HMW Pond 1 Earthworks and Liner Installation Completed, Evaporation Process Commenced

Galan Lithium Limited (ASX:GLN) (Galan or the Company) is pleased to provide a further update on the progress of construction activities at its 100% owned Hombre Muerto West (HMW) Phase 1 lithium brine project, with lithium chloride production expected in H1 2025. Galan continues its steady progress in advancing its low cost, high grade HMW project to production in a timely manner.

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Pond 1 earthworks and liner installation (2.4kms in length) now completed;Filling of the remainder of pond 1 is currently underway; evaporation process commenced, being the first major step of Galan’s long-term production schedulePond 2 earthworks construction progressing well (65% completed), liner installation to commence next week9 production wells constructed offering operational flexibility; Phase 1 production only requires 6 wellsHMW Project is a 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 2025Low all-in sustaining costs; HMW is in the 1st quartile of lithium industry’s cost curve with an initial reserve estimate of 40 yearsOperating cost of $US3,510/t LCE equates to a low Li2O equivalent operating cost of SC6 $US310/t-$US350/t; equates to solid production margins at current spot pricesGlencore due diligence continues

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. The very positive Phase 2 DFS results were announced on 3 October 2023 (https://wcsecure.weblink.com.au/pdf/GLN/02720109.pdf).

Galan’s Managing Director, Juan Pablo (JP) Vargas de la Vega, commented:

“The completion of earthworks and the installation of liners for Pond 1 represents a significant milestone for the HMW Phase 1 construction team. Evaporation has now commenced which is the first step of the Company’s long-term production schedule for its low-cost, low-risk lithium chloride development strategy, as Galan looks to become the next lithium producer in Argentina in H1 2025.”

Construction progress at HMW (February 2024)

The brine well field is located in the same area as the HMW ponds system. The well field for Phases 1 and 2 are exclusively located in the Rana de Sal, Del Condor, Deceo III, Pata Pila, Casa del Inca III & IV, and Santa Barbara XXIV mining tenements. The HMW Project also has several tenements (including Catalina) with potential to further increase the quantity and quality of the brine resources, which may result in additional production.

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