42-101 Report

INFERRED RESOURCE ESTIMATION OF LITHIUM AND
POTASSIUM AT THE CAUCHARI AND OLAROZ SALARS, JUJUY
PROVINCE, ARGENTINA

PREPARED FOR:
TORONTO, CANADA
PREPARED BY:
MARK KING, PH.D., P.GEO
CANADIAN PROFESSIONAL GEOSCIENTIST REGISTERED WITH
THE ASSOCIATION OF PROFESSIONAL GEOSCIENTISTS OF NOVA SCOTIA
GROUNDWATER INSIGHT, INC.
30 OCEANVIEW DRIVE, HALIFAX, NOVA SCOTIA, B3P 2H3
FEBRUARY 15th 2010

TABLE OF CONTENTS
ABBREVIATIONS ..............................................................................................................................ix
SUMMARY ......................................................................................................................................xii
S.1 Terms of Reference ..............................................................................................................xii
S.2 Property Location, Description and Ownership ...................................................................xii
S.3 Geology.................................................................................................................................xii
S.4 Mineralization……………………………………………………………………………………………………………..…xiii
S.5 Exploration Concept and Status ..........................................................................................xiii
S.6 Conclusions .......................................................................................................................... xiv
S.7 Recommendations............................................................................................................... xiv
1‐ INTRODUCTION........................................................................................................................... 1
1.1 Authorization and Purpose.................................................................................................... 1
1.2 Sources of Information.......................................................................................................... 1
1.3 Scope of Personal Inspection ................................................................................................ 2
2‐ RELIANCE ON OTHER EXPERTS ................................................................................................... 5
3‐ PROPERTY DESCRIPTION AND LOCATION................................................................................... 7
3.1 Location ................................................................................................................................. 7
3.2 Property Area ........................................................................................................................ 9
3.3 Type of Mineral Tenure ....................................................................................................... 12
3.4 Title ...................................................................................................................................... 12
3.5 Property Boundaries............................................................................................................ 12
3.6 Environmental Liabilities ..................................................................................................... 13
3.7 Permits................................................................................................................................. 13
4‐ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY.......... 14
4.1 Topography.......................................................................................................................... 14
4.2 Access .................................................................................................................................. 16
4.3 Population Centres .............................................................................................................. 16
4.4 Climate................................................................................................................................. 16
4.5 Infrastructure ...................................................................................................................... 18
‐ i ‐

5‐ HISTORY .................................................................................................................................... 19

6‐ GEOLOGICAL AND HYDROLOGICAL SETTING............................................................................ 20
6.1 Regional Structural Features ............................................................................................... 20
6.2 Regional Geology................................................................................................................. 20
6.3 Local Geology ...................................................................................................................... 22
6.3.1 Carbonate Facies......................................................................................................... 23
6.3.2 Borax Facies ................................................................................................................ 23
6.3.3 Sulphate Facies ........................................................................................................... 24
6.3.4 Clay Facies ................................................................................................................... 26
6.3.5 Sodium Chloride Facies............................................................................................... 26
6.4 Vertical Geological Section.................................................................................................. 27
6.4.1 Upper Mixed Sequence............................................................................................... 29
6.4.2 Thin Bedded Sequence ............................................................................................... 29
6.4.3 Coarse Bedded Sequence ........................................................................................... 30
6.5 Hydrogeology ...................................................................................................................... 32
6.5.1 Surface Water ............................................................................................................. 32
6.5.2 Groundwater............................................................................................................... 35
6.5.3 Water Balance............................................................................................................. 36
7‐ DEPOSIT TYPES.......................................................................................................................... 37
8‐ MINERALIZATION ...................................................................................................................... 39
9‐ EXPLORATION ........................................................................................................................... 40
9.1 Overview.............................................................................................................................. 40
9.2 Surface Sampling Program .................................................................................................. 41
9.3 Seismic Geophysical Program.............................................................................................. 44
10‐ DRILLING ................................................................................................................................. 47
10.1 Reverse Circulation Drilling Program ................................................................................ 47
10.2 Diamond Drilling Program ................................................................................................. 59
11‐SAMPLING METHOD AND APPROACH..................................................................................... 60
11.1 Background........................................................................................................................ 60
11.2 Surface Brine Sampling Methods ...................................................................................... 60
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11.3 RC Borehole Sampling Methods........................................................................................ 60
11.4 DD Borehole Sampling Methods ....................................................................................... 61
12‐SAMPLE PREPARATION, ANALYSES AND SECURITY................................................................. 62
12.1 Overview............................................................................................................................ 62
12.2 Sample Preparation........................................................................................................... 62
12.2.1 Surface Brine Sample Preparation............................................................................. 62
12.2.2 RC Borehole Brine Sample Preparation ..................................................................... 62
12.2.3 DD Borehole Core Sample Preparation ..................................................................... 62
12.3 Brine Analysis .................................................................................................................... 63
12.3.1 Analytical Methods ................................................................................................... 63
12.3.2 Analytical Quality Assurance and Quality Control (QA/QC) ..................................... 63
12.4 Geotechnical Analyses....................................................................................................... 68
12.4.1 Overview ................................................................................................................... 68
12.4.2 Analytical Methods .................................................................................................. 68
12.5 Sample Security ................................................................................................................. 69
13‐ DATA VERIFICATION................................................................................................................ 70
13.1 Overview............................................................................................................................ 70
13.2 Site Visit ............................................................................................................................. 70
13.3 Laboratory QA/QC Results ................................................................................................ 71
13.4 Brine Composition Trends................................................................................................. 72
13.5 Technical Competence ...................................................................................................... 72
14‐ ADJACENT PROPERTIES........................................................................................................... 73
15‐ MINERAL PROCESSING AND METALLURGICAL TESTING ........................................................ 75
15.1 Overview ............................................................................................................................ 75
15.2 Simulated Solar Evaporation Solubility Testing................................................................. 75
15.2.1 Experimental Methods .............................................................................................. 75
15.2.2 Test Results ................................................................................................................ 77
15.2.3 Phase Diagrams.......................................................................................................... 81
15.2.4 Discussion and Conclusions ....................................................................................... 82
16‐ MINERAL RESOURCE ESTIMATE ............................................................................................. 84
‐ iii ‐

16.1 Overview............................................................................................................................ 84
16.2 Conceptual Geologic Model .............................................................................................. 84
16.3 Block Model Construction ................................................................................................. 84
16.4 Resource Estimate Boundaries.......................................................................................... 87
16.5 Drainable Porosity ............................................................................................................. 89
16.6 Lithium Distribution........................................................................................................... 90
16.7 Inferred in situ Resource Estimation ................................................................................. 94
16.8 Cut off Analysis .................................................................................................................. 95
17‐ OTHER RELEVANT DATA AND INFORMATION ........................................................................ 96
18‐ INTERPRETATION AND CONCLUSIONS ................................................................................... 97
19‐ RECOMMENDATIONS ............................................................................................................. 98
19.1 Objectives .......................................................................................................................... 98
19.2 Hydrogeological Investigations ......................................................................................... 98
19.2.1 Resource Definition Drilling ....................................................................................... 98
19.2.2 Pumping Tests............................................................................................................ 98
19.2.3 Geophysical Surveys ................................................................................................ 100
19.2.4 Monitoring Programs............................................................................................... 100
19.2.5 Revised Resource Estimate...................................................................................... 100
19.2.6 Long‐term Aquifer Response ................................................................................... 100
19.3 Brine Process Development ............................................................................................ 100
19.4 Estimated Budget ............................................................................................................ 101
20‐ REFERENCES.......................................................................................................................... 103
21‐ DATE AND SIGNATURE PAGE ................................................................................................ 105
22‐ ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT
PROPERTIES AND PRODUCTION PROPERTIES....................................................................... 107
23‐ ILLUSTRATIONS ..................................................................................................................... 108
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LIST OF TABLES
3.1 Status of Minera Exar S.A. mineral claims on the Cauchari and Olaroz Salars ................... 10

8.1 Comparative chemical composition of natural brines (wt %)............................................. 39
10.1 Brine concentration (mg/L)and density (g/cm3) results from RC Borehole Program ...... 48
10.2 Average concentrations (g/L) and associated ratios from brine samples from the RC
Borehole Program ............................................................................................................. 48
10.3 Results of drainable porosity testing................................................................................. 59
12.1 Check Assays (ASL vs Univ. Salta): RMA regression statistics ........................................... 66
12.2 Summary of geotechnical property analyses .................................................................... 68
15.1 Concentration (wt%) and density (g/cm3) for the brine from borehole PE‐4 .................. 75
15.2 Mass balance in terms of salts, solution and evaporated water ...................................... 77
15.3 Composition in wt% and properties of the evaporating brine ......................................... 78
15.4 Chemical composition in wt% and moisture of harvested salts ....................................... 79
15.5 Mineralization of Salts from Evaporation Test at 30°C (4th Stage) .................................. 80
15.6 Mineralization of Salts from Solubility Test at 15°C (4th Stage) ....................................... 80
16.1 Model layer porosity estimates......................................................................................... 89
16.2 Inferred in situ lithium resource........................................................................................ 94
16.3 Inferred in situ potassium resource .................................................................................. 95
17.1 Comparison of selected lithium brine resources .............................................................. 96
19.1 Estimated Budget ............................................................................................................. 102
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LIST OF FIGURES
3.1 Location map ......................................................................................................................... 8
3.2 LAC property claims for the Cauchari ‐ Olaroz Project........................................................ 11
4.1 Topography map ................................................................................................................. 15
4.2 Monthly average precipitation for Susques ....................................................................... 17
4.3 Monthly average precipitation for Olacapato.................................................................... 17
6.1 Regional geology in the vicinity of the LAC Project............................................................ 21
6.2 Local geology of the Cauchari and Olaroz Salars................................................................ 25
6.3 Conceptual section of the Cauchari and Olaroz Salars ...................................................... 27
6.4 Conceptual stratigraphical column of the Cauchari and Olaroz Salars............................... 28
6.5 Cauchari – Olaroz Watershed.............................................................................................. 33
9.1 Distribution of lithium concentration in surface brine samples ......................................... 42
9.2 Distribution of potassium concentration in surface brine samples.................................... 43
9.3 Seismic tomography lines completed during 2009 ............................................................. 45
9.4 Example seismic tomography results (Line 1)..................................................................... 46
10.1 PE‐1 summary geologic log and brine analyses ................................................................ 50
12.1 RMA plot for the fitted multiple regression model for potassium ................................... 66
12.2 RMA plot for the fitted multiple regression model for lithium......................................... 67
12.3 RMA plot for the fitted multiple regression model for magnesium ................................. 67
14.1 Location map of Orocobre claims ..................................................................................... 74
15.1 Evaporation path of brine from Cauchari Salar................................................................. 81
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15.2 Evaporation path of brine from Cauchari Salar................................................................. 82
16.1 Plan view of the block model extent................................................................................. 86
16.2 Section showing stratigraphy within the block model ..................................................... 87
16.3 Lateral extent of the inferred resource estimation zone.................................................. 88
16.4 Lateral lithium distribution in the inferred resource estimation zone. ............................ 91
16.5 Vertical lithium distributions in the resource estimation zone of the block model…. ..... 92
16.6 Drift analysis of the block model along the x‐axis............................................................. 93
16.7 Drift analysis of the block model along the y‐axis. ........................................................... 93
16.8 Drift analysis of the block model along the z‐axis…. ......................................................... 94
16.9 Lithium reserve tonnage and grade, as determined by cutoff concentration…............... 95
19.1 The 2010 drill hole program.............................................................................................. 99
‐ vii ‐

LIST OF PHOTOS
6.1 Boundary between Cauchary and Olaroz Salars ................................................................. 22

6.2 Carbonate facies (sinter) in the western margin of Cauchari Salar .................................... 23
6.3 Borax facies in western Cauchari ........................................................................................ 24
6.4 Clay facies in the Cauchari Salar ......................................................................................... 26
6.5 Sodium Chloride facies in the Olaroz Salar ......................................................................... 27
6.6 Upper Mixed Sequence clay with borax mineralization ..................................................... 29
6.7 Thin Bedded Sequence showing alternating sand and halite layers................................... 30
6.8 Sand‐dominant Unit ............................................................................................................ 31
6.9 Porous Halite in the Coarse Bedded Sequence................................................................... 31
6.10 Rio Rosario just above the Highway 74 bridge crossing ................................................... 34
6.11 Rio Ola at Achibarca .......................................................................................................... 34
6.12 Rio Tocomar 8 km below Alto Tocomar ............................................................................ 35
9.1 Brine sampling from a shallow pit in Cauchari.................................................................... 41
9.2 Brine collection from abandoned borax production pit ..................................................... 41
11.1 Cyclone with plastic bag .................................................................................................... 61
11.2 Rock chip tray with dry and wet samples.......................................................................... 61
11.3 Collecting the undisturbed sample from sand core.......................................................... 61
11.4 Collecting undisturbed sample from clay core.................................................................. 61
12.1 Filtration of brine and clay mixture................................................................................... 63
12.2 Brine after filtration........................................................................................................... 63
15.1 Fiberglass evaporation pan and associated apparatus ..................................................... 76

‐ viii ‐

LIST OF ABREVIATIONS
% : percentage
° C : temperature in degrees Celcius
AAS : atomic absorption spectometry
ASTM : American Society for Testing and Materials
B : boron
b : width
B2O3 : boron oxide
B5O : borate
C : carbon
Ca : calcium
CaCO3 : calcium carbonate
CBS : coarse bedded sequence
Cc : coefficient of curvature
CCP : container capacity package
Cl : chloride
Cl– : chloride ion
cm : centimetre
CO3 : carbonate
Cu : uniformity coefficient
d50 : median diameter
DD : diamond drilling
DTRC : dual tube reverse circulation
g/cm3 : grams per cubic centimetre
g/L : grams per litre
GPS : global positioning system
H3BO3 : boric acid
ha : hectare
HCO3 : bicarbonate
‐ ix ‐

HQ : diamond drilling diameter
Hz : hertz
ICP: Inductively Coupled Plasma
JORC : Joint Ore Reserve Committee
K : potassium
K/Li : potassium to lithium ratio
K+ : potassium ion
kg : kilogram
km : kilometre
km2 : square kilometre
L : litre
L/s : litre per second
Li : lithium
Li2CO3 : lithium carbonate
m : metre
m/s : metre per second
masl : metres above sea level
mg : milligram
Mg(OH)2 : magnesium hydroxide
mg/L : milligrams per litre
Mg/Li : magnesium to lithium ratio
Mg++: magnesium ion
mm : millimetre
mol% : molar percentage
Na+: sodium ion
NCH : Chilean standard
ODEX : drilling method
pH : measure of acidity or alkalinity
PQ : drilling diameter in diamond drilling
PVC : polyvinyl chloride
‐ x ‐

QA/QC : quality assurance/quality control
RC : reverse circulation
RMA : reduction to major axis
rpm : rotations per minute
RWRC : relative water release capacity
SO4 : sulphate
SO4/(Mg +Ca) : molar ratio
SO4/K : sulphate to potassium ratio
SO4/Li : sulphate to lithium ratio
SO4/Mg : sulphate to magnesium ratio
SO4= : sulphate ion
TBS : Thin Bedded Sequence
TDS: total dissolved solids
UMS : Upper Mixed Sequence
USD : United States dollar
USDA : United States Department of Agriculture
UTM : Universal Transverse Mercator coordinate system
WGS : World Geodetic System
wt% : weight percent
XRD : x‐ray diffraction

‐ xi ‐

SUMMARY
S.1 Terms of Reference
This report (the “Report”) was prepared for Lithium Americas Corp. (the “Company” or “LAC”) to
document the basis for, and results of, an inferred resource estimate on mineral claims held by the
Company. The estimate applies to lithium and potassium contained in brine underlying the Olaroz
and Cauchari Salars, two salt lakes in Jujuy Province in northwestern Argentina.
The format and content of this report is intended to fulfill the requirements of National Instrument
43‐101 – Standards of Disclosure for Mineral Projects, including Form 43‐101F1 ‐ Technical Report
and Companion Policy 43‐101 CP – To National Instrument 43‐101 Standards of Disclosure for
Mineral Projects of the Canadian Securities Administrators (“NI 43‐101”). Report preparation was
supervised by Mark King Ph.D., P.Geo., a “qualified person” (the “QP”) who is “independent” of
LAC, as such terms are defined by NI 43‐101.
It is the intention of LAC to file this document with the Canadian securities regulatory authorities
as an NI 43‐101 compliant Technical Report.
S2. Property Location, Description and Ownership
The Cauchari and Olaroz Salars are located in the Department of Susques of the Province of Jujuy
in northwestern Argentina, approximately 250 km northwest of San Salvador de Jujuy, the
provincial capital, and 100 km east of the international border with Chile. Average ground
elevation of the salars is 3 950 masl.
LAC, through its Argentinian subsidiary Minera Exar S.A., has obtained legal title to mining and
exploration permits covering a total of 36 974 ha over the Cauchari and Olaroz Salars (the
“Cauchari‐Olaroz Project” or the “Project”). The Provincial Government of Jujuy approved the LAC
Environmental Impacts Report for the Cauchari‐Olaroz Project exploration work by Resolution No.
25/09 on August 26, 2009.
S.3 Geology
The Cauchari and Olaroz Salars are “Silver Peak, Nevada” type terrigenous salars. These deposits
occur in structural basins in‐filled with sediments differentiated as inter‐bedded units of clays, salt
(halite), sands and gravels. They host a lithium‐bearing aquifer that has developed during arid
climatic periods. The conceptual geologic model for the Olaroz and Cauchari Salars includes:
¾ An Upper Mixed Sequence (“UMS”) – This is the surface unit in the salars. It includes clays, thin
evaporite facies (sodium chloride, mirabilite, soda ash, etc.), carbonate facies, ulexite facies and
the coarse clastic sediments from the alluvial cones encroaching on the salars.
¾ A Thin Bedded Sequence (“TBS”) ‐ This unit is at intermediate depth and is composed of thinly
bedded clay, silt, sand and evaporite facies (mostly halite and gypsum). This sequence is coarser
grained than the UMS which is dominated by clay.
‐ xii ‐

