Non-binding understanding contemplates multi-year supply of battery-grade lithium carbonate to support Epsilon CAM’s growing cathode materials business

Company Website: https://www.e3lithium.ca/
CALGARY, Alberta & MUMBAI, India -- (Business Wire)

E3 LITHIUM LTD. (TSXV: ETL) (FSE: OW3) (OTCQX: EEMMF), "E3", "E3 Lithium" or the "Company," a leader in Canadian lithium development, has entered into a non-binding Memorandum of Understanding (the "MOU") with Epsilon CAM Pvt. Ltd. ("Epsilon"), a developer and manufacturer of Lithium Iron Phosphate (“LFP”) based Cathode Active Materials ("CAM") for lithium-ion batteries. The MOU, effective September 1, 2026, outlines the framework for potential long-term supply of battery-grade lithium carbonate from E3's Clearwater Project.

The MOU contemplates the potential supply of maximum up to 5,000 tonnes per year of battery-grade lithium carbonate over a five-year term, representing up to 40% of E3 Lithium’s proposed Stage 1 production of 12,000 tonnes per year from the Clearwater Project. Final volumes and commercial terms would be established as the parties progress towards a definitive agreement.

This understanding strengthens Epsilon’s strategy to build a geographically diversified and resilient battery materials supply chain. Epsilon’s Gen III LFP is already progressing with global customer validations, while the company is building a 30,000 tonnes per year cathode materials facility with Phase 1 completion by early 2028. The potential supply of battery-grade lithium carbonate from E3 Lithium’s Clearwater Project would add a new source of this critical raw material to the supply chain.

“Securing long-term offtake contracts is a critical commercial milestone required to advance the Clearwater Project," said Chris Doornbos, CEO & Chair of E3 Lithium. "This MOU with Epsilon demonstrates a serious interest and draws a clear path from Alberta brine directly into the battery supply chain. We look forward to advancing our negotiations and relationship with Epsilon as our Clearwater Project moves toward shovel-ready."

Vikram Handa, Managing Director of Epsilon CAM, said, “The electric mobility growth requires a battery materials supply chain that is resilient, diversified and globally connected. Our engagement with E3 Lithium strengthens this approach as we progress towards commercialization in India with a 30,000 tonnes cathode materials facility. This is also a great opportunity to connect upstream lithium resources in Canada with downstream cathode active material production in India, for development of a more diversified battery materials & battery value chain.”

The terms of the MOU are likely to follow industry standards for offtake and follow a predictable path towards a definitive agreement seen within the industry. Generally, as the Company continues to execute on permitting, advancing Demonstration, and moving closer to completing its Feasibility Study, E3 expects agreements to finalize as the Project advances toward FID.

About Epsilon Cathode Active Materials (ECAM)

Established in 2023, Epsilon Cathode Active Materials specializes in the development and commercial production of Lithium Iron Phosphate (LFP) Cathode Active Materials. The company's ISO 9001-certified Cathode Technology Centre in Moosburg, Germany has a portfolio of 149 patents in next-generation cathode technologies, a 250-ton commercial demonstration plant, and advanced cell testing capabilities, positioning ECAM as one of the few organizations conducting serious cathode materials R&D at commercial scale.

With its R&D foundation in Germany, ECAM is ready for commercial scale Cathode Active Material facility, with 30,000 tons per annum capacity by 2028 in India. This shows the company's broader commitment to building a resilient, geographically diversified, and sustainable battery materials ecosystem for the global EV and energy storage industries.

For more information, visit www.epsilonam.com/cathode.html

Media Contact: Sandeep Kumar - sandeep.kumar@epsiloncarbon.com

About E3 Lithium

E3 Lithium is a development company with a total of 21.2 million tonnes (Mt) of lithium carbonate equivalent (LCE) Measured and Indicated mineral resources as well as 0.3 Mt LCE Inferred mineral resources in Alberta, comprised of (a) Measured and Indicated mineral resources of 16.2 Mt lithium at a grade of 75.5 mg/L within its Clearwater Project¹ and (b) Measured and Indicated mineral resources of 5.0 Mt lithium at a grade of 54.0 mg/L lithium and Inferred mineral resources of 0.3 Mt lithium at a grade of 42 mg/L lithium within its Garrington District². The Clearwater Pre-Feasibility Study outlined a 1.13 Mt LCE proven and probable mineral reserve at a grade of 75.5 mg/L lithium, with a pre-tax NPV(8%) of USD 5.2 Billion with a 29.2% IRR and an after-tax NPV(8%) of USD 3.7 Billion with a 24.6% IRR¹.

