E3 Lithium Approaches Completion of Phase 2 of its Demonstration Facility and Outlines Path to Commercialization

CALGARY, Alberta--(BUSINESS WIRE)-- E3 LITHIUM LTD. (TSXV: ETL) (FSE: OW3) (OTCQX: EEMMF), “E3”, “E3 Lithium”, or the “Company” is approaching completion of Phase 2 of its Demonstration Facility and provides an update on the progress of its Clearwater Project toward commercial production.

Phase 2 of the Demonstration Facility provides the last major piece of data required to complete the design of the commercial facility. The completion of Phase 2 will mark an important engineering milestone and enable E3 to confidently proceed with a robust design for a commercial facility. Moving towards a shovel ready project is the next step in the development towards an operating lithium facility. This major milestone is a compilation of five business drivers. Upon reaching the shovel-ready milestone, E3 will move towards the completion of the project financing to reach Final Investment Decision (“FID”) for the Clearwater Project.

The foundation for each of the five business drivers, outlined below, was established throughout 2025 and has advanced significantly in 2026. Success in accomplishing these will lead to a project that is ready to move through, and substantively support, the project financing initiative. The goal is to enable the construction of a facility in Alberta to produce approximately 12,000 tonnes of battery-grade lithium carbonate per year, the first Stage of E3’s commercial operations.

Business Driver	E3 Deliverables
Successful demonstration of commercial scaled Direct Lithium Extraction (“DLE”) operations	Operation of the 30-column DLE system Construction and operation of the scaled single DLE column Operation of each system for a minimum of six months (operations of the two systems can happen independently and concurrently)
Outline an economically robust project at a Class III cost estimate level	Continued engineering of the commercial facility to enable major equipment lists to be compiled Obtain cost estimates from vendors for major equipment and compile a Class III cost estimate Publication of the NI 43-101 compliant Feasibility Study report summarizing these results
Commercial permits	Continue working with stakeholders and the AER on the D56 licence application for a lithium carbonate facility scalable to 30,000 tonnes of production per year – Clearwater’s Central Processing Facility (“CPF”) Stakeholder engagement prior to advancing applications for the remaining permits (wells and pipelines)
Binding offtake agreement(s)	Advancing strong relationship with off-takers towards execution of binding agreement(s) Work to execute additional offtake contracts as the project warrants to facilitate FID
Project Financing	Ongoing throughout the development of the other business drivers to ensure we deliver results that meet financing expectations. The completion of the above four business drivers will facilitate the requirements for E3 to source the debt and equity to fund the construction of the Clearwater Project – Stage 1

"Clearwater is moving forward on every front towards commercial production: operating a Demonstration Facility that is de-risking our technology at commercial scale, advancing permit applications for our processing facility, engaging with several international offtake partners, and receiving strong federal support," said Chris Doornbos, CEO & Chair of E3 Lithium. "E3 is designing the Clearwater Project exactly as we intend to build it. This methodical and structured discipline reduces construction risk, protects capital, and positions Clearwater for an efficient path to commercial production."

Demonstration Facility: The Foundation of Commercial Operations The Demonstration Facility is E3's most important de-risking initiative and a major milestone for the Company and the lithium industry in Alberta. Once fully operational across the two components outlined below, it will mark E3’s progression from concept to scaled commercial operations. This achievement will also represent the transition from technology development to readiness to scale, a milestone E3 is looking forward to celebrating.

Phase 1 of the Demonstration Facility was commissioned approximately one year ago and successfully produced battery-grade lithium carbonate using the 30-column DLE system. Phase 2 involved drilling and operating a full-size producer and injector well pair, designed to the Pre-Feasibility Study ("PFS") specifications, to test the reservoir and collect data for the Clearwater Project's Feasibility Study. Now nearing completion, Phase 2 has confirmed sustained production from the Leduc reservoir, moving more than 60,000 m to-date, validating consistent brine chemistry across the broader resource, and has generated valuable gas-water data to support commercial facility design.

Phase 3 of the Demonstration Facility will operate in two parts:

E3 will restart the 30-column DLE system in Q4 2026, shortly after conclusion of Phase 2, aimed at finalizing process optimization and to produce battery-grade lithium carbonate.
E3 is in the process of finalizing the design and procurement of a commercial scale DLE column, for an operation start in 2027, aimed at providing robust operational data required by project financiers, strategic partners, and off-takers.

Extended operation of Phase 3 will provide the opportunity for E3 to train operations staff, continue producing battery-grade lithium carbonate to support offtake, and further optimize key process metrics.

