Quarterly Activities and Cash Flow Report

The Board of Galan Lithium Limited (Galan or the Company) is pleased to provide this Quarterly Activities Report for the quarter ended 31 December 2023 and to the date of this report. The main focus for the quarter was the ongoing construction works/activities and the securement of an offtake agreement for Phase 1 production at the Company’s 100% owned, high-grade/low-impurity Hombre Muerto West (HMW) Project in the Catamarca Province, Argentina.

Hombre Muerto West (HMW)

• HMW Project is a low cost, tier one project that will produce a premium high grade lithium chloride (LiCl) concentrate of 6% Li, comparable to 13% Li2O or 32% Lithium Carbonate Equivalent (LCE) in H1 2025
• Operating cost of $US3,510/t LCE equates to a Li2O equivalent operating cost of SC6 $US310/t-$US350/t; HMW in the 1st quartile of lithium industry’s cost curve
• Pond 1 liner installation rapidly moving forward (50% completion)
• Buffer wall installed at 35% mark of Pond 1; filling ongoing
• Evaporation process has commenced; the first major step of the long- term production schedule
• Pond 2 earthworks construction progressing well (30% completion)
• Phase 1 Glencore production offtake due diligence ongoing; site visit completed
• Phase 2 production offtake discussions advancing
• On-site laboratory commissioned for ongoing Li assaying
• Phase 2 EIA lodged with Catamarca Government
• 9 production wells constructed (works ongoing); Phase 1 production only requires 6 wells
• Galan’s robust 4 phase production strategy (up to 60ktpa LCE) provides an exceptional foundation for significant future economic upside
• Current resource 6.6Mt LCE @ 880 mg/L Li (72% in Measured category); updated resource estimate due in Q1 2024

Greenbushes South

• Further drill program planned for late Q1 or early Q2, 2024

Corporate:

• Cash and investments at the end of quarter ≈A$19 million
• A$19.5 million Equity Raising announced 31 January 2024

Hombre Muerto West (100% Galan)

As previously announced, the HMW project was separated into four production phases. The initial Phase 1 Definitive Feasibility Study (DFS) focused on the production of 5.4ktpa LCE of a lithium chloride concentrate by H1 2025, as governed by the approved production permits. The Phase 2 DFS targets 21ktpa LCE of a lithium chloride concentrate in 2026, followed by Phase 3 production of 40ktpa LCE by 2028 and finally a Phase 4 production target of 60ktpa LCE by 2030. Phase 4 will include lithium brine sourced from both HMW and Galan’s other 100% owned project in Argentina, Candelas. For details surrounding the very positive Phase 2 DFS results please refer to the ASX announcement released on 3 October 2023 (https://wcsecure.weblink.com.au/pdf/GLN/02720109.pdf).

Figure 1 – Overview of HMW Phase 1 project construction (includes camp, pilot plant and filling of Pond 1 in the background)

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