Mr. Jared Lazerson reports

MGX MINERALS COMMENCES US LITHIUM BRINE STAKING AND OILFIELD ACQUISITION ACTIVITIES- FORMS PETROLITHIUM CORPORATION

MGX Minerals Inc. has formed the PetroLithium Corp. of America, a 100-per-cent-owned U.S. subsidiary of the company.

MGX has mandated PetroLithium Corp. to acquire oil field assets, including brine-bearing lithium resources, oil wells, and existing oil and gas (O&G) infrastructure. Staking and oil well acquisition activities in lithium-brine-bearing areas of Utah have already commenced. Additionally, acquisition and exploration activities are expected to commence shortly in Colorado, Texas and Arkansas. All states are host to significant current and past-producing oil production associated with areas of enriched minerals including sodium, calcium, magnesium, potassium, boron, bromine and lithium.

Geological overview

PetroLithium Corp. is focusing activities on the Mississippian and Pennsylvanian (Carboniferous) age aquifers of the Paradox basin (Utah, Colorado) and the Jurassic-period Smackover formation (Texas, Arkansas). Enrichment is theorized in both formations to be a result of trapped ocean water in dolomite/limestone host rock previously concentrated under high temperature and pressured to many times ocean levels of mineralization. High-temperature formation represents a common characteristic of lithium brine mineralization within the Paradox basin and Smackover formations. As a result, minerals are generally found in basins and directly associated with oil-bearing strata of similar geological periods.

Smackover formation

The Smackover formation has produced nearly two billion barrels of oil to date and is home to some of the country's largest past-producing oil fields. Many wells are now stripper wells producing 10 barrels per day (U.S. Environmental Information Administration). Investigation is now under way to determine whether these areas of older oil production with very high brine-to-oil ratios may once again become viable due to the addition of value from extraction of minerals including lithium.

Extraction of lithium from oil field brine

MGX recently reported the extraction of lithium from oil waste water using its patent-pending process (U.S. provisional Patent No. 62/419,011) for the extraction of lithium and other valuable minerals from oil brine (see press release dated Jan. 3, 2017).

It is the only patent of its kind providing for the rapid extraction of lithium and other valuable minerals from oil field brine. Current conventional production of lithium from brine takes up to 18 months due to the solar evaporation phase. MGX's process eliminates the solar evaporation step, reducing potential production to one day and representing a reduction of greater than 99 per cent and a byproduct of reuseable, non-toxic water. The treatment of oil waste water offers significant revenue potential and environmental benefit in addition to mineral extraction as the processing removed all suspended solids, including 99.7 per cent of hydrocarbons and 99.9 per cent of silica and other scale-forming minerals. With its engineering partner PurLucid Treatment Solutions Inc., MGX expects deployment of pilot plant shortly. Commercial deployment is expected in the second half of 2017 and offtake negotiations are under way.

PetroLithium Corp.

MGX has formed the PetroLithium Corp. to enter significant mineral, oil and environmental markets in the United States. Appointment of management positions is under way.

The oil field technical and acquisition team will be headed by Dr. Larry Marks. Dr. Marks was with Royal Dutch Shell for 30 years and held project director positions at the Hague, which covered the Middle East and Africa. Dr. Marks, a professional geophysicist, completed his career as vice-president, marketing and transportation, with Shell Canada, Calgary, Alta., where his responsibilities included sale and delivery of a diverse range of oil and gas products as well as merger and acquisition activities. Dr. Marks currently leads the oil field technical and acquisitions team for the company's Alberta lithium exploration. Dr. Marks will be primarily responsible for acquisition of lithium-bearing brine and oil wells for PetroLithium Corp.

Product development and sales will be overseen by Claudio Manissero. Mr. Manissero was formerly director of sales at FMC Lithium and where he held multiple positions spanning over 20 years.

The scientific team will be led by Dr. Preston McEachern, a leader in water management in the oil and gas industry. Dr. McEachern has 23 years experience in solving water challenges. He holds three faculty appointments with Canadian universities and was previously vice-president of research and development at Tervita. Dr. McEachern is the chief executive officer of Purlucid Treatment Solutions Inc., MGX's engineering partner.

The company has filed a trademark application with the U.S. Patent and Trademark Office for the name PetroLithium for future use in commerce, and if granted will give MGX exclusive right to its use in trade.

Canadian lithium portfolio

MGX is the largest holder of mineral permits covering known lithium-bearing brine areas in Canada with a land package encompassing nearly 500,000 hectares (1.2 million acres). All permits are focused on major oil and gas production areas of Alberta. Along with oil and gas, these areas currently produce more than one million barrels per day of brine.

Qualified persons

The technical portions of this press release have been reviewed by Andris Kikauka, PGeo, vice-president of exploration for MGX Minerals. Mr. Kikauka is a non-independent qualified person within the meaning of National Instrument 43-101 standards.

About MGX Minerals

MGX Minerals is engaged in the development of large-scale industrial mineral portfolios in Western Canada. The company operates lithium, magnesium and silicon projects throughout British Columbia and Alberta. Additionally, the company is the largest lithium brine landholder in Canada, controlling nearly 487,000 hectares of land representing over one million barrels of brine production per day.

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