The document discusses the changing global availability of lithium. It notes that world lithium reserves are estimated at 12.6 million tonnes and resources at 32.5 million tonnes. Forecasted global lithium demand is expected to grow from 134,672 tonnes in 2010 to 190,500 tonnes in 2015 and 254,300 tonnes in 2020. Several new lithium mining and production projects are under development that could help meet this increasing demand if brought online successfully. The long-term outlook for sufficient lithium supply depends on the ability of both existing and new projects to ramp up production levels to satisfy cumulative demand growth.

1. The changing face of lithium availability Gerry Clarke – International Lithium Institute

2. @Objectivelive GLOBAL RESOURCESINVESTMENT CONFERENCE 2011 Lead sponsor: Media partners: Other sponsors & participating organisations:

3. The changing face of lithium availability Gerry Clarke International Lithium Institute

5. USGS 2010 World Production: 134,672 tonnes LCE (circa 77% chemical)

6. Average (5) Forecast World Demand 2015: 190,500 tpa LCE

7. Average (6) Forecast World Demand 2020: 254,300 tpa LCE

8. 3 majors adding 80,900 tpa LCE capacity plus SQM yet to announce

9. Four Major Producers 2015: 225,800 tpa LCE capacity

10. Pipeline Projects 2015 add: 219,700 tpa LCE capacity

11. Total supply capability 2015: 445,500 tpa LCE ex China!

12. Forecast excess capacity 2015: 255,000 tpa LCE

14. Announced LCE Capacity Rises (‘000 tpa)*SQM will also increase capacity but not yet announced

15. Near Projects in Development Company Start Location Plan capacity* Galaxy Resources 2011 Aus/China 17k Orocobre 2012 Argentina 15k Canada Lithium 2012 Quebec 19k Western Lithium 2014 Nevada 27k Lithium Americas 2014 Argentina 15k Total 93k tpa LCE *Company published LCE annual capacity By 2012 Talison’sGreenbushes, WA capacity will equal 2010 world demand: 110k tpa LCE Reserves: 9.6m. te 3.9% Li20 (920k LCE) M&I Resources: 22.0m te 3.7% Li20 (2m LCE) Capacity: 315k tpa concentrates (47k LCE) going to 740k tpa(110k LCE) June 2012 Li2CO3 plant: Undertaking engineering & location studies for Li2CO3 plant & targeting first stage 20ktpa fiscal 2015 with a second 20ktpa stage to follow. Total: 40,000 tpa Courtesy: Talison Lithium, Greenbushes, WA

16. Chemetall LithiumSalar de Atacama: 30k tpa LCE

17. SQM’s final LiCl evaporation pond In 2010 the brine volume (2,700 ppm Li) pumped to produce 1.5m tonnes of potash contained such a large volume of lithium in excess of the 44k tpa LCE capacity that 400k tonnes LCE were reinjected into the aquifer.

18. Emerging & Advanced Projects Brines Mines Rincon Lithium 2010 Galaxy Resources 2010 Orocobre2012 Reed Resources 2011 Albemarle 2012 Canada Lithium 2012 Lithium Americas 2014Nemaska Exploration 2013 Lithium One 2014 Western Lithium 2014 POSCO 2014 Rodinia2015 International Li 2016Rio Tinto 2016 Plus other projects further out------and------China?

20. Brine: 600 ppm Li, 2,500 ppm Mg

21. Phased expansions up to 50k tpa Li2CO3

22. Reserves: 1.4m tonnes lithium: NI43-101 awaited

23. Project initiated 2002 by Equity-1 Resources morphed into Admiralty Resources 2004 and developed project to envisaged 17,000 tpa Li2CO3 2007 starting mid-2008.

25. Brine: 690 Li, 5,730 K, 1,656 Mg, plus B

26. NI43-101 M+I Reserve: 1.2m tonnes contained lithium

27. FS 2011: 16,400 tpa Li2CO3: 2012 start

28. Capital cost: $206.7m.

29. Op Cost: $1,512/t Li2CO3 or $1,230/t net including K2O

30. Sinclair Knight Merz project engineers

31. Final stages approvals, financing, engineering progressing

33. Smackover Formation oilfield brine: 750kt Li

34. 100-200 ppm lithium in bromine tailings

35. April 2011: new proprietary tech for Li extraction

36. Pilot plant now optimising process

37. Commercial production as early as 2013

38. Capacity not announced: maybe 10-15kt Li2CO3

40. Brine: 627 Li; 5,417 K; 1,470 Mg

41. NI43-101 M+I Reserve: 997kt contained lithium

42. Full FS expected Q1 2012

43. April 2011 PEA Op cost: $1,434/tonne Li2CO3

44. Engineers: ARA Worley Parsons

45. Two phases: 20k tpa 2014; 20ktpa 2018

46. Capital cost: $217m phase 1; $399m phases 1 & 2

47. Expect 75% phase 1 production 2015: 16,000 tpa Li2CO3

49. Brine: 695 Li, 7,590K, 1,520 Mg, plus B

50. NI43-101 Inf Reserve: 1.0m tonnes contained lithium

51. Expect PEA Q3/2011 and FS Q2/2012

52. Pilot plant operating since October 2010

53. ARA Worley Parsons project engineers

55. Earn-in up to 70%: Galaxy Resources/started DFS exp Q4/2012

56. Hard rock (Spodumene): average grade 1.25% Li2O; c/o 0.75%

58. Brine: 556 Li, 6,206 K, 2,057 Mg, plus B

59. NI43-101 Inf Reserve: 932kt contained lithium

60. PEA Q1 2012 for 10-15ktpa LCE start 2015Esmeralda Co, Clayton Valley, Nevada, USA: 29,275 ha Ratones & Centenario, Salta, Argentina: 1,282 ha Salinas Grandes, Jujuy, Argentina: 4,500 ha

