26 September 2023 

CleanTech Lithium PLC ("CleanTech Lithium" or the "Company")

Scoping Study Confirms Potential Viability of Francisco Basin as

CleanTech Lithium's Second Major Project in Chile

CleanTech Lithium PLC, (AIM:CTL, Frankfurt:T2N, OTCQX:CTLHF), an exploration and development company, advancing sustainable lithium projects in Chile for the clean energy transition, announces the results of a recently completed Scoping Study for the Francisco Basin Project, which confirms the project's outstanding economics, potential for future resource expansion and strong ESG credentials.

Highlights:

·    Supports the potential for Francisco Basin to become a major supplier of battery grade lithium to European and US markets based on sustainable direct lithium extraction ("DLE") technology

Scoping Study Highlights:

·    Based on annual production of 20,000 tonnes of battery grade lithium carbonate for a production period of 12 years based largely on Indicated resources

·    Calculates accumulated net cashflows (post-tax and royalties) of US$2.5 billion to be generated over the production period with low operating cost of US$3,641 per tonne of lithium carbonate

·    Estimated capital expenditure of US$450.0m, based on DLE plant using Sunresin Materials existing DLE technology, including 20% contingency

·    Attractive economics with post-tax NPV of US$1.1 billion using a discount rate of 8%, post-tax IRR of 43.5% and a payback period of 2 years and 7 months - based on a long-term lithium carbonate price of US$22,500 per tonne from 2028 (Note: see below for sensitivity analysis including the NPV at a 10% discount rate)

·    The study assumes production commences in 2027 as the Company aims to progress project development stages with a one-year lag to the more advanced Laguna Verde project, where production is targeted for 2026

·    Industry leading ESG credentials, a critical advantage for the EU market, based on utilising DLE which returns spent brine to the basin aquifers, and renewable energy for processing power by connecting with the Chilean grid and its abundant renewable energy supply

·    The Company plans to undertake another resource drill programme at Francisco Basin, commencing Q4 2023, aiming to further upgrade the current resource estimate, which is 0.92 million tonnes of lithium carbonate equivalent (LCE) at a grade of 207mg/L Lithium

·    This could extend the 12-year production period and would enhance projected economic returns

·    A Pre-Feasibility Study ("PFS") on the project is planned to commence on the completion of the resource drill programme, which is expected to be in 2H 2024

Commenting, Aldo Boitano, Chief Executive Officer, of CleanTech Lithium PLC, said:

"The Scoping Study provides added confidence in the robust economics of our second project, Francisco Basin, based on low operating and capital costs, with a post-tax NPV of US$1.1 billion and IRR of 43.5%, and a payback period of 2 years and 7 months. The study further advances the process and technical design concept for the project, with strong ESG principles incorporated at each stage.

"The next step at the project is to complete further resource drilling with the aim to expand and upgrade the current JORC resource estimate of 0.92 million tonnes LCE; an increase in the resource provides the potential to extend the production period of 12 years assumed in the study. DLE test-work on Francisco Basin brine is ongoing and important technical data will be generated when trials start at our pilot plant, which is currently being assembled at our facility in Copiapó. The Company plans to proceed to a Pre-Feasibility Study (PFS) for the project on completion of the planned resource drill programme, which is expected to be in 2H 2024.

"Francisco Basin is our second project which is being developed on a schedule one year behind our more advanced Laguna Verde project. Combining the two scoping studies means we have a total NPV of nearly $3 billion and an IRR of more than 43% for each project.

"This Scoping Study marks a major milestone for the Company and I would like to take this opportunity to thank the Scoping Study consultant, Chilean based lithium sector experts Ad-Infinitum, as well as our technical team for their hard work in completing the study. The Scoping Study outlines a plan to produce battery-grade lithium with a low environmental footprint, which positions the Company extremely well to supply the EU and US markets."

Further Information

Summary of Key Scoping Study Outcomes

A summary of the outcomes for key operational and economic analysis metrics derived from the completion of the scoping study are presented in the table below.

