Argentina Lithium & Energy : Earnings Document

ARGENTINA LITHIUM & ENERGY CORP.

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023

Introduction

This Management's Discussion and Analysis ("MD&A") should be read in conjunction with the condensed consolidated interim financial statements of Argentina Lithium & Energy Corp. ("Argentina Lithium" or "the Company") for the three months ended March 31, 2024 and 2023 and related notes thereto which have been prepared in accordance with IFRS Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). All figures are in Canadian dollars unless otherwise noted. This MD&A has been prepared as of May 27, 2024.

Company Overview

The Company was incorporated on April 11, 2000 and was transitioned under the Business Corporations Act (BC) on June 17, 2004. The address of the Company's registered office is Suite 411 - 837 West Hastings Street, Vancouver, BC, Canada V6C 3N6. The Company remained without a business asset until March 2003, when the Company negotiated a number of agreements to option and acquire interests in various mineral concessions located in Argentina. In December 2003, the Company completed its initial public offering and commenced trading on the TSX Venture Exchange ("TSX-V" or the "Exchange") under the symbol "AMS". In December 2008, the Company consolidated its outstanding common shares on a 10 for 1 basis and changed its name to Panthera Exploration Inc. (formerly Amera Resources Corporation) trading on the TSX-V under the symbol "PNX". In January 2012, the Company changed its name to Iron South Mining Corp. (formerly Panthera Exploration Inc.) trading on the TSX-V under the symbol "IS". In September 2016, the Company changed its name to Argentina Lithium & Energy Corp. (formerly Iron South Mining Corp.) trading on the TSX-V under the symbol "LIT".

The Company is a junior mineral exploration company engaged in the business of acquiring, exploring and evaluating natural resource properties and either joint venturing or developing these properties further or disposing of them when the evaluation is completed. The Company's material mineral property interests are located in Argentina, and while the Company continually considers additional exploration projects to acquire, its focus is to explore and advance its current group of Argentinian lithium properties. In Argentina, the Company operates via its subsidiary Argentina Litio y Energia S.A. ("ALE"). As of the date of this MD&A, the Company has not earned any production revenue, nor established any reserves on any of its properties. The Company is a reporting issuer in British Columbia and Alberta.

The Company's technical disclosure in this MD&A has been reviewed by David Terry Ph.D., P.Geo, a Qualified Person under NI 43-101, and a director of the Company.

Stellantis Investment

In September 2023, Argentina Lithium announced that Peugeot Citroen Argentina S.A., a subsidiary of Stellantis N.V. ("Stellantis"), had agreed to invest the ARS$ equivalent of US$90 million to acquire shares of the Company's subsidiary, ALE. Stellantis is one of the world's leading automakers and mobility providers with iconic brands including Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS Automobiles, Fiat, Jeep®, Lancia, Maserati, Opel, Peugeot, RAM, Vauxhall, Free2Move and Leasys. On October 4, 2023, ALE received approximately 31.5 billion Argentina Pesos in Argentina that was equivalent to US$90 million at the official exchange rate and recognised the investment as a non-controlling interest. As a result of the transaction, Stellantis owns 19.9% of the issued and outstanding ALE shares and Argentina Lithium owns 80.1%. The Company has also granted Stellantis the right to exchange all of the ALE Shares for up to 19.9% of the outstanding common shares of Argentina Lithium (on an undiluted basis) in the future, subject to certain conditions. In addition, both parties have agreed to an offtake agreement for future lithium production that sees Stellantis purchase from ALE up to 15,000 tonnes per annum of lithium over a seven-year period subject to certain terms and conditions.

As a result of this investment, the scale and number of field programs is expected to increase to meet a new mandate of accelerated exploration, evaluation and potential development of the Company's projects.

Additional details of the investment transaction, offtake agreement and shareholders agreement are available in the original news releases dated September 27, 2023 and October 5, 2023 and in Note 7 of the Company's condensed consolidated interim financial statements for the three months ended March 31, 2024 and 2023.

