AUGUST 2021 LITHIUMSOUTH.COM - Lithium South Development Corporation
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AUGUST 2021 LITHIUMSOUTH.COM
FORWARD LOOKING STATEMENTS AND DISCLAIMERS The information contained herein is provided solely for the reader's general knowledge. The information is not intended to be a comprehensive review of all matters and developments concerning NRG Metals Inc. All information is offered on a "best intentions" basis. No securities commission or other regulatory authority in Canada or any other country or jurisdiction has in any way passed upon this information and no representation or warranty is made by NRG Metals Inc. to that effect. This presentation may include "forward looking statements.” All statements, other than statements of historical fact, included herein, including without limitation, statements regarding exploration results, future plans and objectives of NRG Metals Inc. are forward looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. NRG Metals Inc. does not make any representations, warranties or guarantees, express or implied, regarding the accuracy, completeness, timeliness, noninfringement, or merchantability or fitness for a particular purpose or use of any information contained in presentation. Furthermore, the information in no way should be construed or interpreted as, or as a part of, an offering or solicitation of securities. Investors are advised to discuss all of their stock purchases with a registered securities broker or personal finance professional prior to investing. No obligation, responsibility or liability shall be incurred by NRG Metals Inc. or any of its officers, directors, employees or agents for any loss or damage whatsoever, whether incidental, special, indirect, consequential, punitive, exemplary, or for lost profits in connection with, caused by or arising from any delays, inaccuracies, errors or omissions in or infringement by, or from any use of, or reliance on such information contained in this presentation. THE FINANCIAL PROJECTIONS PERTAINING TO THE HOMBRE MUERTO LITHIUM PROJECT ARE BASED UPON ASSUMPTIONS, EXPERIENCE AND PROPRIETARY KNOWLEDGE OF KEY LITHIUM MANAGEMENT. FURTHER EXPLORATION OF THE HOMBRE MUERTO NORTH LITHIUM PROJECT IS REQUIRED TO CONFIRM THE ASSUMPTIONS CONTAINED WITHIN THIS PRESENTATION AND TO VERIFY AND CONFIRM THE POTENTIAL OF THE FINANCIAL MODEL THIS PRESENTATION IS FOR DISCUSSION PURPOSES ONLY The production of this presentation was supervised by Ms. M. Casini, a Qualified Person as defined under National Instrument 43-101. Ms Casini approves the scientific disclosure contained herein. TSX-V: LIS | OTCQB: LISMF
COMPANY MISSION
“Lithium South is developing a world class lithium brine project with sustainable technology, delivering
value for Lithium South’s shareholders”
Why Lithium?
Global electric vehicle stock
• 40% year-on-year growth in electric
vehicles since 2010
• Based on current government policies
there will be 140mn electric vehicles
by 2030. But, if taking into
consideration the Paris Agreement,
the electric vehicle stock could be as
high as 245mn by 2030
• By 2030 the global electric vehicle
stock will be at least 30x greater than
today
This will need to be underpinned by a
long-term, stable supply of lithium.
2030 2030
2010 2019
Govt. Policies Paris Agreement
TSX-V: LIS | OTCQB: LISMF
LITHIUM SUPPLY & DEMAND
Demand
• Current oversupply is short term
• Demand is expected to exceed
supply by 2023.
• Expected to increase 10x over the
next decade.
• By 2040 demand is expected to
outstrip supply by 100%
Why?
Insufficient upstream resource
investment coupled with inefficient
investment in downstream processing
capacity. Source: Broker research and internal analysis
TSX-V: LIS | OTCQB: LISMF
Why Lithium South
World Class Resource
• >750 mg/L Li, low Mg/Li ratio
• Defined resource of 571,000T Lithium Carbonate Equivalent (measured &
indicated) *1
• Developing new technology in parallel with proven evaporation technology
• Environmental Baseline Study underway for Environmental Impact Report
Pursuing Direct Lithium Extraction Technology
• Evaluating 3 different types of Direct Lithium Extraction Technology:
Lilac Solutions of Oakland, CA USA Chemphys of Chengdu, China Eon Minerals of Salta, Argentina
• 2,000 liter samples for testing by interested parties
• Potential to extract lithium without using evaporation ponds
• Potential to extract lithium in hours, not years
• Smaller foot-print with less environmental impact
• Experienced technical staff on board for process development
TSX-V: LIS | OTCQB: LISMF
LITHIUM TRIANGLE
The Lithium Triangle produces
~50% of global lithium production at
lowest quartile cost
Prime location in Hombre Muerto Salar
• Southern Lithium’s Hombre Muerto
North Project is a Tier-1 lithium project
in the Lithium Triangle, Argentina
• High lithium content, low impurity
brine chemistry
