LBNK.V · 2024-01-16 12:00:00

LithiumBank Announces Updated PEA; Significantly Increases Pre-Tax NPV8% to USD $3.7 Billion and Reduces OPEX to USD $4,588 per LCE/T at Flagship Boardwalk Lithium Brine Project, Alberta, Canada

Economic Studies

LithiumBank Announces Updated PEA;

Significantly Increases Pre-Tax NPV8% to USD

$3.7 Billion and Reduces OPEX to USD $4,588

per LCE/T at Flagship Boardwalk Lithium

Brine Project, Alberta, Canada

Calgary, Alberta--(Newsfile Corp. - January 16, 2024) -

LithiumBank Resources Corp.

(

TSXV:

LBNK

) (

OTCQX: LBNKF

) ("

LithiumBank

" or the "

Company

") is pleased to announce the highlights

from an updated Preliminary Economic Assessment ("

Updated PEA

") by Hatch Inc. ("

Hatch

") for its

100%-owned Boardwalk Lithium Brine Project ("

Boardwalk

") located in west-central Alberta. The

significant difference from the initial PEA ("

Original PEA

") released in May 2023 was the incorporation

of newly licensed continuous Direct Lithium Extraction ("

cDLE®

") technology from G2L Greenview

Resources Inc ("

G2L

") The G2L technology has numerous advantages over the direct lithium extraction

DLE

") process applied in the original PEA. This update builds upon a lithium carbonate equivalent

LCE

") updated resource estimates at the Boardwalk Project of 395,000 tonnes LCE of indicated and

5.73 million tonnes LCE of inferred resources. The mineral resource update was completed by APEX

Geoscience Ltd. ("

APEX

"). The updated NI 43-101 PEA Technical Report will be filed on SEDAR within

45 days of this announcement.

Boardwalk Updated PEA Improvements Highlights include

[1]

Increased lithium recovery of 98% using the G2L's cDLE® technology

Increased production to 34,005 tonnes per year of battery grade lithium hydroxide monohydrate

LHM

[2]

over a 20-year period

A significant reduction of 34% in operational expenditures to USD $4,588 per tonne LHM

USD $3.7 Billion Net Present Value

NPV8

") and 25.0% IRR on a pre-tax basis

USD $2.3 Billion NPV

and 20.6% IRR on an after-tax basis

Reduction in the payback period from 4.1 years to 3.5 years, on a pre-tax basis

Production of high-grade lithium sulphate (Li

) eluate at a concentration of 3,238 mg/L Li (3.24

g/L Li)

Lower cost and commercially available reagents used in the cDLE® process

Majority of acid is recovered in the downstream processing and reused in the elution stage

Reduction in freshwater usage using the G2L cDLE®

Achievement of commercial production within 3 years is possible under Provincial permitting

directives

Located in the resource friendly jurisdiction of west-central Alberta, which has a long history of

resource extraction, well established infrastructure, and an actively supportive government

Power expected to be generated on site using high-efficiency gas turbines with steam

cogeneration that is expected to lower the project's overall carbon footprint. The proposed gas

turbine units may be run on 80% hydrogen when a reliable supply is available

Project economics again used USD $26,000/t LHM and provides strong leverage to higher lithium

prices

No changes were made to the front end of the engineering which includes everything up to the DLE

"We are very pleased to provide an updated PEA which highlights the effectiveness of our newly

licensed

cDLE®

technology from G2L," commented LithiumBank CEO Rob Shewchuk. "Reducing

the operating cost by 34% to US $4,588 /t LHM both shortens the payback period to 3.5 years and

increases NPV to US$ 3.7B, making our Boardwalk project highly competitive on the world stage. We

believe having district scale, 100% owned, unconventional lithium development projects in North

America makes LithiumBank a unique investment opportunity. This, along with the combination of

substantial LCE resources and the ability to utilize the wealth of experience, data and infrastructure

provided by major energy companies in Central Alberta, positions us well for continued success."