Information on Study and Contributors

The study was undertaken by Ad-Infinitum, a Chilean engineering services company/technical consultant with over 30 years of experience in the lithium sector with clients including SQM, Albemarle and Galan Lithium.  Ad-Infinitum specialise in processes and operations involving the processing of brines and minerals that contain Lithium, Potassium, Sulfate, Nitrates and other elements; and provide specialist technical solutions that contribute to the development of projects in all their stages, as well as the improvement of operations.  Since 2014, Ad-Infinitum has worked on lithium production processes from brine on different projects in Chile, Argentina, China, Korea and elsewhere.

The capital cost estimates for the DLE plant were contributed by Sunresin, the leader in commercial scale DLE plants. The lithium price cost curve estimate used in the study is based on estimates by Canaccord Genuity, a market leading broker with considerable experience in the lithium sector.  The key study contributors are further summarised in the table below.

The Mineral Resource scheduled for extraction in the scoping study production plan is based on the Francisco Basin updated JORC resource estimate reported by the Company in August 2023. For the 12 year production plan, approximately 68% of the volume is attributed to resources classified as Indicated and 32% of the volume is attributed to resources classified as Inferred.  The resource estimate was prepared by an Independent Competent Person, Christian Feddersen, in accordance with the requirements of the JORC Code.

Scoping Study Summary

Project Description and Geology

The Francisco Basin project is located in the northern Atacama Region of Chile at an altitude of 4,150m above sea level.  The project is located 200km east of the capital city of the region, Copiapó, where the mining sector is the main driver of the economy which allows access to mining services and specialised infrastructure. The port of Caldera, 270 km away by road, is a point of entry for supplies and an outlet for products with excellent loading facilities for general cargo and specialty commodities.  The project is accessed by a network of paved and unpaved roads from Copiapó.  Figure 1 provides a regional map, which additionally shows that Francisco Basin is approximately 100km from CleanTech Lithium´s most advanced project, Laguna Verde.

Figure 1: Regional Map of Francisco Basin Showing Distance From Key Centres and Laguna Verde Project

Francisco Basin is classified as an immature clastic salar characterised by greater moisture regimes and a sediment profile with higher porosities than mature halite salars.  The Francisco Basin is an elongated basin aligned on a NW-SE axis bounded on all sides by volcanic mountain ranges.  The surface of the salar is at an elevation of approximately 4,136m. To the south-east the basin forms a gently rising plain which forms the focus area of the project. The basin fill is characterised by sedimentary deposits that can be separated into three general units:

1.    An upper unit of fine to coarse sands intercalated with fine gravels, minor clay and tuff levels

2.    A middle unit of clay beds intercalated with minor levels of fine sands and gypsum

3.    A basal unit of moderately consolidated gravels and sands, transitioning to silt beds

The brine aquifer is contained mainly from the middle unit down to the basement, with the general basin stratigraphy interpretation presented in Figure 2 below.

Figure 2: Francisco Basin General Stratigraphy

Mineral Property and Title

Under Chilean law, exploration and exploitation of mineral resources are granted through mining concessions.  CleanTech Lithium, via its 100% owned subsidiary Laguna Negro Francisco SpA, owns a total of 47 exploitation and exploration mining concessions at the Francisco Basin Project with a total area of 127km². The map of the concession outline is shown in Figure 3.

Under Chilean law, the exploration and exploitation of lithium can be executed by a Special Operation Contract for Lithium (CEOL), under the terms and conditions established by the President of the Republic. On 6 September 2023, the Company submitted CEOL applications to the Chilean authorities which are now subject to a formal review process which is expected to take 3-6 months. The outline of the area of the CEOL applications is shown in Figure 3.

Figure 3: Tenement map of Francisco Basin Project Mining Concessions

Mineral Resource Estimate

An updated JORC compliant resource estimate for the Francisco Basin project of 919,346 tonnes of LCE was published on 24 August 2023. This estimate was based on resource drill programmes undertaken in the first halves of 2022 and 2023. In addition to a single resource well completed in 2022 (designated FB01), a further five wells (FB02 - FB06) were completed during the 2023 programme, with recorded drilling depths and coordinates as per Table 1 below.

