrumental in delivering simulation and physical testing to verify that the HyProMag magnets produced via short-loop recycling have equivalent performance to primary magnets of the same grade.
• The first production-ready HDD magnet separation system has been built by INSERMA ANOIA SL ("Inserma")[i] and is expected to be delivered to the UK in Q3. The system has been shown to more accurately identify and remove the magnets from HDD for HPMS processing at scale. The addition of a printed circuit board removal module is at an advanced stage of development, which would be transformational for the process and enhances the Information Security requirements of HDD Recycling.
• Increased magnetic performance has been achieved through further optimisation of the HPMS and magnet manufacturing processes, with positive feedback from customers who are currently stress testing magnet prototypes. Further technical details, including magnet grades and performance achieved, are elaborated in a detailed HyProMag technical bulletin, which can be accessed via the following link: https://hypromag.com/executive-summary-of-recent-technical-progress-by-hypromag-ltd-june-2025
• Magnets produced from HPMS generated alloys are the first sintered NdFeB magnets to be produced in the UK since the closure of Philips in Southport in December 2003. This capability for manufacture of sintered, commercial grade magnets need not be confined to producing magnets directly from scrap and can be further enhanced by blending with new cast alloys made from virgin mine-sourced metals or recycled metals.
• Acceleration of research and development (R&D) work on blending recycled HPMS powders with virgin materials (from primary as well as medium and long loop recycled sources) is underway, which will broaden the range to higher magnet grades available for commercial purchase and aligns strongly with incoming thresholds for minimum recycled content under the European Union Critical Raw Materials Act.
• Over 100 different blends of recycled material have been created in the last six months to meet R&D and customer requirements, with magnets derived from both single and blended batches of HPMS powder demonstrating consistent performance and further validating the short-loop recycling and magnet manufacturing process.
• Whether in collaborative projects, such as SusMagPro and REEsilience in Europe and UKRI (United Kingdom Research and Innovation) projects RaRE, REAP, SCREAM, ReREwind and REEmelt, or through other collaborations, HyProMag's development partners remain confident of its continuing progress. A recent article has been published which has acknowledged the quality of magnets produced for rotating machines:
• Rare earth magnets derived from HPMS will be extremely low in their Product Carbon Footprint (PCF). For further details and breakdown see https://mkango.ca/news/hypromag-usas-iso-compliant-product-carbon-footprint-study-confirms-exceptionally-low-co-sub-2-sub-footprint-of-2.35-kg-co-sub/

Through the abovementioned workstreams, together with further optimisation and development of blending and grain boundary technologies, HyProMag expects to significantly expand the range of commercial grades produced as illustrated below:

Will Dawes, Mkango CEO commented: "HyProMag is going from strength to strength with the support of its excellent and growing team, as well as from the University of Birmingham and its other partners. The company is well placed to capitalise on the increasing demand for more robust supply chains and sustainably sourced magnetic materials - technologies being commercialised by HyProMag will be transformational for the sector, and we look forward to first sales in UK and Germany in the coming months, as well as completion of detailed engineering in the USA in advance of large-scale project development."

Julian Treger, CoTec CEO commented: "We are very pleased with the continued progress of HyProMag in advance of the commissioning of the UK and German plants. The learnings from these plants and the University of Birmingham's pilot plant programme represent a significant opportunity for HyProMag USA to optimise and refine the detailed design phase. Furthermore, the production of a wide range of magnet grades for U.S. customers from multiple scrap feedstocks will support our financing and off take activities."

Nick Mann, HyProMag Limited MD commented: "The improvements on magnetic properties made are down to the increased understanding gained by the metallurgical team on how to process, blend and sinter differing input feed stocks to achieve a consistent grade of magnet. As we begin production at Tyseley we are testing, collaborating and supplying our commercial partners with our magnets against specifications and are demonstrating good alignment with their products."