LithiumBank elected to update the Original PEA because of the strong results received from the G2L

test work using their cDLE® Ion Exchange ("

") technology. The G2L cDLE® technology is unique in

that it is designed to work at high flow rates while maintaining a very high recovery of lithium (98%) and

achieving a high purity (70%) lithium eluate. Furthermore, this updated PEA demonstrates that lower

cost and readily available reagents such as quick lime (CaO) and sulphuric acid (H

) can produce a

high purity lithium sulphate eluate for further downstream processing. Lithium sulphate is a common

product in spodumene mining where Hatch has extensive experience in designing and implementing the

appropriate processing equipment.

"Based on the results of this PEA it is clear that implementing efficient DLE technology has a

significant positive economic impact on a project. In early 2021 LithiumBank made a strategic

decision to conduct an extensive DLE assessment program study run by Hatch to determine the

optimal technology and commence pilot studies," commented LithiumBank COO Kevin Piepgrass.

"That in-depth process took time, and we are now pleased to share how the Company's licenced

cDLE®

has greatly improved the results of the updated PEA. We look forward to commencing our

pilot studies with G2L on both our Boardwalk and Park Place lithium brine projects in the coming

months."

Updated Economic Analysis

The base case assumes a long term LHM price of US$26,000/t. At this price, the project has an

improved NPV of $3.7 billion on a pre-tax basis at an 8% real discount rate. A summary of key indicators

is shown in

Table 1

Table 1 - Boardwalk Economic Summary

Description

Unit

Original PEA

Updated PEA

Percent change

LHM Sales

t/year

31,350

34,005

LHM Price

US$/t

26,000

Site Operating Unit Cost

US$/t sold

6,941

4,588

-34%

Site Operating Cost

US$M/year

214

155.2

-27%

Project Life

years

Initial Capital Cost

US$M

2,092

2,160

Sustaining Capital Cost

US$M

129

131

USD/CAD Exchange Rate

US$/C$

0.74

0.73

-1%

Pre-tax NPV @ 8%

US$M

2,722

3,679

35%

After-tax NPV @ 8%

US$M

1,657

2,305

39%

Pre-tax IRR

21.6

25.0

16%

After-tax IRR

17.8

20.6

16%

Pre-tax Payback

operating years

4.1

3.5

-15%

After-tax Payback

operating years

4.5

3.9

-13%

The preliminary economic assessment is inherently preliminary in nature. It includes inferred mineral

resources that are too speculative geologically to have economic considerations applied to them that

would enable them to be categorized as mineral reserves, and there is no certainty that the results

indicated in this preliminary economic assessment will be realized.

Capital and Operating Cost Estimates

The Capital Expenditure ("

CAPEX

") Estimate was prepared in accordance with the Association for the

Advancement of Cost Engineering (AACE) Class 5 Study standards, and has an approximate accuracy

of +50%, -30%.

The total estimated CAPEX for the project is presented in table 2 below, inclusive of contingency.

Table 2 - Capital Cost Estimate Summary

Capital Item

Estimated Cost

(M USD)

Plant Wide - General

$26.70

Onsite Infrastructure

$265.20

Offsite Infrastructure

$19.50

Brine Wellfield Services

$273.00

Surface Brine Infrastructure

$207.60

Lithium Processing Plant

$610.70

Direct Cost - Subtotal

$1,402.70

Indirect Cost

$327.30

Contingency

$373.50

Owner's Cost

$56.10

Total Project Capital Cost

$2,159.70

The Operating Expenditure ("

OPEX

") Estimate for the project was also prepared in accordance with the

AACE Class 5 Study standard. The total OPEX is presented below in Table 3.

