Sigma Lithium Updates Feasibility Study with Phase 1 After-Tax NPV of US$1.6 Bn, Increasing Mineral Reserves 2.6x to 34MT and Supporting Phase 1 and Phase 2 Combined Potential Production Capacity Increase to a Total of 450,000 Tpa
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SIGMA LITHIUM UPDATES FEASIBILITY STUDY WITH PHASE 1
AFTER-TAX NPV OF US$1.6 BN, INCREASING MINERAL
RESERVES 2.6x TO 34MT AND SUPPORTING PHASE 1 AND
PHASE 2 COMBINED POTENTIAL PRODUCTION CAPACITY
INCREASE TO A TOTAL OF 450,000 tpa
PLANNED PHASE 1 PRODUCTION AND ESTIMATED PHASE 2 SCALE UP
• Updated Phase 1 Feasibility Study base case to produce 230,000 tpa (34,000 LCE) of 6%
Battery Grade Sustainable Lithium for 8 years.
o After-tax NPV of Phase 1 (standalone): US$1.6 billion (potentially increasing to US$1.9
billion).
o After-tax IRR of Phase 1 (standalone): 424%.
o Payback period of 4 months.
o Phase 1 is financially robust as a standalone operation even before factoring in a
potential Phase 2 production expansion.
• Optionality to increase Phase 1 production to 265,000 tpa of Battery Grade Sustainable
Lithium, in line with current market specifications, with the following NPVs:
o @ 6.0% Li2O: production of 230,000 tpa, NPV of US$1.6 billion.
o @ 5.7% Li2O: production of 242,000 tpa, NPV of US$1.7 billion.
o @ 5.5% Li2O: production of 251,000 tpa, NPV of US$1.8 billion.
o @ 5.2% Li2O: production of 265,000 tpa, NPV of US$1.9 billion.
• Phase 2 has the po tential for additional production of 220,000 tpa (33,000 LCE) , which is
estimated to scale up the Company’s total annual production to 450,000 tpa (67,000 LCE) of 6%
Battery Grade Sustainable Lithium.
o Low-risk execution strategy: Phase 2 construction of production plant foundation earth
works could commence concurrent with Phase 1 commissioning.
o Multiple workstreams advancing with the objective of preparing for Phase 2 production
in the near term.
• Updated Phase 2 Pre-Feasibility study with combined Phase 1 and Phase 2 economics to be
published early Q2-2022.
MINERAL RESERVES AND MINERAL RESOURCE INCREASE
• Sigma Lithium has increased its estimated total mineral resources to 58.9Mt, including 33.6 Mt of
mineral reserves1, while preserving its competitive advantage of high-grade & high-purity deposits,
as demonstrated by Phase 2 DMS metallurgical results.
o 25.3 Mt of Proven mineral reserves at an average grade of 1.44% Li 2O.
1 tonnes and grades have been rounded in accordance with reporting guidelines
2
o 8.3 Mt of Probable mineral reserves at 1.39% Li2O.
o 50.4 Mt of Measured and Indicated mineral resources at 1.40% Li2O.
o 8.6 Mt of Inferred mineral resources at 1.43 % Li2O.
• Company’s confidence in the potential Phase 2 production expansion increased as a result of:
o Maiden mineral reserve for the Phase 2 Deposit of 21.8 Mt.
o 30% increase of mineral resource for the Phase 2 Deposit.
o Additional DMS metallurgical tests were completed for Phase 2 achieving exceptional
results indicating lithium recoveries of approximately 60%.
• Phase 2 Deposit can be processed into Battery Grade Sustainable Lithium utilizing similar DMS
green and environmentally sustainable technology as the Phase 1 Plant (without the additional
complexities of a flotation circuit).
PHASE 1 UPDATED REMAINING CAPEX AND COSTS (FEL3 PRECISION)
• Updated Phase 1 CAPEX (FEL3) to reach commercial production of US$ 123.1 million, in line
with expectations when compared to US$113.6 million total capex estimated in the Feasibility
Study Technical Report dated November 2019 (FEL2) (the “2019 FS”).
o Sigma Lithium remains fully funded to finalize construction of commercial Production
Plant.
