In our ongoing efforts to provide you with broader communications and industry information, we are pleased to issue another Industry Bulletin discussing recent trends in the markets of various rare and strategic metals. This edition looks at the emerging popularity and growth of battery-assisted (or electric) bicycles, more recently referred to as "eBikes". According to the Electric Bikes Worldwide Report, 2008 Update, 20.8 million eBikes were sold worldwide in 2007 and now represent the fastest-growing segment of the bicycle market. This product is yet another example of new electric vehicle technology enabled by rare metals, in this case lithium.

http://blog.tmcnet.com/blog/rich-teh...

The main challenge with electric vehicles is that battery technology is not advancing fast enough to keep pace with the power needs of today's electric vehicle. Toshiba's new battery technology called SCiB® or Super Charge ion Battery represents a significant breakthrough. SCiBs charge to 90% capacity in under 10 minutes, have a 10-year lifespan with frequent recharging (withstanding 5,000 to 6,000 recharge cycles), won't explode if crushed or overheated and work in sub-zero temperatures, giving them a clear advantage over the currently-dominant Lithium-ion batteries. Toshiba's innovative technology has only been available for industrial machinery since March 2007.

Toshiba's Corporate Vice President, Toshiharu Watanabe, has said global sales of the new fast-charging battery are expected to reach 100 billion yen (US$893.7 million) in fiscal 2009.

The key feature of the SciB battery is that lithium titanate (Li4Ti5O12) is used as a negative-electrode material using electrolyte with a high flash point and a separator with a high heat resistance as well as new manufacturing technology. Because of these features, thermal runaway is less likely to occur in case of an internal short-circuit, so the risks of unexpected combustion are greatly-reduced.

http://www.obsessable.com/news/2008/...

As with all new forms of energy and energy storage technology, the development cycle is a lengthy and exhaustive process. There are numerous steps involved, from research, design protocols, testing (internal and external), manufacturing and ultimately market adoption.

At Interbike 2008 in Las Vegas in September, Toshiba announced that its SCiB battery had been selected by Cannondale Sports Group, a global leader in branded bicycles to provide the power battery module for a new electric bicycle for the North American and European markets. Toshiba's SCiB 24V/4.2Ah module will be installed in the Tailwind, a new electric bicycle Cannondale Sports Group will bring to market under the Schwinn Bicycles brand, one of the most revered names in U.S. cycling history. Commercial launch of the Tailwind is scheduled for early 2009.

http://www.batterypoweronline.com/im...

In addition to applications that include battery-powered bicycles, motorcycles, automated guided vehicles, electric forklift trucks and construction machinery, which already use rechargeable batteries, Toshiba believes that the SCiB is also a promising candidate for emergency power sources, electric power regeneration in wind power systems and stabilization of electric power supply. Application in hybrid cars is also planned, with the intent of extending application to electric cars in the future.

http://www.toshiba.co.jp/about/press...

http://www.reuters.com/article/press...

Avalon is well positioned to benefit from the new demand for lithium products for such emerging alternative energy applications, through its large lithium resources at Separation Rapids in northern Ontario, Canada. While lithium mineral markets traditionally support the glass/ceramics sector (representing 25% of the total lithium demand in 2007), and lithium chemicals sourced from brine operations are generally used for batteries, lubricants, pharmaceuticals, and aluminum applications, lithium minerals are increasingly being used as a source for lithium chemicals. As such, lithium minerals are currently the source for 40% of the overall supply for lithium products for all industries. The Separation Rapids Project clearly presents a significant North American lithium resource capable of complementing the supply base needed to satisfy the growing demand for lithium products.

For further information about Avalon and its Thor Lake project, please visit Avalon's website at http://www.avalonventures.com

If you have any comments or questions, please do not hesitate to post them on Avalon's official investor relations hub at http://www.agoracom.com/IR/Avalon.

Regards,

AGORACOM Investor Relations