FL.V · 2021-02-16 12:00:00

Frontier Lithium PEA Demonstrates Attractive 27% IRR Pre-Tax for Lithium Chemical Production in North America's Great Lakes Region

Economic Studies

Frontier Lithium PEA Demonstrates Attractive

27% IRR Pre-Tax for Lithium Chemical

Production in North America's Great Lakes

Region

SUDBURY, ON

Feb. 16, 2021

/CNW/ - Frontier Lithium Inc. (TSXV: FL) (OTCQB: LITOF) (FSE:

HL2) ("Frontier" or "the Company") is pleased to release the strong results of a Preliminary

Economic Assessment ("PEA") for a proposed mine-to-lithium hydroxide chemical/hydromet plant

facility ("Integrated Project") in the Great Lakes Region of North America. The fully Integrated

Project PEA assumes a hydromet plant that would convert spodumene concentrate feedstock

sourced from open-pit mining and a milling facility at the Company's PAK Lithium Project, located

north of

Red Lake

, Ontario.

Frontier Lithium PEA Demonstrates Attractive 27% IRR Pre-Tax for Lithium Chemical Production in

North America's Great Lakes Region (CNW Group/Frontier Lithium Inc.)

Highlights ($USD unless otherwise stated):

Life of Project Revenue of

$8.52 billion

over 26-year total project life;

Total initial capital expenditure estimate of

$685 million

with a contingency of 22.5% included.

Sustaining Capital of

$117 million

;

Pre-tax Net Present Value at an 8% base case discount rate ("NPV

") of

.62 billion and

Internal Rate of Return ("IRR") of 27%;

Post-tax net "undiscounted" Cash Flow (before initial capital expenditures) of

$3.75 billion

;

Post-tax NPV

$974.6 million

and IRR of 21%;

Annual Average EBITDA (steady-state) of

$225 million

Chemical plant producing 23,174 tonnes of battery-quality Lithium Hydroxide Monohydrate

(LiOH-H

O) per year with an average selling price of

$13,500

per tonne. A total of 556,200

tonnes of LiOH has been contemplated being produced from open pit mining only at the PAK

and Spark deposits; underground constrained mineral resources available at the PAK deposit

for future consideration.

PAK and Spark deposits are open in all directions and could provide potential resource

expansion for a newly commenced Preliminary Feasibility Study ("PFS");

All-in operating cash costs of $4,083 per tonne of LiOH; and

After-Tax Pay Back of Capital Expenditures is 4.5 years after the start of commercial

operations.

"The fully Integrated Project PEA demonstrates the economic and strategic benefits of developing

lithium chemical production of lithium hydroxide in the Great Lakes Region of

North America

, with

skilled labour, exceptional infrastructure, low carbon sources of energy, prime intermodal

transportation access and low operating costs." stated

Trevor Walker

, President & CEO of Frontier

Lithium. "With PEA completion, Frontier will advance the Integrated Project to a PFS level and

continue to advance the high-grade PAK Lithium Project resource toward the goal of production of

premium lithium chemicals. Underpinning the PFS will be the current drilling at the PAK Lithium

Project and ongoing operations of the Company's mini-pilot plant testing our proprietary Lithium

Hydroxide production process. As western automotive companies rapidly electrify their product

lineups, we expect very strong demand for locally sourced premium lithium chemicals supply, and the

Great Lakes region is the prime location as it is the largest auto manufacturing hub on the continent."

(All Tables are in $USD unless otherwise stated)

Table

: Summary of PAK Project PEA Economics

Project Economics

Pre-Tax

NPV

$1.62 Billion ("B")

IRR

27%

Cumulative Cash Flow

$5.26 B

Annual Average EBITDA (steady-state)

$225 Million ("M")

Post-Tax

NPV

$974.6 M

IRR

21%

Cumulative Cash Flow

$3.51 B

Table

: Summary of PAK Project PEA Economic Assumptions

Economic Assumptions and Parameters

Exchange Rate ($USD/$CAD)

$0.78

Discount Rate (base case)

