Lithium Energy : All Approvals Now Received to Drill Lithium Triangle Project

Wednesday, 27 April 2022

ASX Code :LEL

MARKET ANNOUNCEMENT

EIA Approvals Now Granted for All Solaroz Lithium Project Concessions - Exploration Underway

KEY HIGHLIGHTS

• ➢ Government approvals now received for exploration and drilling to commence at ALL concessions at Lithium Energy's Solaroz Lithium Brine Project in Argentina

• ➢ With all 8 Solaroz concessions (totalling 12,000 hectares) now approved, a major exploration programme is underway which will comprise comprehensive geophysical surveys and a significant drilling programme

• ➢ Solaroz is located in the highly prospective Lithium Triangle in Argentina and is directly adjacent to or principally surrounded by lithium majors Allkem Limited (ASX/TSX:AKE)and Lithium Americas Corporation (TSX/NYSE:LAC)

• ➢ Historical Olaroz North AMT Line Survey indicate the likely presence of conductive brines extending underneath Lithium Energy's adjacent Solaroz Chico I, Chico V and

  Payo 2 (South) concessions

• ➢ The interpreted paleo channel through which brines are interpreted to have likely flowed into the producing aquifer lies under Lithium Energy's Solaroz Payo 1 and Payo 2 concessions

• ➢ Lithium Energy has already commenced exploration at Solaroz, with passive seismic completed (and results being analysed) on the Payo concession

• ➢ Geophysical surveys (passive seismic and TEM surveys) are scheduled for all concessions, followed by rotary and diamond drilling campaigns

• ➢ Executive Chairman William Johnson, has recently completed a successful visit to Argentina, meeting key stakeholders, including local Government mining authorities and drilling contractors, and establishing a new local office in Jujuy to support exploration operations

William Johnson, Executive Chairman:

The receipt of the final set of Government approvals for exploration at Solaroz is a significant milestone and major value catalyst for Lithium Energy. In our view, there is no better address in the world to be exploring for lithium than the prolific lithium triangle, and our ground is directly adjacent to or principally surrounded by two of the largest lithium discoveries globally owned by Allkem and Lithium Americas.

ASX : LEL

www.lithiumenergy.com.au

LITHIUM ENERGY LIMITED

A.B.N. 94 647 135 108

Suite 1, Level 1, 680 Murray Street, West Perth, Western Australia 6005

T | [phone]

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E |[e-mail]

Furthermore, Allkem's recent (April 2022) upgrade to their Olaroz Resource in concessions adjacent or nearby to those held by Lithium Energy has provided further support for the Company's conceptual Exploration Target for Solaroz.

Exploration activity is already underway and will include geophysical studies and drilling across all of the highly prospective Solaroz concessions, with the objective of establishing a maiden JORC Mineral Resource of contained lithium in brine at Solaroz.

There has been significant M&A activity in the area showing the global interest in the district and lithium brines in particular, and we are very excited to now be in a position to ramp up our exploration efforts at Soloroz.

On behalf of Lithium Energy, I would like to thank the Jujuy Mining Secretary Miguel Soler and Mining Director Jose Gomez for their support and endorsement of the development of Solaroz.

All Exploration Approvals Now Received for Solaroz Concessions

Lithium Energy Limited (ASX:LEL)(Lithium Energy) is pleased to report that it has received the final set of Environmental Impact Assessment (EIA) approvals from the local Jujuy Provincial Government Mining Authority to undertake exploration works at its Solaroz Lithium Brine Project in Argentina (Solaroz).

An EIA approval has been received from the Provincial Authority to commence exploration works on the Payo I, Payo 2, Chico I, Chico V, Chico VI, Silvia Irene concessions which are located at the north-west section of the Salar de Olaroz basin (Olaroz Salar) (refer Figures 2 and 4).

This approval follows the recent approvals received for the Payo1 and Mario Angel2 concessions and means all 8 Solaroz concessions (totalling 12,000 hectares) have now received EIA approvals.

This last set of Government approval paves the way for Lithium Energy to advance a programme of geophysics and drilling over all concessions, with the objective of validating the previous exploration target announced by the Company and delineating a maiden JORC Mineral Resource.