Table 3 - Operating Cost Summary

Cost Component

Lithium Plant Annual

Operating Cost (M USD)

Original PEA Operating

Cost (USD/t LHM)

Updated PEA Operating

Cost (USD/t LHM)

Percent Change Operating

Cost

Reagents

37.3

3,689

1,089

-70%

Utilities

51.9

1,480

1,515

Consumables

16.5

154

482

213%

Labour

17.6

513

Maintenance Materials and

Services

18.7

646

546

-15%

Transport and Logistics

6.6

114

192

68%

General and Administrative

(G&A)

6.7

210

196

-7%

Total Operating Cost

155.2

6,941

4,588

-34%

Sensitivity Analysis

Returns are highly sensitive to input assumptions and should be viewed in the context of the sensitivity

analysis provided in Figures 1 through 4. The product price (US $26,000/t LHM), exchange rate (0.73),

capital cost, and operating cost were each varied independently on an annual basis and the resulting

variations in, before and after tax, NPV @ 8% and IRR are shown in as well as the stated accuracies for

items such as capital costs.

Figure 1: NPV @ 8% Discount Rate Pre-Tax

To view an enhanced version of this graphic, please visit:

https://images.newsfilecorp.com/files/10140/194378_5b8c644a546a88ba_001full.jpg

Figure 2 - NPV @ 8% Discount Rate After-Tax Sensitivity

To view an enhanced version of this graphic, please visit:

https://images.newsfilecorp.com/files/10140/194378_5b8c644a546a88ba_002full.jpg

Figure 3: IRR Pre-Tax Sensitivity

To view an enhanced version of this graphic, please visit:

https://images.newsfilecorp.com/files/10140/194378_5b8c644a546a88ba_003full.jpg

Figure 4 - IRR After-Tax Sensitivity

To view an enhanced version of this graphic, please visit:

https://images.newsfilecorp.com/files/10140/194378_5b8c644a546a88ba_004full.jpg

"We are excited to announce this updated Boardwalk PEA that enhances an already impressive DLE

project in the tier 1 jurisdiction of Alberta, Canada. Over the last 8 months, we have rigorously tested

the G2L cDLE technology and begun to quantify its very positive impact on the project economics,"

commented Paul Matysek, Executive Chairman LithiumBank. "These improved economics,

combined with its scale, potential speed to production, availability of existing infrastructure, and large

inferred LCE resource, makes Boardwalk a very attractive project right here in North America.

Furthermore, there is potential for substantial upside from the Canadian Investment Tax Credit, along

with other numerous optimization opportunities."

Updated Lithium Recovery Methods - DLE Technology

LithiumBank commissioned a bench-scale testing campaign to establish the selective lithium extraction

performance of G2L's cDLE® technology. The test work also assessed optimal process conditions that

produce lithium concentrates that can be upgraded to battery grade products. The first stage of the work

was completed at G2L's lab facility in Melbourne, Australia. It included the bench scale of tests of the

thermodynamic and kinetic properties of the IX media during loading and elution. The testing

successfully demonstrated that the IX media can selectively extract 98% lithium from LithiumBank's feed

brine and produce a lithium sulphate concentrate suitable for downstream production of lithium

chemicals.

The lithium processing facility is designed to a nameplate production capacity of approximately 34,005

tonnes per annum of battery grade lithium hydroxide monohydrate (29,951 tonnes per annum LCE) at a

feed brine throughput of 250,000 m

/d at an average concentration of 70.1 mg/L. This assumes a 98.7%

operating factor and a 98%

[3]

overall lithium recovery. Once the dissolved H

S, residual suspended

solids and hydrocarbons are removed from the brine, lithium is preferentially extracted through the

cDLE® IX technology. After removal of the precipitated impurities from the eluate, the lithium concentrate

is polished prior to the lithium sulfate electrochemical process to produce lithium hydroxide. Battery

grade lithium hydroxide monohydrates are produced through two stages of crystallization, followed by

drying and packaging. The processing stages that follow the DLE extraction are similar to what is used

in the processing of other lithium-rich bines around the world and are well understood and commonly

used.