Technical Grade Concentrate (7.2% Li2O)

$1,600/tonne

Chemical Grade Concentrate (6.0% Li2O)

$750/tonne

Lithium Hydroxide Monohydrate_Battery Grade

$13,500/tonne

Table

: Summary of PAK Project PEA Production Profile

Production Profile

Total Project Life (LOM)

26 Years

Mine and Concentrator

Total Tonnes Milled

22,914,500

Diluted Head Grade

1.46% Li

Average Stripping Ratio (W:O)

3.6

Daily mill commercial throughput

2,900 t/d

Average Lithium Recovery (mill)

83.9%

Total CG Production (6.0% Li

4,076,600 tonnes

Total TG Production (7.2% Li

525,700 tonnes

Hydromet Plant

Yearly chemical plant throughput

160,000 tonnes

Lithium Recovery

85%

Total battery grade Lithium Hydroxide (LiOH)

556,200 tonnes

Table

: Summary of PAK Project PEA Operating Costs

Operating Costs

$/t

processed

Mine and Concentrator

Direct Open Pit Mining Cost

3.48

Direct Processing Cost

17.82

Avg. Spodumene Conc. Production Cost (EXW hydromet plant)

313

Hydromet Plant

Average Processing Cost

1,785

Lithium Recovery

85%

Total Lithium Hydroxide Production Cash Cost (EXW plant)

4,083

Table

: Summary of PAK Project PEA Capital

Capital Requirements

$ Million

EPCM

41.3

Contingency

111.4

Mine and Mill

Site Preparation/Infrastructure

41.4

Mill Processing and Storage

100.3

Power Distribution

6.2

Open Pit Equipment

16.6

Water treatment and waste management

4.2

Chemical Plant

Civil/Structural

103.9

Hydromet Processing

168.8

Utilities/Aux. & Services

90.9

Total Pre-Production Capital Cost

684.9

Total Sustaining Capital Cost

117.1

Cautionary Statements

The fully Integrated Project PEA referred to in this announcement has been undertaken to determine

the potential viability of the integrated project comprising a mine/concentrator and chemical plant in

northern

Ontario

and to reach a decision to proceed with more definitive studies. This PEA is

preliminary in nature, includes inferred mineral resources that are considered too geologically

speculative to have the economic considerations applied to them that would enable them to be

categorized as mineral reserves. There is no certainty the PAK Lithium Project outlined by the PEA

will be realized. The Company has concluded it has a reasonable basis for providing the forward-

looking statements included in this announcement and believes that it has a reasonable basis to

expect it will be able to fund the development of the Integrated Project. Given the uncertainties

involved, investors should not make any investment decisions based solely on the results of the PEA.

Mining and Milling

A preliminary integrated site plan including mining operations, waste disposal, and concentrator was

considered and developed for the purpose of the PEA. The PEA study outlines two open pits at the

mine, one at the PAK deposit and one at the Spark deposit. The PAK deposit contains a pit

constrained mineral resource in the measured and indicated categories of 5.4 million tonnes

averaging 1.99% Li

O and a pit constrained inferred mineral resource of 0.60 million tonnes

averaging 1.97% Li

O that hosts a rare technical/ceramic grade spodumene with low inherent iron

(below 0.1% Fe

). The Spark deposit is located only 2km northwest of the PAK deposit and

contains a pit constrained mineral resource estimate of 3.3 million tonnes averaging 1.59% Li

O in

the indicated category and a pit constrained mineral resource of 15.7 million tonnes averaging 1.31%

O in the inferred category. Under the PEA, the open pits targeted production results in an

anticipated stripping ratio of 3.6 to 1. The open pits will be mined using a standard fleet of off-road

mining trucks and hydraulic excavators at a rate of approximately 2,900 tonnes of ore per day. The

concentrator will process all of the ore generated from mining operations. Frontier Lithium has filed

with appropriate authorities for a mining lease which comprises the mining and surface rights

necessary to mine the PAK and Spark deposits and encompass the appropriate area for a mining

operation as outlined in the PEA. Frontier Lithium does not have the necessary permits in place at

the time of this release to build the project as described in the PEA.