¾ A Coarse Bedded Sequence (“CBS”) – This is the bottom salar unit and consists of thick inter‐
layered sand and evaporite (mostly halite) beds.
These sediment sequences are underlain by bedrock composed mostly of Lower Ordovician
turbidites (shale and sandstone) intruded by Late Ordovician granitoids. Alluvial fans extend onto
the salars from surrounding higher ground.
S.4 Mineralization
The brines of the Cauchari and Olaroz Salars have relatively high sulphate content and can be
classified as “sulphate type brine deposits”. The brines of Cauchari are saturated in sodium
chloride with total dissolved solids (“TDS”) on the order of 27% (324‐335 g/L) and an average
density of approximately 1.215 g/cm3. The other components present in these brines, which
constitute a complex aqueous system, are: K, Li, Mg, Ca, SO4, HCO3, and B as borates and free
H3BO3.
S.5 Exploration Concept and Status
The following exploration programs were initiated in 2009, to evaluate the lithium development
potential of the Project area:
¾ Surface Brine Program ‐ Brine samples were collected from shallow pits throughout the salars to
obtain a preliminary indication of lithium occurrence and distribution. A total of 55 samples
were collected for laboratory analyses.
¾ Seismic Geophysical Program – A seismic survey was conducted to support delineation of basin
geometry, mapping of basin‐fill sequences, and locating future borehole sites. A total of 24.7
km of seismic data have been acquired along seven lines.
¾ Reverse Circulation (“RC”) Borehole Program ‐ Dual tube reverse circulation drilling is being
conducted to develop vertical profiles of brine chemistry at depth in the salars and to provide
geological and hydrogeological data. Nine RC boreholes have been drilled for a total of 1 333 m.
760 brine samples were collected for laboratory chemical analyses.
¾ Diamond Drilling (“DD”) Borehole Program – This program is being conducted to collect
continuous cores for geotechnical testing (porosity, grain size and density) and geological
characterization. Five DD boreholes have been drilled to date for a total of 1 280 m. 113
undisturbed samples have been collected for geotechnical analyses. The boreholes were
completed as observation wells for future brine sampling and monitoring.
¾ An inferred in situ resource estimate was prepared, based on the integration, analyses and
interpretation of results from the above outlined exploration programs. The following resource
tonnages are indicated:
o 926 000 tonnes of lithium metal or 4.9 million tonnes of lithium carbonate; and
o 7.7 million tonnes of potassium.
‐ xiii ‐

This inferred resource estimate is limited to the LAC claim areas in the north central part of the
Cauchari Salar.
S.6 Conclusions
The key conclusions from this work are as follows:
¾ The lithium and potassium resource described in this report occurs in a subsurface brine. The
brine is contained within the pore space of salar deposits that have accumulated in a structural
basin.
¾ A conceptual geologic model has been developed for the basin which includes three primary
salar units: the UMS, the TBS, and the CBS. The CBS is the most vertically extensive unit and
has the highest porosity. Consequently, it contains the majority of the resource. The salar
deposits are constrained on the sides of the basin by alluvium and pediment‐type deposits,
known in this report as the Border Facies.
¾ The bottom boundary of the resource estimate has been constrained to the depth of drilling
conducted to date by LAC. The existing boreholes have not encountered the bottom of the
basin. Estimates from individual seismic lines indicate that the basin bottom is between 300
and 600 m, depending on location. The depths of the boreholes used in the inferred resource
estimate range from 176 to 249 m. Consequently, the resource remains open at depth.
¾ The north and south lateral boundaries of the resource estimate (i.e., along the longitudinal
axis of the basin) have been constrained to the central cluster of boreholes drilled to date, with
relatively high concentrations at either end of this zone. Consequently, some extension of the
resource in these directions is possible, based on future drilling.
¾ The high dissolved solids content of the brines is a source of variability in the existing analytical
results. Additional analytical QA/QC refinement should be conducted in advance of the next
level of estimation. On balance, however, it is the opinion of the independent QP that the
existing brine dataset is acceptable for use in an inferred resource estimate.
¾ Extensive sampling indicates that the brine has a relatively low magnesium/lithium ratio (lower
than three, on average), suggesting that it would be amenable to conventional lithium recovery
processing. The brine is relatively high in sulphate which is also advantageous for brine
processing because the amounts of sodium sulphate or soda ash required for calcium removal
would be relatively low.
S.7 Recommendations
Based on the results of the current inferred resource estimate it is recommended to continue the
investigation of the lithium development potential of the Cauchari‐Olaroz Project. It should be
noted that the current inferred resource estimate is limited to an area that covers less than half of
the LAC mining and exploration claims and is open at depth. A detailed work program has been
proposed and consists of two main components:
‐ xiv ‐

¾ Hydrogeological investigations to further refine lithium and potassium resource estimates and
to evaluate brine extractability and long‐term aquifer hydraulics.
¾ A metallurgical program to develop a lithium extraction process and to carry out pilot scale
process investigations.
This work would support the completion of a pre‐feasibility study for the Project during 2011, at an
estimated cost of approximately USD 29.6 million.
‐ xv ‐

1 INTRODUCTION
1.1 Authorization and Purpose
This report (the “Report”) was prepared for Lithium Americas Corp. (the “Company” or “LAC”) to
document the basis for, and results of, an inferred resource estimate on mineral claims held by the
Company. The estimate applies to lithium contained in brine within the basin of the Olaroz and
Cauchari Salars, two dry salt lakes in Jujuy Province of northwestern Argentina.

The format and content of this report is intended to fulfill the requirements of National Instrument
43‐101 – Standards of Disclosure for Mineral Projects including, Form 43‐101F1 ‐ Technical Report
and Companion Policy 43‐101CP – To National Instrument 43‐101 Standards of Disclosure for
Mineral Projects , of the Canadian Securities Administrators (“NI 43‐101”). Report preparation was
supervised by Mark King Ph.D., P.Geo., a “qualified person” (a “QP”) who is “independent” of LAC,
as such terms are defined by NI 43‐101.
It is the intention of LAC to file this document with Canadian securities regulatory authorities as an
NI 43‐101 compliant Technical Report.
1.2 Sources of Information
The inferred resource estimate documented in this report is based on the following information
sources:

¾ A conceptual geologic model for the salar basins, which in turn is based on:

o Expertise in salar geology held by members of the LAC technical team;

o Geologic logging of five diamond drill boreholes drilled by LAC;

o Geologic logging of nine reverse circulation boreholes drilled by LAC;

o A seismic survey conducted by LAC;

¾ Subsurface distributions of lithium and other dissolved constituents, delineated through
collection and analysis of more than 750 brine samples from reverse circulation boreholes;

¾ Near‐surface distributions of lithium and other dissolved constituents, delineated through
collection and analysis of 55 brine samples from shallow, hand‐dug pits; and

¾ Formation porosity measurements, obtained through the collection and analysis of 113
undisturbed core samples from diamond drill boreholes.

‐ 1 ‐

Preliminary evaluation of lithium brine processing considerations is also reported herein.
Processing was evaluated through a laboratory study of brine evaporation and salts solubility by
the University of Antofagasta in Chile.

Sources of qualitative information were also important as a background for preparing this report,
and included the following:

¾ Various technical papers on salar geology and salar brine chemistry;

¾ Evaluation of the Exploration Potential at the Salares de Cauchari and Olaroz, Province of Jujuy,
Argentina. Internal report by TRU Group for Lithium Americas Corp. (2009);
¾ Various maps of the Servicio Geológico Minero Argentino;

¾ Various discussions with LAC personnel familiar with the property and the LAC exploration
programs;

¾ Detailed discussions with the block model specialist for the Project, regarding the development
and structure of the model; and

¾ Personal inspection visits by the independent QP (Mark King) to the site, the field office in
Susques, the logistics office in Jujuy, and the corporate office in Mendoza (all in Argentina).

The QP acknowledges the full and complete cooperation of all LAC personnel and LAC contractors,
in assisting in the preparation of this report. All site information and data were made readily
available and all topics were open for critical examination and discussion. Site information and
data were stored in an orderly manner that facilitated retrieval.

1.3 Scope of Personal Inspection
The QP visited the Project site and field office on December 10 and 11, 2009. Features that were
inspected and reviewed during a driving and walking tour of the site included the following:

¾ Overall site layout, salar features, and surrounding topography;

¾ An operating drill conducting the ongoing drilling program;

¾ Most previous drilling sites, including cuttings, well completions, brine ponds, and new gravel
roads constructed to the sites;

¾ One of the shallow pits used for the near‐surface brine sampling program;

¾ Perimeter areas and alluvial fans;

¾ Surface mining operations conducted by others; and
‐ 2 ‐

¾ The general location of lithium brine exploration work conducted by others, on adjacent
properties in the Olaroz Salar.

Exploration program components inspected and reviewed at the Susques field office included the
following:

¾ Sampling procedures for brine, rock chips and core;

¾ Sample and core storage facilities;

¾ Sample handling, preparation and security systems;

¾ Example cores and rock chips;

¾ Field data entry and log production procedures;

¾ Interaction with the central data storage technician at the Mendoza corporate office;

¾ All plotted logs and mapping available up to the time of the visit; and

¾ Staff operations, responsibilities and mentoring.

The QP visited, and worked from, the corporate office in Mendoza from January 22 to January 30,
2010. Relevant Project features inspected and reviewed at that time included the following:

¾ Hard copies of all analytical data available up to that time;

¾ Project technical papers;

¾ Project environmental and property documentation;

¾ Drafting and administrative support;

¾ Plotted borehole logs and maps; and

¾ Block model construction and development.

Through these personal inspections and additional off‐site interaction with the LAC Project team
and Project dataset, the independent QP has gained a clear understanding of the exploration
program methods and results. Furthermore, the QP understands the manner in which these
results support the inferred resource estimate, and the potential sources of uncertainty in the
‐ 3 ‐

estimate. In consideration of these sources, it is the opinion of the QP that the inferred resource
estimate is appropriate and reasonable for this stage of the Project. The rationale for this
conclusion is provided in appropriate locations throughout this document, and particularly in
Section 13.
‐ 4 ‐

2 RELIANCE ON OTHER EXPERTS
The preparation of this Report was supervised by the independent QP, Mark King, Ph.D., P. Geo.,
at the request of LAC. Dr. King is a hydrogeologist with 25 years experience. He has provided
senior technical direction and hands‐on project management on large groundwater projects
throughout Canada and the US. One of his areas of expertise is groundwater modelling, which
relates closely to the development of the block model used for the inferred resource estimate. He
also specializes in field delineation and characterization of solute distributions in groundwater,
which is a primary objective of the LAC Project.

A wide range of technical disciplines were required to address the objective of estimating and
characterizing the lithium resource. In preparing the Report, these disciplines were led by experts
in each area. Overall review and verification of materials prepared by these experts was
conducted by Dr. King. It is acknowledged that Dr. King is not an expert in all these disparate fields
(e.g., salar geology, lithium processing). However, his expertise in quantitative aspects of
hydrogeology and in the delineation of solutes in groundwater is an appropriate foundation for
evaluation of the inferred resource estimate, and information used in its development. Members
of the panel of experts, and their various roles in preparing Report materials are as follows:

¾ Eduardo Peralta, Ph.D., Geologist – Expert in salar geology;

¾ Pedro Pavlovic, M.Sc., Chemical Engineer – Expert in mineral and brine processing; Section 15
(Mineral Processing) is presented largely as prepared by Mr. Pavlovic since he is a world‐
renowned expert in this subject area;

¾ Frits Reidel, B. Sc., Hydrogeologist with 23 years of experience – Expert in groundwater
resource evaluations, aquifer characterization, and mining hydrology; background includes
experience on other brine projects in North and South America;

¾ John Kieley, P.Geo. (Canada) ‐ Project Manager and LAC QP for the Project; geophysicist with
more than 35 years experience in mineral exploration;

¾ Waldo Perez Ph.D., P. Geo. ‐ CEO and President of Lithium Americas Corp.; exploration
geologist.

¾ Danilo Castillo ‐ Specialist in block model construction for resource estimation, with Maptek in
Chile.

The methods, results and interpretations provided in this Report have been developed by the
above noted experts. Subsequent review and evaluation is provided by the independent QP,
based on background expertise and observations from the Project site and dataset. In evaluating
this information, the key issue considered by the independent QP is whether the methods, results
‐ 5 ‐

and interpretations are appropriate and acceptable to support an inferred resource estimate for
the lithium brine deposit.

For the purpose of this Report, the independent QP has relied on an ownership and claim Title
Opinion provided by the law firm of De Pablos & Associates. This opinion states that agreements
with third parties are valid, enforceable and comply with local laws. The QP has not researched
title or mineral rights of the Project and expresses no legal opinion as to the ownership status of
the Cauchari‐Olaroz Project.

‐ 6 ‐

3 PROPERTY DESCRIPTION AND LOCATION
3.1 Location

The Cauchari and Olaroz Salars are located in the Department of Susques in the Province of Jujuy
in northwestern Argentina. The salars extend in a north‐south direction from S23 o 18’ to S24 o 05’
and in and east‐west direction from W66o 34’ to W66 o 51’. The average elevation of both salars is
3950 m.

Figure 3.1 shows the location of both salars, approximately 250 km northwest of San Salvador de
Jujuy, the provincial capital. The midpoint between the Olaroz and Cauchari Salars is located
directly on Highway 52, 55 km west of the Town of Susques where the LAC field offices are located.
The nearest port is Antofagasta (Chile), located 530 km west of the Project.
‐ 7 ‐

Figure 3.1: Location map.

‐ 8 ‐

3.2 Property Area

LAC has negotiated, through its Argentinian subsidiary Minera Exar S.A., mining and exploration
permits, and has requested from mining authorities exploration permits covering a total of 48 950
ha in the Department of Susques, of which 36 974 ha have been granted to date.

Figure 3.2 shows the location of the LAC claims in the Olaroz‐Cauchari Project. The claims are
contiguous and cover most of the Cauchari Salar and the eastern portion of the Olaroz Salar. Table
3.1 provides a summary overview of the 70 properties acquired for the Project. The aggregate
property payments required by LAC under the agreements references in Figure 3.2 is USD
5,785,000.

Under LAC’s usufruct agreement with Grupo Minero Los Boros S.A., LAC agreed to pay Grupo
Minero Los Boros S.A. a royalty of USD 300,000 at the beginning of the commercial production and
a three percent net profit interest on commercial production from the Project. LAC has the option
to purchase such royalty by a one time payment of USD 7,000,000. Under LAC’s usufuct
agreement with Borax Argentina S.A., LAC is required to pay Borax Argentina S.A. an annual royalty
of USD 200,000 commencing once LAC exercises its usufruct option. There are no other royalties
related to the Cauchari‐Olaroz Properties.

‐ 9 ‐

Table 3.1: Status of Minera EXAR S.A mineral claims at Cauchari and Olaroz Salars.
MINERA EXAR S.A.
CLAIM FILE CLAIM REQUESTED RECEIVED ABORIGINAL CONTRACT
OWNER
NAME NUMBER TYPE HA HA COMMUNITY TYPE
1 ZOILA 341‐C‐44 Borax Argentina S.A. MP 100 101 OLAROZ CHICO Usufruct Agreement
2 MASCOTA 394‐B‐44 Borax Argentina S.A. MP 300 302 MANANTIALES Usufruct Agreement
3 UNION 336‐C‐44 Borax Argentina S.A. MP 300 100 MANANTIALES Usufruct Agreement
4 JULIA 347‐C‐44 Borax Argentina S.A. MP 300 100 PUESTO SEY Usufruct Agreement
5 SAENZ PEÑA 354‐C‐44 Borax Argentina S.A. MP 300 100 PUESTO SEY Usufruct Agreement
6 DEMASIA SAENZ PEÑA 354‐C‐44 Borax Argentina S.A. MP 100 59 PUESTO SEY Usufruct Agreement
7 MONTES DE OCA 340‐C‐44 Borax Argentina S.A. MP 100 99 PUESTO SEY Usufruct Agreement
8 JULIO A. ROCA 444‐P‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
9 ELENA 353‐C‐44 Borax Argentina S.A. MP 300 301 PUESTO SEY Usufruct Agreement
10 EMMA 350‐C‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
11 URUGUAY 89‐N‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
12 UNO 345‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
13 TRES 343‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
14 DOS 344‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
15 CUATRO 352‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
16 CINCO 351‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
17 AVELLANEDA 365‐V‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
18 BUENOS AIRES 122‐D‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
19 MORENO 221‐S‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
20 SARMIENTO 190‐R‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
21 PORVENIR 116‐D‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
22 SAHARA 117‐D‐44 Borax Argentina S.A. MP 300 300 PUESTO SEY Usufruct Agreement
23 ALICIA 389‐B‐45 Borax Argentina S.A. MP 100 99 PUESTO SEY Usufruct Agreement
24 SIBERIA 306‐B‐44 Borax Argentina S.A. MP 24 24 PUESTO SEY Usufruct Agreement
25 CLARISA 402‐B‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
26 DEMASIA CLARISA 402‐B‐44 Borax Argentina S.A. MP 19 19 PUESTO SEY Usufruct Agreement
27 PAULINA 195‐S‐44 Borax Argentina S.A. MP 100 98 PUESTO SEVICATUA Usufruct Agreement
28 INES 220‐S‐44 Borax Argentina S.A. MP 100 102 PUESTO SEVICATUA Usufruct Agreement
29 MARIA ESTHER 259‐M‐44 Borax Argentina S.A. MP 100 100 PUESTO SEY Usufruct Agreement
30 MARIA CENTRAL 43‐E‐44 Borax Argentina S.A. MP 100 100 PUESTO SEVICATUA Usufruct Agreement
31 DELIA 42‐D‐44 Borax Argentina S.A. MP 100 101 MANANTIALES Usufruct Agreement
32 GRAZIELLA 438‐G‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
33 LINDA 160‐T‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
34 MARIA TERESA 378‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
35 JUANCITO 339‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
36 ARCHIBALD 377‐C‐44 Borax Argentina S.A. MP 100 100 MANANTIALES Usufruct Agreement
37 SAN NICOLAS 91‐R‐94 Borax Argentina S.A. MP 100 100 HUANCAR Usufruct Agreement
38 NELIDA 56‐C‐95 Electroquimica El Carmen S.A. MP 100 100 OLAROZ CHICO Usufruct Agreement
39 MARIA ANGELA 177‐Z‐03 Electroquimica El Carmen S.A. MP 100 100 OLAROZ CHICO Usufruct Agreement
40 HEKATON 150‐M‐92 Electroquimica El Carmen S.A. MP 200 200 HUANCAR/OLAROZ CHICO Usufruct Agreement
41 VICTORIA I 65‐E‐92 Electroquimica El Carmen S.A. MP 200 200 HUANCAR/OLAROZ CHICO Usufruct Agreement
42 EDUARDO 183‐D‐90 Electroquimica El Carmen S.A. MP 100 100 OLAROZ CHICO Usufruct Agreement
43 CAUCHARI ESTE 1149‐L‐09 MINERA EXAR S.A. MP 5900 980 HUANCAR Staked
44 CAUCHARI SUR (1) 1072‐L‐08 MINERA EXAR S.A. EP 1501 PUESTO SEY Staked
45 EDUARDO DANIEL 120‐M‐44 Fundacion Misión de la Paz MP 100 100 OLAROZ CHICO Option to Purchase
46 JORGE 62‐L‐98 Luis Losi S.A MP 2352 2352 PUESTO SEY Usufruct Agreement
Luis Austin Cekada and
47 VERANO I 299‐M‐04 MP 2488 2488 PUESTO SEY Option to Purchase
Camilo Alberto Morales
48 SAN ANTONIO 72‐M‐99 Grupo Minero Santa Rita S.R.L MP 2500 2500 PUESTO SEY Option to Purchase
49 TITO 48‐P‐98 Grupo Minero Santa Rita S.R.L MP 200 100 PUESTO SEY Option to Purchase
50 MARIA VICTORIA (2) 121‐M‐03 Grupo Minero Santa Rita S.R.L MP 1800 OLAROZ CHICO Option to Purchase
51 LUISA 61‐L‐08 Grupo Minero Los Boros S.A MP 4706 4705 HUANCAR/OLAROZ CHICO Usufruct Agreement
52 ARTURO 60‐L‐98 Grupo Minero Los Boros S.A MP 5100 5061 HUANCAR/OLAROZ CHICO Usufruct Agreement
53 ANGELINA 59‐L‐98 Grupo Minero Los Boros S.A MP 2346 2252 HUANCAR/OLAROZ CHICO Usufruct Agreement
54 MIGUEL 381‐M‐05 Mario Moncholi MP 100 100 PUESTO SEY Option to Purchase
55 CHICO 1231‐M‐09 Mario Moncholi MP 300 300 OLAROZ CHICO Option to Purchase
56 CHICO 3 (1) 1251‐M‐09 Mario Moncholi MP 1100 OLAROZ CHICO Option to Purchase
57 CHICO 4 (1) 1252‐M‐09 Mario Moncholi MP 1500 OLAROZ CHICO Option to Purchase
58 LA YAVEÑA 27‐R‐00 Silvia Rojo MP 1117 1116 MANANTIALES Option to Purchase
59 SULFA 6 70‐R‐98 Silvia Rojo MP 1759 1683 PUESTO SEY Option to Purchase
63 CAUCHARI NORTE 349‐R‐06 Silvia Rojo EP 998 998 MANANTIALES Option to Purchase
64 BECERRO DE ORO 264‐M‐44 Silvia Schapiro MP 100 100 PUESTO SEY Option to Purchase
65 OSIRIS 263‐M‐44 Silvia Schapiro MP 100 100 PUESTO SEY Option to Purchase
66 ALSINA 48‐H‐44 Silvia Schapiro MP 100 100 PUESTO SEY Option to Purchase
67 MINERVA 37‐V‐02 Sylvia Valente MP 250 230 OLAROZ CHICO Option to Purchase
68 IRENE 140‐N‐92 Triboro S.A. MP 200 200 HUANCAR/OLAROZ CHICO Option to Purchase
69 CHIN CHIN CHULI II 202‐E‐04 Vicente Costa MP 1000 931 HUANCAR/OLAROZ CHICO Usufruct Agreement
70 GRUPO LA INUNDADA 101‐C‐90 MINERA EXAR S.A. MP 550 537 PUESTO SEY Purchase
TOTAL 48 950 36 974
MP: Mining permit; EP: Exploration permit
Notes: (1) Final permit pending. (2) This property is under legal dispute with Property owner.
‐ 10 ‐

