Chairman’s letter to Shareholders: Simon Linge commences as CEO

Dear Shareholders

The 2022 calendar year has been a transitional one for Lithium Australia Limited (ASX: LIT) (the Company). We started the year as a no liability Company and finished as a limited liability Company, recently updating our classification from exploration to materials. This is driven by the increased focus towards battery materials technology and manufacturing delivered primarily through Battery Recycling (Envirostream) and Cathode Materials (VSPC).

The renewed priorities for the Company are summarised as:

• Battery Recycling: optimise existing capacity through increased volumes and process flowsheet optimisation, expand national infrastructure and seek international partnerships.
• Cathode Materials: Pursue offtake and joint development partners for lithium ferro phosphate (‘LFP’) manufacturing.

Over the past six months much progress has been made against the above priorities. We recognise there is more to be done and we welcome Simon Linge as CEO to lead the team as we continue to deliver against these priorities. We also obtained funding to enable delivery against our goals.

In 1926 Henry Ford said, “Industry owes it to society to conserve materials in every possible way. Not only for the element of cost in the manufactured article, although that is important, but mostly for the conservation of those materials whose production and transportation are laying an increasing burden on society.”

We believe in the above philosophy and as we strive for a cleaner world, through the electrification of our transportation system and storing electricity generated by renewables, we need to ensure we recycle and reuse our precious resources, including lithium, cobalt, copper, and graphite in our lithium batteries.

Since June 2022, Envirostream has significantly increased collection volumes with the notable achievements of securing a minimum 250 tonnes of lithium-ion batteries from LG Energy Solution and signing Battery World as a collection partner - similar to prior agreements with Bunnings Warehouse and Officeworks. Higher sale prices have been achieved for mixed metal dust (‘MMD’) through the diversification of customers.

Envirostream is now working on continuous improvements to operating processes to enhance system efficiencies ahead of further expected volumes. In parallel, a national infrastructure expansion plan has been initiated.

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