The Kathleen Valley Lithium Project is located on the western edge of the Norseman-Wiluna Greenstone Belt within the Archaean Yilgarn Craton of Western Australia. The belt consists of mafic and ultramafic volcanics with considerable volumes of clastic sediments, minor felsic volcanics and differentiate gabbros. The greenstones in the Kathleen Valley area have been metamorphosed to upper greenschist-lower amphibolite facies metamorphic grades and include tholeiitic lavas, differentiated gabbroic sills and ultramafic chlorite schists.

Lithium mineralisation is hosted within spodumene-bearing pegmatites, which are part of a series of lithium-caesium-tantalum (LCT)-type rare metal pegmatites that intrude mafic and sedimentary rocks in the region.

Twenty mineralised pegmatites have been identified at the Kathleen Valley Project hosted by two, outcropping, NW/SE trending pegmatite swarms – a shallowly-dipping, north-eastern swarm (Kathleen’s Corner), which contains approximately 90% of the pegmatites, and a steeper dipping south-western swarm (Mt Mann). The two swarms are interpreted to merge at depth to form a single, thick, moderately dipping mineralised body which remains open down-dip and along strike.

Most of the lithium is contained within spodumene. Small, isolated zones of petalite mineralisation have been observed in the north-western part of the deposit (this material equates to <0.5% of the resource samples).

The mineralisation is contained within pegmatite veins that are readily distinguished from the surrounding rocks. Sectional interpretation and wireframing indicates good continuity of the interpreted pegmatite veins both on-section and between sections. The confidence in the grade and geological continuity is reflected by the assigned resource classification.

Twenty lithium mineralised pegmatites have been identified at the Kathleen Valley Project which extend from surface to a depth of 640 m.

At Mt Mann, two steeply-dipping (-70° west) pegmatites have been drilled over a strike length of 1,200 m and to a vertical depth of around 300 m to 400 m. The two pegmatites are up to 35 m thick and have average thicknesses of 9 m and 11 m.

At Kathleen’s Corner, 18 sub-horizontal pegmatites have been drilled over an area of 1,800 m by 1,300 m. These pegmatites outcrop in the northeast and are up to 40 m thick with an average thickness of 8 m. The pegmatites coalesce and merge with the Mt Mann pegmatites at approximately 300 m to 400 m below surface to form a single, thick (35 m to 75 m) mineralised body that extends for a further 600 m to 700 m down-dip.

The proposed mining operations at Kathleen Valley will comprise both open pit and underground mining, with the underground operations providing most of the ore feed over the estimated 23-year
mine life.

The underground mine is divided into two separate mining areas:
• The Mount Mann Vertical (MMV), which comprises a 5-40m wide orebody dipping at 50° to 60° to the south-west; and
• The NorthWest Flats (NWF), which comprises multiple stacked, flat to shallow dipping pegmatite lodes that range from 4-30m thick

The mineralisation at Kathleen Valley extends from surface and would be suitable for open pit mining. High grade mineralisation is present at depth and would be suitable for underground mining.

Open Pit
Two small open pits will be developed, one at the MMV and one at the NWF. Both open pits will be used to provide long term access portals to the underground.

The open pit has been designed to supply ore for the plant in the first 1-2 years until the underground operation is ramped-up to full capacity. The open pit designs contain a total of 3.3Mt of ore, at a diluted grade of 1.2% Li2O / 141ppm Ta2O5. The pits contain 22Mt of waste material and 3.2Mt of ore for an average strip ratio of 6.8:1. Importantly most of the open pit mining is completed concurrently with the construction phase to provide ore at start-up, thereby de-risking initial operations.

Open pit mining dilution was applied using a Selective Mining Unit (SMU) block size of 5m x 5m x 3m.

Conventional open pit mining will use excavators and rigid dump trucks as the preferred mining method. Experienced mining contractors will be engaged to undertake all aspects of the mining operation. Supervision, grade control and planning will be undertaken by an Owner’s team. All material will be blasted. Bulk waste will be blasted on 12m benches and the ore zones will be blasted on 6m benches and mined in two or three flitches for greater selectivity (depending on the point in the mine schedule) with ore delivered to stockpiles and blend fingers on the Run of Mine (ROM) pad.

Open pit mining will commence during the plant construction period to establish the portal and boxcut positions and will be completed early in Year 2 of production. Open pit ore will be stockpiled close to the plant for processing at the start of the mine life.

Underground Design
To establish the cut-off grade strategy for the underground several stope optimisations were completed for the MMV and NWF at a range of cut-off grades. Schedules were run using different.