Figure 3.2: LAC property claims at the Cauchari‐Olaroz Project.
‐ 11 ‐

3.3 Type of Mineral Tenure

There are two types of mineral tenure in Argentina: Mining Permits and Exploration Permits.
Mining Permits are licenses that allow the property holder to exploit the property, providing
environmental approval is obtained. Exploration Permits are licenses that allow the property
holder to explore the property for a period of time that is proportional to the size of the property
(5 years per 10 000 ha). An Exploration Permit can be transformed into a Mining Permit any time
before the expiry date of the Exploration Permit, by presenting a report and paying canon rent.

LAC acquired its interests in the Cauchari and Olaroz Salars through either direct staking or
concluding straightforward exploration contracts with third party property owners, giving LAC the
option to make graduated payments over a period of time that varies from 12 months to five years
depending on the contract. A final payment would result in one of the following, depending on the
arrangement with the owner:

¾ Full ownership by LAC;

¾ LAC acquires an option to purchase the property; or

¾ LAC acquires the right to mine the brines from depth through pumping but the vendor retains
the right to mine borax from the surface (Usufruct Contracts).

LAC can abandon a contract on any mineral property at any time, depending on the results of the
exploration.

3.4 Title

The LAC claims are recorded in the Provincial Catastro at the Juzgado Administrativo de Minas in
the provincial capital of San Salvador of Jujuy. LAC has provided a Title Opinion from the law firm
of De Pablos & Associates that has been reviewed for the preparation of this report. This opinion
states that agreements with third parties are valid, enforceable and comply with local laws. Mining
concessions have been properly registered and are in “good‐standing”.

3.5 Property Boundaries

The LAC claims follow the north‐northeast trend of the Cauchari and Olaroz Salars. Figure 3.2
shows that the boundaries of the claims are irregular in shape (a reflection of the mineral claim
law of the Province of Jujuy). While most countries use UTM coordinates, Argentina has
developed its own grid system in Gauss Krueger Coordinates with the WGS 84 datum. The
coordinates (Gauss Krueger) of the boundaries of each claim are recorded in an “expediente” in
the claims department of the Jujuy Provincial Ministry of Mines.

‐ 12 ‐

3.6 Environmental Liabilities

LAC complies with local and national regulations and adheres to high international environmental
guidelines including the Equator Principles. A preliminary review of the Cauchari‐Olaroz Project
suggests that the possibility of significant environmental liabilities is low. Low population density
in the region and distance from major urban centres places the attention of potential negative
impact of a brine operation on local flora and fauna.

The vegetation in the vicinity of the Cauchari and Olaroz Salars is typical of the high desert
environment, consisting mainly of xerophyte and halophyte bushes. Other vegetation includes the
yareta, copa‐copa and tola bushes as well as some grasses. There is no vegetation on the surfaces
of the salars. It therefore appears that the potential development of the Cauchari–Olaroz Project
into a brine operation will not have any significant impacts on the local flora.

Llamas, guanacos and vicunas are common in the region. The vicuna was traditionally exploited by
local inhabitants for its meat and wool and also used in special rituals. Past un‐restricted hunting
resulted in near‐extinction of the vicuna, which is now protected under a 1972 international
agreement signed between Argentina, Chile, Peru and Ecuador. It appears that the potential
development of the Cauchari–Olaroz Project into a brine operation will not have any significant
impacts on the local fauna.

LAC has prepared an inventory of known archeological sites in the Department of Susques. This
inventory shows that the Cauchari‐Olaroz Project is remote from these sites and that therefore any
impacts are unlikely.

Five local indigenous communities are located in the vicinity of the Cauchari‐Olaroz Project area
and include: Olaroz Chico, Huancar, Pastos Chicos, Susques and Puesto Sey. LAC has designed and
implemented a special communities relations program for long‐term co‐operation. In turn these
communities have provided required approvals on the LAC Environmental Impact Report (see
Section 3.7 below).

3.7 Permits

The Provincial Government of Jujuy (Direccion Provincial de Mineria y Recursos Energeticos)
approved the LAC Environmental Impacts Report (the “EIA”) for the Cauchari‐Olaroz Project
exploration work by Resolution No. 25/09 on August 26, 2009. Subsequent EIA updates have been
presented to accurately reflect the ongoing exploration program; these updates do not require
Government approvals. Additional permits are not required. LAC has also obtained a license for
the abstraction of groundwater to meet water supply requirements for the exploration program.
This license was granted by the provincial water authority (Direccion Provincial de Recursos
Hidricos) in Jujuy and is in good standing, with all applicable tariffs paid to date.

‐ 13 ‐

4 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY

4.1 Topography

Figure 4.1 shows a topography map of the Cauchari and Olaroz Salars. These salars are bounded
on the west side by mountains that range in elevation from 4 600 m to 4 900 m and on the east
side by mountains that also rise to an elevation of 4 900 m. The Cauchari Salar forms an elongated
northeast‐southwest trending depression extending 55 km in a north‐south direction and
approximately 6 to 10 km in an east‐west direction. The Olaroz Salar covers an area of 30 km by
10 to 15 km. The elevation of the floor of the salars ranges from 3 910 m to 3 950 m.

The vegetation of the salars is typical for the altiplano and is described in Section 3.6.

‐ 14 ‐

Figure 4.1: Topography.
‐ 15 ‐

4.2 Access

The main access to the Olaroz and Cauchari Salars from San Salvador de Jujuy is via paved
National Highways 9 and 52, as shown in Figure 3.1. The midpoint between the two salars is
located directly on Highway 52 (Marker KM 192). Paso Jama, a national border crossing
between Chile and Argentina (also on Highway 52) is 100 km west of the Project. These
highways carry significant truck traffic, transporting borate products from various salars in
northern Argentina. Access to the interior of the Olaroz and Cauchari Salars is possible through
a gravel road, Highway 70, which skirts the west side of the salars and is used by borate
producers.

4.3 Population Centres

Figure 4.1 shows the population centres around the Project area. The Town of Susques, 45 km
east of the Olaroz Salar, is the nearest population centre (Figure 4.1). Further east lies the
provincial capital of San Salvador de Jujuy (not shown) and the settlement of Catua to the
southwest. All three centres could provide labour for a brine operation. At the Salar de
Atacama, in Chile, the Sociedad de Litio used the local population of Peine for the pond and
potassium operations and brought in more experienced operators from Antofagasta. A parallel
situation for a future operation at the Cauchari and Olaroz Salars would have local people
trained to work on the pond system and more qualified personnel brought in from San Salvador
de Jujuy and Salta. Buses would provide transport to and from the camps for operations
personnel.

4.4 Climate

The Cauchari and Olaroz Salars are within a High Altitude Desert Belt which is characterized by
extremes of temperature varying from ‐250 C to ‐300 C in the winter and from 150 C to 200 C in
the summer (average: 50 C). Temperatures also vary widely between day and night.
Precipitation comes mainly in the form of rain during the wet season from December through
March. Figures 4.2 and 4.3 show monthly average precipitation records for Susques and
Olacapato (located on the south side of Cauchari Salar).

Significant winds are encountered throughout the year that can occasionally result in sand
storms, as is common in many desert regions of the world. High winds are a positive factor for
concentrating brines in evaporation ponds since evaporation rates are improved not only by
high temperature, but also by wind currents that remove humidity above the water surface.

‐ 16 ‐

Figure 4.2: Monthly average precipitation for Susques. (From: Bianchi, et al. 1992.)

Figure 4.3: Monthly average precipitation for Olacapato (From: Bianchi, et al. 1992.)
‐ 17 ‐

4.5 Infrastructure

The Cauchari and Olaroz Salars are situated favourably to the north of the Inter‐Andes
Transmission Line that links the Argentina power grid to Chile's northern electric grid. This
transmission line should provide the necessary power to the operating wells, pond transfer
pumps and a chemical plant. The location of a pond system and a potential chemical plant will
dictate the capital costs of a power line to the operational centre.

Drilling conducted to date in the salars indicates that sufficient fresh groundwater resources are
available to meet water supply requirements for potential future brine processing facilities.

Demand for surface rights in the region is low. Acquisition of surface rights for the construction
of lithium processing facilities on the Cauchari or Olaroz Salars is expected to be
straightforward.
‐ 18 ‐

5 HISTORY
Historically, Rio Tinto has mined borates on the western side of Cauchari, at Yacimiento de
Borato El Porvenir. Grupo Minero Los Boros S.A. mines a few thousand tonnes per year of
ulexite on the east side of the Olaroz Salar. No other mining activity (including lithium
exploration and production) has been recorded at the properties comprising the Cauchari‐
Olaroz Project.

LAC acquired Mining and Exploration Permits across the Cauchari and Olaroz Salars during 2009
(see Section 3) and initiated lithium exploration activities over these claims during 2009. LAC
has not prepared prior mineral resource or reserves estimates for the Cauchari‐Olaroz Project.

Orocobre Limited (“Orocobre”) owns mining claims in the Olaroz Salar adjacent to the LAC
Olaroz properties. Orocobre has prepared and published an inferred lithium and potassium
resource estimate for its project area during 2009 (see Section 14 for further information).

‐ 19 ‐

6 GEOLOGICAL AND HYDROLOGICAL SETTING
6.1 Regional Structural Features
Figure 6.1 shows that there are two primary structural features in the region. The first feature
consists of sets of high angle north‐south trending faults causing narrow and deep horst and
graben basins. These tectonic basins have formed in the Puna plateau through non‐collisional,
compressional, Miocene‐age orogeny (Helvaci and Alonso, 2000). The basins occur
predominantly in the eastern and central sector of the Puna. They have been accumulation
sites for numerous salars, including Olaroz and Cauchari.
The basin system is crossed and displaced by the second primary structural feature in the
region: northwest‐southeast trending lineaments (Figure 6.1). The El Toro Lineament and the
Achibarca Lineament occur in the vicinity of the LAC Project. The Cauchari Basin (which
contains the Olaroz and Cauchari Salars) is located north of the El Toro Lineament. Between
the El Toro and Achibarca Lineaments, the basin is displaced to the southeast and is known as
the Centenario Basin. South of the Achibarca Lineament, the basin is displacement to the
northwest and is known as the Antofalla Basin. Collectively, these three displaced basin
segments contain a lithium brine mine (Hombre Muerto) and several lithium brine exploration
projects (Figure 6.2). Two lithium brine mines are also located between the same major
lineaments, within the Atacama Basin located approximately 150 km west of the Cauchari
Basin.
6.2 Regional Geology
The regional geology in the vicinity of the Olaroz and Cauchari Salars is shown in Figure 6.1. The
basement rock in this area is composed of Lower Ordovician turbidites (shale and sandstone)
intruded by Late Ordovician granitoids. It is exposed to the east, west and south of the two
salars, and generally along the eastern boundary of the Puna Region.
Elsewhere in the Puna Region, a wide range of rock types uncomformably overlie the basement
rock. Throughout most of the Chilean and Argentina‐Chile border area of the region, the
basement rock is overlain by Tertiary‐Quaternary volcanics, including ignimbritic tuffs covered
by andesites (6 to 3 millon years) and recent basaltic flows (0.8 ‐ 0.1 millon years) ranging up to
several tens of metres in thickness. In some areas, including to the south and east of the two
salars, the basement rock is overlain by Cretaceous‐Tertiary continental and marine
sedimentary rocks such as conglomerates, sandstones and siltstones, as well as tuffs and oolitic
limestones.
‐ 20 ‐

The tectonic basins in the local area include the Atacama, Cauchari, Centenario and Antofalla
Basins, as shown in Figure 6.1. They are in‐filled with unconsolidated Miocene sediment
sequences and intercalated tuffs, and also with evaporites including halite, borates and gypsum
(Figures 6.1 and 6.2). Quaternary alluvial deposits, pediment sediments, mudflows and
occasional saline deposits encroach into the basins from the sides.

Figure 6.1: Regional geology in the vicinity of the LAC Project. (From: Peralta, E; 2009)
‐ 21 ‐

6.3 Local Geology
Local geology in the vicinity of the Cauchari and Olaroz Salars is shown in Figure 6.2. Subsurface
deposits are laterally contiguous between the two salars and include interbedded clastic and
evaporitic rocks of the following five main facies:
¾ Carbonate;

¾ Borax;

¾ Sulphate;

¾ Clay; and

¾ Sodium chloride.

Each of these are described in the subsections below. On the surface, the salars are partially
separated by an alluvial fan formed by the Ola River. The paved road that links Argentina and
Chile also crosses the salars along this boundary (Photo 6.1). Two alluvial fans are also
encroaching on the south end of the Cauchari Salar. The encroachment of these coarse clastic
sediments indicates that the recent period is wet relative to much of the previous history of the
salars.
Olaroz Salar
Cauchari Salar

Photo 6.1: Boundary between Cauchari and Olaroz Salars.
‐ 22 ‐

6.3.1 Carbonate Facies
This unit outcrops intermittently along the west side of the Cauchari Salar, and is relatively
scarce in Olaroz (Figure 6.2). It comprises brown and buff clays inter‐layered with dirty
travertines or sands with calcareous cement produced by hydrothermal activity (“calcareous
sinters"). This unit tends to be exposed in high relief areas (Photo 6.2). Ulexite
(NaCaB5O6(OH)6.5H2O) concretions, with or without gypsum (CaSO4.2H2O) and mirabilite
(S2O4.10H2O), are sometimes associated with the carbonate facies.