Table 1: Francisco Basin Resource Drilling Details

The resource estimate is classified in the categories of Indicated and Inferred. Of the total resource 443,215 tonnes are classified in the Indicated category and 476,130 is classified in the Inferred category, as shown in Table 2 below. For the 12-year production plan outlined in the scoping study, 68% of the volume is assumed from Indicated resources and 32% from Inferred, which roughly corresponds to the final four years of the production profile.

Table 2:  Francisco Basin JORC Resource Estimate

Mining Method

Lithium enriched brine occurring within the porous sub-surface sediments is to be extracted utilising a well field.  A total of twenty-three extractions wells have been considered in the study, with the area of the well field shown in red in Figure 3. The extracted brine will be transferred to a tank to be mixed prior to being fed into the first stage of plant processing, which is the DLE adsorption columns. The spent brine from the adsorption process, which is the brine with lithium removed, will be reinjected into the salar basin through deep wells, in areas where the mineral resource will not be affected by dilution. The area considered in the Scoping Study for reinjection wells is shown in Figure 4. Further hydrogeological work is required to develop the extraction and reinjection model for the production phase of the project.

Figure 4: Scoping Study Wellfield Infrastructure Layout Plan

Power Supply

Francisco Basin project will use renewable energy for power supply through contracting a supplier of renewable energy via a Power Purchase Agreement (PPA). The study notes that as of December 2022, 62% of the installed capacity in Chile is renewable energy, such as hydropower, solar-thermal, geothermal, wind, and photovoltaic solar, making such a PPA feasible.  A feature of the project is the proximity to the Maricunga Substation, 10km south-west of the project area as shown in Figure 4, which is supplied via a 110 KV transmission line.  This is expected to significantly facilitate the cost of providing energy supply to the project.

Process Method

Brine processing test design work has progressed emphasising the minimisation of environmental impact, waste disposal and water consumption to ensure high ESG standards for the project.  The process considers the use of DLE to selectively extract lithium-ions from the brine before standard concentration, impurity removal and finally carbonation stages. DLE is primarily a cleaning stage and subsequent concentration stages are used to increase the lithium concentration to about 1% Li.  The process design, based on test work completed and simulation, can be described broadly in six stages to produce lithium carbonate as listed below, and shown in Figure 5 which provides an overview diagram of the process stages. As process work is further advanced the option of producing lithium hydroxide, either via conversion of lithium carbonate or an alternative process route will be further evaluated. 

1.    Direct Lithium Extraction (DLE)

2.    Concentration of the solution

3.    Purification of the solution

4.    Carbonation and Production of Li2CO3

5.    Treatment of the Mother Liquor

6.    Water Recovery

Figure 5: Process Stages

Process Recovery

Lithium recovery is the key factor to determine the efficiency and effectiveness of the process. The overall recovery rate used in the study of 89.3% is based on the DLE stage achieving a 94.8% recovery. Treatment of the mother liquor after carbonation to precipitate NaCI and then recirculation of the concentrated solution to the first purification stage allows for the maximisation of process water recovery and overall lithium recovery. Based on the modelling, the stages with the lowest recovery are the direct extraction and lithium carbonation processes. These process stages will be optimised in the piloting stage. The modelled lithium recovery according to the process stage is shown in Table 3 below.

Table 3: Overall Process Recovery

Summary Mass Balance

The streams that represent the incoming and outgoing material flows in the system are quantified in the summary mass balance below.

Table 4: Summary Mass Balance for 20,000 tpa LCE production rate

Wash water refers to water used for washing in the process with elements such as Boron, Calcium and Magnesium, that cannot be recycled. As these are extracted from the brine this wash water will be combined in the reinjection brine. The largest waste product stream is NaCl from mother liquor recovery. This will also be combined with spent brine and reinjected without changing the original brine chemistry.

Reagent Requirements

Table 5 shows the volume of reagents required to produce lithium carbonate based on the modelled process with the annual consumption rates based on elemental consumption and adjusted for real volumes of commercial product.

