Core Lithium : Quarterly Activities and Cashflow Report 31 March 2022

ASX: CXO Announcement

Quarterly Activities Report for Three Months Ended 31 March 2022

27 April 2022

CORE LITHIUM LTD

Level 5, 149 Flinders Street Adelaide SA 5000 [phone]

Contact:

Stephen Biggins | Managing Director

Jarek Kopias | Company Secretary Email |[e-mail] Website |www.corelithium.com.au

Highlights

The Board of Core Lithium Ltd ("Core" or "Company") is pleased to present its Quarterly Activities Report for the period ended 31 March 2022.

During the March quarter, Core was focused on a number of initiatives aimed at advancing the construction stage of its wholly owned Finniss Lithium Project, located near Darwin in the Northern Territory.

During the reporting period, Core:

• • Reached a landmark binding Term Sheet with US electric vehicle maker Tesla;

  Directors:

• • Advanced construction activities at the Finniss Project;

Greg English | Non-Executive	•	Completed the acquisition of highly
Chairman	prospective Mineral Leases adjacent
Stephen Biggins | Managing	to Finniss;
Director	•	Reported significant drill results at
Heath Hellewell | Non-Executive	BP33 and Carlton deposits;
Director	•	Announced the resignation of long-
Malcolm McComas | Non-Executive	serving MD, Stephen Biggins; and
Director	•	Joined the ASX300 Index.
Issued Capital:

• • 1,716,781,927 Ordinary Shares

• • 40,223,183 Unquoted Options

• • 17,988,332 Unquoted Performance Rights

ASX: CXO

Finniss Lithium Project, NT

The Finniss Lithium Project ("Finniss Project") is Australia's most advanced new lithium project on the ASX and places Core at the front line of new global lithium production.

The Finniss Project is one of the most capital efficient lithium projects and has arguably the best logistics chain to markets of any Australian lithium project.

The Project lies within 25km of power station, gas, rail and one hour by sealed road to workforce accommodated in Darwin and importantly to Darwin Port - Australia's nearest port to Asia.

Lithium is the core element in batteries used to power electric vehicles. The Finniss Project boasts world-class, high-grade and high-quality lithium suitable for this use and other renewable energy sources.

Figure 1. Lithium resources within Core's 100%-owned Finniss Project - new MLs in green.

March Quarter Activities

Finniss Project Development Update

Construction and mining activities commenced at the Finniss Project during the last quarter of 2021. Since that time, the majority of the activity undertaken on site has been preparatory infrastructure works needed to support the mining and plant construction efforts. Activities have included road works, clearing, establishment of administration buildings and erection of communication towers.

During the reporting period, a 7km process water pipeline from Observation Hill Dam was completed and construction of the drainage control infrastructure and the erosion and sediment control infrastructure commenced.

Development of the Finniss Lithium Project continues to run according to schedule with site activities during the current quarter to focus on the pre-strip needed to uncover ore by about mid-year and the erection of the DMS plant.

Figure 2. CAT777 truck being loaded at the Finniss Lithium Project

Core enters into binding Term Sheet for the supply of lithium to Tesla

During the reporting period, Core reached a landmark agreement with US electric vehicle maker Tesla, with the two companies entering into a binding Term Sheet for the supply of up to 110,000 tonnes of Li2O spodumene concentrate from the Finniss Project over a term of 4 years, with pricing referenced to the market price for spodumene concentrate, subject to a price floor and ceiling.

The Term Sheet is subject to the parties completing negotiations and execution of a definitive product purchase agreement by 27 August 2022, which is to provide for a supply commencement date before 31 July 2023 (subject to extension by mutual agreement).

In addition to the offtake commitment, Tesla has agreed, subject to execution of a definitive agreement, to provide additional support to Core to assist with the assessment and possible development of Core's Stage 3 Expansion.

BP33 drilling

In February, Core provided results and assays from BP33 drilling undertaken throughout the 2021 field season.

Drilling included deep mineral resource extensional drilling below existing BP33 mineralisation, as well as two diamond holes drilled to collect samples for variability metallurgical testwork and a small program of reverse circulation (RC) drilling to test for a southern extension to the pegmatite hosting mineralisation at BP33.

Two deep diamond drill holes were completed at BP33 along strike to the north and south to test for the continuity of the pegmatite and mineralisation at depth (Figures 3 and 4).

Both holes intersected high quality spodumene-bearing pegmatite mineralisation. Significant intersections, which represent a true thickness of approximately 30m35m in each hole, are shown below, with full drill hole data included in the ASX announcement dated 18 February 2022.

• • 57.35m @ 1.83% Li2O in NMRD016

  • o Incl. 11.51m @ 2.37% Li2O and 10.48m @ 2.05% Li2O

• • 51.0m @ 1.63% Li2O in FRCD023

  • o Incl. 17.0m @ 2.12% Li2O and 9.0m @ 2.21% Li2O

These high-quality intersections support the current interpretation that the BP33 mineralisation is improving with depth.

Figure 3. Cross-section for BP33 showing new and previous drill assay results.