Additional PEA Enhancement Opportunities

Leveraging of existing wells and surface infrastructure including roads, well pads, pipelines, and

utilities

Reduction of well and power requirements through enhanced 3-D reservoir modelling and new

drilling information

Utilise ZS2 Technologies Inc. to capture and sequester CO

emissions to produce carbon credits,

lowering brine reinjection volume amounts by at least 10%

Additional trade-off studies aimed at streamlining pipeline infrastructure

The Government of Canada announced an Investment Tax Credit ("

ITC

") for Clean Technology

Manufacturing in its Budget 2023. A potential Refundable tax credit may be applied on capital

expenditures for the extraction and processing of critical minerals

Updated Mineral Resource Estimates

The Mineral Resource Estimates were updated to reflect a minor change in the Boardwalk Property

boundary associated with the conversion of Mineral Permits to Brine-Hosed Mineral Licences as per

new Alberta Mineral Tenure Regulation. The updated mineral resource estimations predict indicated

LCE resources of 395,000 tonnes LCE at 71.6 mg/L lithium and a slight decrease of inferred LCE

resources to 5.734 million tonnes LCE at 68.0% mg/L Li (decrease of 1.3% from the previous resource

estimate effectively dated June 16, 2023). Reconciliation of the updated mineral resources is entirely

related to the change, and slight reduction, in the Boardwalk Property land position.

The Boardwalk Leduc Formation Li-brine resource estimates are classified as indicated and inferred

mineral resources in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum

definition standards and best practice guidelines (2014, 2019) and the Canadian Securities

Administration's Standards for Disclosure of Mineral Projects, National Instrument 43-101.

The indicated and inferred Boardwalk Leduc Formation lithium-brine resource estimations are

presented as a total (or global value), and were estimated using the following relation in consideration of

the Leduc Formation aquifer brine:

Lithium Resource = Total Brine Aquifer Volume X Average Porosity X Percentage of Brine in

the Pore Space X Average Concentration of Lithium in the Brine.

The indicated mineral resource area is defined by the outline of the Sturgeon Lake South Oilfield. The

resource classification within the Sturgeon Lake South Oilfield is elevated to an indicated mineral

resource due to 1) the correlation of historical Li-brine data in conjunction with 2021-2022 brine

analytical work conducted by LithiumBank; 2) reinterpretation of 2-D seismic data and understanding of

the dimensions of the Leduc Formation reef buildups; and 3) mineral processing test work - all of which

have advanced the confidence level of the Li-brine concentration, geological model and potential for

recovery of lithium from the brine. The inferred mineral resource area is defined by the remaining area of

the Sturgeon Lake Reef Complex that is situated outside of the indicated mineral resource area.

Three-dimensional wireframes of the Leduc Formation aquifer were created using the grid surfaces of

the top and base of the Leduc Formation within the 3-D geological model. The 2-D strings were

connected to create a solid 3-D wireframe of the Leduc Formation aquifer within the resource areas.

Only those parts of the Sturgeon Lake Reef Complex that occur within the permitted LithiumBank

Boardwalk Property were used in the resource estimate process. The 3-D closed solid polygon

wireframe of the Leduc Formation aquifer domain was used to calculate the volumes of rock, or the

aquifer volumes. The aquifer volumes underlying the Boardwalk Property, summarized as the total Leduc

Formation domain aquifer volumes, are 19.9 km

and 305.0 km

in the indicated and inferred resource

areas, respectively.

The brine volumes are calculated for the Leduc Formation aquifer domain, or resource areas, by

multiplying the aquifer volume (in km

) times the average porosity times the percentage of brine

assumed within the pore space. Using an average effective porosity value of 5.3% and an average

modal abundance of brine in the Leduc Formation pore space percentage of 98%, the indicated and

inferred resource brine volumes are 1.036 km

and 15.842 km

, respectively.

Average Leduc Formation aquifer brine lithium concentrations of 71.6 milligrams per liter (mg/L) Li and

68.0 mg/L Li were selected for the calculation of the indicated and inferred resource estimations. These

values were determined from a lithium assay database of 25 ICP-OES analyses conducted by

LithiumBank's primary lab (indicated resource area) and 89 LithiumBank and historical ICP-OES

analyses (inferred resource area). The quality of the average lithium concentrations was assessed and is

considered to represent elevated levels of analytical precision.