Table 5: Annual consumption of Reagents

Basin Water Balance

The process to produce the planned 20,000 tpa of battery grade lithium requires water for desorption (or elution) in the DLE process, preparation of reagents, washing and other process steps. The total volume required is 880,200m³ or 28 l/s. This is planned to be provided by a fresh water extraction well located in a peripheral area of the basin, where numerous fresh water extraction wells have previously been drilled. This volume of process water, labelled ´Water make-up´ in Figure 6, is part of the reinjection volume and does not therefore represent water loss.   

Figure 6: Basin Water Balance

The observed difference in the extraction and reinjection flows corresponds to the water loss in the process, for which a break down is summarised in Table 6.  This is based on a loss factor from Nano filtration reject and liquid waste which are not suitable for reinjection, along with moisture loss in the final product and in the NaCl waste stream produced by recovery of mother liquor. This represents a water loss of 31,926 m³/year, which corresponds to 1.6m³ of water loss per tonne of final product. 

As a comparison, water loss from evaporation pond based operations in Chile is estimated to exceed 100m³ per tonne of final product, representing the water lost to the atmosphere in the process of evaporation. In a DLE based operation this water loss is vastly reduced, avoiding the environmental impact of basin aquifer depletion. 

Table 6: Water loss breakdown

Process Work Next Stage - Pilot Plant and Lithium Hydroxide Evaluation

For the development of more advanced engineering studies, the study recommends the operation of a pilot plant to validate and adjust, if necessary, the process design. The Company has commenced assembly of a pilot plant with the capacity to produce 1 tonne per month of battery-grade lithium carbonate. The pilot plant has a feed brine inlet of 4.5m³ per hour which will be processed by the DLE unit to produce a lithium eluate.  For the concentration of the eluate, Nano Filtration, Reverse Osmosis and Forward Osmosis is being considered, with the aim of obtaining a lithium chloride solution with a concentration of 1.2% lithium, before the final removal of contaminants and carbonation stages.  The Company has a 1,000m² facility near Copiapó where the pilot plant DLE unit is currently being assembled for commissioning and commencement of operation before the end of 2023.

Fig. 7: Pilot plant DLE columns installed Copiapó (Aug 2023)  Fig. 8: Rotary valve final tests Belgium (Aug 2023)

Based on long-term industry trends, lithium hydroxide is expected to experience higher demand growth than lithium carbonate. Lithium hydroxide can be conventionally obtained by converting the lithium carbonate produced in the first stage of the process with lime. This will be tested in test-work and potentially at the pilot plant scale. Several other processes to produce lithium hydroxide from brines are in development that will also be considered.

Capital Expenditure

Capital expenditure (CAPEX) estimates are based on an annual production of 20,000 tonnes of lithium carbonate. The cost of the equipment has been obtained by Ad-Infinitum from a combination of data from similar projects and information from supplier quotes. A summary of the CAPEX by major areas is provided in Table 7. This estimate was made based on figures for the fourth quarter of 2022 with a 10% inflation adjustment applied for some lines. The estimated accuracy is within a range of -15%/+30%.  Maintenance CAPEX is estimated at a total of US$ 21.5 million over the 12-year evaluation period.

Table 7: Capital Expenditure Summary Breakdown

The Well Field CAPEX item includes brine extraction wells, spent brine reinjection wells, and water extraction wells as shown in Table 8 below. Twenty-three brine extraction wells have been assumed at an average depth of 350 metres with each well estimated at an average flow rate of 30 L/s.  Sixteen spent brine reinjection wells were assumed with spent brine discharged in two reinjection fields, requiring two main pumps. Two wells have been assumed for process water supply, with their respective pumps and pipes transporting the water to the lithium carbonate plant area.

Table 8: Well Field Capital Expenditure Breakdown

The Plant CAPEX estimate is made up of the DLE plant, based on a quotation received from Sunresin, and a Reverse Osmosis and Chemical plant, based on data from suppliers and developers of the required equipment calculated using Ad-Infinitum's database. Table 9 shows a further breakdown of the DLE and Reverse Osmosis estimates.

Table 9: Plant Capital Expenditure Breakdown

The Services CAPEX estimate of US$23.8 million includes all the satellite activities that are essential for the operation of the wells and the lithium carbonate plant: electricity supply, boilers, preparation of reagents, water treatment, and fire-fighting system, among others.