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Exploration Projects Overview

Rincon West Project, Salta

The Rincon West Project includes mining concessions covering over 5000 hectares at the Rincon Salar. Two concessions, ("Villanoveño II" and "Demasia Villanoveño II") covering an area of 2390.5 hectares are located on the west side of the salar. These were acquired via the Rincon-Pocitos option agreement described below and are now 100% held. Argentina Lithium announced on July 21, 2022 it had obtained 100% ownership of an adjacent concession block, ("Rinconcita II") covering 460.5 hectares adjacent to and east of Villanoveño II, on the salar. Terms for acquiring the concession included:

• An initial payment to REMSA of USD $2.5M at the time of signing of the purchase agreement (paid)
• REMSA retains a 3% Net Smelter Return ("NSR")
• The Company proposed an exploration program that includes environmental permitting, ground geophysics and exploratory drilling.

On October 6, 2022, the Company announced another property addition to the project. The Paso de Sico agreement covers 791.3 hectares of concessions via an option that includes cash payments totaling US$1,500,000 paid over two years, including obligatory payment commitments totaling US$300,000 in the first six months. The option grants a 3% NSR to the Vendor, which can be purchased by the Company for an additional US$1.5 million. The Paso de Sico option agreement also includes a total of US$2.3 million of exploration and development expenditures over a three-year period. The Paso de Sico concession block is currently undrilled and is undergoing permitting required for exploration geophysics and drilling.

Option Payment	Exploration Expenditure
US$		US$	Year
100,000	(paid)	-	2022
200,000	(paid)	-	2023
400,000	(paid)	300,000	2023
400,000	(paid)	-	2024
400,000		800,000	2024
-		1,200,000	2025
1,500,000		2,300,000

On November 8, 2023 the Company announced that it had entered into an option agreement for a fourth property block: the "Don Fermin" concession. Don Fermin is a mining concession granted by the mining authority of Salta Province, located on the eastern flank of the Salar de Rincon, approximately 19 km east of the Rincon West property block. The property has not received significant exploration work previously. Terms of the option include cash payments totaling US$2,750,000 over 18 months, including an initial non-reimbursable payment of US$250,000. The Company can advance the dates of the subsequent four payments at its discretion. The vendor retains a 1.5% NSR which can be repurchased for US$4,000,000.

Option Payment
US$		Year
250,000	(paid)	2023
500,000	(paid)	2023
750,000	(paid)	2024
1,000,000		2024
250,000		2025
2,750,000

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The Rincon Salar is situated approximately 90 kilometres west of the town of San Antonio de los Cobres, the largest town in Argentina's high plain, and approximately 250 kilometres west of the provincial capital city of Salta. It is close to the railway, and just 17 kilometres south of Provincial Route 51, the international road that connects to Chile's coastal ports. The InterAndes power corridor runs within one kilometre of the Rincon Salar. There are two significant lithium resource development projects on the salar, owned by Rio Tinto (https://www.riotinto.com/operations/projects/rincon) and Argosy Minerals (www.argosyminerals.com.au) both of which have executed demonstration-scale production of lithium carbonate.

Argentina Lithium cautions that proximity to a discovery, mineral resource, or mining operation does not indicate that mineralization will occur on the Company's property, and if mineralization does occur, that it will occur in sufficient quantity or grade that would result in an economic extraction scenario.

In March 2022, the Company initiated a deep-seeing Transient Electromagnetic (TEM) sounding survey to delineate areas of potential brines and map the bottom of the basin. Results of the survey were announced May 2, 2022, when the Company reported that modeling of the TEM data suggested that the interpreted brine aquifers extend substantially further west and south than indicated by earlier electrical surveys. Results from the TEM survey were used to target holes for an initial drill campaign that commenced at the end of May.

Permitting to drill nine holes was secured, and a first program of five exploration holes was initiated to test multiple prospective brine targets. Results from the first hole were announced on July 13, 2022. Hole RW-DDH-001 was

executed with HQ-size diamond drilling to a depth of 300 metres. The hole entered brackish-to-brine aquifer at approximately 45 metres depth and continued in permeable units to approximately 144 metres, highlighted by a 70 metre thick interval with lithium grades ranging from 225 to 380 mg/litre, potassium from 4035 to 7231 mg/litre and magnesium from 2090 to 3132 mg/litre. Results from holes two through four were released in October (see October 3, 2022 and October 25, 2022 News Releases). Holes two and four returned long brine intervals with very consistent lithium grades. RW-DDH-002 was tested with packer sampling over ~77% of the interval between 182 and 305 metre depths, with lithium values ranging from 337 to 367 mg/litre. The fourth hole (RW-DDH-004) produced the best results to date.