TSX-V: LIS | OTCQB: LISMF
HOMBRE MUERTO SALAR OVERVIEW
Hombre Muerto North (HMN):
• Advanced stage exploration
development project
• NI 43-101 Certified Li – K Resource
Estimate (See page 17
TSX-V: LIS | OTCQB: LISMF
Lithium South’s Hombre Muerto North Project
Work Completed:
• Two production wells drilled and cased
• Resource Estimate:
Resources Li (mg/L) LCE (T)
Measured 797 509,000
Indicated 534 62,000
Total 756 571,000
• Preliminary Economic Assessment
(traditional evaporation):
• Test work underway for DLE Technology
NPV (8% DISCOUNT) US $217 million
CAPEX US $98 million
IRR (Post-Tax) 28%
Life of Mine 30 years
Pay back (from production) 2 years 5 months
TSX-V: LIS | OTCQB: LISMF
Lithium South Hombre Muerto North Project
Property Package
Timing Work Stream
• 3,287 hectares / Li resource at Tramo Summer 2021 • Complete QP review of laboratory DLE test
claim block located in Salta Province, work and publish results
outside of conflict zone between Salta
• Conduct bulk brine sample cycle testing
Province and Catamarca Province
Fall 2021 • Complete pilot DLE test work
• Decision on DLE Technology for site
Spring 2022 • On-site DLE pilot unit testing in Argentina
• Evaporation process test work
• Groundwater modelling
• Environmental Study
TSX-V: LIS | OTCQB: LISMFDLE Technology
Traditional Evaporation Direct Lithium Extraction (DLE)
Process
Lithium Production > 18 months Anticipated Hours / subject to QP certification
Lithium Recoveries ~ 40 % Anticipated ~ 80 % / subject to QP certification
Weather Susceptibility Dilution & Flooding None
✓ Laboratory scale test work underway with results pending QP review
✓ Decision on pilot testing
✓ Targeting pilot unit onsite in Argentina in first quarter 2022
Spent brine evaporation, subject to local conditions & regulation
Lithium Rich
Solution
Lithium Carbonate Proprietary Direct Brine Feedstock
Plant Lithium Extraction Pre-Treatment
Unit
Brine Resource
TSX-V: LIS | OTCQB: LISMFHMN PROJECT BUDGET FULLY FUNDED
12 MONTH WORK STREAM COST
• LIS IS FULLY FUNDED TO
Long term pumping test & traditional MEET THIS 12 MONTH
evaporation process development ground US $500,000 WORK STREAM
water model
Permitting / EIR US $100,000
General working capital US $400,000
DLE pilot testing US $100,000
Property acquisition payment due March
US $2,000,000
2022
Total funding required US $3,100,000
Hombre Muerto North
Lithium Triangle, Argentina
TSX-V: LIS | OTCQB: LISMFLITHIUM SOUTH TEAM
LITHIUM SOUTH TEAM IN ARGENITINA & CHINA
Fernando E. Villarroel Mr. Villarroel has 12 years of experience in the mining industry in Argentina with a focus on Lithium process development.
VICE PRESIDENT & From 2009 to 2013 he worked with Lithium Americas Corp. (Minera Exar S.A.) as Project Manager which included
DIRECTOR PROJECT
construction management and commissioning of the initial pilot evaporation facilities and laboratory at the Cauchari
DEVELOPMENT
Olaroz Lithium Project. He has also acted as a consultant to Neo Lithium and International Lithium Inc. He holds a degree
in Industrial Engineering and has specialized training in Data Modeling & Analysis for Business and Engineering from
M.I.T.
Marcela Casini Ms. Casini has a distinguished career in the lithium exploration and development industry in Argentina. Upon graduating
SENIOR from Cordoba University in Argentina, she worked for Rio Tino as a field geologist exploring salars in the Puna region of
GEOLOGIST/HYDROGEOLOGIST
Northwest Argentina. From 2009 to present, Ms Casini has worked for the Cauchari Olaroz lithium brine project, a joint
venture with Lithium Americas Corp. and Ganfeng Lithium Co, where she is responsible for the well field of a projected
40,000 tonne per year lithium operation. In addition to that, since 2016 she has consulted to PepinNini Minerals regarding
the exploration and development of lithium resources at the Rincon and Pular salars.
Vijay Mehta A recognized expert in lithium mining and processing, Dr. Mehta (PhD) brings almost five decades of experience to LIS. His
TECHNICAL CONSULTANT AND experience includes evaluating the technological and economic feasibility of lithium brine projects around the world. He
QUALIFIED PERSON
was the Product and Process Technology Development Leader of FMC Corporation (NYSE: FMC) for 30 years and was one
of the founding developers of FMC’s lithium plant at the Hombre Muerto Salar, Argentina, which has been in production
since 1998. He holds 12 lithium related U.S. patents and has published over 50 technology reports and ten academic
papers.
Chemphys Chemphys have an 11-member technical team working full time on development of the Direct Lithium Extraction
DIRECT LITHIUM EXTRACTION & Technology. Founded in 1998, Chemphys is recognized as one of the world’s leading lithium processing and technology
PROCESSING TEAM
companies with over 22 patents (valid and under application) developed in-house.