Chemical/Hydromet Plant

The hydromet plant PEA considers a lithium processing plant to be located on a Great Lakes port

and includes spodumene concentrate receiving and storage facilities, reagent receiving and storage

facilities, process facilities and site infrastructure. For the purpose of the PEA the chemical plant

flowsheet incorporates as far as practical 'conventional' or proven-in-operation, equipment, and

process stages, in order to minimize process, technology and equipment risk. The hydromet plant is

designed to produce 23,174 tonnes per year of battery grade lithium hydroxide monohydrate

(approx. 20,400 t/year of lithium carbonate equivalent "LCE").

Mineral Resource Estimate

A summary of the Mineral Resource Estimate for Spark is set out in Table 6. The Mineral Resource

Estimate for PAK is summarized in Tables 7 and 8.

Table

: Spark Mineral Resource Calculation (Updated 2021)

Cut-Off

Resource

Classification

Tonnes (t)

O (%)

(ppm)

Contained

O (t)

0.60%

Indicated

3,261,000

1.59

123

52,000

Inferred

15,718,000

1.31

108

206,000

able

: PAK Open Pit Mineral Resource Calculation (Updated 2021)

Cut-

off

Resource

Category

Commodity

Geologic Zone

Tonnes (t)

(%)

(ppm)

Contained Li

(t)

0.8% Li

Measured

Lithium

UIZ

Lithium

LIZ

Lithium

Total Lithium Zone

Lithium / Tantalum / Rubidium

Bulk Pegmatite

0.8% Li

Indicated

Lithium

UIZ

Lithium

LIZ

1,261,700

2.15

27,127

Lithium

Total Lithium Zone

1,261,700

2.15

27,127

Tantalum / Rubidium

CIZ

3,830

1.16

n/a

Lithium / Tantalum / Rubidium

Bulk Pegmatite

1,265,530

2.14

27,127

0.8% Li

Measured + Indicated

Lithium

UIZ

Lithium

LIZ

1,261,700

2.15

27,127

Lithium

Total Lithium Zone

1,261,700

2.15

27,127

Tantalum / Rubidium

CIZ

3,830

1.16

143

n/a

Lithium / Tantalum / Rubidium

Bulk Pegmatite

1,265,530

2.14

27,127

0.8% Li

Inferred

Lithium

UIZ

27,450

4.35

1,194

Lithium

LIZ

2,043,400

2.35

48,020

Lithium

Total Lithium Zone

2,070,850

2.38

49,214

Tantalum /Rubidium

CIZ

6,900

2.03

146

n/a

Lithium / Tantalum / Rubidium

Bulk Pegmatite

2,077,750

2.37

49,214

(1)

Upper Intermediate Zone

(2)

Lower Intermediate Zone

(3)

Central Intermediate Zone

Mineral Resource Estimate Notes

Mineral Resources were prepared in accordance with NI 43-101 and CIM Definition Standards (2014). Minerals Resources that are not Mineral Reserves do not have

demonstrated economic viability. This estimate of Minerals Resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical,

marketing and other issues.

Open Pit Mineral Resources are reported at a cut-off of 0.60% Li

O. Underground Mineral Resources are reported at a cut-off of 0.80% Li

Appropriate mining costs, processing costs, metals recoveries and inter ramp pit slope angles were used to generate pit shells.

Appropriate mining costs, processing costs, metals recoveries and mining shapes were used to generate underground mineral resources

Rounding may result in apparent summation differences between tonnes, grades and contained metals content

Tonnage and grades measurements are in metric units

Contributing assay composites at Spark were capped at 3.55% Li

O. At PAK, composite assays were capped at 4.40 % Li

O in the CIZ, 4.18% Li

O in the LIZ and 4.95%

O in the UIZ.

A specific gravity of 2.718 was applied to the pegmatite at Spark based on 241 measurements. The specific gravity at PAK vary from 2.66 to 2.86 depending on the

pegmatite domain.