The Li-brine resources were estimated using a cut-off grade of 50 mg/L lithium. With respect to units of

measurement, 1 mg/L = 1 g/m

. If concentration is in mg/L and volume in m

, then the calculated

resource has units of grams. (1 g/m

x 1 m

= 1 gram or 0.001 kg).

The Updated Boardwalk Leduc Formation Li-brine indicated resource estimate is globally estimated at

74,000 tonnes of elemental Li (Table 4). The global (total) lithium carbonate equivalent for the indicated

resource is 395,000 tonnes.

The Updated Boardwalk Leduc Formation Li-brine inferred resource estimate is globally estimated at

1.077 million tonnes of elemental Li (Table 5). The global (total) lithium carbonate equivalent for the

inferred resource is 5.734 million tonnes.

Mineral resources are not mineral reserves and do not have demonstrated economic viability. There is

no guarantee that all or any part of the mineral resource will be converted into a mineral reserve. The

estimate of mineral resources may be materially affected by geology, environment, permitting, legal, title,

taxation, socio-political, marketing, or other relevant issues.

Table 4 - Boardwalk Indicated Li-brine resource estimation presented as a global (total)

resource contained within the Leduc Formation of the Sturgeon Lake South Oilfield.

Indicated Resource

Estimate

Reporting parameter

Leduc Formation Reef Domain

Aquifer volume (km

)

19.942

Brine volume (km

)

1.036

Average lithium concentration (mg/L)

71.6

Average porosity (%)

5.3

Average brine in pore space (%)

98.0

Total elemental Li resource (tonnes)

74,000

Total LCE (tonnes)

395,000

Note 1: Mineral resources are not mineral reserves and do not have demonstrated economic viability.

Note 2: The weights are reported in metric tonnes (1,000 kg or 2,204.6 lbs).

Note 3: Tonnage numbers are rounded to the nearest 1,000 unit.

Note 4: In a 'confined' aquifer (as reported herein), porosity is a proxy for specific yield.

Note 5: The resource estimation was completed and reported using a cutoff of 50 mg/L Li.

Note 6: To describe the resource in terms of industry standard, a conversion factor of 5.323 is used to convert elemental Li to Li

, or Lithium

Carbonate Equivalent (LCE).

Table 5 - Boardwalk Inferred Li-brine resource estimation presented as a global (total) resource

that is contained within the Leduc Formation that encompasses the Sturgeon Lake Reef

Complex outside of the Sturgeon Lake South Oilfield (or area of the Indicated mineral

resource).

Inferred Resource

Estimate

Reporting parameter

Leduc Formation Reef Domain

Aquifer volume (km

)

304.999

Brine volume (km

)

15.842

Average lithium concentration (mg/L)

68.0

Average porosity (%)

5.3

Average brine in pore space (%)

98.0

Total elemental Li resource (tonnes)

1,077,000

Total LCE (tonnes)

5,734,000

Note 1: Mineral resources are not mineral reserves and do not have demonstrated economic viability.

Note 2: The weights are reported in metric tonnes (1,000 kg or 2,204.6 lbs).

Note 3: Tonnage numbers are rounded to the nearest 1,000 unit.

Note 4: In a 'confined' aquifer (as reported herein), porosity is a proxy for specific yield.

Note 5: The resource estimation was completed and reported using a cutoff of 50 mg/L Li.

Note 6: To describe the resource in terms of industry standard, a conversion factor of 5.323 is used to convert elemental Li to Li

, or Lithium

Carbonate Equivalent (LCE).

Property Description

The 100% owned Boardwalk Property is in west-central Alberta, Canada, directly south and west of the

Town of Valleyview, approximately 85 km east of the City of Grande Prairie and 270 km northwest of the

City of Edmonton (Figure 5). The Boardwalk Project, within the Boardwalk property, and shown on

Figure 5 as the "Boardwalk Production Zone" encompasses approximately 30,000 ha of the south and

eastern portion of the Sturgeon Lake Leduc reef.

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