• Potential to be one of the lowest-cost producers globally of Battery Grade Lithium
Concentrate
o Average Cash Costs of US$357/t FOB Production Plant (at operation’s truck loading
bay).
o Average All-in Sustaining Costs of US$463/t CIF China.
INVESTOR VIDEO CONFERENCE CALL
April 11, 2022 at 11 AM (EST)
Registration link for Zoom video call below:
https://us06web.zoom.us/webinar/register/WN_EcuVNqQFT4i7_iIgcLvypQ
Zoom meeting ID: 899 8003 0030
Access Code: 001021
Join by phone using the following dial in: North America: +1 646 558 8656, UK: +44 203 481 5237, Brazil: +55
11 4680 6788
VANCOUVER, CANADA -- (April 11, 2022) - SIGMA Lithium Corporation ("Sigma Lithium" or the "Company")
(NASDAQ: SGML, TSXV: SGML) dedicated to powering the next generation of electric vehicles with
environmentally sustainable and high-purity lithium, is pleased to announce a significant increase in the Phase 1
(ONLY) After-Tax NPV to US$1.6 billion, as part of the updated Phase 1 Feasibility Study Technical Report (the
“Updated Phase 1 Feasibility Study” or the “Updated Phase 1 FS”) for its wholly owned Grota do Cirilo Project
(the “Project”).
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The Updated Phase 1 FS economics demonstrate that Phase 1 is financially robust even as a standalone
project.
• The key factors influencing the study outcome include a high average mill feed grade of 1.55% Li₂O
(mineral reserve grade) and Phase 1 Plant DMS process recoveries of 60.4%.
• The economic model assumes:
o an average production plant feed of 1.5Mtpa resulting in production of approximately 230,000
tonnes per year of 6% lithium concentrate (“Battery Grade Sustainable Lithium”); and
o pricing based on a fixed percentage of the market forecast for battery grade lithium hydroxide
provided by Benchmark Mineral Intelligence.
Figure 1: Overall Aerial View of the Phase 1 Plant Construction Area
UPDATED PHASE 1 FEASIBILITY STUDY
Phase 1 of the Grota do Cirilo Project will involve material from the Xuxa deposit (the “Phase 1 Mine”) to be
processed by Sigma Lithium’s green tech production plant (the “Phase 1 Plant”), which will produce Battery
Grade Sustainable Lithium, creating a fully integrated lithium operation.
The Updated Phase 1 FS reflects increased precision of the technical assumptions, resulting from over 11 -
months of detailed engineering, bringing the confidence level of the Project to FE L3. As a result, the Company
is pleased to report an updated remaining construction capex for Phase 1 of US$12 3.1 million (the “Phase 1
CAPEX”), compared to US$113.6 million total capex referenced in the 2019 FS.
The Phase 1 “all-in sustaining cost” was updated in the Updated Phase 1 FS, demonstrating Sigma Lithium’s
low-cost and strong cash flow profile:
• Average Cash Costs of US$357/t FOB Production Plant (at Project’s truck loading bay).
• Average All-in Sustaining Costs of US$463/t CIF China.
The Company also confirmed the exceptional lithium recovery of 60 .4% using DMS, which was announced in
the 2019 FS, through additional metallurgical testing at SGS’s laboratory.
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• To further test the effectiveness of the DMS processing flowsheet during detailed engineering, the
Company conducted additional variability tests, utilizing both Heavy Liquid Separation (“HLS”) and DMS
methodologies for the Phase 1 Mine.
• All representative samples produced very positive results for lithium concentrate with over 6% lithium
oxide (Li2O), and dry magnetic separation reduced iron content of below 1% Fe2O3.
• Combined spodumene concentrate grades ranged from 6.06% to 6.43% Li 2O.
While the base case Updated Phase 1 FS is based on production of 6% lithium concentrate (230,000 tpa), the
Company has optionality to deliver additional production of Battery Grade Sustainable Lithium, maintaining
specifications in-line with current lithium markets as follows:
• 242,000 tpa @ 5.7% Li2O;
• 251,000 tpa @ 5.5% Li2O; and
• 265,000 tpa @ 5.2% Li2O.
