Mr. Guy Bourassa reports

UPDATE ON OVERALL WHABOUCHI PROJECT

Nemaska Lithium Inc. has provided an update on the evolution of the Whabouchi project (mine and electrochemical plant). The corporation reports that construction and purchasing of equipment at both the Whabouchi mine and the Shawinigan electrochemical plant are progressing on schedule. As expected at this stage of construction, a cost to complete reassessment was performed to reflect the current level of detailed engineering and reception of numerous firm quotes for equipment and installation.

"We now have a better understanding on the remaining scope of the project, estimated budget and current market conditions. The revised overall project cost reflects a more precise outlook on installation costs and other key variables to the completion of our project," said Guy Bourassa, president and chief executive officer of Nemaska Lithium.

As at Dec. 31, 2018, $138.4-million has been incurred for the Whabouchi mine, and $67.3-million for the Shawinigan electrochemical plant covering mainly engineering, site and civil works. As of Feb. 8, 2019, the corporation had on hand $335-million in unrestricted cash and cash equivalents.

Cost to complete reassessment

Based on the $1.1-billion financing package announced on May 30, 2018, and based on the past eight months of construction, the corporation currently estimates that additional net funds of about $375-million would be required to enable the corporation to complete construction and meet the drawdown conditions provided in the streaming agreement with Orion Mine Finance and the senior secured bonds closed on April 12 and May 30, 2018, respectively.

An important portion of these costs are now being based on finalized agreements and/or bids received rather than estimates as it was the case for the National Instrument 43-101 technical report. This additional estimated financing, which is largely related to installation and indirect costs, was determined as a result of a detailed review and deeper knowledge of all project components, including detailed engineering work, revised site geotechnical data, and updated equipment and installation costs. On the other hand, direct purchase package costs, mainly representing equipment, are in line with the initial budget.

"Project construction is on time and we have a capable team in place to execute and deliver the project. We also have the benefit of a strong shareholder base as well as partners with whom we are working very closely to identify a variety of funding solutions to deliver the project according to the schedule," said Guy Bourassa. "We are evaluating several options that would enable existing and new shareholders, and project partners to join the table. Our objective remains to close the required financing on time to stay on target to complete mine construction in October, 2019, in order to make the first shipment of spodumene concentrate in December, 2019, followed by the start-up of the Shawinigan facility the year after."

Continuing activities

In the meantime, the corporation continues to deliver high-quality lithium hydroxide products from the phase 1 plant: "We have recently completed the installation of the drying and bagging equipment, and we have started producing lithium hydroxide monohydrate that meets battery industry product specifications," added Mr. Bourassa. "We are very pleased with the high interest demonstrated for the product as over 20 end-users from across the world have requested to receive some of the first samples for qualification."

The corporation is currently evaluating the opportunity to increase the lithium hydroxide versus carbonate sales ratio to better meet the growing demand of hydroxide globally.

In parallel, significant work has also been done to finalize and implement the Whabouchi mine readiness plan, everything from procurement to operations, as well as recruitment and training activities.

"Currently, there is a very limited number of vertically integrated lithium projects that are fully permitted and under construction around the world and Nemaska Lithium is the most advanced. As new sources of supply are required, mainly for electrical vehicles, we are building in Quebec strong and valuable assets that will support innovative and green business opportunities," concluded Mr. Bourassa.

About Nemaska Lithium Inc.

Nemaska Lithium is a developing chemical company whose activities will be vertically integrated, from spodumene mining to the commercialization of high-purity lithium hydroxide and lithium carbonate. These lithium salts are mainly destined for the fast-growing lithium-ion battery market, which is driven by the increasing demand for electric vehicles and energy storage worldwide. With its products and processes, the corporation intends to facilitate access to green energy, for the benefit of humanity.

We seek Safe Harbor.