Lithium brines were found to start at 38 metres depth and in the interval from 95 metres to 227 metres depth, lithium values range from 334 to 382 mg/litre over a continuous 132 m interval. Hole RW-DDH-003 was positioned 1.8km to the south and encountered lower grade lithium brines towards the bottom of the hole. Results from holes five and six were announced on January 26, 2023. Hole RW-DDH-006 returned a 153 m interval ranging from 329 to 393 mg/l lithium starting at 167 m depth. This hole was a step-out of 960 m from the prior best intersection reported in RW-DDH-004. On April 24, 2023 the Company announced the results from holes seven and eight of the program. RW-DDH-007 was an in-fill hole in the south-central portion of the basin. Single and double packer sampling returned multiple intervals ranging in concentration from 241 to 340 mg/l lithium throughout a 178 m section starting at 143 metres depth (no sample was collected from 30 m of this interval). RW-DDH-008 extends drilling to the northwest and infills an undrilled area between holes RW-DDH-005 and 006. Three 15-metre intervals were intersected between 140 and 212 metres depth, with concentrations ranging from 228 to 355 mg/l. The ninth and final hole of the program was reported on May 31, 2023. Hole nine returned the highest peak lithium value and longest concentrated brine interval reported to date on the Rincon West project: 258 m ranging from 287 to 402 mg/l lithium. (Two portions of this interval were not sampled, one length of 42 m and a second length of 33 m.) brine zone remains open to the north, clearly demonstrating the requirement to expand drilling in this direction in a future campaign. Overall, the program demonstrated that the concentrated brines from the neighboring salt flat extend through the western basin, and the prospect remains open to identifying additional lithium-rich brines in several directions.

In July 2023, following the receipt of new permits, the Company completed 12 line-km of Controlled Source Audio-frequency Magnetotelluric (CSAMT) geophysics surveys over the Rinconcita II property, demonstrating the presence of extremely conductive strata (low resistivity) at less than 100 metres below surface, consistent with formations saturated with lithium-bearing brines.

This work helped site holes for the new drill campaign that commenced in September, as announced on October 19, 2023. The new program is designed to include five diamond holes to test for brines and one rotary drill well for pump testing. Results from the first two holes in the program were reported on January 22, 2024, with highlights including: 21 brine samples collected between 63.5 m depth and 359.0 m depth in RW-DDH-010 ranging from 245 to 366 mg/l lithium; and 33 brine samples collected between 24.5 m depth and 345.50 m depth RW-DDH-011 ranging from 246 to 344 mg/l lithium. Hole RW-DDH-012 was reported on April 24, 2024, and continued the trend of strong lithium results, with 23 brine samples ranging from 322 to 371 mg/L lithium collected between 48.5 and 213.5 m depth.

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Brine sampling is mainly conducted using packer sampling during drilling which allows the collection of brine samples at specific depths while sealing the hole at the bottom and at the top of the interval. Samples of brine were submitted for analysis to Alex Stewart International Argentina S.A., the local subsidiary of Alex Stewart International. an ISO 9001:2008 certified laboratory, with ISO 17025:2005 certification for the analysis of lithium and potassium. The quality of sample analytical results was controlled and assessed with a protocol of blank, duplicate and standard samples included within the sample sequence. Differences between original and duplicate samples and results for standards and blanks were considered within the acceptable range for lithium.

In March 2024 the Company commenced Transient Electromagnetic soundings (TEM) to detect and delineate brines for drill testing on Don Fermin.

Pocitos Project

The Pocitos Project includes over 26,000 hectares of properties subject to four option agreements. The Pocitos Salar is located approximately 100 kilometres west of the town of San Antonio de los Cobres and approximately 250 kilometres west of the provincial capital city of Salta. The Provincial Route 17 and the natural gas pipeline-fed industrial park at the settlement of Pocitos are located 17 km to the east. The rail line that crosses the middle of the Pocitos West property joins Salta with the port of Antofagasta on the Chilean Pacific coast. The present surface expression of the Pocitos Salar is approximately 57 kilometres north-south, and approximately 10 kilometres east-west. The salt pan is almost completely flat with portions of the older salar surface covered by talus and alluvial fan.