Exploration Programme to Validate Exploration Target

As previously announced to the market, following a detailed review of reported results from various geophysical surveys and drilling data previously undertaken in the Olaroz Salar by its neighbours Allkem Limited (ASX/TSX:AKM) (formerly Orocobre Limited) (Allkem)3 and Lithium Americas Corporation (TSX/NYSE:LAC) (Lithium Americas), Lithium Energy believes that its Solaroz concessions lie over the same lithium rich aquifer within the Olaroz Salar from which Allkem has been extracting and processing lithium-rich brine for sale as lithium carbonate since 2015 and from which Lithium Americas plans to draw upon for its neighbouring Cauchari-Olaroz development project.

Lithium Energy proposes to test the proposition that the aquifer which supplies the lithium-rich brine being extracted by Allkem extends under the Company's Solaroz concessions. This will be tested by geophysical work and drilling with a view to fast tracking production of lithium carbonate dependent upon these works being successfully concluded.

Lithium Energy is now finalising arrangements with local geophysics and drilling contractors to prepare for the advancement of exploration works across the whole Solaroz project.

• 1 Refer LEL ASX Announcement dated7 February 2022: Lithium Energy Receives First EIA Approval for Exploration to Commence at Solaroz LithiumProject

• 2 Refer LEL ASX Announcement dated6 April 2022: Lithium Energy Receives Further EIA Approval for Exploration at Solaroz Lithium Project

• 3 Orocobre Limited (former ASX:ORE) changed its name to Allkem Limited (ASX:AKE) with effect on6 December 2021

An extensive work programme will be conducted, aimed at locating potentially lithium bearing brines of economic interest and obtaining preliminary information related to the hydrogeological and geochemical characteristics of the brine rich aquifer that comprises the Olaroz Salar underneath the Solaroz concessions.

Figure 1: North-Western section of the Olaroz Salar, where Lithium Energy exploration programme is set to commence

The first stage of the geophysical surveys will be the completion of passive seismic programmes across all the Solaroz concessions, which will be used to determine the depth of the underlying basement rock (i.e. the theoretical limit of potential lithium mineralisation) underneath the concessions.

Passive seismic survey fieldwork has already been undertaken at the Payo concession in the south-east corner of the Olaroz Salar and is currently being interpreted. Lithium Energy is now planning to mobilise a team during May to undertake passive seismic work across the remaining Solaroz concessions.

The Company is also planning to undertake a programme of TEM geophysics commencing in May, to identify the location and thickness of potential lithum-hosting conductive brines underneath the concessions.

The TEM survey will be followed by an exploration drilling campaign, based on the results from previous work, to assess the distribution and geochemistry of the brine and to obtain data related to basic physical parameters of the different hydrogeological units.

Lithium Energy is in discussions with several local drilling contractors, with the objective of securing suitable rigs to undertake 2,500 - 5,000 metres of rotary and diamond-core drilling once the interpretation of the geophysical surveys referred to above is complete.

In addition to the above works, Lithium Energy will be undertaking an assessment of relevant mine economic criteria to assist in developing a pathway to the completion of feasibility study(s), including the delineation of a maiden Mineral Resource.

Figure 2: Geology of the Olaroz Salar with Location of the Solaroz Concessions and Location of Geophysical Surveys undertaken by Allkem Limited4

4

Source: Salfity Geological Consultants- www.salfitygeologicalconsultant.com

Establishment of Local Solaroz Office in Jujuy

Executive Chairman William Johnson recently undertook a visit to Argentina, during which he held highly productive meetings with prospective local contractors and key stakeholders, including local Government mining authorities in the provincial capital of San Salvador de Jujuy and community leaders at the Olaroz Salar.

A local office has now been established in San Salvador de Jujuy to be the base for Solaroz operations, with several key local staff already employed and further appointments pending.

Figure 3: Executive Chairman William Johnson (right) with Jujuy Mining Secretary Miguel Soler and Jujuy Mining Director Jose Gomez

Solaroz Project Background

Lithium Energy's flagship Solaroz Project comprises 8 mineral concessions totalling approximately 12,000 hectares, located approximately 230 kilometres north-west of the provincial capital city of Jujuy within

South America's 'Lithium Triangle' in North-West Argentina in the Olaroz Salar.

The highly prospective nature of the Solaroz Project is highlighted by its close proximity to two world class Lithium brine assets, being the flagship Olaroz Lithium Facility of Allkem Limited (ASX/TSX:AKE)(formerly Orocobre Limited) (under a joint venture with Tokyo Stock Exchange listedToyota TsushoCorporation(TYO:8015)) and the advanced Cauchari-Olaroz development project held by Lithium Americas Corporation (TSX/NYSE:LAC) (under a joint venture with Ganfeng Lithium).