A key element of the environmental strategy for the Phase 1 Mine, as detailed in the 2019 FS, was the decision
to operate the Phase 1 Mine as two separate pits to preserve the Piauí “seasonal creek” and its surrounding
ecosystems (collectively, the “Piauí”).
• This decision was due to the importance o f the Piaui´s role in providing freshwater to the surrounding
communities for four to five months of the year (the Project is located within a semi -arid region with
extended dry season).
• Sigma Lithium does not utilize Piauí water in its Phase 1 Plant, instead sourcing non-potable water from
the Jequitinhonha River (approximately 5 km away).
Phase 1 Economic Analysis
The Phase 1 After-Tax NPV and Phase 1 After-Tax IRR were calculated based on an average annual production
rate of 230,000 tonnes of Battery Grade Sustainable Lithium over an 8-year operating life. A financial summary
for Phase 1 is included in Table 1 below, which demonstrates that even as a standalone min e, Phase 1 is
economically robust.
Table 1: Phase 1 Production Financial Summary
Item Base Case @ Battery Grade 6%
Lithium Concentrate
Economic Analysis
After-Tax Net Present Value (@ 8% Discount Rate) US$1,600 million
After-Tax Internal Rate of Return 424%
After-Tax Payback Period 4 months
Revenues, Cash Flow and Capex
Operating Life 8 years
Average Annual Lithium Concentrate Production 230,000 tpa
Lithium Carbonate Equivalent 34,000 t LCE per year
Average LOM Lithium Concentrate Price US$1,954/t
Average Annual Revenue US$450 million
Average Annual After-Tax Free Cash Flow US$273 million
Costs per tonne of Lithium Concentrate
Total Cash Cost at Production US$357/t
All-in Sustaining Cost (CIF China) US$463/t
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Lithium Recovery Rate (DMS)
60.4%
Integrated Costs (Mine and Production Plant)
Mining costs per tonne of lithium concentrate US$232/t
Greentech Production Plant Processing costs per tonne of lithium concentrate US$65/t
G&A costs per tonne of lithium concentrate US$21/t
Spodumene Mined Feedstock for Lithium Plant (Integrated)
Total quantity mined 11.8 million tonnes
Annual run of mine (ROM) 1.5 million tonnes / year
Spodumene ore feed grade LOM average 1.55%
Mining costs per waste and ore mined (ROM) US$2.06/t
Phase 1 average revenue and operating costs per tonne of Battery Grade Sustainable Lithium are outlined below
in Table 2. The lithium prices forecasted are based on the Benchmark Mineral Intelligence curve of battery
grade lithium hydroxide (LiOH) shown in Figure 2, with the price of the lithium concentrate (SC6) calculated
based on a fixed percentage of 7% of the LiOH price. This results in an average we ighted lithium concentrate
price of US$1,954/t over the 8-year period.