Permitting Permitting is among the longest-lead items for any resource project, and E3 has been proactive in submitting applications almost one year ago. Between December 2025 and January 2026, E3 submitted its Directive 056 facility licence and Environmental Protection and Enhancement Act (“EPEA”) applications to the Alberta Energy Regulator (“AER”) for the Clearwater Project’s CPF which, once granted, are the critical permits required to build and operate the CPF. E3’s Demonstration Facility, which was fully permitted in September 2025, operates under the same AER Directives as the Company’s commercial licence application. E3 continues to engage closely with local stakeholders and the regulator throughout the process.

Commercial Agreements The Company has signed non-binding Memorandum of Understanding (“MOUs”) with international partners, geared toward potential offtake, most remaining commercially sensitive and confidential. Over the past 12 months, the Company signed MOUs with Epsilon CAM in India towards offtake, Tees Valley Lithium in the United Kingdom towards tolling for hydroxide conversion, and Axens in France towards offtake. E3 continues to advance discussions with various prospective offtake partners, including shipping lithium carbonate for evaluation and product qualification, the step that precedes binding long-term supply agreements. Additional battery-grade lithium produced from Phase 3 of the Demonstration Facility will continue to support offtake discussions.

Funding, Strategic Partnerships, and Project Financing Phase 3 of the Demonstration Facility and Front-End Engineering Design (“FEED”) are supported by up to $36.5 million in non-repayable funding through Natural Resources Canada's Global Partnerships Initiative (“GPI”), reflecting E3’s focus on efficient capital deployment. In September 2026, E3 also closed an upsized equity financing of approximately $11.5 million in gross proceeds. The recent capital, along with broad government support, allows E3 to continue progressing its Demonstration Facility and engineering, the cornerstones of project development toward commercial production.

E3 recognizes its partnership with Germany’s TKMS, which was named preferred supplier for the Canadian Patrol Submarine Project (“CPSP”) earlier this year. E3 is positioned to realize strategic and financial benefits through the program's Industrial and Technological Benefits (“ITB”) commitments, reiterating the importance of what E3 brings to national and international markets.

E3 is also in continued discussions to explore project financing for construction and operation of the CPF as the Clearwater Project progresses toward commercialization. Advancing on Demonstration Facility, FEED, Feasibility Study, and offtake will support securing project financing. The Company is evaluating strategic and diversified financing options to advance the Clearwater Project toward a fully funded FID, including strategic capital and project-level debt and equity.

ON BEHALF OF THE BOARD OF DIRECTORS

Chris Doornbos, CEO & Chair E3 Lithium Ltd. 587-324-2775

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 LCE at a lithium grade of 75.5 mg/L within its Clearwater Project and (b) Measured and Indicated mineral resources of 5.0 Mt LCE at a lithium grade of 54.0 mg/L and Inferred mineral resources of 0.3 Mt LCE at a lithium grade of 42 mg/L within its Garrington District. The Clearwater Pre-Feasibility Study outlined a 1.13 Mt LCE proven and probable mineral reserve at a lithium grade of 75.5 mg/L, 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% IRR.

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 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 an effective date of June 25, 2025, is available on 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 in 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 Pre-Feasibility Study (“PFS”), but such statements are not guarantees of future performance. In particular, this news release contains forward-looking information relating to: the Company's path to commercial production at the Clearwater Project, including the achievement of shovel-ready status and the advancement of the five business drivers described herein; the completion of Phase 2 of the Demonstration Facility; the restart of the 30-column DLE system in Q4 2026 and the continued production of battery-grade lithium carbonate; the design, procurement, construction and operation of the commercial-scale DLE column, the expected commencement of its operation in 2027, and the expectation that its operating data will support project financiers, strategic partners and off-takers; the training of operations staff and the optimization of key process metrics; the continued engineering of the commercial facility, the compilation of a Class III cost estimate, and the completion and publication of the Clearwater Project Feasibility Study and FEED; the expected production capacity of Stage 1 of the Clearwater Project and the scalability of the Central Processing Facility; the Company's Directive 056 licence and EPEA applications to the Alberta Energy Regulator for the Clearwater Central Processing Facility, the timing and outcome of the regulatory review, and the advancement of applications for the remaining permits; the continued shipment of lithium carbonate to prospective offtake partners, the outcome of their evaluation and product qualification, and the negotiation and execution of binding offtake agreements; the non-binding Memoranda of Understanding with Epsilon CAM, Tees Valley Lithium and Axens, and the negotiation and execution of definitive agreements; the amount of non-repayable funding available under Natural Resources Canada's Global Partnerships Initiative and the eligibility and timing of reimbursement of program costs; the use of proceeds from the Company's September 2026 equity financing; the strategic and financial benefits the Company expects to realize through the Industrial and Technological Benefits commitments associated with the Canadian Patrol Submarine Project; and the Company's ability to secure project financing and the timing of a Final Investment Decision, construction and commercial operations at the Clearwater Project.