Photo 6.2: Carbonate facies (sinter) in the western margin of Cauchari Salar.
6.3.2 Borax Facies
These facies consist of black and brown clays with borax mineralization (Photo 6.3). In the
Cauchari Salar, this unit is exposed in a discontinuous strip along the western edge of the salar,
stratigraphically below the carbonate facies. In Olaroz, the borax facies occur along the eastern
border of the salar and in the central and north area (Figure 6.2). When evaporitic minerals
(predominantly ulexite, with local transition to borax at depth) occur in this unit, the proportion
of clay and silt tends to decrease, to an estimated minimum of 30% to 40%. The borax minerals
within this unit have been heavily exploited for many years.
‐ 23 ‐

Photo 6.3: Borax facies in western Cauchari, Angelina Borax Mine.
6.3.3 Sulphate Facies
The sulphate facies are composed of fine clastic sediments, usually brown clays inter‐layered
with mirabilite (S2O4.10H2O), gypsum (CaSO4.2H2O) and soda ash (Na2CO3). This unit generally
occurs below the borax facies. The sulphate facies are exposed in the central‐south area of
Cauchari and in the northern area of Olaroz. The sulphate facies in Cauchari are significantly
richer in soda ash than those in Olaroz, while the latter tends to be relatively enriched in
mirabilite.
‐ 24 ‐

Figure 6.2: Local Geology of the Cauchari and Olaroz Salars (From: Peralta, E; 2009)
‐ 25 ‐

6.3.4 Clay Facies
These facies occur across most of the surface of the Cauchari Salar and isolated zones in the
southern area of the Olaroz Salar (Photo 6.4). They are composed of predominantly brown to
reddish clays (dominantly illite; Cravero 2009a and 2009b) inter‐layered and sometimes mixed
with thin sand or silt layers. This unit is always impregnated with various evaporites, including
the following:
¾ In southern Cauchari ‐ gypsum (CaSO4.2H2O) with some glaserite (K3Na(SO4)2);

¾ In south‐central Cauchari ‐ halite (NaCl) and gypsum (CaSO4.2H2O);

¾ In north‐central Cauchari ‐ halite (NaCl); and

¾ In the boundary area between Cauchari and Olaroz ‐ ulexite, sulphates (predominantly
mirabilite) and alkaline carbonates (predominantly soda ash).
Despite the large surface outcrop of the clay facies, drilling data indicate that they have a
maximum thickness of 30 m and a typical thickness of 10 m or less.
Photo 6.4: Clay facies in the Cauchari Salar.
6.3.5 Sodium Chloride Facies
These facies (Photo 6.5) typically occur at the surface of many salars, and are characterized by a
polygonal‐cracked hard crust, with a composition dominated by halite (NaCl). They are the
dominant facies on the surface of the Olaroz Salar, but are almost nonexistent on the surface of
the Cauchari. The surface occurrence of the sodium chloride facies on the Olaroz Salar is thin
(between 5 cm and 25 cm). Drilling data indicate that this unit also occurs at depth in the
Cauchari Salar and ranges up to several tens of metres in thickness. The substantial occurrence
of this unit at depth in the Cauchari indicates that this salar has completed a geological cycle
and is in the process of being buried by accumulation of clay facies.
‐ 26 ‐

Photo 6.5: Sodium Chloride facies in the Olaroz Salar.
6.4 Vertical Geological Section
A conceptual stratigraphic section and column were developed for the salars, based on all
Project borehole results available to date. The available borehole logs, which extend from
southern Olaroz to central Cauchari, indicate some variability in stratigraphic details between
locations. They also indicate, however, that some valid and useful stratigraphic generalizations
can be made. The conceptual section is shown in Figure 6.3 and the column is shown in Figure
6.4. The vertical zonation of the Cauchari and Olaroz Salars can be simplified into three main
sequences, which are described in the following sections.
Figure 6.3: Conceptual section of the Cauchari and Olaroz Salars showing three
main sequences: the Upper Mixed Sequence, the Thin Bedded
Sequence and the Coarse Bedded Sequence.
‐ 27 ‐

Figure 6.4: Conceptual stratigraphic column of the Cauchari and Olaroz Salars
‐ 28 ‐

6.4.1 Upper Mixed Sequence
This sequence (Photo 6.6) occurs at the surface and includes relatively thin layers of all the
facies described in section 6.3, and alluvium. This unit typically ranges in thickness from 20 to
40 m across the salars, however, geophysical and drilling data indicate that it can range as thick
as 80 m (in Olaroz) and as thin as 10 m (in northern Cauchari). XRD analysis of the clays in this
sequence (Cravero, 2009a and 2009b) shows that they are predominantly illite with minor
kaolinite, smectite and chlorite. Glass shards and magnetite are also present, indicating the
volcanic nature of the source rock.

Photo 6.6: Upper Mixed Sequence clay with borax mineralization.
Drilling and shallow test pit data show that some layers occur in the UMS which are sufficiently
permeable to be considered aquifers. However, these layers are relatively thin, ranging up to
four metres in thickness but typically less than one metre. These layers are considered to be
coarser components of the clay facies mixed with sand or silt.
6.4.2 Thin Bedded Sequence
This sequence (Photo 6.7) encompasses thinly bedded clay facies, evaporite facies (mostly
halite and gypsum), silt, and sand. The individual beds vary in thickness from a few centimetres
to a few metres. This sequence has a larger component of coarse grain sized material than the
UMS, which is mostly clay. The evaporite facies are composed mainly of halite and, occasionally
halite with gypsum, in layers ranging from of a few centimetres to few metres in thickness.
Drilling and geophysical data show that the TBS is typically between 50 and 60 m thick. It
ranges up to more than 250 m thick in Olaroz; the maximum thickness observed in Cauchari
was 50 m, in the north area of the salar.
‐ 29 ‐

Sand
Halite
Halite
Photo 6.7: Thin Bedded Sequence showing alternating sand and halite layers.
Drilling data show that the TBS hosts permeable brine‐saturated units that are continuous
(several metres thick) separated only by narrow clay units (a few metres thick).
6.4.3 Coarse Bedded Sequence
To date, the CBS has been observed only in the Cauchari Salar. It consists of interlayered sand
and evaporite (mostly halite) layers, several tens of metres thick. The upper level of the
sequence is characterized by a thick, compact, dry layer of halite ranging from 10 to 30 m in
thickness, followed by a coarse sandstone layer. Below these two layers, the sequence includes
sandy sediments and porous, crackled halite intercalations (Photo 6.8). The two dominant units
in this sequence have the following characteristics:
¾ Sand‐dominant Unit: Contains significant layers from 50 to 100 m thick of slightly cemented
aeolian (perfectly rounded) sand, alternating with thin layers of halite (Photo 6.8). This unit
includes occasional thin clay lenses (0.2 to 2 m thick). The sandy material shows
homogeneous grain size and mineralogical composition with well‐rounded particles 1 to 3
mm in diameter, which are dominated by silica glass, quartz, feldspar, mafic minerals
(pyroxene, biotite and amphibole) and a striking abundance of magnetite. Invariably, this
unit contains abundant halite crystals, gypsum and occasional borates (ulexite and narrow
beds of tinkal). This unit can be considered an aquifer because of the predominance of
coarse particle sizes and associated high permeability.
‐ 30 ‐

Photo 6.8: Sand‐dominant Unit. Grain size analysis shows that this material is predominantly sand
with d50 around 0.21mm; inspection under microscope and hand lens shows that the
grains are very well rounded quartz, magnetite and mafic minerals.
¾ Evaporite‐dominant Unit: This unit is composed of halite, sometimes massive, but generally
forming a sintered sponge of halite crystals, with high permeability and frequent cavities due
to crystal corrosion (Photo 6.9). The evaporite layers alternate with the sandy layers, both
ranging from 15 m to 30 m in thickness, although a continuous 100 m layer of halite was
observed at one borehole location (DD‐3). This unit occasionally includes thin lenses of clays
(between 0.25 m and 4 m). In southern and central Cauchari, carbonate facies were also
observed in this unit, ranging up to six metres in thickness and with karstic solution caverns
and holes filled with loose sand.
Photo 6.9: Porous Halite in the Coarse Bedded Sequence.
The bottom of the CBS was not reached in the boreholes advanced to date. Geophysical data
suggest that this sequence continues to the bottom of the salar, estimated to be between 300
and 600 m depth, depending on the basin sector.
‐ 31 ‐

6.5 Hydrogeology
6.5.1 Surface water
The Olaroz‐Cauchari hydrographic basin is an elongated depression with a length of
approximately 150 km in a north‐south direction and a width of 30 to 40 km in an east‐west
direction. The basin covers approximately 4 500 km2 as shown in Figure 6.5.
Surface water inflow along the perimeter of the hydrographic basin occurs primarily from Rios
El Rosario, Ola and Tocomar. Rio Rosario, which is locally called Rio El Toro, originates in the
very northern part of the Olaroz‐Cauchari watershed at an elevation of 4 500 m. The river flows
south‐southeast for 55 km past the village of El Toro before it enters into the Olaroz Salar. Flow
was measured at approximately 200 L/s just above the Highway 74 bridge crossing (some 5 km
southeast of the village of El Toro) at an elevation of 4 010 m on November 7, 2009 at the end
of the dry season (Photo 6.10). Rio Rosario was dry on that same date, at a location some 15
km further south into Salar de Olaroz, at an elevation of around 3 940 m.
Rio Ola, which is locally called Rio Lama, originates at an elevation of around 4 500 m just south
of Cerro Bayo Achibarca and flows east for 20 km. It enters the salars on top of the large alluvial
fan that separates Olaroz from Cauchari on the western flank of the basin. In Achibarca where
Rio Ola flows immediately adjacent to Highway 52, flow was estimated at approximately 5 L/s
on November 7, 2009 (Photo 6.11).
‐ 32 ‐

Figure 6.5: Cauchari – Olaroz watershed.
‐ 33 ‐

Photo 6.10: Rio Rosario just above the Highway 74 bridge crossing.

Photo 6.11: Rio Ola at Achibarca.
Rio Tocomar, which is locally called Rio Olapacato, originates some 10 km west of Alto Chorillo
at an elevation of around 4 360 m. The river flows west for approximately 30 km before it
enters the Cauchari Salar from the southeast. Flow was measured at 30 L/s at a location eight
kilometres west of Alto Tocomar at an elevation of 4 210 m on November 6, 2009 (Photo 6.12).
Rio Tocomar was dry in the villages of Olacapato and Cauchari on that same date.
‐ 34 ‐

Photo 6.12: Rio Tocomar eight kilometres below Alto Tocomar.
No other surface water features were observed along the perimeter of the Olaroz‐Cauchari
watershed during November 2009, at the end of the dry season.
Surface water also occurs in the central southern part of the Cauchari Salar some 15 km north
of the village of Cauchari, where a number of springs discharge on the surface of the salar.
Discharge from these springs is naturally channeled into a single stream and flows north for
several kilometres. Flow was measured at approximately 10 L/s on November 8, 2009.
There is no surface water outflow from the Olaroz‐Cauchari Salars.
6.5.2 Groundwater
Groundwater flow occurs primarily in the unconsolidated and semi‐consolidated basin fill
sediments of the Olaroz‐Cauchari basin. Groundwater flow is generally towards the central axis
of each salar. The large alluvial fan of the Rio Ola creates a groundwater divide (fresh water)
between the two salars.
Groundwater elevation measurements were carried out in November and December 2009
across Olaroz and Cauchari in a number of observation wells and open boreholes that were
installed as part of the 2009 LAC drilling program. These measurements indicate that confining
conditions occur over large parts of both salars. Artesian flow conditions are encountered in at
least one hole in Olaroz. Depth to groundwater ranges from zero (ground surface) to about 10
m across the two salars.
Groundwater along the edges of the Olaroz‐Cauchari basin is relatively fresh as a result of
recent recharge. Salinity of the groundwater increases rapidly towards the central areas in
each salar. The location of the fresh water / brine interface will be defined during the 2010
program through a combination of drilling and geophysical methods.
‐ 35 ‐

6.5.3 Water balance
Recharge
Groundwater recharge takes place as a result of infiltration of precipitation along the margins
of the salar during the wet season from December through March each year. Precipitation
records for Olacapata in the southern part of Cauchari between 1950 and 1990 (Figure 4.3)
show that the total rainfall is approximately seven centimetres per year. It is estimated that
between 5% and 20% of this rainfall ultimately becomes recharge to groundwater.
Surface water flow losses observed in Rios Rosario, Ola and Tocomar are partly due to recharge
to the groundwater system.
Discharge
Groundwater discharge takes place through evaporation, evapotranspiration and discharge

from springs. Evaporation takes place from the central and marginal areas of the salar and
evapotranspiration along the margins of salars where vegetation occurs.
Spring discharge is observed in southern Cauchari and was estimated at around 10 L/s in
November 2009 at the end of the dry season.
There are no known groundwater outflows from the Olaroz‐Cauchari basin and to date there is
no known discharge through groundwater pumping.
‐ 36 ‐

7 DEPOSIT TYPES
The Cauchari and Olaroz Salars are classified as “Silver Peak, Nevada” type terrigenous salars.
Silver Peak, Nevada in the USA was the first lithium‐bearing brine deposit in the world to be
exploited. These deposits are characterized by restricted basins within deep structural
depressions in‐filled with sediments differentiated as inter‐bedded units of clays, salt (halite),
sands and gravels. Within these sediments a lithium‐bearing aquifer has developed during arid
climatic periods. On the surface, they are presently covered by carbonate, borax, sulphate, clay,
and sodium chloride facies. Section 6 herein provides a detailed description of the geology of
the Olaroz and Cauchari Salars.

Cauchari and Olaroz have relatively high sulphate contents and therefore both salars can be
further classified as “sulphate type brine deposits”. Sections 8 and 12 provide detailed further
discussion of the chemistry of Cauchari and Olaroz.

‐ 37 ‐

8 MINERALIZATION
The brines from Cauchari are solutions saturated in sodium chloride with total dissolved solids
(TDS) on the order of 27% (324 to 335 g/L) and an average density of about 1.215 g/cm3. The
other components present in these brines, which constitute a complex aqueous system and
exist also in brines of other salars in Argentina, Bolivia and Chile, are the following: K, Li, Mg, Ca,
SO4, HCO3, and B as borates and free H3BO3.
As in other natural brines in the region, such as those of the Salar de Atacama and Salar del
Hombre Muerto, the higher content of the ions Cl–, SO4=, K+, Mg++, Na+ at Cauchari, compared
with the other primary ions (Ca, Li, B) allows a simplification for the study of crystallization of
salts during evaporation. The known phase diagram (Janecke projection) of the aqueous
quinary system (Na+, K+, Mg++, SO4=, Cl–) at 25°C and saturated in sodium chloride (equilibrium
data from the technical literature) can be used. However, in order to fit this phase diagram with
the important presence of lithium in the brines, the Janecke projection of MgLi‐SO4‐K2 in mol %
is used. The Cauchari brine composition is represented in this diagram in Section 15, where
there is also a discussion of results from simulated evaporation performed by the University of
Antofagasta.
Table 8.1 shows a comparison of the average Cauchari brine composition with other natural
brines from Silver Peak (USA), Salar de Atacama (Chile), Salar del Hombre Muerto (Argentina),
Salar de Rincon (Argentina), Zhabuye Salt Lake (Tibet) and Salar de Uyuni (Bolivia).
‐ 38 ‐

Table 8.1: Comparative chemical composition of natural brines (wt %).
Salar de Hombre Salar de Salar del Zhabuye Salar de

Silver Peak
Atacama Muerto Cauchari Rincon Salt Lake Uyuni
(USA)
(Chile) (Argentina) (Argentina) (Argentina) (Tibet) (Bolivia)
Na 6.20 7.60 9.79 9.33 9.46 10.81 8.75
K 0.53 1.85 0.617 0.42 0.656 2.64 0.72
Li 0.023 0.150 0.062 0.051 0.033 0.097 0.035
Mg 0.03 0.96 0.085 0.145 0.303 0.001 0.65
Ca 0.02 0.031 0.053 0.033 0.059 0.007 0.046
SO4 0.71 1.65 0.853 1.57 1.015 5.24 0.85
Cl 10.06 16.04 15.80 14.86 16.06 12.16 15.69
HCO3 n.a. traces 0.045 0.067 0.030 5.679 0.040
B 0.008 0.064 0.035 0.112 0.040 0.286 0.02
Density n.a. 1.223 1.205 1.215 1.220 1.297 1.211
Mg/Li 1.43 6.40 1.37 2.84 9.29 0.01 18.6
K/Li 23.04 12.33 9.95 8.24 20.12 27.21 20.57
SO4/Li 30.87 11.0 13.76 30.78 31.13 54.02 24.28
SO4/Mg 23.67 1.72 10.04 10.83 3.35 5240 1.31
SO4/K 1.34 0.89 1.38 3.74 1.55 1.98 1.18
‐ 39 ‐

9 EXPLORATION
9.1 Overview
The following exploration programs have been conducted to evaluate the lithium development
potential of the Project area:
¾ Surface Brine Program ‐ Brine samples were collected from shallow pits throughout the
salars to obtain a preliminary indication of lithium occurrence and distribution.
¾ Seismic Geophysical Program – A seismic survey was conducted to support delineation of
basin geometry, mapping of basin‐fill sequences, and locating future borehole sites.
¾ Reverse Circulation (RC) Borehole Program ‐ Dual tube reverse circulation drilling is being
conducted to develop vertical profiles of brine chemistry at depth in the salars and to
provide geological and hydrogeological data.
¾ Diamond Drilling (DD) Borehole Program – This program is being conducted to collect
continuous cores for geotechnical testing (porosity, grain size and density) and geological
characterization. The boreholes were completed as observation wells for future brine
sampling and monitoring.
The RC Borehole Program is described in the following sections:
¾ 10.1 (drilling methods and summary of results);
¾ 11.3 (sample collection and field analysis);
¾ 12.2 (sample preparation); and
¾ 12.3 (laboratory analysis).
The DD Borehole Program is described in the following sections:
¾ 10.2 (drilling methods and summary of results);
¾ 11.4 (field core sampling);
¾ 12.2 (sample preparation); and
¾ 12.4 (laboratory geotechnical analysis).
Methods and results for the Surface Brine and Seismic Geophysical Programs are summarized
below and additional methodology details on the Surface Brine Program are provided in Section
11.2.
‐ 40 ‐

9.2 Surface Brine Program
A total of 55 surface brine samples were collected from shallow hand‐dug test pits excavated
throughout the Project site, at the locations shown on Figure 9.1. The pits ranged from 1.5 to 3
m in depth and they were left open after completion to allow seepage of brine (Photos 9.1 and
9.2). One‐litre brine samples were collected from each pit. Samples of the intersected clay and,
if present, thin salt layers, were also collected.

Photo 9.1: Brine sampling from a shallow pit on the Cauchari Salar.

