E3 Lithium and Imperial Finalize Freehold Mineral Land for E3’s Clearwater Project

Rhea-AI Summary

E3 Lithium (TSXV: ETL, OTCQX: EEMMF) has finalized rights and agreements with Imperial Oil for freehold mineral tenure for its Clearwater Project. The Project Completion Agreement dated February 28, 2025, provides E3 with a mineral lease covering 110 sections of Imperial's freehold interest.

The lease features a 10-year primary term with a renewable 10-year term. The agreement includes the cancellation of 3,413,979 warrants granted to Imperial at C$1.86 per warrant, with E3 paying C$4,150,000 in three installments over 2025's first three quarters.

Following E3's successful pilot operations in 2023, the company plans a demonstration program for 2025. This agreement strengthens E3's position in developing lithium production in Alberta and advancing the Clearwater Project, which aims to establish Alberta as a key player in the global lithium supply chain.

Positive

• Secured long-term mineral rights for 110 sections of land
• Successfully completed pilot operations in 2023
• Strategic partnership with major energy company Imperial Oil

Negative

• C$4.15M cash payment required over three quarters in 2025

Insights

Financial Analyst

E3 Lithium's formalization of freehold mineral rights with Imperial Oil represents a significant strategic development that materially advances its Clearwater Project. The secured 110-section mineral lease provides long-term operational certainty with its initial 10-year term and renewable 10-year extension.

The financial structure of the deal reveals important insights: E3 will pay C$4,150,000 over three quarterly installments in 2025 to cancel 3,413,979 warrants previously issued to Imperial at C$1.86 per warrant. This transaction effectively removes potential future dilution while establishing a clear payment framework that appears manageable for a company with E3's market capitalization ($48.2 million).

What makes this agreement particularly valuable is how it consolidates E3's control over critical mineral resources needed for lithium production. For a development-stage company, securing these mineral rights eliminates a significant project execution risk and strengthens E3's position for raising capital for future development phases, including the planned 2025 demonstration program that follows their successful 2023 pilot operations.

The timing is strategically aligned with growing demand for domestic lithium production, with Alberta positioning itself as a potential hub in the global lithium supply chain. While execution risks remain, this agreement removes a major uncertainty from E3's development pathway.

Resources Industry Analyst

This agreement between E3 Lithium and Imperial represents a important advancement in resource security for E3's Clearwater Project. By obtaining mineral leases for 110 sections of freehold interest, E3 has secured a substantial land position - critical in the resource sector where controlling the underlying mineral rights is fundamental to project development.

The structure as a long-term lease with a 10-year primary term plus renewable 10-year term provides E3 with the operational timeline necessary for lithium development, which typically requires extensive periods from exploration through production. This tenure arrangement gives E3 the security needed to advance through demonstration to commercial production phases.

Particularly noteworthy is how this agreement builds upon E3's 2023 pilot operations successes. The company is utilizing Direct Lithium Extraction (DLE) technology to extract lithium from the Leduc reservoir - leveraging existing oil and gas infrastructure in Alberta. This approach differentiates E3 from traditional hard-rock or evaporative lithium producers by potentially offering faster development timelines and smaller environmental footprints.

The agreement's structure - replacing warrants with defined cash payments - demonstrates Imperial's continuing confidence in the project while simplifying E3's capital structure. For E3, having a major player like Imperial providing this level of support enhances project credibility as they move toward their 2025 demonstration program, which will be important for validating their extraction technology at larger scale.

CALGARY, Alberta--(BUSINESS WIRE)-- E3 LITHIUM LTD. (TSXV: ETL) (FSE: OW3) (OTCQX: EEMMF), “E3 Lithium” or the “Company,” a leader in Canadian lithium, announced today it has finalized the rights and agreements for freehold mineral tenure held by Imperial Oil Limited (TSX:IMO) (NYSE:IMO), “Imperial” for the E3 Clearwater Project.

The companies have entered into a Project Completion Agreement dated February 28, 2025, 2025 (the “Project Completion Agreement”) to finalize the rights and lease agreements for the freehold mineral tenure held by Imperial for E3’s use in its Clearwater Project, pursuant to the Strategic Agreement dated June 22, 2022 and amended May 9, 2024 (the “Strategic Agreement”).

As set out in the Strategic Agreement, Imperial has provided a mineral lease for 110 sections of the Imperial freehold interest in the area of the Clearwater Project. The long-term lease has a 10-year primary term with a renewable 10-year term on the mineral title. The Project Completion Agreement supersedes the Strategic Agreement and includes the cancellation of 3,413,979 warrants granted to Imperial at a pre-paid price of C$1.86 per warrant upon the payment by E3 of cash consideration in the aggregate amount of C$4,150,000. This amount will be payable in three installments over the first three quarters of 2025, with the warrants being cancelled in proportion to the installment payments.