The Indirect Costs estimate of US$48.2 million includes all other expenses incurred during the construction period.  The Construction and Operation Camp, and Polyclinic, are the major expense, followed by the Vendor´s technical assistance.

Finally, a 20% Contingency was applied to all CAPEX items by Ad-Infinitum in accordance with industry practice. 

Operating Expenditure

Estimates are based on the design of the production process, considering yields and estimated recoveries, and the estimated consumption and prices for the main reagents used. The estimates of expenses, prices and labour are based on Ad-Infinitum's database for the costs of similar operations in Chile. Operating expenses are summarised in Table 10. 

Table 10: Operating Expenditure Summary Breakdown

Energy and Reagents are the two largest items representing 32% and 30% of total operating costs.  The unit cost for energy is US$0.1437/kWh consistent with the pricing of similar supply contracts in the Chilean market. The Reagent cost is dominated by Soda Ash used in the Carbonation process, which comprises 67% of the total cost for reagents. 

Manpower costs include an estimated total operational manpower of 163 people with an additional 59 people providing G&A services - totalling 222 personnel supporting the operation of the project.  

Transportation assumes land transportation of the product packed in 1-tonne capacity bulk bags by ramp truck from the plant in Francisco Basin, via Copiapó, to the port at Caldera from where it is shipped in containers to its destination in the EU and/or the USA.  

Cash flow and Economic analysis

The economic analysis carried out in the study included the following basic assumptions:

Table 11: Key Assumptions in Economic Analysis of Francisco Basin project

Cashflows Analysis 

The Scoping Study confirms, based on the assumptions, very strong cashflows from operations from an early stage as shown in Table 12 below.   

Table 12:  Cashflow Forecast Summary  

Economic Evaluation Results: 

Base Case: Based on the post-tax cashflows shown in Table 12 above, the following economic evaluation results were obtained:

Table 13:  Economic Evaluation Results after taxes

Sensitivity Analysis  

A sensitivity analysis was undertaken for the three parameters with the greatest impact on the calculation of the Present Value of the project and the Internal Rate of Return. This analysis was carried out for variations of -25% and 25% regarding the Base Case, with the results being shown in Table 14 below. These sensitivities show the robust economics of the project, even in downside scenarios.

Table 14:  NPV and IRR sensitivities over Capex, Opex and Sales Price

It is observed for both analyses that the "Price" variable is the one that has the greatest impact on the calculation of the Present Value of the project flows, as well as on the calculation of the Internal Rate of Return, followed by Capex in the case of IRR.

Project Funding

It is recognised in the Scoping Study that to achieve the range of outcomes indicated, it is estimated that pre-production funding of approximately US$400-450 million before working capital will likely be required. The Report states that given the very high worldwide demand for lithium for electric car batteries, with significant demand growth forecast for the next 10 years, it is anticipated by the Company that the finance will be sourced through a combination of the following:

·    Equity and debt instruments from strategic partners or offtake partners and their associated banks

·    Through access to funds that are available from the USA, European Union and other countries to support the expansion of green lithium supply

·    From ESG specialist funds and/or infrastructure funds, targeted at sustainable lithium production practices which pass ESG criteria/hurdles

·    From new or existing equity investors and debt providers from the UK, USA, Australia and elsewhere, and/or

·    From various other sources, linked to the above.   

CleanTech Lithium plc has formed the view that there is a reasonable basis to believe that requisite funding for development of the Francisco Basin Project would be available when required, having considered factors including the following:

•     The quality of the Francisco Basin Project, in terms of the grade of the deposit and relatively low level of projected pre-production capital expenditure. The release of the Scoping Study will provide a potential platform for CleanTech Lithium to commence discussions with potential strategic or offtake partners and financiers, although the Company may wait until a pre-feasibility study has been completed on this Project before entering into substantive discussions.

•     Global debt and equity finance availability for lithium extraction projects like the Francisco Basin Project is expected to remain robust, particularly given the long-term price forecasts for lithium.

•     The project is in Chile, which holds the largest reserves of lithium in the world (source:  United States Geological Survey, McKinsey & Company article, 25 May 2022) and is a well-respected international mining jurisdiction.