Photo 9.2: Brine collection from abandoned borax production pit.
Surface brine concentration distributions are shown in Figure 9.1 for lithium and Figure 9.2 for
potassium. As shown in Figure 9.1 most of the lithium concentrations from throughout the
salars exceeded 200 mg/L. In the central area of Cauchari, there is an area where lithium is
elevated to greater than 1 000 mg/L. Concentrations below 200 mg/L occur primarily in the
south end of Cauchari and in the boundary zone between Olaroz and Cauchari, probably due to
an influx of fresh surface water associated with the alluvial cones in these areas.
These surface brine results were considered a favorable indication of potential for significant
lithium grades at depth in the salars. The additional exploration programs were initiated on the
basis of these results.
‐ 41 ‐

Figure 9.1: Distribution of lithium concentration in surface brine samples.
‐ 42 ‐

Figure 9.2: Distribution of potassium concentration in surface brine samples.
‐ 43 ‐

9.3 Seismic Geophysical Program
A high resolution seismic tomography survey was conducted on the Olaroz and Cauchari Salars.
The survey configuration utilized a five‐metre geophone separation, and a semi‐logarithmic
expanding drop‐weight array symmetrical to the central geophone array. The geophone array
comprised 48 mobile measurement sites utilizing Geode Geoelectrics 8 Hz geophones.
Symmetrically surrounding the 48 geophones were accelerated, 150 kg drop‐weight sites
moving away from the geophone array as follows: 15, 30, 60, 90, 120, 150, 250, 500, 750, and
900m. Based on accepted rules of thumb for depth resolution, the outer drop‐weight positions
would provide sufficient velocity detail to depths on the order of 500 to 600 m. The survey was
contracted to Geophysical Exploration Consulting (GEC) of Mendoza, Argentina.
Measurements were conducted along seven survey lines, as shown on Figure 9.3. Six lines are
oriented east‐west, and one line (Line 7) has a north‐south orientation. A total of 24 700 m of
seismic survey data were acquired. Data acquisition took place from early July to mid‐
December of 2009. These seismic survey data supported the identification of drilling sites for
the RC and DD Programs in 2009 and will continue to be of use during the 2010 program. An
example seismic survey line is shown in Figure 9.4.
‐ 44 ‐

Figure 9.3: Seismic tomography lines completed during 2009.
‐ 45 ‐

Figure 9.4: Example seismic tomography results (Line 1).
Interpretation of the seismic data indicates that there is good correlation with the three salar
units (UMS, TBS and CBS), as shown in Figure 6.4. The CBS is considered the primary lithium‐
bearing aquifer. The seismic response of this unit generally ranged from 3 000 m/sec to 4 000
m/sec, as correlated with stratigraphic information from the RC and DD Borehole Programs
(Section 10). The response of the generally less permeable units ranged from <500 m/sec to
3 000 m/sec. These seismic trends supported the development of the geological conceptual
model which was used for the inferred resource estimate (Section 16).
The maximum interpreted depth of salar units in each of the seven seismic lines ranged from
approximately 300 to 600 m. None of the boreholes drilled at the site to date (nine for the RC
Borehole Program and five for the DD Borehole Program) have reached the underlying
basement, to confirm this depth estimate.
‐ 46 ‐

10 DRILLING
10.1 Reverse Circulation Drilling Program
The objectives of this program are to develop vertical profiles of brine chemistry at depth in the
salars, and to provide geological and hydrogeological data. Major Drilling of Argentina was
contracted to carry out the RC drilling using a Schramm T685W rig and support equipment. The
holes are drilled using ODEX and open‐hole RC drilling methods at 10‐, 8‐ and 6‐inch diameters.
No drilling additives are used.
This program is currently in progress; the boreholes reported herein were completed between
September and December 2009. Nine RC boreholes (PE‐1 through PE‐9) were completed
during this period, for total drilling of 1 333 m. Borehole depths range from 28 m (PE‐1) to 249
m (PE‐7).
During drilling, chip and brine samples are collected from the cyclone at one‐metre intervals.
Occasionally, lost circulation resulted in the inability to collect samples from some intervals. A
total of 760 brine samples were collected for laboratory chemical analyses. For each brine
sample, field measurements are also conducted for potassium (by portable XRF analyzer),
electrical conductivity, pH and temperature. Sample collection, preparation and analytical
methods are described in Sections 11.3, 12.2 and 12.3, respectively.
Airlift flow measurements are conducted at six‐metre intervals when circulation is adequate.
Daily static water level measurements are carried out inside the drill string at the start of each
drilling shift, using a water level tape. Boreholes are completed with steel surface casing, a
surface sanitary cement seal and a lockable cap.
Average concentrations in the brine samples from the eight RC boreholes drilled in the salars
are shown in Table 10.1. Results for PE‐3 are not included in the table because it is considered
to be located on the eastern margin of the Olaroz Salar. It is a flowing artesian well and
receives fresh water from the adjacent alluvial cone. The table provides average values for the
boreholes in Cauchari because the majority of brine samples were collected from this salar.
Results of geologic logging and brine analyses for boreholes PE‐1 through PE‐9 are shown
graphically in Figures 10.1 through 10.9, respectively.
‐ 47 ‐

Table 10.1: Brine concentration (mg/L) and density (g/cm3) results from the RC Borehole Program.
No. of
Bore Na K Li Ca Mg Cl SO4 B CO3 density
Samples
Average values for individual RC boreholes in Olaroz Salar
PE‐1 3 115 600 4 820 456 810 1 230 183 600 6 970 660 430 1.207
PE‐2 6 113 400 5 820 552 590 1 380 181 900 10 380 840 610 1.211
PE‐5 180 66 400 3 110 347 1 050 1 040 108 300 10 050 910 803 1.137
Average values for individual RC Boreholes in Cauchari Salar
PE‐4 110 105 700 6 720 682 330 2 040 177 900 22 760 940 795 1.220
PE‐6 114 117 500 6 984 869 376 2 050 186 000 16 770 1 250 870 1.218
PE‐7 132 117 300 4 230 511 483 1 240 182 700 15 410 1 010 668 1.211
PE‐8 143 109 000 2 900 414 434 1 680 171 600 20 000 2 780 2 666 1.209
PE‐9 72 118 200 4 800 614 380 1 860 184 100 20 600 840 621 1.217
Average of the five Cauchari RC borehole averages
Cauchari
113 500 5 127 618 401 1 770 180 500 19 110 1 360 1 124 1.215
boreholes

Brine chemistry, particularly the concentration levels of chemical species of commercial
interest, such as potassium and lithium, and their relationship with other components not
considered economically attractive, constitutes the most important factor for a natural brine to
be competitive for extraction and processing. In order to evaluate the brine quality, it is
necessary to know the relationship among the elements of higher commercial interest, such as
lithium and potassium, with those components that in some respect constitute impurities, such
as Mg, Ca and SO4. The calculated ratios for the average chemical composition at each RC drill
hole are presented in Table 10.2.
Table 10.2: Average concentrations (g/L) and associated ratios for brine samples from the RC
Borehole Program.
Drill N° of
K Li Ca Mg SO4 Mg/Li K/Li SO4/Li SO4/Ca+Mg*
Hole Samples
Average values for individual RC Boreholes in Olaroz Salar
PE‐1 3 4.82 0.46 0.81 1.23 6.97 2.67 10.56 15.28 1.17
PE‐2 6 5.82 0.55 0.59 1.38 10.38 2.50 10.54 18.79 1.51
PE‐5 180 3.11 0.35 1.05 1.04 10.05 2.98 8.95 28.95 1.52
Average values for individual RC Boreholes in Cauchari Salar
PE‐4 110 6.72 0.68 0.33 2.04 22.76 2.99 9.85 33.40 2.57
PE‐6 114 7.00 0.87 0.38 2.05 16.77 2.36 8.04 19.30 1.87
PE‐7 132 4.23 0.51 0.48 1.24 15.41 2.42 8.28 30.15 2.55
PE‐8 143 2.90 0.41 0.43 1.68 20.00 4.06 7.01 48.30 2.61
PE‐9 72 4.80 0.61 0.38 1.86 20.60 3.03 7.82 33.55 2.50
*SO4/Ca+Mg is a molar ratio
‐ 48 ‐

The brines from Cauchari, as well as from the south Olaroz area, where the LAC claims are
located, have a relatively low Mg/Li ratio (lower than three, on average). This indicates that
both brines would be amenable to a conventional lithium recovery process. Based on the
relatively high sulphate content, both salars can be considered sulphate‐type brine deposits.
For this classification, PE‐5 has been taken as representative of the south Olaroz area.
The molar ratio SO4/(Mg+Ca) is greater than one for all boreholes. This is advantageous for
brine processing, since after liming the brine to remove magnesium as Mg(OH)2, the amounts
of sodium sulphate or soda ash required for Ca removal are substantially reduced because the
SO4 ion is used to remove Ca as gypsum. The implications of these results, with regard to brine
processing, are discussed in detail in Section 15.

‐ 49 ‐

Figure 10.1: PE‐1 summary geologic log and brine analyses; a total of 3 brine samples were collected
from this borehole.
‐ 50 ‐

Figure 10.2: PE‐2 summary geologic log and brine analyses; a total of 6 brine samples were collected
from this borehole.

‐ 51 ‐

Figure 10.3: PE‐3 summary geologic log and brine analyses; a total of 62 brine samples were
collected from this borehole.

‐ 52 ‐

‐ 53 ‐

‐ 54 ‐


‐ 55 ‐

‐ 56 ‐

‐ 57 ‐

‐ 58 ‐

10.2 Diamond Drilling Borehole Program
The objectives of this program are to collect continuous cores for geotechnical testing (porosity,
grain size and density) and geological characterization, and to construct observation wells for
future sampling and monitoring. Major Drilling Argentina S.A. was contracted to carry out the
drilling using a Major‐50 rig and support equipment. The boreholes were drilled using triple
tube PQ and HQ drilling methods.
This program is currently in progress; the boreholes reported herein were completed between
October and December 2009. Five boreholes (DDH‐1 through DDH‐5) were completed during
this period, for total drilling of 1 280 m. Borehole depths range from 79 m (DDH‐2) to 322 m
(DDH‐3).
During drilling, core is retrieved and stored in boxes for subsequent geologic logging.
Undisturbed samples are taken from the core in PVC sleeves (2‐inch diameter and 5‐inch
length) at selected intervals, for laboratory testing of geotechnical parameters including: total
and drainable porosity, grain size, and particle density. A total of 113 undisturbed samples
have been prepared and shipped to D.B. Stevens & Associates Laboratory for testing. Sample
collection, preparation and testing methods are described in Sections 11.4 and 12.2 and 12.4,
respectively. Table 10.1 shows the results of the drainable porosity testing carried out on the
undisturbed samples.
Table 10.3: Results of drainable porosity testing.
Lithology Number of samples Avg. Drainable Porosity (%)
Clay 10 3.2
Silt 23 12.0
Sand 49 25.5
Salt (semi‐consolidated/porous) 25 26.8
Salt (solid halite core) 6 4.8
On completion of drilling, each borehole was converted to an observation well through the
installation of Schedule 80, 2‐inch diameter, blank and slotted (1mm) PVC casing. The
observation wells were completed with steel surface casing, a surface sanitary cement seal and
lockable cap. During March 2010, a low flow sampling program will be conducted within these
wells. Brine samples will be collected from each well (DDH‐1 through DDH‐5) at selected
intervals, and submitted for laboratory analyses.
A systematic water level monitoring program has been implemented for observation wells
DDH‐1 through DDH‐5 and for the boreholes drilled for the RC Borehole Program (PE‐1 through
PE‐9). Additional water level monitoring and hydraulic testing will be conducted.
‐ 59 ‐

11 SAMPLING METHOD AND APPROACH
11.1 Background
Sampling procedures and protocols for the Surface Sampling, RC Borehole and DD Borehole
Programs were designed by Dr. Waldo Perez P. Geo, Frits Reidel, B. Sc. and Pedro Pavlovic,
Chem. Eng. The various programs were executed under the direct field supervision of Dr. Waldo
Perez P. Geo. from Project startup (July 2008) to September 2009. Since that time, all site work
is conducted under the supervision of the Company QP, John Kieley (P.Geo. from Canada).
11.2 Surface Brine Sampling Methods
A total of 55 surface brine samples were collected from shallow hand‐dug test pits excavated
throughout the Project site, at the locations shown on Figure 9.1. The pits ranged from 1.5 to 3
m in depth and were left open after completion to allow entry of brine (Photos 9.1 and 9.2).
After evacuating the hole several times and allowing the brine to re‐enter, a brine sample was
collected in a brine‐rinsed, one litre plastic bottle. The bottle top was sealed with Teflon tape
and the bottle was tagged with a pre‐numbered ticket. The coordinates of the sample location
were measured with a handheld GPS and entered in a log book which was signed by the person
responsible for sample collection. Samples of the intersected clay and, if present, thin salt
layers, were also collected. Results from the Surface Brine Program are presented in Section
9.2
11.3 RC Borehole Sampling Methods
During RC drilling, rock chips and brine are directed from the drill cyclone into a plastic bag,
over a one‐metre drilling interval. If the output from the cyclone is dry (rock chips only), a
geologist places a representative sample from the plastic bag into a rock chip tray. If the output
is wet (rock chips and brine), it is sieved. The separated solids are then placed in a rock chip
tray and the brine is poured from the bottom of the sieve into a plastic bottle. The brine is then
field analyzed for the following:
¾ Potassium – using a Thermo Fisher Scientific Niton portable XRF analyzer;
¾ pH and temperature ‐ using a Hach HD‐30 pH meter; and
¾ Conductivity – using a HD‐30 conductivity meter.
After the field measurements are taken, the brine sample is split into three, one litre, clean,
plastic sample bottles. The three bottles are tagged with pre‐printed tag numbers. Two
samples are mixed to form one sample, which is shipped to the Alex Stewart Laboratories S.A.
(“ASL”) in Mendoza. One sample is maintained in the LAC Susques office as a backup. Results
from the RC Borehole Program are presented in Section 10.1.
‐ 60 ‐

Photo 11.1 (left): Cyclone with plastic bag (dry sample).
Photo 11.2 (right): rock chip tray with dry and wet samples.
11.4 DD Borehole Sampling Methods
During diamond drilling, PQ or HQ diameter cores are collected through a triple tube sampler.
The cores are taken directly from the triple tube and placed in wooden core boxes for logging
and undisturbed sample collection. Undisturbed samples are collected by driving a two inch
diameter PVC sleeve sampler into the core at selected intervals. A total of 113 undisturbed
samples were collected from the cores of DDH‐1 through DDH‐5.
Undisturbed samples were shipped to D.B. Stephens & Associates Laboratory in the USA for
analysis of geotechnical parameters, including: total and drainable porosity, grain size, and
particle density.

Photo 11.3 (left): Collecting an undisturbed sample from sand core.
Photo 11.4 (right): Collecting an undisturbed sample from clay core.
‐ 61 ‐

12 SAMPLE PREPARATION, ANALYSES AND SECURITY
12.1 Overview
The surface brine, RC brine, rock chip and core samples were prepared on site under the
supervision of Dr. Waldo Perez (P. Geo. Canada) from Project startup (July 2008) to September
2009. Since that time, all site work (including sample preparation) is conducted under the
supervision of the Company QP, John Kieley (P.Geo. from Canada). Brine samples are analyzed
by ASL. This company is an ISO 9001‐certified laboratory with facilities in Mendoza, Argentina
and headquarters in England.
The University of Salta (“UNSa”) in Salta, Argentina, is used for analysis of duplicate brine
samples. Since 1996, the quality of UNSa chemical analysis is periodically evaluated through
inter‐laboratory testing organized by Instituto Nacional de Tecnología Industrial. The University
of Antofagasta in Northern Chile is the third laboratory used for brine analyses and also for
brine evaporation tests (Section 15). This laboratory is certified by Chilean Standards (NCH)
17045 OF 2005. Additional performance and quality checks are carried out as part of an inter‐
laboratory testing program conducted since 1996.
D.B. Stephens and Associates Laboratory in Albuquerque, New Mexico, USA are used for the
geotechnical property analyses of the undisturbed core samples from the DD Borehole
Program. D.B. Stephens and Associates is certified by the US Army Corps of Engineers and is a
contract laboratory for the Geological Society of America.
12.2 Sample Preparation
12.2.1 Surface Brine Sample Preparation
No additional preparation was required for the surface brine samples. The samples were
collected and shipped to the laboratory.
12.2.2 RC Borehole Brine Sample Preparation
Samples collected through the RC Borehole Program often contain high levels of turbidity. If
the silt and clay in suspension is significant (more than one centimetre accumulated at the
bottom of the bottle) then these samples are filtered in the LAC Susques field office. The
filtration is carried out using a standard lab filter, Kitasato flask and a vacuum pump.
12.2.3 DD Borehole Core Sample Preparation
Undisturbed samples are collected by driving a 2‐inch diameter PVC sleeve sampler into the
core at selected intervals. End caps are tightly fitted on both end of the PVC sample sleeve and
a unique sample identification tag is attached to each sample. Plastic foil is wrapped around
the entire sample sleeve with end caps before placed in boxes for shipping.
‐ 62 ‐

Photo 12.1: Filtration of brine and clay mixture. Photo 12.2: Brine after filtration.
12.3 Brine Analysis
12.3.1 Analytical Methods
ASL was selected as the primary laboratory for assaying the RC Borehole Program brine
samples. They also assayed duplicate samples, blanks and reference standards, which were
inserted as blind control samples. In order to provide a quick response, they employed
Inductively Coupled Plasma (“ICP”) as the analytical technique for the primary constituents of
interest in the brine samples, including: Na, K, Li, Ca, Mg and B.
For the first six RC boreholes (PE‐1 through PE‐6) sulphate was assayed using the turbidimetric
method, with checking of 20% of samples using the gravimetric method. Samples from PE‐7,
PE‐8 and PE‐9 were analyzed by only the gravimetric technique, which provides more accurate
results. The argentometric method was used for assaying chloride and volumetric analysis
(acid/base titration) was used for carbonates (alkalinity as CaCO3). Laboratory measurements
were conducted for Total Dissolved Solids (“TDS”), density, and pH.
12.3.2 Analytical Quality Assurance and Quality Control (“QA/QC”)
The QA/QC procedures adopted for the Project are discussed below, and include the following:
¾ ASL conducts an internal check on overall analytical accuracy for the primary parameters,
using ion balance and the ratio of measured to calculated TDS;
¾ 10% of samples submitted to ASL are blanks;
¾ 10% of samples submitted to ASL are reference standard control samples collected from a
brine pit in the Borax Mine in Cauchari; these are high TDS samples;
¾ Duplicate samples are composed for 5% of the brine samples, and are submitted to ASL as
unique samples (blind duplicates);
¾ Duplicates are composed for 5% of the brine samples, and are analyzed for Na, K, Li, Ca and
Mg by ASL using an alternative method (atomic absorption spectrometry (“AAS”));
‐ 63 ‐

¾ Duplicates are composed for 5% of the brine samples, including control samples, and are
submitted to a secondary lab (UNSa) as check samples (external duplicates); and
¾ Five selected samples were submitted for round robin testing at eight different analytical
laboratories (in addition to ASL); results were not available for inclusion in this report.
Results from these QA/QC procedures are discussed below.
Ion Balance
The ion balance evaluation of overall analytical accuracy is based on a comparison of cations
and anions in the sample. Sums are calculated for these two components (expressed in
milliequivalents per litre) and the difference between the two is expressed as a percentage.
Based on the extensive experience of ASL with brines from other salars, and discussions with
Universidad Nacional San Luis, a maximum difference of 5% was adopted as the acceptability
criteria for the Project. Analytical performance with regard to the ion balance criteria is
summarized below for all RC boreholes excluding PE‐1 and PE‐2 (minimal brine sampling was
conducted) and PE‐3 (located on the salar periphery):
¾ 7% of samples (8 of 110) from PE‐4 exceeded the 5% criteria; this situation was improved in
subsequent boreholes;
¾ 5% of samples (9 of 180) from PE‐5 exceeded the 5% criteria;
¾ No samples (of 114) from PE‐6 exceeded the 5% criteria;
¾ 2% of samples (2 of 132) from PE‐7 exceeded the 5% criteria;
¾ 1% of samples (1 of 143) from PE‐8 exceeded the 5% criteria; and
¾ 1% of samples (1 of 72) from PE‐9 exceeded the 5% criteria.
ASL considered that the results exceeding the ion balance criteria were primarily due to the
exceptional TDS levels present in the samples. They note that elevated TDS levels have caused
imbalances in samples from other brine sites for which they conduct analysis.
‐ 64 ‐