Figure 2: Battery Grade LiOH & SC6 Price Forecast (US$/t)
Table 2: Phase 1 Mine Estimated Revenue and Operating Costs
Phase 1 Estimated Revenue, Operating Cost and After-Tax
Earnings
Annual Average
Economics
(8 Years Phase 1
Operating Life)
Annual Average
Economics per Tonne of
Lithium concentrate sold
(8 years Phase 1 Operating
Life)
(US$ MM) (US$/t)
Gross Revenue $450 $1,954
Less: Realization costs ($14) ($60)
(-) CFEM ($9) ($39)
2,209
2,617
2,805
2,716
1,939
1,469
1,351
1,283
1,248
1,270
1,302
1,323
1,355
1,366
1,398
1,419
1,441
1,462
1,505
2,840
3,364
3,606
3,492
2,493
1,889
1,737
1,650
1,605
1,632
1,674
1,701
1,742
1,756
1,797
1,825
1,853
1,880
1,935
10,000
20,000
30,000
40,000
50,000
–
1,000
2,000
3,000
4,000
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040
LiOH Forecast (US$/t)
Battery Grade Sustainable Lithium Concentrate
Price Based on LiOH Forecast (US$/t)
Battery Grade Sustainable Lithium Concentrate Lower Band (7%)
Battery Grade Sustainable Lithium Concentrate Higher Band (9%)
Lithium Hydroxide Battery Grade Global Prevailing Price
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(-) Commercial Discount ($5) ($20)
Net Revenues $436 $1,895
Less: Site Operating Costs ($97) ($422)
(-) Mining ($53) ($232)
(-) Processing ($15) ($65)
(-) Transport ($24) ($104)
(-) Selling, General & Administration ($5) ($21)
EBIT $339 $1,473
% EBIT Margin 78% 78%
(-) Taxes ($49) ($214)
After-Tax Earnings $290 $1,259
% After-Tax Earnings Margin 66% 66%
Given the relatively low capital intensity of the Phase 1 Mine, the Phase 1 After -Tax NPV shows low sensitivity
to changes in capex , BRL/USD exchange rate and operating expenses. The Phase 1 After -Tax NPV is more
sensitive to variations in lithium concentrate prices.
Figure 3: Phase 1 (ONLY) After-Tax NPV8% Sensitivity Analysis to Lithium Concentrate Prices (US$ billion)
Phase 1 Capital Expenditure (FEL3)
Remaining Phase 1 CAPEX (FEL3) to construct both the Phase 1 Plant and Phase 1 Mine was updated to
US$123.1 million, which includes all associated plant and mine infrastructure, as well as all direct and indirect
costs and contingencies. This represents a modest increase from the prior capital expenditure (FEL2) estimate
of US$113.6 million, from the 2019 FS, resulting primarily fr om increased capacity of the environmental circuit
(dry stacking and water recirculation) to support both Phase 1 and potential Phase 2 (US$8 million).
• The Company elected to purchase (included in the Phase 1 Capex) previously leased items (included in
the operating expenses), as a result of the potential operating life extension provided by Phase 2 and
potential further expansions, including:
o a customized primary crushing plant (US$23 M) with a rated throughput capacity of 1.7Mtpa
ROM feed; and
o power substation (US$7 M).
$1.2
$1.4
$1.6
$1.8
$2.0
$0.0
$0.4
$0.8
$1.2
$1.6
$2.0
$2.4
(20%)
(US$1,563/t)
(10%)
(US$1,759/t)
Base
(US$1,954/t)
10%
(US$2,150/t)
20%
(US$2,345/t)
After-Tax NPV (US$ billion)
Lithium Concentrate Price Change (%)
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The Phase 1 Capex was estimated at a FEL3 level of engineering detail, whereby the engineering firms provided
pricing quotations from qualified suppliers for all areas of construction (summarized in Table 3 below).
• This FEL3 quoting exercise was led by the procurement teams at Promon Engenharia Ltda.
(infrastructure, services, buildings and bulk earthworks) , Primero Group Ltd (crushing plant and DMS
plant) and GE21 Consultoria Mineral (mining).
Table 3: Phase 1 Capex to Commercial Production (1)
Item (US$ M)
Mine $9.3
Process Plant $69.8
Environmental Equipment (Water & Dry Stacking) $15.5
Engineering Services $19.2
Substation & Utility Power Supply $7.4
Operational and ESG Expenses During Construction $9.8
Working Capital During Plant Commissioning $6.1
Tax Incentives (Savings) ($5.9)
Capex already Disbursed During Construction ($8.3)
Total Capex to Commercial Production $123.1
(1) Note: The sustaining capital is estimated at US$3.2 M (including contingency) for replacement of key plant components
over the 8-year Phase 1 Mine life, considering the modelled operating life and useful life of major equipment items. The
sustaining capex is mainly for the crushing area and allows for crusher rebuilds (replacements).
Phase 1 All-In Sustaining Cost
The operating cost estimate is based on an owner -operated model with contract mining. Table 4 below shows
the anticipated average operating costs over the operating life.