62. Strategic Investor: Jiangxi Ganfeng Lithium 9.99%

64. Forgan Lake, Ontario, Canada: Li, Ta project

65. Niemi, ON, Canada: Li, Ta project

66. Mavis, ON, Canada: Li, TA, Cs, Rb project

68. JORC M+I Reserve 2011: 70kt Li: Total 91kt Li; 1.08% Li2O

70. Also Lithium battery manufacturing plant

73. Capacity: 204,000 tpa concentrates @ 6.5% Li2O

75. Proven & Probable Reserve: 17,064kt @ 0.94% Li2O

76. Plus low grade P&P Reserve: 3,271kt @ 0.38% Li2O

77. Total P&P Reserve: 20,335kt @ 0.85% Li2O: 80.2kt Li

78. For a 20,000 tpa Li2CO3 plant 2013

79. Capital construction cost: US$202m.

80. Operating cost: US$3,164 per tonne Li2CO3

81. Now under construction for commission Q4 2012

82. Full production expected Q4 2013

84. NI43-101 M+I Res: 25.1kt @ 1.54% Li2O: 179.2 kt Li

85. Open pit Q2 2013: 202,000 tpaspodumeneconcs

86. DFS for concentrate Q1 2012; Q2 2012 for Li2CO3

87. Plant for Li2CO3 & LiOH: construct 2013: 25ktpa LCE

89. Sichuan Tianqi Lithium Industry Co LtdSpodumene conversion plant, Shehong, Sichuan

91. Stage 1 NI43-101 M+I Res: 37.3m tonnes @ 0.404% Li = 150.7kt lithium. Represents 7.3% of historic total

92. Supports 25-year mine life

93. Jan 2010: 27.7ktpa Li2CO3 & operating cost $1,967/tonne

94. Nov 2010 upgraded Stage 1 feedstock resource allowed lower initial capacity at 13,500 tpa Li2CO3 and overall reduced costs

95. Prefeasibility study expected now

96. Detailed engineering/construction: mid-2012

98. Lower jadarite zone: 125.3m tonnes @ 1.8% Li2O

99. Decided to retain & develop project: $27m drill camp

100. Free milling soft rock

101. Off-the shelf conversion technology

102. Envisaged commissioning 2016 earliest

104. Lithium Resources in China Continental Brines: One in Tibet, two in Qinghai: Remote west Hard Rock: Four in Sichuan, two in Jiangxi, one in Hunan Mineral Conversion: Ten companies 2011 capacity: 52.5k LCE Sichuan Tianqi, Xinjiang Lithium Salt, Ganfeng Lithium, Sichuan Ni&CoGuorun are the majors now being joined by Galaxy Resources at Zhangjiagang, Shanghai (17k tpa LCE) External reliance: Spodumene imports from Australia, partnering new resource development in Canada (Tianqi/Nemaska) & Argentina (Internat’l Lithium/Ganfeng) High altitude, high magnesium, remoteness & robust growth in traditional lithium mineral uses especially glass/now battery

105. Other projects further out Simbol Materials, S California KGRA, Geo brines Bollore-Eramet: Minera Santa Rita, Argentina Salares Lithium Inc, Salares 7, Atacama RIII East Coast Minerals: Austria Li3 Energy, Salar de Maricunga, Chile American Lithium Minerals, Borate Hills, NV, USA Perilya Canada, Moblan, QC, Canada (Globestar) Rock Tech Lithium, Georgia Lake, ON, Canada And many more: see LAWM June 2011

107. Diversification: geopolitical, oligopoly

108. Commissioning to full capacity: ramping period

109. Strategic partnerships: financial support, off-takes

110. Resource quality: operating cost, scale, by-products, losses

111. End product markets: direct, CO3, OH, Cl, derivative

112. Government influences: CO2 reduction, supply security

113. Processing capability: conversion know-how

114. Financial strength: patience for ROI, failure risk

115. Project entry timing v market uptake: minimum capacity

116. Major companies’ actions: price, capacity expansion

118. Buyers support supply diversification allowing several only to enter at low occupacity levels restraining prices and slowing project development

119. Market volume growth to 2020 too slow causes project delays, shelving, abandonment.

120. Market volume growth to 2100 requires all projects (except seawater) to meet cumulative demand of 20m. tonnes Li -- 50% of broad based reserves of over 39m. tonnes (LAWM 2009) just covers need for double demand levels to cover extraction losses (Miller, Ford Motor Co. 2011).