Measured Versus Calculated TDS
The second overall evaluation of analytical accuracy is based on the ratio of measured to
calculated TDS. According to Standard Methods (APHA‐AWWA‐WPCF, 1998) this ratio should be
between 1.2 and 1.0. Results for the submitted samples ranged from 0.9 to 1.15 indicating that
many of the samples were below the acceptance criteria.
Again this discrepancy was attributed to the exceptionally high dissolved solids content of the
brine.
Blank samples to ALS
Lithium was non‐detectable in all 116 submitted blank samples except one.
Reference Standard Samples to ALS
Reference standard samples (116) were collected from a brine pit in the Borax mine in
Cauchari, as a means of evaluating the ongoing reproducibility of the analysis. The results show
that these samples are even more highly concentrated than the in situ brine, probably due to
evaporation. Detected concentrations of lithium and other solutes were relatively constant
over the duration of the program, with variability both above and below the long‐term mean,
and no apparent systematic change. It is noted, however, that ionic balance results for most of
these samples was significantly higher than 5%. It was suggested by ASL that this is due to the
extreme dissolved solids content in these samples (up to 35% by weight).
Duplicates by Alternative Method (AAS) at ALS
The analytical results obtained by AAS for duplicate samples (1 in 20 ordinary samples) show
strong discrepancies: up to 40% in Mg, 30% in Na, 20% in Ca, 16% in Li and 7% in K; generally
lower values compared with ICP results. Additional method development work is required for
the analysis of brine samples by AAS.
Blind Duplicates to ALS
The analytical results for 117 blind duplicate samples indicate good reproducibility by the ICP
analytical method.
External Duplicates at Secondary Laboratory
Five percent of brine samples were submitted in duplicate to UNSa although, to date, results
are only available for 19 samples, due to laboratory turnaround time. Statistical analysis of the
19 pairs of results was conducted using Reduction‐to‐Major‐Axis (“RMA”) multiple linear
regression for K, Li and Mg. StatGraphics software was used for this analysis. Results are
summarized in Table 12.1 and shown graphically in Figures 12.1, 12.2 and 12.3 for K, Li and Mg,
respectively.
‐ 65 ‐

Table 12.1: Check Assays (ASL vs. Univ. Salta): RMA regression statistics.
CAUCHARI‐OLAROZ PROJECT ‐ RMA Statistics (ASL vs. U. Salta)
Element R2 Pairs M Error (m) B Error (b) Bias
K (mg/L) 0.86369 19 0.97782 0.04944 ‐34.3162 545.193 2.22%
Li (mg/L) 0.93426 19 1.09238 0.07028 ‐67.039 48.438 9.24%
Mg (mg/L) 0.843118 19 0.89326 0.09345 193.13 155.882 10.37%

The bias, which is a measure of accuracy (the higher the bias, the lower the accuracy), is
calculated as Bias (%) = 1 – RMAS where RMAS is the slope (m) of the Reduction‐to‐Major‐Axis
regression line of the secondary laboratory AAS values (UNSa) versus the primary laboratory ICP
values (ALS) for each element.
The RMA analysis results show that the fitted model is better for lithium (higher R‐squared
coefficient) than for potassium and magnesium. However, the bias result for potassium is more
favourable.
Plot of Fitted Model
(X 1000,0)
10
Po tassiu m m g /L A lex Stew art
0
0 2 4 6 8 10
(X 1000,0)
Potassium m g/L University Salta
Figure 12.1: RMA plot for the fitted multiple regression model for potassium.
‐ 66 ‐

1200
1000
Lithium m g/L A le x S te wa rt
800
600
400
200
0
0 200 400 600 800 1000
Lithium mg/L University of Salta
Figure 12.2: RMA plot for the fitted multiple regression model for lithium.
2500
Magnesium m g/L A lex Stewart
2200
1900
1600
1300
1000
700
0 500 1000 1500 2000 2500
Magnesium mg/L University Salta

Figure 12.3: RMA plot for the fitted multiple regression model for magnesium.
Results from the inter‐laboratory comparison indicate a reasonable correlation between labs,
especially for Li, which tends to be present at lower concentrations than the other two
constituents (K and Mg). Discrepancies appear to become more significant at higher
concentrations, which is consistent with interference caused by the exceptional TDS of the
sample.
Overall QA/QC Conclusion
It is noted by the independent QP that the high dissolved solids content of the brines are a
source of analytical variability in the existing results. This is especially apparent in the results
for the checks based on ionic balance and measured versus calculated TDS. These two standard
aqueous chemistry checks are typically used for waters with less extreme TDS levels. Their
applicability for the exceptional chemistry of the brines should be further evaluated and
‐ 67 ‐

refined. This is consistent with LAC’s stated objective of identifying and minimizing the sources
of analytical variability as the Project moves forward.
On balance, however, it is the opinion of the independent QP that the existing QA/QC
information adequately demonstrates that the brine dataset is acceptable for use in an inferred
resource estimate. While some of the basic check criteria (e.g., ion balance, TDS) are exceeded
for some samples, the degree to which they are exceeded is still considered relatively minor in
the context of the inferred resource estimate, and potential impact on the final result.
However, additional analytical QA/QC refinement should be conducted in advance of the next
level of estimation.
12.4 Geotechnical Analyses
12.4.1 Overview
D.B. Stephens and Associates Laboratory carried out selected geotechnical analyses on 113
undisturbed samples from the geologic cores (DDH‐1 through DDH‐5) as summarized in Table
12.2. Results are provided in Section 10.2.
Table 12.2: Summary of geotechnical property analyses.

ANALYSIS ASTM PROCEDURE
Dry bulk density D6836
Moisture content D2216, D6836
Total porosity D6836
Specific gravity (fine grained) D854
Specific gravity (coarse grained) C127
Particle size analyses D422
Relative water release capacity NA
Container capacity package NA

12.4.2 Analytical Methods
Specific gravity
Specific gravity testing was conducted for four formation samples (012714, 012715, 012716,
and 012743). Density results for these samples ranged from 2.47 g/cm3 to 2.75 g/cm3. It was
subsequently determined that these values could be skewed due to the high salt content.
Consequently, no attempt was made to apply these measured values to the remaining samples,
and an assumed particle density of 2.65 g/cm3 was used for all other samples.
‐ 68 ‐

Drainable porosity
Drainable porosity tests were carried out on all undisturbed samples through “Relative Water
Release Capacity (“RWRC”)” or “Container Capacity Package (“CCP”)” analyses. Both methods
are based on calculating changes in volumetric moisture content as samples (initially fully
saturated) drain over a three‐day period, either under the force of gravity (in the CCP method)
or vacuum suction (in the RWRC method). The drainable porosity is considered to be equal to
the difference between volumetric moisture contents at the start and finish of the test.
Particle size analyses
Particle size analyses were carried out on all undisturbed samples after the drainable porosity
testing was completed. Uniformity and curvature coefficients (Cu and Cc) were calculated for
each sample and samples were classified according to the USDA soil classification system.
12.5 Sample Security
There is an established and firm chain of custody procedure for Project sampling, storage and
shipping. Samples are taken daily from the drill sites and stored at the Susques field office of
LAC. All brine samples are stored inside a locked office, and all drill core is stored inside a
locked warehouse adjacent to the office. Samples are periodically driven in Project vehicles to
Jujuy approximately three hours from the site. In Jujuy, the samples are delivered to a courier
(DHL) for immediate shipment to the appropriate analytical laboratory.
‐ 69 ‐

13 DATA VERIFICATION
13.1 Overview
The independent QP conducted the following forms of data verification:
¾ Visits to the salar site, the LAC field office, and the LAC corporate office;
¾ Review of LAC sampling procedures, although it is noted that actual brine sampling was not
viewed due to the nature of the geologic units encountered by the RC drill at the time of the
site visit;
¾ Inspection of original laboratory results forms for the LAC brine dataset;
¾ Inspection of electronic copies of the LAC brine dataset and comparison with corresponding
stratigraphic logs;
¾ Review of LAC field and laboratory QA/QC results;
¾ Review of publicly available information from an adjacent exploration property (Orocobre)
in Olaroz Salar; and
¾ Detailed and ongoing technical discussion of the Project with key Project personnel,
including the LAC field supervisor (John Kieley, a P.Geo. from Canada); the Independent
Hydrogeologist (Frits Reidel) and the block model construction specialist (Danilo Castillo).
Independent sampling and chemical analysis were not conducted by the independent QP.
13.2 Site Visit
The QP visited the Project site and field office on December 10 and 11, 2009 and made the
following observations that are relevant to data verification:
¾ Most of the past drilling sites were observed, including cuttings, well completions, brine
ponds, and new gravel roads constructed to the sites;
¾ Sampling procedures for brine, rock chips and core were reviewed and are considered
appropriate for maintaining data integrity;
¾ An active drilling site was observed, although it is noted that brine sampling was not
conducted during the visit due to the nature of the salar units through which the RC drill was
advancing at that time;
¾ The sample storage facility and security systems were observed and are considered
appropriate;
¾ Example cores were inspected, compared with compiled logs, and determined to be
consistent;
‐ 70 ‐

¾ Field data entry and log production procedures were observed and determined to be
appropriate;
¾ Interaction procedures with the central data storage technician at the Mendoza corporate
office were reviewed and determined to be appropriate;
¾ Staff operations, responsibilities and mentoring were observed; it was determined that staff
were conducting tasks appropriate to their training, and that the working environment
encouraged scientific integrity, diligence, and mentoring through progressive levels of
responsibility.
The QP visited, and worked from, the corporate office in Mendoza from January 22 to
January 30, 2010 and made the following observations that are relevant to data verification:
¾ Hard copies of all analytical data available to that time were reviewed; spot comparisons
were made with plotted borehole logs, maps and working spreadsheets; accurate
transcription was confirmed;
¾ The derivation of the geologic conceptual model (used as input for the block model) was
reviewed in detail and was determined to be a reasonable representation of site conditions;
¾ The development of the block model and the process for generating interim and final
inferred estimate results were reviewed in detail; during the visit, some adjustments were
made to the block model by the LAC experts which added to the degree of conservatism in
the estimate.
13.3 Laboratory QA/QC Results
An appropriate suite of QA/QC checks were applied to the brine analysis, including: field
duplicates, field blanks, field standards, inter‐laboratory comparisons, inter‐method
comparison (i.e., between ICP and AAS), and secondary analytical checks (i.e., ion balance and
TDS checks). Results from these checks indicate that the extreme TDS of the samples
contributes to analytical variability and that acceptability criteria are exceeded for some
samples. The analytical laboratory has indicated that, based on their widespread experience
with salar brines, this issue is relatively common in these highly concentrated waters. The
experience of the independent QP in the interpretation of aqueous chemistry is consistent with
this suggestion, where analytical error is often observed to increase due to the response of
analytical equipment to extreme concentrations.
On balance, however, it is the opinion of the independent QP that the existing QA/QC
information adequately demonstrates that the brine dataset is acceptable for use in an inferred
resource estimate. While some of the basic check criteria (e.g., ion balance, TDS) are exceeded
for some samples, the degree to which they are exceeded is still considered relatively minor in
the context of the inferred resource estimate, and potential impact on the final result.
It is further noted that the reproducibility of the brine results is relatively high when compared
to results from many solid phase mineral deposits. In situ concentration trends in aqueous
bodies tend to be smoothed by hydrodynamic processes such as diffusion, advection,
‐ 71 ‐

dispersion and density effects. Consequently aqueous salt distributions are more readily
delineated than many solid deposits, which can have a high degree of inherent heterogeneity,
characterized by large concentrations changes over short distances.
13.4 Brine Composition Trends
The observed vertical brine concentration trends from the RC boreholes are qualitatively
consistent with expected natural trends, and provide some overall verification of the dataset.
Borehole brine concentrations tend to be consistent over vertical distances of several metres.
When changes in concentration are observed, they tend to occur gradually over several
successive samples leading ultimately to a peak or low concentration followed by reversal back
to a baseline level.
Publicly available information from the Orocobre exploration property located adjacent to LAC
claims in Olaroz Salar also provides some overall verification of the LAC brine dataset. On their
website, Orocobre reports that through a Joint Ore Reserve Committee (“JORC”) ‐ compliant
inferred resource estimate, they have identified a resource of 350 million kL of brine with
concentrations of 800 mg/L lithium and 6 600 mg/L potassium. Although information on the
distribution of these two constituents is not provided, it is noted that the reported
concentrations are similar to the high concentration zone defined by LAC in the Cauchari Salar.
13.5 Technical Competence
The independent QP has personally met and had detailed technical discussions with most of the
technical experts working on the Project on behalf of LAC. These individuals are competent
professionals, with deep experience within their respective disciplines. The actions of these
experts show that they are committed to developing a technically‐defensible inferred resource
estimate. Their interpretations demonstrate a conservative approach in assigning constraints
on the estimate, which increases the technical strength of the result.
‐ 72 ‐

14 ADJACENT PROPERTIES
Orocobre is an Australian listed company that owns mineral properties on the Olaroz Salar,
adjacent to some of the LAC claims. Figure 14.1 shows the location of the Orocobre claims. The
Orocobre website (www.orocobre.com.au) states that a JORC‐compliant inferred resource
estimate was completed by Geos independent consultants in July 2009. The stated inferred
resource estimate for the Olaroz property is 1.5 million tonnes of lithium carbonate and 4.4
million tonnes of potash. The estimate zone extends to a depth of 55 m, and the company
states that exploration potential exists to a depth of 200 m. The company states that the brine
chemistry is favourable, with low impurities. Neither LAC nor the QP have carried out an
independent review of the validity of the Orocobre resource estimates and such information is
not necessarily indicative of the mineralization on the Cauchari‐Olaroz Project.

‐ 73 ‐

Figure 14.1: Location map of Orocobre claims.
‐ 74 ‐

15 MINERAL PROCESSING AND METALLURGICAL TESTING
15.1 Overview
Evaporation and solubility tests were conducted to provide information on the crystallized salts
produced through the different stages of the evaporation process, and to provide a basis for
preliminary evaluation of the lithium recovery process. Results from these tests are intended
to be representative of typical brine chemistry at the site, not the entire range of brine
chemistry. They will be used as input for the design of more rigorous testing that would
ultimately support the design of an effective overall lithium recovery process.

Simulated solar evaporation tests were carried out on brines from Cauchari Salar by the
University of Antofagasta. These batch‐wise tests were conducted at a constant temperature
(30°C) and at laboratory scale. Solubility testing was conducted at a temperature that
approached field conditions (15°C). Harvested crystallized salts and solutions (liquors)
recovered from various stages of the 30°C evaporation tests were used in the solubility tests.

Testing was conducted with approximately 42 L of typical Cauchari brine, composed with
duplicate samples from borehole PE‐4. The brine was transported to University of Antofagasta
in late October 2009, to be used for this first round of isothermal evaporation test work.
Additional testing is planned for a composite sample of typical Olaroz brine from borehole PE‐5.
15.2 Simulated Solar Evaporation and Solubility Testing
15.2.1 Experimental Methods
The brine used in the evaporation test was composed of duplicate samples from PE‐4, located
in Cauchari Salar. The samples were collected from depths between 59 and 186 m. Table 15.1
provides analytical results for this composite brine from the University of Antofagasta (cations
by AAS and sulphate by gravimetry) and ASL (cations and B by ICP, sulphate by turbidimetry).
The results are comparable between the two laboratories, with the largest discrepancies noted
for sodium, calcium and sulphate.
Table 15.1: Concentration (wt%) and density (g/cm3) for the brine from borehole PE‐4.
Laboratory Na K Li Ca Mg Cl SO4 B Density
Univ.
10.06 0.50 0.060 0.030 0.160 14.87 2.20 0.078 1.2144
Antofagasta
ASL 8.68 0.55 0.056 0.026 0.164 14.48 1.87 0.075 1.2177
In the evaporation test, 42 L (51 kg) of the PE‐4 brine composite was subjected to isothermal
evaporation at 30°C. The brine was concentrated over five stages of evaporation, harvesting the
crystallized salts at every stage. A fiberglass reinforced plastic pan (75.5 cm diameter, 12.3 cm
‐ 75 ‐

depth) was used for the first three stages and an acrylic pan (40 cm diameter, 6 cm depth) for
the last two stages. Magnesium was used as a tracer through the evaporation stages. Over the
test, magnesium ranged from an initial content by weight of 0.16% to 2.72% in the final
concentrated brine (less than 1 L). Samples of the solution and the salts (after filtering) were
collected from each stage, for chemical analysis and x‐ray diffraction.
Daily evaporation trends were simulated by varying the conditions to which the evaporation
pan was exposed. Daytime conditions were simulated with two heat lamps, an oscillating fan
and a hair dryer. The brine was stirred with a stainless steel paddle‐type agitator (6‐7 rpm) to
suspend the crystallized salts. At night, the heat sources were turned off, which resulted in
overnight cooling of the brine by approximately 5°C. The large fibreglass evaporation pan and
associated apparatus are shown in Photo 15.1.
Solubility tests were conducted at 15°C, which approaches conditions at the Cauchari Salar.
Tests were done using crystallized salts and mother liquor produced at each stage of the
evaporation test at 30°C. Closed glass vessels containing mixtures of 100 cm3 of liquor and 20 g
of salts were set in a rotating stainless steel basket inside a thermostatically‐controlled bath at
15°C. Solution density was monitored until it reached a constant value, which indicates that
liquor and salts have reached equilibrium. The slurry was then filtered and samples of both
liquor and salts were collected for assaying.

Photo 15.1: Fiberglass evaporation pan and associated apparatus.
‐ 76 ‐

15.2.2 Test Results
Table 15.2 shows a mass balance (crystallized salts, solution and evaporated water), with
reference to the initial weight of brine for each evaporating stage at 30°C.
Table 15.2: Mass balance (g) in terms of salts, solution and evaporated water.

Evaporation Evaporated
Initial Weight Salts Liquor
Stage Water
1 50 839 8 241.3 22 504.3 20 093.3

2 22 303.5 3 339.7 11 165.2 7 798.5
3 10 962.9 1 960.1 4 936.2 4 067.2
4 4 725.6 901.9 2 564.5 1 259

5 2 354.6 521 1 076.4 757.1

Tables 15.3 and 15.4 show brine composition and harvested salts during the five evaporation
stages. The evolution of the density and refractive index of the brine is also indicated.
Additionally, the moisture of the crystallized salts after harvesting and filtration is included in
Table 15.3.
‐ 77 ‐

Table 15.3 Composition (wt%) and properties of the evaporating brine.

