Mr. Chris Doornbos reports

E3 LITHIUM PROVIDES ACTIVITY UPDATE ON PHASE TWO OF ITS DEMONSTRATION FACILITY AND DETAILS EMPLOYEE INCENTIVES FOR 2026

E3 Lithium Ltd. has provided an update on its demonstration facility progress and outlines employee equity incentives for 2026.

Demonstration facility progress update

In late 2025, the company successfully completed the drilling of two wells at its demonstration facility located east of Olds, Alta. The well pair consists of one well designed to produce brine and the other designed for injection. The wells were drilled to collect additional reservoir and brine chemistry data and to complete a reservoir characterization test. These two wells were drilled next to each other on surface, targeting the Leduc reservoir roughly 2,500 metres below the surface, with the wells approximately 200 metres apart at depth. Flow results will provide additional data for reservoir development planning, including the placement of commercial wells and expected production profile for the commercial development plan.

Earlier this year, E3 ordered the required surface equipment for phase 2 of the demonstration facility, prepared the pad site and mobilized the completions equipment. A service rig is currently on site finishing the completion of the wells and installing a downhole brine pump. Surface equipment will be installed to enable the reservoir testing as well as data collection and analysis. Samples will be collected for the duration of the operation to analyze the brine and entrained gasses, which will provide essential data to refine the inlet equipment design of the commercial facility. E3 expects to be operating the facility in April, 2026.

The data collected through phase 2 of the demonstration facility will enable the completion of the company's front-end engineering and design (FEED) and feasibility study for the Clearwater project.

Following the successful execution of the Global Partnerships Initiative (GPI) contribution agreement for up to $36.5-million, announced on March 2, 2026, E3 will begin ordering the required equipment for the third and final phase of the demonstration facility. This includes redeploying the 30-column direct lithium extraction (DLE) skids and producing battery-grade lithium carbonate at the new site. The company will also procure and construct a larger, commercial-scale, single-column (1:1 on a per-column basis) DLE system for commercial testing and validation. E3 expects to execute phase 3 in stages through the second and third quarters of 2026, starting with the 30-column unit, with the goal of being fully operational within six months of executing the agreement. The detailed plan for the work contemplated under the agreement will be published once executed.

Successful achievement of 2025 goals and 2026 objectives

E3 had a successful 2025 achieving major project development and organizational milestones. In recognition of its 2025 accomplishments, E3's board of directors has approved the grant of 738,000 restricted share units (RSUs), under its omnibus equity incentive plan, as a form of non-cash compensation, to officers and employees, helping maintain the company's financial strength by supporting the staff without using the company's cash reserves.

In support of its strategic objectives, the company's board of directors has also approved the grant of performance share units (PSUs) to officers and employees. The PSUs may be settled through the issuance of up to 613,500 common shares upon vesting. No PSUs will vest earlier than one year from the date of grant.

The PSUs will vest upon the achievement of the following performance goals during a 24-month performance period:

• Successful completion of phase 2 of the demonstration facility;
• Completion of Clearwater project to shovel ready;
• Continued financing, including grant funding, of the company.

About E3 Lithium Ltd.

E3 Lithium is a development company with a total of 21.2 million tonnes of lithium carbonate equivalent (LCE) measured and indicated as well as 300,000 tonnes of LCE inferred mineral resources in Alberta. The Clearwater prefeasibility study outlined a 1.13-million-tonne- lithium-carbonate-equivalent proven and probable mineral reserve with a pretax net present value (discounted at 8 per cent) of $5.2-billion (U.S.) with a 29.2-per-cent internal rate of return and an after-tax NPV (discounted at 8 per cent) of $3.7-billion (U.S.) with a 24.6-per-cent IRR.

Unless otherwise indicated, Chris Doornbos, PGeo, a qualified person under National Instrument 43-101, has reviewed and approved the technical information contained in this news release.

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