Hains Technology Hains Technology Associates, located in Ontario, Canada will provide technical guidance and Qualified Person review of all
Associates test work conducted by SinoLi. In addition, Hains will work directly with Mr. Carlos Galli who will provide technical support
TECHNICAL GUIDANCE & locally in Argentina. Hains and Carlos Galli are recognized for their lithium expertise having conducted many studies for
QUALIFIED PERSONAL REVIEW
companies within the industry.
TSX-V: LIS | OTCQB: LISMFBOARD OF DIRECTORS & MANAGEMENT
Adrian F. C. Hobkirk Adrian has 26 years of experience in the mining and venture capital industry, He has been involved in
PRESIDENT
Guyana for over twenty years and founded the company to develop the Groete Gold Copper Deposit in
CHIEF EXECUTIVE OFFICER
2006, the third largest gold deposit in Guyana. He has worked in many countries including Argentina and
is the largest shareholder of NRG Metals Inc., founding the company in 2016.
Christopher P. Cherry Mr. Cherry has over 20 years of corporate accounting and audit experience. Formerly an auditor with
CHIEF FINANCIAL OFFICER AND
KPMG, Mr. Cherry has extensive corporate experience and has held senior-level positions for several
DIRECTOR
public mining companies. He is a certified general accountant and a chartered accountant.
Yi Hua Dai Yi Hua (PhD) founded Chemphys in 1998 to focus on battery quality and high purity lithium processing.
DIRECTOR
He is a certified Technical and Economic Expert of Sichuan Province and China Non-ferrous Metals
Industry Association Expert. Yi Hua has a proven record of leading the development of lithium
manufacturing techniques with 24 patents valid and under application. .
Alison Dai Ms. Dai has 9 years of experience in the lithium industry and is responsible for business development and
DIRECTOR
is a director for Chengdu Chemphys Chemical Industry Co., Ltd. In her role at Chemphys, Ms. Dai has
been involved in developing strategic partnerships, international markets and procurement. Prior to
joining Chemphys, Ms. Dai was an investment banking analyst at J.P. Morgan Australia in the mining and
metals team. Ms. Dai holds a double degree in Bachelor of Laws and Bachelor of Commerce from the
University of Western Australia.
Jan Urata Ms. Urata brings over 20 years experience in public company corporate finance and securities related
CORPORATE SECRETARY
matters including her years as a paralegal at McMillan. She also serves as a Corporate Secretary to other
TSX Venture issuers.
TSX-V: LIS | OTCQB: LISMFNATIONAL INSTRUMENT 43-101 CALCULATED RESOURCE
RESOURCE ESTIMATE
Resource Brine Volume Li Grade Li Li2CO3 Equivalent K Grade K KCl Equivalent
Category (1000m3) (mg/L) (tonnes) (tonnes) (mg/L) (tonnes) (tonnes)
Measured 119,862 797 96,000 509,000 7,039 844,000 1,609,000
Indicated 21,936 534 12,000 62,000 5,517 121,000 231,000
M&I 141,798 756 107,000 571,000 6,803 965,000 1,840,000
The resource estimate was prepared in accordance with the requirements of National Instrument 43-101 and uses best practice methods specific
to brine resources, including a reliance on core drilling and sampling methods that yield depth-specific chemistry and effective (drainable) porosity
measurements. The resource estimation was completed by independent qualified person Mr. Michael Rosko, M.Sc., C.P.G. of the international
hydrogeology firm E.L. Montgomery & Associates (M&A). Tonnages are rounded off to the nearest 1,000. Cut-off grade: 500 mg/L lithium, but no
laboratory results were less that the cut-off grade. The conversion used to calculate the equivalents from their metal ions is based on the molar
weight for the elements added to generate the equivalent. The equations are Li X 5.3328=lithium carbonate equivalent and K X 1.907 = potassium
chloride equivalent. The reader is cautioned that mineral resources are not mineral reserves and do not have demonstrated economic viability.
Preliminary Economic Assessment The PEA was prepared by Knight Piesold
Consulting (KP) and JDS Energy and Mining (JDS),
After-tax net present value (8% discount rate) $217 million both of Vancouver, in accordance with the
standards set out in National Instrument 43-101
After-tax internal rate of return (IRR) 28% Standards of disclosure for Mineral Projects (NI
CAPEX capital expenditures $93.3 million 43-101), and CIM’s Best Practice Guidelines for
Mineral Processing (BPGMP).
OPEX cash operating costs (per metric tonne of lithium $3,112
carbonate) The Preliminary Economic Assessment is
preliminary in nature, there is no certainty that
Average annual production (lithium carbonate) 5,000 the Preliminary Economic Assessment will be
realized. The economic analysis is based upon
Mine life 30 years
mineral resources that are measured and
Payback period (from commencement of production) 2 years 5 indicated, but are not mineral reserves, and
months have not demonstrated economic viability.
TSX-V: LIS | OTCQB: LISMFAdrian F.C. Hobkirk
President & Chief Executive Officer
1-855-415-8100
ahobkirk@lithiumsouth.com
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