Modeling at Spark was performed using GEOVIA Surpac 2019 software with grades estimated using ordinary kriging (OK) interpolation methodology. Samples were

composited at 1.0 meter down hole. Block grades were estimated on a multi pass basis with a minimum and maximum number of composites required for each estimation

pass. Block size is 2 metre * by 2 metre (y) by 2 metre (z).

10.

Modeling at PAK was performed using GEOVIA Surpac 2019 software with grades estimated using ordinary kriging (OK) interpolation methodology. Samples were

composited at 1.0 meter down hole. Block grades were estimated on a multi pass basis with a minimum and maximum number of composites required for each estimation

pass. Block size is 2.5 metre * by 2.5 metre (y) by 2.5 metre (z).

Quality Assurance and Quality Control

Under Frontier's QA/QC procedures, all drilling was completed by Chenier Drilling Ltd. of Val Caron,

ON using thin-walled BTW drill rods (4.2 cm core diameter) and a Reflex ACT III oriented core

system. Using the Reflex system, the drill core was oriented and marked as it was retrieved at the

drill. The core was boxed and delivered to the Frontier core shack where it was examined,

geologically logged and marked for sampling. The core was photographed prior to sampling. Using

a rock saw, the marked sample intervals were halved with one halve bagged for analysis. Sample

blanks along with lithium, rubidium and cesium certified reference material was routinely inserted into

the sample stream in accordance with industry recommended practices. Field duplicate samples

were also taken in accordance with industry recommended practices. The samples were placed in

poly sample bags and transported to Red Lake by Frontier employees and then shipped to AGAT

Laboratories Ltd. (AGAT) in Mississauga, ON for quantitative multi-element analysis. AGAT is an

ISO accredited laboratory. All petrographic sample preparation and electron microprobe (EMP)

analysis was completed at the Queen's Facility for Isotope Research (QFIR) at Queen's University

in Kingston, Ontario under the direct supervision of Dr. Steve Beyer. The core is stored on site at the

Pakeagama Lake exploration camp.

Qualified Persons

The Mineral Resources for PAK Lithium Project disclosed in this news release have been estimated

by Mr.

Todd McCracken

, P. Geo., an employee of

BBA Engineering Ltd.

and independent of

Frontier. By virtue of his education and relevant experience, Mr. McCracken is "Qualified Person" for

the purpose of National Instrument 43-101. The mineral resource has been classified in accordance

with CIM Definition Standards for mineral resources and mineral reserves, (

November 2014

). Mr.

McCracken, P. Geo., has read and approved the contents of this press release as it pertains to the

disclosed Mineral Resource estimate and financial model. The National Instrument 43-101 PEA

report will be filed on SEDAR (

www.sedar.com

) within 45 days.

BBA Engineering Ltd. is a Canadian consulting engineering firm specialized in power, mining and

metals, biofuels, oil and gas.

Johnny Canosa P.Eng

., Sr. Mining Engineer for JAC Mining Consultants is an independent Qualified

Person as defined by NI 43-101 and has reviewed and approved the contents of this news release.

Mr. Canosa is responsible for open pit mine planning, scheduling operating and capital costs related

to mining and surface infrastructure.

Kurt Boyko

, P.Eng., Consulting Specialist - Mechanical for Nordmin Engineering Ltd., is an

independent Qualified Person as defined by NI 43-101 and has reviewed and approved the contents

of this news release. Mr. Boyko is responsible for process plant design, chemical plant design and

operating and capital cost estimates related to the processing facilities.

Steve Wilson

, P.Eng., Process Engineer – Wil-Solve Consulting Services, is an independent

Qualified Person as defined by NI 43-101 and has reviewed and approved the contents of this news

release. Mr. Wilson is responsible for mineral processing and metallurgical testing.

Review of Technical Information

Garth Drever

, P. Geo, Vice President Exploration for

Frontier Lithium Inc.

is a Qualified Person as

defined by NI 43-101 and has reviewed and approved the contents of this news release. Mr. Drever

has been involved with all aspects of the PAK Lithium project since 2013.