The optioned properties are believed to have had little prior exploration and no drilling with the exception of the group of concessions in the Rincon-Pocitos option (see below) which have had modest geophysics and surface sampling, with very limited drilling. As of early March 2024, the Company had completed 103.3 line-kim of Transient Electromagnetic soundings to detect and delineate brines for testing by up to four drill holes, initially.

Rincon-Pocitos Option

On October 8, 2021, Argentina Lithium announced that it had signed a definitive agreement with a private vendor to acquire a 100% interest in the 2,370 hectare Rincon West (described above) and 15,857 hectare Pocitos projects in Salta Province, Argentina. Subsequently, a small block of 20.5 hectares (Demaisia Villanoveño II) was awarded and added to the Rincon West project under the option.

On November 30, 2023, the Company announced that it had exercised the option agreement to obtain 100% in the properties. The option was conditional on cash payments of US$4,200,000 and payment of shares in the Company equivalent to CA$500,000 at the time of issuance, payable over 36 months. The Company had previously made US$1,300,000 in payments towards the option and completed its share issuance requirements and has now paid the remaining balance of US$2,900,000. The exercise of the Rincon West/Pocitos option grants 100% ownership of the Villanoveño II property as originally announced (2370 hectares) as well as the subsequently awarded Demasia Villanoveño II (20.5 hectares), both located at the Salar de Rincon, and the eleven properties designated as Pocitos 200, 201, 202, 203, 204, 205, 206, 207, 208, 209, 211, totaling 15,857 hectares located at the Salar de Pocitos.

El Pidio GIII and Aguamarga Options

Argentina Lithium can acquire a 100% interest in the 1,602 hectare "El Pidio GIII" property in the southeast of the Pocitos Basin pursuant to an option agreement dated January 3, 2022. The option terms include US$165,000 in cash payments over three years, including a mandatory total of US$30,000 over the first 18 months. In addition, 25,000 shares of the Company are to be issued to the vendor on signing, with additional share issuances valued at $70,000 over the subsequent three years, including mandatory issuances valued at $25,000 over the first 18 months.

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Option Payments	Shares to be issued	Number of shares	Year
or Firm commitment	valued at	to be issued
US$		$	#
10,000	(paid)	11,500 (issued)	25,000	(issued)	2022
10,000	(paid)	12,500 (issued)	41,667	(issued)	2023
10,000	(paid)	12,500 (issued)	41,667	(issued)	2023
35,000	(paid)	20,000 (issued)	66,667	(issued)	2024
100,000		25,000	83,333		2025
165,000		81,500	258,334

Argentina Lithium can acquire a 100% interest in the Aguamarga 11 and Aguamarga 16 properties, totaling 7,000 hectares in the east flank of the Pocitos Basin pursuant to an option agreement dated January 3, 2022. The option terms include US$1,890,000 in cash payments over three years, including a mandatory total of US$105,000 over the first 12 months. In addition, 168,000 shares of the Company are to be issued to the vendor on signing, with additional share issuances valued at $651,000 over the subsequent three years, including a mandatory issuance valued at $126,000 after twelve months.

Option Payments	Shares to be issued	Number of shares	Year
or Firm commitment	valued at	to be issued
US$		$		#
42,000	(paid)	77,280	(issued)	168,000	(issued)	2022
63,000	(paid)	126,000	(issued)	420,000	(issued)	2023
105,000	(paid)	-		-		2023
420,000	(paid)	210,000	(issued)	700,000	(issued)	2024
1,260,000		315,000		1,050,000		2025
1,890,000		728,280		2,338,000

The number of common shares of the Company issuable under the option agreements are calculated based on the discounted market price of $0.30 per share on the Exchange on January 7, 2022. All shares issued pursuant to the terms of the option agreements are subject to a hold period under applicable securities laws for a period of four months from the date of issuance.

Ramos Option

The agreement, dated January 6, 2022, gives Argentina Lithium the option to earn a 100% interest in five additional properties totaling approximately 1,762 hectares at the Pocitos Salar ("the Ramos Properties"). The option terms include mandatory payments totaling US$150,000 in the first year, followed by US$550,000 2 years after signing. The vendor retains a 1% Net Smelter Royalty ("NSR") which can be purchased by the Company for US$500,000.

