Quarterly Activities Report and Appendix 5B

• Nolans Project enters appraisal phase for potential €100m equity investment from German Raw Materials Fund
• Active sales and marketing program underway in Germany for potential offtake partners
• Intensifying geopolitical focus on rare earths strengthens strategic position of Nolans Project

Arafura Rare Earths Limited (ASX: ARU) reports that during the June 2025 quarter, it continued to advance its equity funding strategy for the Nolans Project, targeting select cornerstone investors with strategic alignment. The company's Nolans Project has entered the appraisal phase for potential equity investment from the German Raw Materials Fund, with Arafura seeking up to €100 million (A$175 million) tied to supply from Nolans. Arafura also has an active sales and marketing program underway in Germany with a number of prospective offtake partners in support of potential funding under the German Raw Materials Fund. The intensifying geopolitical focus on rare earths continues to drive strong market momentum, strengthening the strategic position of the Nolans Project as the leading construction-ready project in the development pipeline. Post 30 June, a bifurcation of pricing materialized as the United States Department of Defense set a floor price for NdPr product from its offtake partner and Benchmark Mineral Intelligence announced the addition of a European and North American rare earth oxide pricing index to commence from 31 July, 2025.

Arafura's confidence in securing its equity investment target remains high, given the substantial progress it is making with all its potential cornerstone investors.