1. The technical report titled “Clearwater Project, NI 43-101 Technical Report on Pre-Feasibility Study, Bashaw District Mineral Property, Central Alberta, Canada”, with an effective date of June 20, 2024, is available on the E3 Lithium’s website (www.e3lithium.ca/technical-reports/) and under E3 Lithium’s profile on SEDAR+ (www.sedarplus.ca).
2. The technical report titled “NI 43-101 Technical Report for the Garrington District Lithium Resource Estimate”, with effective date of June 25, 2025, is available on the E3 Lithium’s website (www.e3lithium.ca/technical-reports/) and under E3 Lithium’s profile on SEDAR+ (www.sedarplus.ca).

Unless otherwise indicated, Chris Doornbos, P. Geo., Chief Executive Officer and a Qualified Person under National Instrument 43-101, has reviewed and approved the technical information contained on this news release.

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.

Forward-Looking and Cautionary Statements

This news release includes certain forward-looking statements as well as management's objectives, strategies, beliefs and intentions or forward-looking information within the meaning of applicable securities laws. Forward-looking statements are frequently identified by such words as "believe", "may", "will", "plan", "expect", "anticipate", "estimate", "intend", "project", "potential", "possible" and similar words referring to future events and results. Forward-looking statements are based on the current opinions, expectations, estimates and assumptions of management in light of its experience, perception of historical trends, and results of the PFS, but such statements are not guarantees of future performance. In particular, this news release contains forward-looking information relating to: the potential outcomes of the non-binding MOU with Epsilon, including whether the parties will negotiate and enter into a definitive agreement and the timing thereof; the contemplated supply of up to 5,000 tonnes per year of battery-grade lithium carbonate over a five-year term, and whether any such volume will form part of a definitive agreement; the expectation that the contemplated volume could represent up to 40% of the Clearwater Project's proposed Stage 1 production of 12,000 tonnes per year; the proposed Stage 1 production rate of 12,000 tonnes per year and the Company's ability to produce battery-grade lithium carbonate from the Clearwater Project; the establishment of final volumes and commercial terms as the parties progress toward a definitive agreement; the expectation that the terms of any definitive agreement would follow industry-standard offtake terms and a predictable path to completion; the expectation that agreements would be finalized as the Clearwater Project advances toward FID, tied to continued execution on permitting, advancement of the Company's Demonstration Facility and completion of the Feasibility Study; the timing and completion of the Feasibility Study and the receipt of required permits and regulatory approvals; the expectation that the Clearwater Project will advance toward shovel-ready status and FID; the expectation that lithium carbonate supplied from the Clearwater Project would add a new source of critical raw material to the battery supply chain and support a more diversified and resilient supply chain connecting upstream lithium resources in Canada with downstream cathode active material production in India; statements regarding Epsilon, including the progress of global customer validations for its Gen III LFP product, the construction of its 30,000 tonnes per year cathode materials facility and Phase 1 completion by early 2028, and its progress toward commercialization in India; the estimated mineral resources and mineral reserves at the Clearwater Project and the Garrington District, including grades and contained LCE; the results of the Clearwater Pre-Feasibility Study, including the estimated pre-tax and after-tax NPV and IRR and the assumptions underlying those estimates; and the inherent hazards associated with mineral exploration and mining operations.

All forward-looking information (including future-orientated financial information) is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the non-binding nature of the MOU and that there is no guarantee that the parties will enter into a definitive agreement; 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, risks related to the availability of financing on commercially reasonable terms and the expected use of proceeds; operations and contractual obligations; changes in estimated mineral reserves or mineral resources; future prices of lithium and other metals; availability of third party contractors; availability of equipment; failure of equipment to operate as anticipated; accidents, effects of weather and other natural phenomena and other risks associated with the mineral exploration industry; the Company's lack of operating revenues; currency fluctuations; risks related to dependence on key personnel; estimates used in financial statements proving to be incorrect; competitive risks and the availability of financing, as described in more detail in our recent securities filings available under the Company's profile on SEDAR+ (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.

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Contacts:

E3 Lithium - Investor Relations
investor@e3lithium.ca
587-324-2775

E3 Lithium - Media Inquiries
communications@e3lithium.ca
587-324-2775

Source: E3 LITHIUM LTD.