Mr. Martin Perez de Solay reports

US$130M PROJECT FINANCING FOR SAL DE VIDA SIGNED

Allkem Ltd. has signed a project financing facility with International Finance Corp. for Allkem's Sal de Vida project located in Catamarca province, Argentina.

Highlights:

• An IFC project financing facility for the development of Sal de Vida project Stage 1 (SDV) has been signed for up to $130-million (U.S.) over a 10-year period consisting of an A loan of up to $100-million (U.S.) and B loan of up to $30-million (U.S.). Allkem is in discussions with another lender to increase the project finance facility by a further $50-million (U.S.) for a total financing package of $180-million (U.S.).
• This project financing facility has been structured as a green and sustainability-linked loan. IFC's environmental and social performance requirements are globally recognized, and the awarding of a sustainability-linked green loan to the facility is recognition and validation of the high environmental, social and governance standards already adopted at Sal de Vida by Allkem.
• A sustainability-linked green loan combines ambitious environmental and social targets. These targets and commitments support the responsible and sustainable development of lithium by Allkem for a greener future and regional economic growth in the province of Catamarca.

Managing director and chief executive officer Martin Perez de Solay said: "We are proud to partner with IFC to ensure long-term safe and sustainable operations, responsible products, and thriving communities. We are committed to the highest sustainability standards for Sal de Vida so that it will contribute to the economy of Catamarca via local employment, the development of local supply chains and community development programs."

Project financing

Due diligence and approval

The financing was approved by the Allkem board of directors, the IFC management and the IFC board of directors.

IFC's performance standards are globally recognized as a benchmark for environmental and social risk management in the private sector. The SDV project's ambitious sustainability targets -- linked to the sustainable development goals -- include reducing Scope 1 and 2 operational greenhouse gas emission intensity and expanding the use of renewable energy in the production process by 2030.

A robust and detailed environmental assessment was conducted by IFC, including the assessment of brine extraction and water usage and the associated monitoring and mitigation plan. Allkem technical teams participated in the process and have worked to agree to the IFC's environmental and social action plan for implementation.

Structure and key terms

IFC project financing support of up to $130-million (U.S.) is provided over a 10-year period and contains a two-year grace period. The loan does not benefit from a parent guarantee following the fulfilment of certain conditions, including the achievement of project financial completion. The interest rate is reflective of this type of financing within the region.

We seek Safe Harbor.