•     The Company has no existing debt.

Environmental and Social Licence Considerations

The project does not fall within a designated environmental protection area, with fauna being scarce due to the high aridity and extreme climate at the altitude of 4,150m. The study confirms that the Company is currently developing an environmental baseline study, as well as compiling information for the environmental impact assessment (EIS) which will be necessary for the production phase of the project. The Company is supported by MYMA (Minería y Medio Ambiente Ltda), which specialises in environmental studies and permitting.

For the purpose of assessing possible impacts CleanTech Lithium plans to develop close relationships with project stakeholders. The Company has recently opened an office in Copiapó and is developing an Early Engagement Plan (PACA) that aims to keep an open communication channel with relevant community bodies and organisations and allows for a continuous assessment of the social impact of the project.

Conclusions and Recommendations

Francisco Basin is classified as an immature clastic salt lake basin. The total resource for the Project is estimated at 919,346 tonnes of LCE, with 443,215 tonnes being in the Indicated resource category and 476,130 tonnes being in the Inferred resource category. The average lithium value is 207 mg/l Lithium.

Public studies of the lithium market indicate strong demand and sustained high prices during the evaluation period. The demand for electric vehicles continues to increase, and progressively more countries are declaring bans on the sale of combustion vehicles in the coming years, ensuring the elevated levels of demand for lithium.

Chile is one of the few countries in the world where there are lithium deposits in continental brines, so the interest and supply requirements for this material should be of national interest.

The offer of a project with low environmental impact is in line with current regulations, so meeting the standards of environmental regulations should be a focus. At this point, it is necessary to have more information on the reinjection system and the development of a hydrogeological model that confirms the low impact on groundwater and its null impact on lake surfaces.

The operating cost, according to what is indicated in the scoping study (-15%/+35% accuracy), of US$ 3,641 per tonne, is a competitive cost for the projected prices, even in comparison with the costs of projects from continental brines and with traditional processes (solar evaporation).

The capital cost of the project is estimated (-15%/+ 30%) at US$ 450 million, considering 20% contingencies.

The economic analysis of the project, after taxes, gives a Net Present Value of US$ 1.1 billion, using a discount rate of 8%, and giving an internal rate of return of 43.5%. The term to recover the investment (payback period) is 2 years and 7 months.

The sensitivity analysis of the economic evaluation model shows that the factor that most impacts the Present Value of the project, for the same variations, is the Price factor. And with respect to IRR, both the Price and Capex are the most influential parameters.

It is recommended that a further resource drilling programme is undertaken at the project with the aim of further expanding and upgrading the current resource estimate. A plan for the location of the next stage of drillholes comprising a total of four wells is shown in Figure 9 below. This is based on three additional resource wells drilled with diamond drilling, labelled FB07 - FB09, with FB07 planned for the same site as well FB02 which was not successfully completed during the 1H 2023 drilling programme.  An additional wide diameter reverse flooded well, labelled IFFB01, is recommended specifically designed for reinjection tests.  

Fig 9: Francisco Basin Recommended Drillhole Locations

Based on the results of the initial explorations and the future exploration program, it is concluded that the Francisco Basin Project justifies continuing its development to determine if the lithium resource can be turned into a reserve, in terms of economic and technical aspects, and confirm the feasibility of its production on a pilot scale.

Competent Persons

The following professionals act as qualified persons, as defined in the AIM Note for Mining, Oil and Gas Companies (June 2009):

·    Christian Gert Feddersen Welkner: Geologist and Master of Science, major in geology (University of Chile). With more than 20 years of experience, Mr Feddersen is a qualified person independent of the company and a member of the Chile Mining Resources and Reserves Competence Qualifying Commission, a "Recognised Professional Organisation" (OPR). He is registered with No. 132 in the public registry of Competent Persons in Mineral Resources and Reserves, under the Law of Competent Persons and its Regulations in force in Chile. Mr Feddersen, who has reviewed and approved the geological information included in the announcement, has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and the activity being undertaken and qualifies as a competent person, as defined in the JORC Code.

