Mr. Blake Hylands reports

LITHIUM IONIC ADVANCES TOWARDS KEY PERMITTING MILESTONE FOR THE BANDEIRA LITHIUM PROJECT, MINAS GERAIS, BRAZIL

The Minas Gerais State Department of Environment and Sustainable Development (SEMAD), the regulatory body responsible for environmental licensing in the state, has issued a favourable technical report recommending the approval of Lithium Ionic Corp.'s concomitant environmental, installation and operational licence (LAC or licenca ambiental concomitante) for its Bandeira lithium project.

This positive recommendation represents a major advancement in the company's permitting process and is a critical step toward securing the final environmental licence necessary to begin construction and operations at Bandeira.

Regulatory progress and next steps

Lithium Ionic submitted its LAC permit application in late 2023, initiating a thorough environmental review process that included a comprehensive site inspection by SEMAD's technical team, detailed review of environmental impact studies and risk assessments, as well as multiple rounds of regulatory reviews and clarifications, successfully addressed by the company.

Following this evaluation, SEMAD's interdisciplinary team formally recommended the approval of the LAC environmental licence, which, when granted, will permit both the construction and operation of the Bandeira project. In the report, SEMAD recommends a granting of the environmental licence for the following:

• Underground lithium mining of pegmatites;
• Mineral treatment unit (UTM);
• Reject/waste pile management;
• Fuel storage and supply infrastructure for operational use.

Upon final approval, the installation licence (LI) will be valid for four years, while the operational licence (LO) will be valid for 10 years, contingent on compliance with regulatory conditions.

According to the report, a final decision on the issuance of the LAC licence is expected to be made on Feb. 28, 2025, following a meeting by the Camara de Atividades Minerarias (CMI), a key decision-making body within SEMAD.

The relevant excerpt from the report is as follows:

"The interdisciplinary team of URA/LM suggests the granting of this environmental licence in the LAC2 modality (LIC and LO) for the Mglit Empreendimentos Ltda. enterprise, for the activities of A-01-01-5 'underground mining of pegmatites and gems;' a-05-02-0 'Mineral Treatment Unit - UTM,' with wet treatment, A-05-04-6 'reject/waste pile of ornamental and coating rocks, pegmatites, gems, and non-metallic minerals' and F-06-01-7 'reseller stations, filling stations or points, retail system installations, floating fuel stations, and aviation fuel reseller stations' carrying out their activities in the municipalities of Aracuai and Itinga-MG, for a period of four years for the LIC and 10 years for the LO, linked to compliance with the conditions."

Blake Hylands, PGeo, chief executive officer of Lithium Ionic, commented: "This positive recommendation from SEMAD is a pivotal milestone for the Bandeira project, bringing us significantly closer to receiving full environmental approval and commencing construction. We appreciate the diligent work of SEMAD's technical team in evaluating our studies and operational plans. With Bandeira positioned as one of Brazil's most advanced lithium projects, we are eager to move forward with development and contribute to the global lithium supply chain."

Project development continues on track

In parallel with the permitting process, Lithium Ionic continues to advance key project development initiatives. Engineering and logistical preparations are well under way, ensuring the company is positioned to begin initial construction activities at Bandeira promptly upon receipt of the LAC licence. The Bandeira feasibility study, announced on May 29, 2024, outlined strong project economics, including a posttax NPV8% (net present value, 8-per-cent discount rate) of $1.31-billion (U.S.) and an IRR (internal rate of return) of 40 per cent, reinforcing the project's potential as a leading lithium operation in the region.

About Lithium Ionic Corp.

Lithium Ionic is a Canadian mining company exploring and developing its lithium properties in Brazil. Its Itinga and Salinas group of properties cover approximately 17,000 hectares in the northeastern part of Minas Gerais state, a mining-friendly jurisdiction that is quickly emerging as a world-class hardrock lithium district. Its feasibility-stage Bandeira project is situated in the same region as CBL's Cachoeira lithium mine, which has produced lithium for 30-plus years, as well as Sigma Lithium Corp.'s Grota do Cirilo project, which hosts the largest hardrock lithium deposit in the Americas.

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