About Frontier Lithium Inc.

Frontier Lithium (

TSX.V: FL

) (

OTCQB: LITOF

) (

FSE: HL2

) is a

Sudbury Ontario

based, publicly

listed, junior mining company with the largest land position in an emerging premium lithium mineral

district located in the Great Lakes region of northern

Ontario

. The company maintains 100% interest

in the PAK Lithium Project which contains one of

North America's

highest-grade, large tonnage hard-

rock lithium resources in the form of a rare low-iron spodumene. The Project has significant upside

exploration potential. Frontier is a pre-production business that is targeting the manufacturing of

battery quality lithium hydroxide in the Great Lakes Region to support electric vehicle and battery

supply chains in

North America

. Frontier maintains a tight share structure with management

ownership approximately 30% of the Company.

About the PAK Lithium Project

The PAK Lithium Project encompasses 26,774 hectares at the south end of

Ontario's

Electric

Avenue, the largest land package hosting lithium bearing pegmatites in

Ontario

. The Project covers

65 km of the Avenue length and remains largely unexplored; however, since 2013 the company has

delineated two premium spodumene bearing lithium deposits located 2.3 km from each other at the

southwestern end of the project. Recently, Frontier confirmed the presence of spodumene with the

Bolt pegmatite, between PAK and Spark deposits and the Pennock Lake pegmatite occurrence a

further 30 km along the Project. Frontier's premier Great Lakes location is advantaged by favorable

geology, proven metallurgy with access to intermodal hubs, infrastructure, power, and mining along

with downstream lithium processing expertise and auto OEM's.

The PAK deposit hosts a rare "technical grade" spodumene maintaining low inherent iron levels

(below 0.1% Fe

) and contains a pit constrained mineral resource in the measured and indicated

categories of 5.4 million tonnes averaging 1.99% Li

O and a pit constrained inferred

mineral resource of 0.60 million tonnes averaging 1.97% Li

O. The PAK deposit also contains an

underground constrained mineral resource in the measured and indicated categories of 1.3 million

tonnes averaging 2.15% Li

O and an underground constrained mineral resource in the inferred

category of 2.1 million tonnes averaging 2.38% Li

O. The Spark deposit is located only 2km

northwest of the PAK deposit and contains a pit constrained mineral resource estimate of 3.3 million

tonnes averaging 1.59% Li

O in the indicated category and a pit constrained mineral resource of

15.7 million tonnes averaging 1.31% Li

O in the inferred category., as per the initial results

supporting an upcoming NI 43-101 Technical Report, "2020 Preliminary Economic Assessment, Fully

Integrated PAK Lithium Project" by BBA Engineering Ltd.

Forward-looking Statements

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in

the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of

this release. This release includes certain statements that may be deemed "forward-looking

statements". All statements in this release, other than statements of historical facts, that address

future production, reserve potential, exploration drilling, exploitation activities and events or

developments that the Company expects are forward-looking statements. Although the Company

believes the expectations expressed in such forward-looking statements are based on reasonable

assumptions, such statements are not guarantees of future performance and actual results or

developments may differ materially from those in the forward-looking statements. Factors that could

cause actual results to differ materially from those in forward looking statements include market

prices, exploitation and exploration successes, continued availability of capital and financing, and

general economic, market or business conditions. Investors are cautioned that any such statements

are not guarantees of future performance and those actual results or developments may differ

materially from those projected in the forward-looking statements. For more information on the

Company, Investors should review the Company's registered filings what are available at

https://www.sedar.com

SOURCE

Frontier Lithium Inc.

View original content to download multimedia:

http://www.newswire.ca/en/releases/archive/February2021/16/c4690.html

%SEDAR: 00008434E

For further information:

Bora Ugurgel, Manager, Investor Relations, 2736 Belisle Drive, Val Caron,

ON. P3N 1B3 CANADA, T. +001 705.897.7622, F. +001 705.897.7618

CO: Frontier Lithium Inc.

CNW 16:30e 16-FEB-21

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