1st Stage 2nd Stage 3rd Stage 4th Stage 5th Stage
Na 9.61 9.04 6.64 5.95 4.16
K 1.36 1.98 4.21 3.67 2.92
Li 0.14 0.23 0.43 0.50 0.57

Ca 0.020 0.070 0.002 0.002 0.003

Mg 0.34 0.63 1.25 1.67 2.72
Cl 14.03 12.53 12.35 12.43 12.961
SO4 5.46 8.21 9.92 10.02 9.42
B4O7 0.17 0.32 0.65 0.34 0.11

H3BO3 0.91 1.67 3.40 2.81 3.32

H2O 67.96 65.32 61.14 62.60 63.816

Anion‐cation balance ‐0.43 0.02 ‐0.20 ‐0.14 ‐0.02
Density (g/cm3 @25° C) 1.23743 1.27302 1.28430 1.31477 1.30292
Refractive Index (25°C) 1.3844 1.3881 1.3892 1.3946 1.3978

Evaporation (%) 40 35 37 27 32

Cumulative evap (%) 40 55 63 65 67

A total of 33 975 grams of water was evaporated in the five stages, which represented 67% of
the initial mass of brine (50 839 g). The lithium concentration was increased from 0.06%
(original brine) up to 0.57% after the fifth stage, although it is noted that lithium started
precipitating from the third stage, as shown in Table 15.4.
‐ 78 ‐

Table 15.4: Composition (wt%) and moisture of harvested salts.

1st Stage 2nd Stage 3rd Stage 4th Stage 5th Stage
Na 33.81 33.91 31.09 17.14 17.33
K 0.18 0.34 0.70 9.63 9.64
Li 0.02 0.03 0.20 0.77 0.93
Ca 0.090 0.070 0.026 0.001 0.01

Mg 0.05 0.10 0.14 1.67 1.62

Cl 52.36 51.82 37.7 27.19 28.17
SO4 1.05 1.77 18.68 22.91 23.38
B4O7 0.03 0.06 0.09 2.05 1.22
H3BO3 0.19 0.29 0.44 8.32 5.52

H2O 10.3 11.61 10.3 10.31 12.19

Anion‐cation Bal. ‐0.89 0.03 ‐1.40 ‐1.2 ‐1.12
Moisture (%) 11.17 12.87 8.96 11.18 11.18

For every harvest of salts, the different species that crystallized were estimated by the method
of mineralization of salts. This involves associating the chemical elements present in the wet
salts to the most probable mineralogical species that would be formed during the crystallization
process. In developing this estimate, the entrainment of the solution must be discounted to
determine the percentage of dried salts that have been mineralized in each stage.
The University of Antofagasta prepared 12 tabular evaluations for the mineralization of
harvested salts (six tables for the evaporation stages at 30°C and six tables for the solubility
tests at 15°C). In the summary provided herein, one table for each case is presented. Although
lithium started to precipitate in the third stage, the fourth stage is shown, because it generated
a greater variety of crystallized salts, including a more abundant amount of lithium salt.
Magnesium, which was used as a tracer in the evaporation test, showed variation in some
stages of the solubility test.
The estimate of salts composition by the mineralization method was compared to the species
identified by x‐ray diffraction. In most cases, the identified mineral species are similar between
the two methods, although the amounts differ.
‐ 79 ‐

Table 15.5: Mineralization of salts from evaporation test at 30°C (4th Stage).
% % % % Anion‐
%Na %K %Li %Ca %Mg % Cl % SO4
B4O7 H3BO3 H2O E Cat Bal
Wet salts 17.14 9.63 0.77 0.00 1.67 27.20 22.91 2.05 8.32 10.31 ‐1.20
Solution 5.95 3.67 0.50 0.00 1.67 12.43 10.02 0.34 2.81 62.61 ‐0.14
Entrainment 0.32 0.19 0.03 0.00 0.09 0.66 0.53 0.02 0.15 3.32 5.3
Dried salts 16.82 9.44 0.74 0.00 1.58 26.54 22.38 2.03 8.17 6.99 94.70
%
Crystallized salts
mineral.
NaCl 16.83 25.96 45.18
MgSO4.K2SO4.6H2O
5.25 1.38 11.90 6.13 26.04
(1)
LiKSO4 (2) 4.19 0.74 10.29 16.08
MgCl2.6H2O.8B2O3
0.20 0.59 4.60 0.89 6.63
(3)
Moisture, 11.18 %
Total 100
100 100 100 100 100 99 100
mineralization, % (*)
Schoenite (2) Lithium schoenite (3) Boracite (*) Boron expressed as B2O3
Table 15.6: Mineralization of salts from solubility test at 15°C (4th Stage)
% % % % % Anion‐

%Na %K %Li %Ca %Mg % Cl SO4 B4O7 H3BO3 H2O E Cat Bal
Wet salts 17.23 9.77 0.42 0.01 1.50 22.59 25.36 2.37 9.79 10.96 ‐0.52
Solution 5.34 3.24 0.58 0.00 1.75 13.34 7.96 0.16 2.13 65.50 ‐0.14
Entrainment 0.32 0.19 0.03 0.00 0.11 0.80 0.48 0.01 0.13 3.93 6
Dried salts 16.91 9.58 0.39 0.01 1.40 21.79 24.88 2.36 9.66 7.03 94.00
%
Crystallized salts mineral.
NaCl 14.13 21.79 38.21
Na2SO4x3K2SO4 (4) 0.93 4.77 7.81 14.38
MgSO4xK2SO4x6H2O 1.35 0.42 3.32 1.87 7.40

MgSO4xNa 2SO4
X4H2O (5) 1.84 0.98 7.71 2.89 14.27
LiKSO4 2.17 0.39 5.33 8.39
KB5O8x4H2O (6) 1.22 6.19 2.25 10.28

100
Total mineralize, % 100 99 100 100 100 97 (**) 100
(4) Glaserite (5) Astrakanite (6) Hydrated potassium borate (*) Boron expressed as B5O
‐ 80 ‐

From the two tables above (specific case of the 4th stage), it is noted that as a result of the
reduction of the temperature to 15°C in the solubility test, the new species glaserite and
astrakanite have been formed in a selective crystallization process. A difference in types of
crystallized salts was also observed in the other stages of evaporation.
15.2.3 Phase Diagrams
The evolving path of the Cauchari brine during evaporation was plotted on a phase diagram
(Janecke projection) for the aqueous five component system (Na+, K+, Mg++, SO4=, Cl–) at 25°C.
Equilibrium data for 25°C were obtained from the technical literature. To plot this path, it is
necessary to express the compositions of the original brine and the liquors from the five stages
as % molar. Another calculation has also been included in this analysis, where the lithium
concentration has been considered equivalent to magnesium and therefore a total equivalent
magnesium concentration (MgL) is obtained, as follows:
%MgL = % Mg + 24.305/ (2*6.941)*% Li.

Figure 15.1: Evaporation path of Cauchari brine based on evaporation at 30°C. Quinary system K,
Na, Mg, Cl, SO4, H2O, saturated in NaCl at 250C.
In the above Figure 15.1, six points have been plotted, corresponding to the original brine and
the mother liquors of each stage of evaporation. The paths from A and B indicate the course
followed by the Cauchari brines subjected to isothermal evaporation (30°C). The line B takes
into consideration the content of lithium in the solution, made equivalent to the Mg ion. It can
be observed that the initial brine is located in the crystallization field of tenardite, although the
concentrating brine is saturated in this salt only in the third stage. This is due to the
representation in the phase diagram at 25°C, which only approximates the actual conditions. It
does not consider the difference in temperature between the two systems or the effect of
other components present in the Cauchari brine such as lithium and boron.
‐ 81 ‐

Figure 15.2: Evaporation path of Cauchari brine based on evaporation at 15°C.
Quinary system K, Na, Mg, Cl, SO4, H2O, saturated in NaCl at 250C.

In Figure 15.2, six points have been plotted, corresponding to the original brine and the
saturated solutions at 15°C, generated from the mother liquors and crystallized salts from the
stages of evaporation at 30°C. The lines starting from A and B indicate the paths that would be
followed by the Cauchari brines subjected to an isothermal evaporation at 15°C. The line B
takes into account the concentration of lithium in the solution, made equivalent to the Mg ion.
It can be observed that at 15°C the initial brine is again located in the crystallization field of
tenardite, despite the fact that the concentrating brine reaches saturation in this salt in the
third stage. Once again, as indicated for the previous phase diagram (Figure 15.1), this
divergence from observed results is due to the approximation represented in the diagram.
15.2.4 Discussion and Conclusions
Composite brine from Cauchari Salar was concentrated in five stages of isothermal evaporation
at 30°C. The brine was concentrated 17 times, undergoing a total cumulative evaporation of
almost 67%. The lithium content in the final liquor reached 0.57% at 30°C, and a slightly higher
concentration (0.61%) at 15°C. Evaporation and solubility testing results are favourable and
indicate that the brine is likely amenable to ordinary processing. In addition, there would be an
opportunity to recover potash which is considered a co‐product of the Project.
The types of crystallized salts were estimated using both the mineralization method and x‐ray
diffraction. Results from these two methods did not always coincide but both methods
indicated that a selective crystallization of salts is produced in accordance with the levels of
magnesium and sulphate present in the brine. Lithium salts start crystallizing in the third stage
of evaporation, either at 15°C or 30°C.
‐ 82 ‐

The solubility tests indicate that the crystallization process is more rapid at 15°C than at 30°C. In
addition, other salts precipitate such as glauberite, glaserite, sodium lithium sulphate
hexahydrate and astrakanite. It can be anticipated that at field temperatures (typically lower
than 15°C) these salts may begin to crystallize in earlier stages of evaporation.
Phase diagrams were constructed representing Cauchari brine evaporation (Janecke projection)
in an aqueous five‐component system (Na+, K+, Mg++, SO4=, Cl–) at 25°C (available in the
technical literature). These diagrams show that the path that the Cauchari brine would follow
during evaporation at 15°C, is closer to the phase diagram prediction, because of the high
sulphate content in the brine.
Correlations of the density and refractive index variation against the increase of Mg
concentration, as the brine is evaporated, were determined. A better fit was obtained for the
refractive index. This property could be used to control evaporation in solar ponds. However,
this may not be possible since the brine should be treated (with liming) at the beginning of the
evaporation process to remove the magnesium and also to significantly reduce the sulphate
content, which favors premature crystallization of lithium salts.
‐ 83 ‐

16 MINERAL RESOURCE ESTIMATE
16.1 Overview
An inferred in situ resource estimate was developed using the Vulcan three‐dimensional block
modelling software. The software was operated by Danilo Castillo, a specialist in Vulcan and
geostatistics at Maptek, in Santiago, Chile. The modelling was supported by geological,
hydrogeological and geochemical data and interpretations provided by the Project experts. The
modelling procedure and results were reviewed in detail by the independent QP and are
considered valid and appropriate for development of an inferred resource estimate, as defined
by the CIM and referenced by NI43‐101.
The modelling was conducted according to the following steps:
1. A conceptual geological model was developed to define the broad three‐dimensional zone
of the Olaroz and Cauchari Salars.
2. The conceptual geological model was discretized into a block model within the Vulcan
software.
3. A series of spatial constraints (e.g., claim boundaries, sampling depths, etc.) were applied to
the broad geological zone, in order to focus the estimate on the relevant parts of the zone.
4. The measured lithium brine concentrations from the RC Borehole Program were used to
discretize a three dimensional concentration field within the block model.
5. The porosity data from the DD Borehole Program were used to estimate representative
average drainable porosity values to apply within the block model.
6. The inferred resource estimate was developed for the focused zone.
7. An analysis was conducted to evaluate the effect of different grade cutoff values on the
estimate.
Additional detail is provided in the subsections below.
LAC has advised the QP that it is unaware of any environmental, permitting, legal, title,
taxation, socio‐economic, marketing or political factors, which are not already described in section
3 of this Report, that may materially affect the mineral resource estimate contained in this
Report.
16.2 Conceptual Geologic Model
A conceptual geologic model of the Olaroz and Cauchari Salars is described in Section 6.4, based
on geological interpretations, logs from the DD and RC programs (Sections 10.1 and 10.2), and
seismic data from the geophysical program (Section 9.3). A map of surface salar deposits is
shown in Figure 6.2 and an idealized section is shown in Figure 6.3. To support the
development of the three dimensional block model within Vulcan, a series of geological
‐ 84 ‐

sections were prepared, based on the conceptual geologic model. These sections delineate the
three main salar units described in Section 6.4, namely:
¾ Upper Mixed Sequence – This is the surface unit in the salars. It includes clays, thin
evaporite facies (sodium chloride, mirabilite, soda ash, etc.), carbonate facies, ulexite facies
and the coarse clastic sediments from the alluvial cones encroaching on the salar.
¾ Thin Bedded Sequence ‐ This unit is at intermediate depth and is composed of thinly bedded
clay, silt, sand and evaporite facies (mostly halite and gypsum). This sequence is coarser
grained than the UMS which is dominated by clay.
¾ Coarse Bedded Sequence – This is the bottom salar unit. It has not been fully penetrated by
the drilling conducted to date although the maximum penetrated thickness is substantial
(224 m at DD‐4). The lower boundary of this unit is based on geophysical interpretation.
The CBS consists of thick inter‐layered sand and evaporite (mostly halite) beds.
In addition to the three salar units described above, the Border Sequence was also represented
in the sections. This sequence is the inferred downward extension of alluvial and detritic
material, along the margins of the salar basin. Delineation of this unit is primarily based on
geological interpretation (Section 6.4). The Border Sequence is outside the zone used for the
inferred resource estimate, and often forms the boundary of the zone.
16.3 Block Model Construction
A Vulcan block model was developed to represent the conceptual geologic model, based on the
cross sections. The lateral extent of the block model is shown in Figure 16.1, and is similar to
the footprint of the salars, except that the block model is truncated along the major claim
boundary in the northwest. The block dimensions and orientation selected for the model are as
follows:
¾ x (east‐west) = 250 m;
¾ y (north‐south) = 250 m; and
¾ z (vertical) = 15 m.
The stratigraphic representation in the block model is shown in Figure 16.2, for an example
model section. The general distribution of the three salar units within the model domain is as
follows:
¾ UMS – upper unit; ranges from 0 m to 40 m in thickness;
¾ TBS – intermediate unit; ranges from 0 m to 176 m in thickness; and
¾ CBS – lower unit; ranges from 0 m to 500 m in thickness.
‐ 85 ‐

Figure 16.1: Plan view of the block model extent. Marker A‐B indicates the section shown in Figure 16.2.
‐ 86 ‐

Figure 16.2: Section showing stratigraphy within the block model, at the location shown on Figure 16.1
(Vertical exaggeration 400:1).
16.4 Resource Estimate Boundaries
The following series of spatial constraints were imposed within the model domain, to define the
final shape for the inferred resource estimate as shown in Figure 16.3:
¾ Claim boundaries – Areas outside the LAC claims (Figure 3.2) were excluded from the
resource estimate zone.
¾ Olaroz Salar – Olaroz was not included in the inferred resource estimate due to the extensive
lateral gap between boreholes PE‐7 and PE‐5 (12.5 km).
¾ Southern Cauchari Salar – The southern extent of Cauchari was not included in the inferred
resources estimate due to lack of drilling data. Borehole PE‐8 defines the southern limit of
the estimate area.
¾ Upper boundary – The upper boundary of the model coincides with the water table.
¾ Lower boundary ‐ The bottom of the resource estimation is defined by the total depth of the
boreholes within the estimate zone as follows: PE‐7: 249 m, PE‐6: 165 m, PE‐4: 187 m, PE‐9:
176 m and PE‐8: 194 m.
¾ Width – The width of the inferred resource estimate area does not exceed 2 000 m.
‐ 87 ‐

Figure 16.3: Lateral extent of the inferred resource estimation zone.
‐ 88 ‐

16.5 Drainable Porosity
The results of the drainable porosity test work are reported in Section 10.3. These values were
conservatively applied to the vertical drilling intersections of each lithological unit to calculate
average drainable porosity values for each model layer (UMS, TBS and CBS). Table 16.1 shows a
summary of the porosity model.
Table 16.1: Model layer porosity estimates.
Upper Mixed Sequence (UMS)
Drainable Porosity Drilling Intersection Model Layer Porosity

Lithology
% (m) %
Clay 3 138
Silt 12 15 5
Sand 20 8
Salt (solid halite) 5 4
Thin Bedded Sequence (TBS)

Lithology
% (m) %
Clay 3 110
Silt 12 58 11
Sand 20 165
Coarse Bedded Sequence (CBS)

Lithology
% (m) %
Clay 3 123
Silt 12 65 15
Sand 20 597
The result is that the UMS is assigned a drainable porosity of 5%, the TBS a drainable porosity of
11% and the CBS a drainable porosity of 15%.
‐ 89 ‐

16.6 Lithium Distribution
The methods and results of the brine sampling conducted as part of the RC Borehole Program
were described in Sections 10.1, 11.4 and 12.3. 760 brine samples were collected from the
nine RC boreholes (PE‐1 through PE‐9) at a target vertical interval of one metre. These data
were incorporated into the block model by calculating the average concentration of all samples
within the 15 m vertical block interval at a given borehole, and assigning that value to the block.
Concentrations were discretized throughout the model domain using an inverse distance
procedure.
Lateral lithium distribution within an example layer is shown in Figure 16.4 and example vertical
distributions are shown in Figure 16.5. The sections in Figure 16.5 demonstrate the relatively
homogeneous and continuous grade distributions at depth. Both figures illustrate the
distribution of higher grades in the northern section of the estimation zone relative to the
southern section.
Drift analysis was conducted to validate the block model and the use of the inverse distance
grid method for discretizing lithium distributions. Figures 16.6, 16.7, and 16.8 show a
comparison between lithium values assigned by the inverse distance method and values
assigned by the “nearest neighbour” (“NN”) method. This comparison indicates that the model
lithium grades are a reasonable representation of sampled grades.
‐ 90 ‐

Figure 16.4: Lateral lithium distribution in the inferred resource estimation zone of the block model,
at a model elevation of 3 940 masl; model sections A‐B and C‐D are provided in Figure
16.5.
‐ 91 ‐

Figure 16.5: Vertical lithium distributions in the resource estimation zone of the block model
(vertical exaggeration 1: 400; section locations are shown on Figure 16.4).
‐ 92 ‐

Figure 16.6: Drift analysis of the block model along the x‐axis.
Figure 16.7: Drift analysis of the block model along the y‐axis.
‐ 93 ‐

Figure 16.8: Drift analysis of the block model along the z‐axis.
16.7 Inferred In Situ Resource Estimation
The results of the inferred in situ lithium and potassium resource estimate are summarized in
Tables 16.2 and 16.3, respectively. Table 16.2 shows that the combined inferred resource from
the three model layers (CBS, TBS and UMS) is 926 000 tonnes of lithium metal or 4.9 million
tonnes of lithium carbonate.

