Lake Resources Provides Operational Update

SYDNEY, July 1, 2024 — Lake Resources N.L.(“Lake” or the “Company”) announces today an operational update regarding the Company’s plan to optimize its financial runway and maximise the value of the Kachi project (“Kachi”).


“We continue to engage with interested parties as part of the strategic partnering process for Kachi,” said David Dickson, Managing Director and Chief Executive Officer of Lake Resources. “We, along with industry analysts across the sector, see a structural deficit of battery-grade lithium in the next five years. Because of that, we are taking all necessary actions to secure our financial flexibility, ensuring we maximise value for our shareholders from the Goldman led strategic process.”

Update on the Strategic Partnering Process

Since the last update (refer to 4 March 2024 ASX announcement), the Company has progressed from reviewing a broad range of potential partners to participating in detailed discussions with a select group of interested parties. The Company is focused on ensuring that the process maximises Kachi’s value, which it believes will take longer than initially expected due to current macro environment conditions.

To support the value of the strategic partnering process, the non-binding Conditional Framework Agreements entered into in late 2022 with WMC Energy B.V. and SK On Co., Ltd. (refer to 5 October 2022 and 10 October 2022 ASX announcements, respectively) are not being progressed. Rather, the Company is focusing on the competitive strategic partnering process to secure equity investment and offtake agreements.

Non-Core Asset Sale Process

Lake is managing an ongoing process for the potential sale of non-core assets and lithium tenements located in Jujuy and Catamarca Provinces; namely Paso de Jama, Olaroz, Cauchari and Ancasti.

“These assets, while non-core to Lake’s strategy, are strategically located within the Lithium Triangle and offer exploration and development potential in close proximity to other known lithium resources,” Mr. Dickson said. “In order to focus our efforts on making Kachi a success, we believe the timing is right for marketing the sale of these assets, which is part of our plan to optimise the Company’s financial runway. This supports the work we have done over the past 18 months and the successful completion of the Definitive Feasibility Study showing that Kachi is a globally significant, tier-one project.”

Proactive Plan to Significantly Reduce Costs

In addition, the Company is implementing operating cost initiatives to right-size its headcount and expenditure level, without impact to ongoing strategic priorities for Kachi, which include:

  • Reduction of more than 50 percent of global headcount, including staggered exits over several months of six members of the Company’s executive team and additional rationalization of and decrease in general and administrative expenses. These actions are in addition to the approximate 50 percent reduction in non-core operational and administrative workforce announced in March 2024 (refer to 4 March 2024 ASX Announcement); and
  • Voluntary deferral of a significant portion of the CEO’s base salary.

These actions are not expected to impact Lake’s ongoing strategic priorities for Kachi, including: the outcome of the Environmental Impact Assessment; the advancement of work on the power solution with YPF Luz; the strategic partnering process; or the strong relationships the Company has built with the surrounding communities.

Strong Cash Position

As reported in the Company’s most recent quarterly 5B (refer to 28 April 2024 ASX announcement), Lake’s cash balance as of 31 March 2024, was A$30.8 million (excluding the A$1.5 million from the Share Purchase Plan, which closed on 18 April 2024). With the benefit of a significantly smaller organization and additional reductions in expenditures, consumption of cash reserves is expected to reduce as we progress through the second half of 2024.