Sean Worrall, GKN Automotive Chief Engineer Product Sustainability commented: "As the key physical testing and simulation partner, we are pleased to confirm that the recycled magnets replicated expected performance exceptionally closely during testing. This means HyProMag's short-cycled magnets can be reliably used in motor design simulation to deliver real world performance. The HPMS process enables a supply chain of sustainable, competitive, rare-earth magnets, decoupled from the problems of the virgin material supply chain"

2025 University of Birmingham (UoB) Accelerated Pilot Programme

In parallel with commissioning of the commercial plants in UK and Germany, and to support ongoing HyProMag USA LLC ("HyProMag USA") detailed design[ii], HyProMag has further invested in piloting utilising the UoB infrastructure, onboarded new production engineers and tripled the throughput capacity of the UoB pilot vessel and associated processes. During a six-month period, multiple sources of scrap feeds will be processed with a target of two tonnes of HPMS power produced and converted into commercial grade magnets. HyProMag will provide these samples to potential customers, as well as targeting further improvements in the engineering design criteria, recoveries and magnet making capability to support commercial developments in the UK, Germany and U.S.

The main objectives of the 2025 UoB Accelerated Pilot Programme are to:

• Provide NdFeB block and finished magnet samples to customers, to support product marketing, offtake discussions and scale-up in Europe and North America, and to complement HyProMag's 2025 commercial production of NdFeB alloys, blocks and finished magnets derived from the commercial scale plant being commissioned at Tyseley Energy Park (TEP) by the University of Birmingham.
• Enhanced QAQC planning - Commercial production at TEP is targeted at 600kg batches of HPMS powder that will be analysed by ICP-OE, XRF and gas analysis. These characterised batches will be blended for targeted magnet qualities based on the development know-how from piloting. These batches will be large and consistent in quality; 1.2 tonnes of blended powder can, for example, deliver 50,000 magnets based on a typical 25g speaker application. Sampling QAQC procedures are being developed with end-users.
• Further demonstrate and optimise HPMS, including pre-processing for larger volumes and broader variety of scrap feeds to derive optimal process conditions and estimates of recovery, NdFeB magnet content and yield to short loop recycling for different scrap feeds
• Complete further variability analysis across different HPMS batches of the same type of scrap feed.
• Further demonstrate the ability to blend HPMS powders from different HPMS batches of the same scrap feed with or without virgin feed additions

The Accelerated Piloting Programme targets over 50 additional HPMS runs over a six-month period covering principal scrap feeds containing: separated magnet scrap, VCMs from different sources, pre-processed HDD feed, surface mounted and embedded rotors from electric motors, MRI, wind turbine feed, speaker assemblies and other forms of NdFeB scrap material provided by strategic partners.

About Mkango Resources Ltd.

Mkango also owns the advanced stage Songwe Hill rare earths project in Malawi ("Songwe") and the Pulawy rare earths separation project in Poland ("Pulawy"). Both the Songwe and Pulawy projects have been selected as Strategic Projects under the European Union Critical Raw Materials Act. Mkango has signed a letter of Intent with Crown PropTech Acquisitions to list the Songwe Hill and Pulawy rare earths projects on NASDAQ via a SPAC Merger.

About CoTec Holdings Corp.

For more information, please visit www.cotec.ca.

About HyProMag USA LLC.

HyProMag USA is owned 50:50 by CoTec and HyProMag Limited. HyProMag Limited is 100 per cent owned by Maginito, which is owned on a 79.4/20.6 per cent basis by Mkango and CoTec.

CoTec Holdings Corp.

Braam Jonker

Chief Financial Officer

Canada: +1 604 992-5600

[i] https://mkango.ca/news/maginito-secures-exclusive-agreement-with-inserma-to-commercialise-automated-pre-processing-of-hard-disc-drives-loudspeakers/

[ii] https://mkango.ca/news/cotec-and-mkango-appoint-lead-engineers-pegasustsi-and-bba-to-perform-engineering-procurement-and-construction-management-epcm/