Option Payments
or Firm commitment
US$		Year
50,000	(paid)	2022
100,000	(paid)	2023
550,000	(paid)	2024
700,000

Antofalla North Lithium Project, Salta

Argentina Lithium currently controls 10,839 hectares of mining concessions in the Salar de Antofalla, distributed between the adjacent provinces of Salta and Catamarca. The Company had previously held 9080 hectares of staked claims ("Staked Properties") for which it impaired exploration costs in 2019 but maintained ownership (see the year-end Management Discussion and Analysis for 2019, filed on SEDAR+). The Company subsequently reduced this area to 3996.1 ha, by relinquishing a less prospective property and also through administrative reductions in non-prospective areas.

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With the resurgence in interest in the lithium markets, the Company re-evaluated its strategy and identified multiple opportunities in the Salar de Antofalla that complement the existing Staked Property position, and could potentially contain significant brine resource.

As such, on August 4, 2021, the Company announced that it had entered into an option agreement ("Pipo-Alcalina V Option") to earn a 100% interest in three granted mine concession properties in the Salta Province mining registry, totaling 5,380 hectares situated adjacent or proximal to the Staked Properties. On November 30th, 2023 Argentina Lithium announced that it had exercised the Pipo/Alcalina option, as described below.

On April 11, 2022, the Company announced that it had entered into a second option agreement ("Amelia Option") for a further 5,411 hectares in three mine concessions on the Antofalla Salar, in the mining registry of Catamarca Province.

On October 6, 2022, the Company announced a third option agreement ("Volcan Option") for an additional 843.5 hectares in a single mine concession on the Antofalla Salar, in the Catamarca mining registry.

On November 8, 2023, the Company announced a fourth option agreement ("Lexi-30 Option") for an additional 789 hectares in a single mining concession on the Antofalla Salar, wholly within the Catamarca mining registry.

The Salta mining registry and the Catamarca mining registry overlap along an east-west belt that is approximately 11. 5 km wide in the vicinity of Antofalla. This situation has existed since 1943. On May 11, 2022 the provinces of Salta and Catamarca signed an agreement to develop properties in the conflicted area jointly, essentially sharing the mineral interests and royalties in the affected region.

If a project in this conflicted zone is to advance, the Company's interpretation is that either the overlapping property concessions must both be controlled by a single operator, or there should be an agreement between the holders of the conflicting mining concessions. The Company has optioned mining concessions in both provincial registers in order to exercise outright control over the largest possible block of prospective ground. However, the Company believes that claimed property that is currently conflicted in a second mining register, could potentially have significant value also. To this end, based on reconnaissance of the area and on work on the company's bounding properties, the Company will seek to purchase or negotiate favorable terms to allow exploration and development of the conflicted properties.

Between the five property groups described above for Antofalla North, the Company exercises complete control over 10,839 hectares of mining concessions (i.e. holds mining rights in both provincial mining registries for areas within the conflicted zone). The Company holds an additional 3,094 hectares of concession ground that is conflicted in an overlapping mining registry.

The Salar de Antofalla is approximately 150 kilometres long and 5-7 kilometres wide and is located at 3,900 metres elevation. The salar is accessed by Provincial highway 43 and unpaved roads, with the small town of Antofalla approximately 50 kilometres to the south and the city of Salta approximately 500 kilometres away. The geological environment at the Salar de Antofalla is similar to other salars in the Puna region where lithium and potash are found. The Antofalla North project extents to within 500 metres of the boundary of a property controlled by global lithium producer Albemarle Inc. on the salar. Albemarle has stated that it believes the lithium resource on its property has potential to rank amongst the largest in Argentina1. [Investors are cautioned that this information is taken from the publicly available sources, has not been independently verified by the Company and it is not known if this resource conforms to the standards of NI 43-101. Furthermore, proximity to a discovery, mine, or mineral resource, does not indicate that mineralization will occur at the Company's Project, and if mineralization does occur, that it will occur in sufficient quantity or grade that would result in an economic extraction scenario.]

Work by a previous operator on the Pipo-Alcalina V properties included surface sampling of brines at 14 locations in 2017. Brines were sampled at depths to 4 metres, over 7 days, and returned reported lithium anomalies up to 61.1mg/L.

1 https://www.albemarle.com/news/albemarle-signs-agreement-for-exclusive-exploration-and-acquisition-rights-to-lithium-resource-in-argentina.

