Overview

The Company’s main property (approximately 82,500 ha) comprises a significant portion of two adjacent salt lakes, Cauchari and Olaroz, located in Jujuy, Argentina. Based on a 43-101 Technical Report filed on December 6, 2010, the Company’s main property hosts the third largest known lithium brine resource in the world. As the resource estimate was based on exploration results obtained from only approximately one-third of the main property, with all drill holes still open at depth, there is the potential to significantly increase the size of the resource estimate in the future.

The Company’s main property is located in the heart of the Puna Plateau, the area where over 80% of the world’s lithium brine reserves are located.  The property is located approximately 200 km east of the largest lithium producing salt lake in the world (Salar de Atacama in Chile, where current lithium producers SQM and Chemetall have operations), and approximately 200 km north of the second largest lithium producing salt lake in the world (Salar del Hombre Muerto in Argentina, where current lithium producer FMC has operations).

The Company’s project is also surrounded by excellent infrastructure and logistics, key elements which have been instrumental in keeping the project’s operating costs very low.  From a transportation perspective, the project is located on a paved highway which connects Argentina to Chile.  The project is in very close proximity to the Chilean port facility of Antofagasta - the deep sea port approximately 550 km away, from where the final lithium product will be shipped to end customers.  From an energy perspective, the project is optimally located – only approximately 50 km away from a natural gas pipeline.  As energy is one of the largest cost elements in lithium carbonate production, access to this inexpensive energy source is a significant benefit to the Company.

A Preliminary Economic Assessment (PEA) has been completed on this project by the independent engineering firm ARA WorleyParsons (ARAWP). ARAWP has a significant amount of experience in lithium brine processing, having designed and participated in building the world’s largest and lowest cost lithium brine processing facility in Chile. The PEA concludes that the Company’s lithium project has favourable economic potential, and that the project’s most important positive feature is its low operating cost of US$1,434 per tonne. The PEA’s base case NPV, assuming an 8% discount rate, is US$983 million pre-tax, and US$715 million post-tax.