Mining costs were estimated based on a quoted proposal from a large Brazilian mining contractor, selected
after an extensive tender process by the Company and its mining consultant, GE21 Consultoria Mineral.
Phase 1 Battery Grade Sustainable Lithium is forecasted to have very low All-in Sustaining Costs (CIF China) of
US$463/t, mainly as a result of the following:
• high-grade and low impurities, as well as large crystal mineralization of the spodumene feed from the
Phase 1 Mine;
• high recoveries achieved in the Phase 1 Plant DMS;
• low overall processing costs of the Phase 1 Plant DMS, resulting from its streamlined processing circuit
(with less processing steps), therefore utilizing less electricity, water and chemical ingredients than a
typical lithium flotation plant; and
• low local G&A costs in Brazil.
Table 4: Phase 1 Operating Cost Estimate
Operating Cost Category US$/t SC6
Mining $232
Processing $65
G&A $21
Royalties $39
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Total Cash Cost (FOB) $357
Transport & Ocean Freight Costs $104
Total Cash Cost (CIF China) $461
Sustaining $2
All-In Sustaining Cost (CIF China) $463
Phase 1 Mine Mineral Reserve Update
The Phase 1 Mine Mineral Reserves have been re-estimated at a total of 11.8Mt of Proven and Probable Mineral
Reserves at an average grade of 1.55% Li 2O, which is comprised of 8.34Mt of Proven Mineral Reserves at an
average grade of 1.55% Li2O and 3.46Mt of Probable Mineral Reserves at an average grade of 1.54% Li 2O.
To access and recover these Mineral Reserves, 195.4 Mt of waste rock must be mined, resulting in an overall
LOM strip ratio of 16.6:1 t/t.
Compared to the previous mineral reserve estimate, the ultimate pit design represents:
• higher total Li2O average grade of 1.55% compared to 1.46%.
• a 14% decrease in mineral reserve tonnage resulting in a 9% decrease in contained LCE.
The reduction was primarily due to extensive field studies and the corresponding update using more
conservative geotechnical parameters which reflect the efforts by Sigma Lithium to increase the robustness
and safety factor of the mining operation . Another important factor was the ESG-driven decision to preserve
the Piauí by mining the Phase 1 Mine as two pits.
Table 5: Revised Xuxa Mineral Reserve Statement
Xuxa Mineral Reserves
Category Tonnes
(Mt)
Grade
(% Li2O)
Contained
LCE (kt)
Proven 8.3 1.55% 320
Probable 3.5 1.54% 132
Proven & Probable 11.8 1.55% 452
Note: Mineral Reserves were estimated using Geovia Whittle 4.3 software and following the economic parameters listed below:
1) Sale price for Lithium concentrate at 6% Li 2O = US$1,500/t concentrate;
2) Exchange rate US$1.00 = R$5.00;
3) Mining costs: US$2.20/t mined;
4) Processing costs: US$10.70/t ore milled;
5) G&A: US$4.00/t ROM (run of mine);
6) Mineral Reserves are the economic portion of the Measured and Indicated Mineral Resources;
7) 97% Mine Recovery and 3.75% Mine Dilution;
8) Final slope angle: 34° to 72° based on Geotechnical Document presented in Section 16;
9) Inferred Mineral Resources with the Final Operational Pit is 0.68 Mt grading at 1.52% Li 2O. The Inferred Mineral Resources are not included in the Mineral
Reserves;
10) Strip Ratio = 16.6 t/t (waste and Inferred mineral resource)/mineral reserve; and
11) The Competent Person for the estimate is Porfírio Cabaleiro Rodriguez, BSc. (MEng), FAIG, an employee of GE21.
UPDATED PHASE 2 RESOURCE AND MAIDEN RESERVE ESTIMATES
The Company is also pleased to announce its maiden mineral reserve estimate for the Phase 2 deposit (the
“Phase 2 Deposit”) of 21.8 Mt, further increasing the Company’s confidence in the potential Phase 2 expansion.
o 16.9 Mt of Proven mineral reserves at 1.4% Li 2O.
o 4.8 Mt of Probable mineral reserves at 1.3% Li 2O.