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On August 24, 2018, the Company reported that a CSAMT geophysical survey had been completed to map deeper stratigraphic units and provide additional information on the subsurface in order to delineate drill targets. The survey identified several potential targets with high conductivity in the first 100 metres and moderate conductivity at deeper levels. The consulting geophysicists recommended reconnaissance drill holes to determine the cause of the conductive anomalies and to test for lithium-bearing brines.

There has been no significant historical exploration work on the remaining optioned properties. These concessions provide the Company with coverage to protect its mineral rights in the area of the provincial boundary between Salta and Catamarca; a portion of the northern part of the optioned properties may overlap a third-party concession in the provincial boundary area.

The work plan includes an estimated 110 line-km of Transient Electromagnetic soundings to delineate areas of potential brines, followed by drilling of up to 6 diamond drill holes to log the basin geology and collect brine samples. Permitting for this work is underway and the program is expected to commence once permits are secured.

Pipo-Alcalina V Option

The Pipo/Alcalina option was announced on August 4, 2021, encompassing three mining concessions totaling 5,380 hectares, conditional on US$4,000,000 in cash payments payable over 42 months and on US$7,000,000 in work expenditure commitments. The Company had previously completed US$800,000 in option payments and before the end of 2023 paid the remaining balance of US$3,200,000. The work commitment conditions were waived, and the cash exercise of the Pipo/Alcalina option grants 100% ownership of Alcalina V, Pipo I and Pipo II, which are considered core properties at the Company's Antofalla North Project. The option exercise was finalized by completing the outstanding cash payments specified in the option agreement. The prior property holders have accepted the full option exercise and have agreed to waive any outstanding work commitment specified in the original agreement. The original property holder group retains a 2% NSR on the properties, which the Company has the further option to purchase at any time for a cash payment of US$5,000,000.

Amelia Option Terms

Terms of the option include cash payments totaling US$2,800,000, and mandatory annual exploration expenditure commitments totaling $7,000,000 over 4 years. The vendors retain a 2% Net Smelter Royalty ("NSR") which Argentina Lithium has the ability to repurchase for US$3,000,000.

Option Payment	Exploration Expenditure
US$	US$	Year
80,000 (paid)	-	2022
100,000 (paid)	-	2023
200,000	(paid)	500,000	2023
300,000 (paid)	-	2024
400,000		1,500,000	2024
1,100,000		2,000,000	2025
620,000		3,000,000	2026
2,800,000		7,000,000

Volcan Option Terms

Terms of the Volcan option include cash payments totaling US$590,000 paid over three years, including the obligatory payment of US$40,000 at the time of signing. The option grants a 1% NSR to the Vendor, which can be purchased by the Company for an additional US$1,300,000.

Option Payment
US$		Year
40,000	(paid)	2022
100,000	(paid)	2023
200,000		2024
250,000		2025
590,000

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Lexi-30 Option Terms

Terms of the Lexi-30 option specify two cash payments totaling US$425,000, including a non-reimbursable initial payment of US$50,000, and an optional final payment of US$ 375,000, payable at up to 12 months. The vendor retains a 2% NSR. In the instance that the vendor wishes to transfer or sell the NSR, the Company has the right to match the terms of NSR transference or sale.

Incahuasi Lithium Project, Catamarca

The Incahuasi Project currently includes a 100% interest in over 25,000 hectares of granted mineral rights properties in the Incahuasi Salar and basin in Catamarca Province, Argentina. The Salar de Incahuasi is located in the northwest of Catamarca Province at approximately 3260 metres above sea level, in the southern half of the "Lithium Triangle". Access to the Incahuasi salar is by gravel road, approximately 34 kilometres southwest from the town of Antofagasta de la Sierra. The salar is approximately 17 kilometres long north to south, and 2.5 kilometres wide, and divided into a north and south section. Initial sampling of near-surface brines in the southern section in 52 pits returned an average of 62 mg/L of lithium, 4661 mg/L of potassium and 9800 mg/L magnesium, with a maximum value of 409 mg/l lithium and 1.56% potassium from a sample in the central portion of the salar. VES geophysical surveying indicates the potential for lithium-rich brines starting at surface and reaching up to 200 metres depth.