·    Marcelo Bravo: Chemical Engineer (Universidad Católica del Norte), has a Master's Degree in Engineering Sciences major in Mineral Processing, Universidad de Antofagasta. He currently works as a Senior Process Consulting Engineer at the Ad-Infinitum company. Mr Bravo has relevant experience in researching and developing potassium, lithium carbonate, and solar evapo-concentration design processes in Chile, Argentina, and Bolivia. Mr Bravo, who has reviewed and approved the information contained in the chapters relevant to his expertise contained in this announcement, is registered with No. 412 in the public registry of Competent Persons in Mining Resources and Reserves per the Law of Persons Competent and its Regulations in force in Chile. Mr Bravo has sufficient experience relevant to the metallurgical tests and the type of subsequent processing of the extracted brines under consideration and to the activity being carried out to qualify as a competent person, as defined in the JORC Code.

The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. Upon publication of this announcement, this inside information is now considered to be in the public domain. The person who arranged for the release of this announcement on behalf of the Company was Gordon Stein, Director and CFO.

Cautionary Statement

The Scoping Study referred to in this AIM release has been undertaken for the purpose of initial evaluation of a potential development of the Francisco Basin Project located approximately 110 km, in a straight line, at east of Copiapó city, south of the Maricunga salt flat, Copiapó Municipality, Copiapó Province, Atacama III Region, Chile ("Francisco Basin Project").  It is a preliminary technical and economic study of the potential viability of the Francisco Basin Project. The Scoping Study outcomes, production target and forecast financial information referred to in the release are based on low level technical and economic assessments that are insufficient to support estimation of Ore Reserves.

The Scoping Study is presented in US dollars to an accuracy level of +/- 35%. While each of the modifying factors was considered and applied, there is no certainty of eventual conversion to Ore Reserves or that the production target itself will be realised.  Further exploration and evaluation and appropriate studies are required before CleanTech Lithium will be able to estimate any Ore Reserves or to provide any assurance of any economic development case. Given the uncertainties involved, investors should not make any investment decisions based solely on the results of the Scoping Study. Of the Mineral Resources scheduled for extraction in the Scoping Study production plan, approximately 68% are classified as Indicated and 32% as Inferred during the 12+-year evaluation period.

The Company has concluded that it has reasonable grounds for disclosing a production target which includes an amount of Inferred Mineral Resources. There is a low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the production target itself will be realised. Inferred Mineral Resources support production over the last 4 years of operation. The viability of the development scenario envisaged in the Scoping Study does not depend on the inclusion of Inferred Mineral Resources. Removing the Inferred Resources from the mine plan still provides a positive NPV and attractive IRR but reduces the production life to 8 years.

The Mineral Resources underpinning the production target in the Scoping Study have been prepared by a competent person in accordance with the requirements of the JORC Code (2012). For full details on the Mineral Resource estimate, please refer to the AIM announcement by CleanTech Lithium plc of 24 August 2023 for the Francisco Basin project.

Other than as presented in this announcement, CleanTech Lithium plc confirms that it is not aware of any new information or data that materially affects the information included in previous announcements and that all material assumptions and technical parameters underpinning the estimate continue to apply and have not been changed. This Scoping Study is based on the material assumptions outlined in this announcement. These include assumptions about the availability of funding. While CleanTech Lithium plc considers that all the material assumptions are based on reasonable grounds, there is no certainty that they will prove to be correct or that the range of outcomes indicated by the Scoping Study will be achieved.

To achieve the range of outcomes indicated in the Scoping Study, funding in the order of between US$400-450 million will likely be required.  Investors should note that that there is no certainty that CleanTech Lithium plc will be able to raise that amount of funding when needed. It is also possible that such funding may only be available on terms that may be dilutive to or otherwise affect the value of CleanTech Lithium plc's existing shares. It is also possible that CleanTech Lithium plc could pursue other value realisation strategies such as an agreement with a strategic partner for future funding and offtake, a sale or partial sale of its interest in the Francisco Basin Project or other potentially dilutive options.  If it does, this could materially reduce CleanTech Lithium plc's proportionate ownership of the project.