E3 Lithium continues to build strong partnerships that are essential for driving success. E3’s success on the pilot operations in 2023 has further bolstered the progress of E3’s technology towards the demonstration program planned for 2025. The freehold mineral tenure for the Clearwater Project will allow E3 Lithium to build upon the success of the pilot operations as it looks to achieve its corporate and strategic goals of building lithium production in Alberta.

“This milestone underscores the strong relationship between Imperial and E3 Lithium,” said Chris Doornbos, CEO of E3 Lithium. “It supports the interests of both companies while continuing to drive the success of E3’s Clearwater Project and Alberta’s position in the global lithium supply chain.”

“Imperial’s successful collaboration with E3 Lithium has been instrumental in advancing E3’s lithium extraction pilot and progressing opportunities from the Leduc reservoir,” said Heather Eggleston, Imperial Vice-President of Low Carbon Solutions. “Imperial’s contribution of its freehold land leases provides further support for E3 Lithium’s Clearwater Project and their overall lithium development in Alberta.”

The Clearwater Project is a transformative opportunity for Alberta’s critical minerals sector; by leveraging advanced extraction technologies and decades of energy expertise, E3 Lithium is positioned to be a global leader in lithium development.

ON BEHALF OF THE BOARD OF DIRECTORS
Chris Doornbos, President & CEO
E3 Lithium Ltd.

About E3 Lithium

E3 Lithium is a development company with a total of 16.2 million tonnes of lithium carbonate equivalent (LCE) Measured and Indicated ¹ as well as 0.9 million tonnes LCE Inferred mineral resources² in Alberta and 2.5 million tonnes LCE Inferred mineral resources³ in Saskatchewan. The Clearwater Pre-Feasibility Study outlined a 1.13 Mt LCE proven and probable mineral reserve with a pre-tax NPV8% of USD 5.2 Billion with a 29.2% IRR and an after-tax NPV8% of USD 3.7 Billion with a 24.6% IRR¹. E3 Lithium’s goal is to produce high purity, battery grade lithium products to power the growing electrical revolution. With a significant lithium resource and innovative technology solutions, E3 Lithium has the potential to deliver lithium to market from one of the best jurisdictions in the world.

1: The Clearwater Pre-Feasibility Study (“PFS”) news release dated June 26, 2024 is available on the E3 Lithium’s website (e3lithium.ca/newsroom/news-releases/) and SEDAR+ (www.sedarplus.ca).

2: The mineral resource NI 43-101 Technical Report for the North Rocky Property, effective October 27, 2017, identified 0.9 Mt LCE (inferred) and is available on the E3 Lithium’s website (e3lithium.ca/technical-reports) and SEDAR+ (www.sedarplus.ca).

3: The mineral resource NI 43-101 Technical Report for the Estevan Lithium District, effective May 23, 2024, identified 2.5 Mt LCE (inferred) and is available on the E3 Lithium’s website (e3lithium.ca/technical-reports) and SEDAR+ (www.sedarplus.ca).

Forward-Looking and Cautionary Statements

This news release includes certain forward-looking statements as well as management’s objectives, strategies, beliefs and intentions. Forward-looking statements are frequently identified by such words as “may”, “will”, “plan”, “expect”, “anticipate”, “estimate”, “intend” and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the speculative nature of mineral exploration and development, fluctuating commodity prices, the effectiveness and feasibility of emerging lithium extraction technologies which have not yet been tested or proven on a commercial scale or on the Company’s brine, competitive risks and the availability of financing, as described in more detail in our recent securities filings available at www.sedarplus.ca. Actual events or results may differ materially from those projected in the forward-looking statements and we caution against placing undue reliance thereon. We assume no obligation to revise or update these forward-looking statements except as required by applicable law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250303344919/en/

E3 Lithium - Investor Relations

Alexis de la Renaudiere

Investor Relations

investor@e3lithium.ca

587-324-2775

E3 Lithium - Media Inquiries

Kati Dolyniuk

External Relations

communications@e3lithium.ca

587-324-2775

Source: E3 Lithium Ltd.

FAQ

What are the key terms of E3 Lithium's (EEMMF) mineral lease agreement with Imperial Oil?

The agreement includes a 110-section mineral lease with a 10-year primary term and renewable 10-year term, plus the cancellation of 3.4M warrants for C$4.15M paid in three installments.

How much will E3 Lithium (EEMMF) pay to cancel Imperial's warrants in 2025?

E3 Lithium will pay C$4,150,000 in three installments over the first three quarters of 2025 to cancel 3,413,979 warrants at C$1.86 per warrant.

What is the timeline for E3 Lithium's (EEMMF) Clearwater Project development?

Following successful pilot operations in 2023, E3 Lithium plans to implement a demonstration program in 2025.

How does the Imperial Oil agreement impact E3 Lithium's (EEMMF) Clearwater Project?

The agreement secures essential mineral rights for the project's development, strengthening E3's ability to advance lithium production in Alberta.