The mine will be accessed via three surface decline and one internal declines:
• A portal will be established in the Mt Mann open pit to access the MMV south orebody via the No. 1 decline and No. 3 internal decline;
• The No. 2 decline will be established from a box-cut located adjacent to the plant and underground laydown area. This decline will access the deeper, high-grade north-western MMV and deeper NWF area; and
• The No. 4 decline will be developed from a portal located in the Stage 2 open pit and will access the upper levels of the NWF.

The underground mines will employ conventional mechanised mining techniques using long-hole open stoping, with paste fill used in most areas to maximise extraction of the resource. Ore and waste will be trucked to surface via respective declines. Some of the narrower areas (<8 m width) in the NWF will be mined using a modified room-and-pillar method. The two underground mines will initially operate independently until a connection between the two is established in Year 3 of production.

The declines will be developed 6m wide by 5.8m high at a gradient of 1:7. They will all extend to the bottom of the mine, reaching a vertical depth of approximately 500m below surface. Stockpiles will be developed along the decline at 150m intervals until level access positions are established. The declines will extend the mine services backbone into the mine.

Underground – Mount Mann Vertical
In the MMV area footwall drives will be developed to access the stopes which extend along the length of this portion of the deposit and cross-cut access will be developed from the footwall drive out to the ore body. The MMV region of the deposit is sub-vertical and typically 20-25m wide. Given the width and strike length, this area of the deposit will be mined by transverse long-hole stoping and cemented paste fill will be used as backfill. Primary stopes will be mined and paste filled first. Secondary stopes, which are adjacent to a paste fill stope, will then be extracted. The production level interval will be 30m floor-to-floor and individual stope width will be typically 30-35m.

Slots will be developed by long-hole methods with relief holes drilled to 760mm (or similar). Production holes will be nominally 89mm in diameter with maximum lengths of around 30-35m.

Holes will be charged using gassed emulsion with primers and electronic detonators installed at spacing of 10m or less along the length of the hole. A central controlled firing system will be used to initiate each blast. Once the slot is fully developed, production rings will be fired on retreat in a series of two or three ring blasts until the stope is completed.

Stope bogging will use a combination of conventional and remote methods. Conventional loading will be used until the stope brow opens, and thereafter cabin remote bogging will be used to clean the stope. All ore bogged from the stope will be placed in adjacent crosscuts or in stockpiles where it can be loaded out when safe and practical to do so. After the last ring is fired, the stope will be cleaned out using remote controlled loaders. Paste fill barricades will be erected at all entrances. The stope will be filled using cemented paste delivered via paste fill line from the paste plant on surface. The paste plant will be operated by the Company. Curing periods of at least 7 days will be observed before extraction of the adjacent stope commences.

Underground – North West Flats
Because the NWF is shallow dipping, a network of ore drives will be developed to access the flat lying long-hole stopes, which will be mined as primary and secondary or tertiary cut-and-fill stopes. Where flat lying areas are thin (< 8 m) they will be mined using room-and-pillar methods.

The NWF region of the deposit comprises shallow to flat dipping mineralisation 10-30m thick. The general stoping cycle will be the same as that described for the MMV stopes; however, these areas will be mined using a chequerboard pattern of long-hole stopes employing an extraction sequence of primary and secondary stopes, using cement paste fill. Paste holes will be drilled into the top of the stope from the extraction level, or from a level above, to enable the stope to be tight filled as far as practicable.

Narrow areas of the NWF region will be mined using room-and-pillar. Lateral development will define pillar boundaries on two sides and long hole blasting will be used to develop the rooms. These areas will not be paste filled.

Underground – General
Approximately 7Mt of waste rock will be generated from underground over the life of mine. All waste will be trucked to surface and tipped into the open pit void adjacent to the portal or taken to the surface waste stockpile, if required.

Underground – Ventilation
The primary ventilation system comprises fresh air intakes from the NW Flats portal and the Mt Mann portals, and fresh air raise intakes. There are five exhaust raises planned, located in the northern, central, and southern ends of the footwall drives.

The Kathleen Valley Project process plant will consist of a mineral processing concentrator with associated services and ancillaries. The plant has been designed using industry standard robust equipment and processes. The process facilities include:
• Two-stage crushing circuit (designed to process 4Mtpa);
• SAG Milling;
• Low and high intensity magnetic separation combined with sequential gravity separation to produce a tantalum concentrate (which also removes ferrous impurities);
• Flotation, thickening and filtration to produce Li2O concentrate; and
• Paste fill & Tailing disposal.

In parallel with the Kathleen Valley Definitive Feasibility Study (DFS) Liontown engaged Lycopodium Minerals Pty Ltd (Lycopodium) to update a previous scoping study. The updated Downstream Scoping Study (DSS) evaluates the impact of integrating the mine, process plant and a downstream refinery, that would be built via a staged approach (Integrated Project) at Kathleen V ........