This announcement contains forward-looking statements. CleanTech Lithium plc has concluded that it has a reasonable basis for providing these forward-looking statements and believes it has a reasonable basis to expect it will be able to fund development of the Francisco Basin Project.  However, several factors could cause actual results or expectations to differ materially from the results expressed or implied in the forward-looking statements. Given the uncertainties involved, investors should not make any investment decisions based solely of the results of this study.

Important Information for this Announcement

The Scoping Study has been prepared and reported in accordance with the requirements of the JORC Code (2012).  The primary purpose of the Scoping Study is to establish whether or not to proceed to a Pre-Feasibility Study ("PFS") and has been prepared to an accuracy level of +/- 35%, the Scoping Study results should not be considered a profit forecast or production forecast. As defined by the JORC Code, a "Scoping Study is an order of magnitude technical and economic study of the potential viability of Mineral Resources. It includes appropriate assessments of realistic assumed Modifying Factors together with any other relevant operational factors that are necessary to demonstrate at the time of reporting that progress to a Pre-Feasibility Study can be justified."

The Modifying Factors included in the JORC Code have been assessed as part of the Scoping Study, including mining (brine extraction), processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and government factors. The Company has received advice from appropriate experts when assessing each Modifying Factor.

Following an assessment of the results of the Scoping Study, the Company has formed the view that a PFS is justified for the Francisco Basin project, which it will commence following completion of the recommended drilling programme. The PFS will provide the Company with a more comprehensive assessment of a range of options for the technical and economic viability of the Francisco Basin project.

The Company has concluded it has a reasonable basis for providing any of the forward-looking statements included in this announcement and believes that it has a reasonable basis to expect that the Company will be able to fund its stated objective of completing a PFS for the Francisco Basin project. All material assumptions on which the forecast financial information is based are set out in this announcement.

Some of the statements appearing in this announcement may be in the nature of  "forward-looking statements" which include all statements other than statements of historical fact, including, without limitation, those regarding the Company's financial position, business strategy, plans and objectives of management for future operations, or any statements preceded by, followed by or that include the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or similar expressions or negatives thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company's control that could cause the actual results, performance or achievements of the Group to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. These forward-looking statements speak only as at the date of this document. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based unless required to do so by applicable law or the AIM Rules.

Beaumont Cornish Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as nominated adviser to the Company in relation to the matters referred herein. Beaumont Cornish Limited is acting exclusively for the Company and for no one else in relation to the matters described in this announcement and is not advising any other person and accordingly will not be responsible to anyone other than the Company for providing the protections afforded to clients of Beaumont Cornish Limited, or for providing advice in relation to the contents of this announcement or any matter referred to in it.

Notes

About CleanTech Lithium

CleanTech Lithium (AIM:CTL, Frankfurt:T2N, OTCQX:CTLHF) is an exploration and development company advancing sustainable lithium projects in Chile for the clean energy transition. Committed to net-zero, CleanTech Lithium's mission is to produce material quantities of battery grade using sustainable Direct Lithium Extraction technology, powered by renewable energy, the Company plan to be the leading supplier of 'green' lithium to the EV and battery manufacturing market.

CleanTech Lithium has three lithium projects - Laguna Verde, Francisco Basin and Llamara - located in the lithium triangle, the world's centre for battery grade lithium production. The Laguna Verde and Francisco Basin projects are situated within basins controlled by the Company, which affords significant potential development and operational advantages. Llamara is the Company's latest greenfield project, which offers material potential upside at a low initial cost. All three projects have direct access to existing infrastructure and renewable power.

CleanTech Lithium is committed to using renewable power for processing and reducing the environmental impact of its lithium production by utilising Direct Lithium Extraction. Direct Lithium Extraction is a transformative technology which removes lithium from brine, with higher recoveries and purities. The method offers short development lead times, low upfront capex, with no extensive site construction and no evaporation pond development so there is no water depletion from the aquifer. www.ctlithium.com

**ENDS**

List of Abbreviations used in Scoping Study

JORC Code, 2012 Edition - Table 1 report

Francisco Basin

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Section 3 Estimation and Reporting of Mineral Resources

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)