Table 16.2: Inferred in situ lithium resource.
AVERAGE
CONCENTRATION MASS CUMULATED
PRODUCT Li (mg/L) Li (tonne) Li2CO3 (tonne)
CBS 570 814 000 4 296 000
TBS 663 85 000 451 000
UMS 633 27 000 141 000
TOTAL 584 926 000 4 888 000
‐ 94 ‐

Table 16.3 shows that the combined inferred potassium resource from the three model layers
(CBS, TBS and UMS) is 7.7 million tonnes.
Table 16.3: Inferred in situ potassium resource.
AVERAGE
MASS CUMULATED
CONCENTRATION
PRODUCT K (mg/L) K (tonne)
CBS 4 740 6 764 000
TBS 5 470 705 000
UMS 5 420 229 000
TOTAL 4 860 7 698 000
16.8 Cut off Analysis
An analysis was conducted to evaluate the effect of different grade cutoff values on the
inferred resource estimate; results are shown in Figure 16.9. This analysis shows that the
resource estimate is not sensitive to any cut off below 400 mg/L.
6.000.000
5.000.000
Li2Co3 (tonnes)
4.000.000
3.000.000
2.000.000
1.000.000
0
0 100 200 300 400 500 600 700 800 900
Lithium Cutoff (mg/L)
Li2CO3 tonnage
Figure 16.9: Lithium resource tonnage as determined by cutoff concentration.
‐ 95 ‐

17‐ OTHER RELEVANT DATA AND INFORMATION
Table 17.1 shows a comparison of selected lithium brine resources around the world.
Table 17.1: Comparison of selected lithium brine resources.
In Situ
Project Location Company County Resources
Salar de Atacama1 SCL Chile 500 000
Salar de Atacama1 Soquimich Chile 5 000 000
Xitai1 Qinghai China 500 000
Dongtai1 Qinghai China 1 300 000
Zabuye1 Zabuye China 1 530 000
Uyuni1 Comibol Bolivia 5 500 000
Silver Peak1 Rockwood USA 100 000
Salar de Hombre
FMC Argentina 850 000
Muerto1
Salar de Rincon1 Sentiment Group Argentina 1 403 000
Salar de Olaroz Orocobre Argentina 282 000
Salar de Cauchari LAC Argentina 926 000
1. Information from Roskill (2009).
‐ 96 ‐

18‐INTERPRETATION AND CONCLUSIONS
Drilling, sampling and geophysical work conducted by LAC on claim properties in the Olaroz and
Cauchari Salars have supported the development of this inferred resource estimate. The
following broad interpretations and conclusions from this work are as follows:
¾ The lithium and potassium resource described in this report occurs in a subsurface brine.
The brine is contained within the pore space of salar deposits that have accumulated in a
structural basin.
¾ A conceptual geologic model has been developed for the basin which includes three primary
salar units: the UMS, the TBS and the CBS. The CBS is the most vertically extensive unit and
has a relatively high porosity. Consequently, it contains the majority of the resource. The
salar deposits are constrained on the sides of the basin by alluvium and pediment‐type
deposits, known in this report as the Border Facies.
¾ The bottom boundary of the resource estimate has been constrained to the depth of drilling
conducted to date by LAC. The existing boreholes have not encountered the bottom of the
basin. Estimates from individual seismic lines indicate that the basin bottom is between 300
and 600 m, depending on location. The depths of the boreholes used in the inferred
resource estimate range from 176 to 249 m. Consequently, the resource remains open at
depth.
¾ The north and south lateral boundaries of the resource estimate (i.e., along the longitudinal
axis of the basin) have been constrained to the central cluster of boreholes drilled to date,
with relatively high concentrations at either end of this zone. Consequently, some extension
of the resource in these directions is possible, based on future drilling.
¾ The high dissolved solids content of the brines are a source of variability in the existing
analytical results. Additional analytical QA/QC refinement should be conducted in advance
of the next level of estimation. On balance, however, it is the opinion of the independent QP
that the existing brine dataset is acceptable for use in an inferred resource estimate.
¾ Extensive sampling indicates that the brine has a relatively low magnesium/lithium ratio
(lower than three, on average), suggesting that it would be amenable to conventional lithium
recovery processing. The brine is relatively high in sulphate which is also advantageous for
brine processing because the amounts of sodium sulphate or soda ash required for calcium
removal would be relatively low.
‐ 97 ‐

19 RECOMMENDATIONS
19.1 Objectives
Based on the results of the current inferred resource estimate it is recommended to continue
the investigation of the lithium development potential of the Cauchari‐Olaroz Project. This
recommended program consists of two main components as follows:
1. A hydrogeological component to further define the resource estimate and to evaluate
brine extractability and long‐term aquifer hydraulics.
2. A metallurgical component to develop a brine process flow sheet and to carry out pilot
scale process investigations.
Both components will be carried out in parallel to, in part, support the completion of a Project
pre‐feasibility study during 2011.
19.2 Hydrogeological Investigations
19.2.1: Resource Definition Drilling
Additional drilling will be required to further define the lithium resource of both salars. It is
recommended that both RC and DD borehole methods are continued. It is estimated that 35
to 40 boreholes are required to define the lateral extent of the lithium resource on the LAC
claims in both salars. Figure 19.1 shows the proposed borehole locations for the 2010
definition‐drilling program. Drilling depths are projected up to 350 m. Brine samples for
laboratory analysis will be collected at selected intervals during the RC drilling. Undisturbed
samples will be collected from the core‐drilling program for geotechnical analyses including
drainable porosity. On completion of drilling the core holes will be converted into observation
wells for future brine sampling and water level monitoring.
19.2.2 Pumping Tests
Based on the results of the resource definition‐drilling program a pumping test program will be
carried out to investigate brine extractability and dynamic aquifer behavior. It is proposed that
3 to 4 test production wells will be drilled and completed to depths of up to 300 m. The
location of the test production wells will be finalized after results of the resource‐drilling
program become available. A number of nested piezometers will be drilled around each
production well to carry out water level monitoring at different levels within the aquifer during
the tests.
It is proposed that pumping tests will be carried out in each test production well. These
pumping tests are to be carried out at a constant rate (25 L/s or more) over a period of 30‐days.
Groundwater levels will be monitored at specified intervals before, during and after each
pumping test. Brine samples will be collected periodically during the pumping tests from each
test well. It is expected that the test production well drilling and pumping test program will be
completed by the end of the fourth quarter of 2010.
‐ 98 ‐

Figure 19.1: The 2010 drill hole program is designed to increase the confidence level from the
current inferred in situ resource estimate to a measured in situ resource.
‐ 99 ‐

19.2.3 Geophysical Surveys
It is recommended that the seismic tomography surveys be continued to help further define
aquifer geometry and help correlate the continuity of hydrogeologic units between boreholes.
Additional east‐west and north‐south profiles are recommended across both salars.
19.2.4 Monitoring Programs
It is recommended that systematic monitoring programs be implemented for meteorology,
surface water flows and chemistry, groundwater levels and chemistry. A database should be
developed and maintained for data storage and analysis.
19.2.5 Revised Resource Estimate
The results of the above programs will be integrated and used to prepare a revised resource
estimate for the Project. The aim is to raise the resource confidence level so that a part of the
inferred resources may be upgraded to indicated or measured in situ resources. It is estimated
that a revised resource estimate could be developed by December 2010.
19.2.6 Long‐term Aquifer Response
On completion of the pumping test program a three‐dimensional, multi‐density fluid flow
model will be constructed and calibrated. The purpose of this flow model will be to evaluate
the long‐term behavior of the aquifer and lithium resource under pumping stresses and to
prepare an estimate of lithium recovery. The model will also be used to make an assessment
of boundaries and fresh water or barren brine inflows, and to design the layout of a potential
future production wellfield. The model will form the basis for the Project pre‐feasibility study
and assessment of reserves.
19.3 Brine Process Development
According to the chemistry of the Cauchari brine, its high sulphate content favours lithium
crystallization in a solar evaporation process. This fact was demonstrated in a simulated solar
evaporation test at 30°C and solubility tests at 15°C, carried out by the University of
Antofagasta. The precipitation of a lithium salt might begin at an earlier stage at the Project
site, where temperatures can be much lower than 15°C, particularly at night. However, any
crystallization will be governed by the phase chemistry at those conditions. Pan evaporation
test work is the approach generally used to study the behavior of the brine under the field
conditions, aimed at outlining a process flowsheet.
Although Cauchari has an Mg/Li ratio somewhat higher than Silver Peak (2.84 vs. 1.43), the
similarity of the chemistry of both brines indicates that, as a preliminary step, the conventional
lithium recovery process can be applied. In order to optimize the pan test work, the brine
should be pre‐treated at the beginning of the solar evaporation stages to first remove the
magnesium as Mg(OH)2 by liming and also to get a substantial removal of the sulphate ion
through the precipitation of gypsum by reaction with Ca++. The reduction of sulphate content in
‐ 100 ‐

the treated brine, which is accomplished in Silver Peak, will be possible because the average
molar ratio, SO4/(Mg+Ca), is much higher than one (2.42).
The treated brine will feed a set of pans, each three metres in diameter and 60 cm deep. Steel
is the preferred material of construction since it is difficult to accidentally puncture when the
salts are harvested. The pans will be operated in series and on a semi‐continuous basis, with
brine transferred one to three times per week, depending on the season, once the pans have
reached steady state. Lithium and boron as boric acid will be the tracers. Four pans are
estimated for the salt section to reach potash saturation and three for the muriate (KCl)
section, where glaserite and boron salts could also crystallize. One or two additional pans
would allow concentrating the brine to produce lithium concentrations of up to 8 000‐10 000
mg/L.
The pan test program is scheduled for at least one calendar year starting in late March or early
April. Evaporation test pans may limit the rate of experimental progress because of the time
required to get brines up to strength. In addition, it is necessary to know the effects of different
seasons on the evaporation rates. This period would be used to train staff.
It is considered that the pan test work would generate sufficient data for the chemical process
simulation in the solar evaporation ponds and the lithium carbonate plant. Therefore, it will
deliver the basic information for undertaking a Project prefeasibility study in 2011.
The next stage planned for process development is to start building the pilot plant and small
solar ponds by September 2010 to test the process at pilot scale. In addition to the pre‐
treatment of the Cauchari brine to feed the ponds, the pilot plant, which should be under
operation by early 2011, would include the last purification (basically boron removal) of the
lithium‐concentrated brine to be used for the lithium carbonate precipitation, by reaction with
a solution of sodium carbonate. This stage will allow evaluation of the expected efficiency of
the lithium recovery process.
Regarding a budget, an estimate for the next six months to set up and operate the test pans,
including pretreatment of brine, camp, power generation, infrastructure, advisors and the
establishment of an own‐certified laboratory would be on the order of USD 2.6 million. From
September 2010, a process simulation, continuation of the pan test work, construction of small
solar ponds (at least four of one hectare each), erection of the pilot process plant and building,
recruitment of engineers and consultants, as well as the operation of ponds and pilot plant and
preparation of a prefeasibility study in 2011 would require funding in the range of USD 12
million.
19.4 Budget Estimate
The estimated budget for completion of the hydrogeological investigations and the
metallurgical testing is summarized in Table 19.1. The total of these two components is
approximately USD 29.6 million without taxes.
‐ 101 ‐

Table 19.1: Estimated Budget.
Item Estimated cost (USD)
Resource definition drilling: 9 100 000
Test production well installations: 1 500 000
Multi level piezometer installations: 2 100 000
Laboratory analyses (brine and porosity): 1 000 000
Geophysics: 500 000
Site supervision and 3D model
800 000
development:
Evaporation test, laboratory, power: 2 600 000
Pilot process plant, engineering: 12 000 000
Estimated total: 29 600 000
‐ 102 ‐

20 REFERENCES
Referred to in Report
¾ APHA, AWWA, WEF, (1998), Standard methods for the examination of water and
wastewater. 20th Ed. Washington.
¾ Biancho, A.R., Yanez, C.E., Las Precipitaciones en el Noroeste Argentina, 20 Edicion INTA‐EEA
Salta, 1992
¾ CIM Standing Committee on Reserve Definition, CIM Definition Standards‐For Mineral
Resources and Mineral Reserves; 2005
¾ Cravero, F., Informe de Actividades realizadas en el Salar Cauchari‐Olaroz, Minera Exar S.A.,
LAC Internal Report, 2009a
¾ Cravero, F., Analisis Mineralogico de los Pozos 5 y 6, Salar de Olaroz. Comparación con los
Resultados de los Pozos 3 y 4, Salar de Cauchari., Minera Exar S.A. LAC Internal Report,
2009b
¾ Estudio de Abogados De Pablos. Title opinion. Buenos Aires November 13, 2009.
¾ Helvaci, C., Alonso, R.N.; Borate Deposits of Turkey and Argentina;a summary and geological
comparison. Turkish Journal of Earth Sciences Vol 9, pp1‐27, 2000
¾ Peralta, E and others; Regional geology in the vicinity of the Olaroz‐Cauchari Salars, 2009
¾ Peralta, E and others: Local geology of the Olaroz – Cauchari Salars, 2009
¾ Roskill; The Economics of Lithium, 2009
Background References
¾ Esteban Carlos Luis. “Estudio geologic y evapofacies del salar Cauchari, departamento
Susques, Jujuy”. Universidad Nacional de Salta, Tesis professional, Salta 2005.
¾ Freeze R.A., Cherry J.A., Groundwater, Prentice‐Hall Inc, 1979.
¾ Koorevaar P., Menelik G., Dirksen C., Elements of Soil Physics, Elsevier, 1983.
¾ Kunaz, I., Cauchari and Incahuasi Argentine Salars Assessment and Development. Internal
report by TRU group for Lithium Americas Corp.; 2009.
¾ Kunaz, I., Evaluation of the Exploration Potential at the Salares de Cauchari and Olaroz,
Province of Jujuy, Argentina. Internal report by TRU group for Lithium Americas Corp.; 2009.
¾ Latin American Minerals. “Informe de impacto ambiental, etapa de exploracion proyecto
Olaroz – Cauchari”. 2009.
‐ 103 ‐

¾ Lic. Echenique Mónica, Lic. Agostino Gilda, Lic Zemplin Telma. “Plan de relaciones
comunitarias”. Jujuy 2009.
¾ Dr. Nicolli Hugo B. “Geoquimica de aguas y salmueras de cuencas evaporaticas de la Puna”.
Anal. Acad. Nac. Cs. Ex. Fís. Nat. Buenos Aires, Tomo 33, 1981.
¾ Schalamuk Isidoro, Fernandez Raúl y Etcheverry Ricardo. “Los yacimientos de minerals no
metalíferos y rocas de aplicacion de la region NOA”. Ministeria de Economía, Subsecretaría
de Minería, Buenos Aires 1983.
¾ Autor desconocido. “Estudio geologic‐económico, mina La Yaveña, departamento de

Susques de Jujuy”. Jujuy 2000.
‐ 104 ‐

22 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT PROPERTIES
AND PRODUCTION PROPERTIES
NOT APPLICABLE
‐ 107 ‐

23 ILLUSTRATIONS
ILLUSTRATIONS ARE LOCATED WITH THE BODY OF THE TEXT. SEE THE LIST OF FIGURES AND
PHOTOS AT THE BEGINNING OF THIS REPORT.
‐ 108 ‐

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INFERRED RESOURCE ESTIMATION OF LITHIUM AND

5‐ HISTORY .................................................................................................................................... 19

3.1 Status of Minera Exar S.A. mineral claims on the Cauchari and Olaroz Salars ................... 10

6.1 Boundary between Cauchary and Olaroz Salars ................................................................. 22

Groundwater discharge takes place through evaporation, evapotranspiration and discharge

Salar de Hombre Salar de Salar del Zhabuye Salar de

K 0.53 1.85 0.617 0.42 0.656 2.64 0.72

Li 0.023 0.150 0.062 0.051 0.033 0.097 0.035

Mg 0.03 0.96 0.085 0.145 0.303 0.001 0.65

Ca 0.02 0.031 0.053 0.033 0.059 0.007 0.046

SO4 0.71 1.65 0.853 1.57 1.015 5.24 0.85

Cl 10.06 16.04 15.80 14.86 16.06 12.16 15.69

HCO3 n.a. traces 0.045 0.067 0.030 5.679 0.040

B 0.008 0.064 0.035 0.112 0.040 0.286 0.02

Density n.a. 1.223 1.205 1.215 1.220 1.297 1.211

Mg/Li 1.43 6.40 1.37 2.84 9.29 0.01 18.6

K/Li 23.04 12.33 9.95 8.24 20.12 27.21 20.57

SO4/Li 30.87 11.0 13.76 30.78 31.13 54.02 24.28

SO4/Mg 23.67 1.72 10.04 10.83 3.35 5240 1.31

SO4/K 1.34 0.89 1.38 3.74 1.55 1.98 1.18

Lithology Number of samples Avg. Drainable Porosity (%)

Clay 10 3.2

Silt 23 12.0

Sand 49 25.5

Salt (semi‐consolidated/porous) 25 26.8

Element R2 Pairs M Error (m) B Error (b) Bias

K (mg/L) 0.86369 19 0.97782 0.04944 ‐34.3162 545.193 2.22%

Li (mg/L) 0.93426 19 1.09238 0.07028 ‐67.039 48.438 9.24%

Mg (mg/L) 0.843118 19 0.89326 0.09345 193.13 155.882 10.37%

Plot of Fitted Model

Plot of Fitted Model

Plot of Fitted Model

Laboratory Na K Li Ca Mg Cl SO4 B Density

4 4 725.6 901.9 2 564.5 1 259

K 1.36 1.98 4.21 3.67 2.92

Li 0.14 0.23 0.43 0.50 0.57

SO4 5.46 8.21 9.92 10.02 9.42

B4O7 0.17 0.32 0.65 0.34 0.11

Refractive Index (25°C) 1.3844 1.3881 1.3892 1.3946 1.3978

K 0.18 0.34 0.70 9.63 9.64

Li 0.02 0.03 0.20 0.77 0.93

Ca 0.090 0.070 0.026 0.001 0.01

B4O7 0.03 0.06 0.09 2.05 1.22

H3BO3 0.19 0.29 0.44 8.32 5.52

% % % % % Anion‐

NaCl 14.13 21.79 38.21

Na2SO4x3K2SO4 (4) 0.93 4.77 7.81 14.38

MgSO4xK2SO4x6H2O 1.35 0.42 3.32 1.87 7.40

LiKSO4 2.17 0.39 5.33 8.39

KB5O8x4H2O (6) 1.22 6.19 2.25 10.28

Drainable Porosity Drilling Intersection Model Layer Porosity

Silt 12 15 5

Drainable Porosity Drilling Intersection Model Layer Porosity

Silt 12 58 11

Sand 20 165

Drainable Porosity Drilling Intersection Model Layer Porosity

Silt 12 65 15

Sand 20 597

PRODUCT Li (mg/L) Li (tonne) Li2CO3 (tonne)

CBS 570 814 000 4 296 000

TBS 663 85 000 451 000

UMS 633 27 000 141 000

TOTAL 584 926 000 4 888 000

PRODUCT K (mg/L) K (tonne)