On January 31, 2018, the Company announced that it had received permits necessary for drilling at Incahuasi and on March 13th announced the start of a 4-hole drill program on the southern part of the salar. On August 24, 2018, the Company announced that the program was complete, with 878 metres drilled in total. Halite and deeper clastic sediments were cored in all holes, and each hole encountered lithium-bearing brines. Lithium concentrations were modest but fairly consistent, averaging 109 mg/L in all 54 samples collected and analyzed. The Company did not complete any work on the property in 2021, 2022 or 2023.

The Company plans to restart exploration at the Incahuasi property, specifically by completing approximately 90 line-km of Transient Electromagnetic soundings to detect & delineate new areas of potential brines for follow-up drill testing.

Results of Operations - For the three months ended March 31, 2024 compared to the three months ended March 31, 2023

During the three months ended March 31, 2024, loss from operating activities increased by $511,110 to $2,341,620 compared to $1,830,510 in loss from operating activities for the three months ended March 31, 2023. The increase in loss from operating activities is largely due to:

• An increase of $280,917 in exploration expenditures. Exploration expenditures were $1,325,946 for the three months ended March 31, 2024, compared to $1,045,029 for the three months ended March 31, 2023. The Company undertook higher exploration work including the drilling program at Rincon West project during the three months ended March 31, 2024 compared to lesser exploration work during the three months ended March 31, 2023.
• An increase of $288,017 in legal and professional fees. Legal and professional fees were $324,865 for the three months ended March 31, 2024, compared to $36,848 for the three months ended March 31, 2023. The increase is due to the Company requiring more professional advice during the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

The increases were partially offset by:

• A decrease of $55,683 in share-based compensation. Share-based compensation were $Nil for the three months ended March 31, 2024 compared to $55,683 for the three months ended March 31, 2023. The decrease is due to no granting and vesting of stock options during the three months ended March 31, 2024, compared to granting and vesting of 300,000 stock options during the three months ended March 31, 2023.

Other Items

During the three months ended March 31, 2024, other income increased by $1,673,719 to $2,337,761 compared to other income of $664,042 for the three months ended March 31, 2023. The increase in other items is largely due to:

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• An increase of $2,074,607 in fair value gain on derivative liability. Fair value gain on derivative liability was $2,074,607 for the three months ended March 31, 2024 compared to $Nil for the three months ended March 31, 2023. The increase is due to revaluation of the fair value estimate of the derivative liability during the three months ended March 31, 2024.
• An increase of $544,453 in foreign exchange gain. Foreign exchange gain was $164,766 for the three months ended March 31, 2024 compared to foreign exchange loss of $379,687 for the three months ended March 31, 2023. The increase is due to the fluctuation in foreign exchange rates, devaluation of Argentine pesos, and differing amounts of foreign currencies held during the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

The increases were partially offset by:

• A decrease of $899,492 in gain on sale of marketable securities. Gain on sale of marketable securities was $94,950 for the three months ended March 31, 2024 compared to $994,442 for the three months ended March 31, 2023. The decrease is due to the Company acquiring and transferring no marketable securities to facilitate intragroup funding during the three months ended March 31, 2024 compared to acquiring and transferring greater marketable securities to facilitate intragroup funding during the three months ended March 31, 2023.

The net loss and comprehensive loss for the three months ended March 31, 2024 was $3,859 or $0.00 per basic and diluted share compared to a net loss and comprehensive loss of $1,166,468 or $0.01 per basic and diluted share for the three months ended March 31, 2023.

Cash Flow

Operating Activities

Cash outflow from operating activities was $1,985,282 for the three months ended March 31, 2024 compared to $2,458,951 for the three months ended March 31, 2023. The decrease in cash outflows is primarily due to corporate and administrative cash costs, as well as changes in non-cash working capital balances due to timing of receipt and payment of cash during the three months ended March 31, 2024.

Investing Activities

Cash inflow from investing activities was $3,303,633 for the three months ended March 31, 2024, compared to $269,720 outflow for the three months ended March 31, 2023. Expenditures on mineral property interests were $3,303,633 during the three months ended March 31, 2024 compared to $269,720 during the three months ended March 31, 2023.

Financing Activities

Cash inflow from financing activities was $97,500 for the three months ended March 31, 2024 compared to $37,500 for the three months ended March 31, 2023. Proceeds from warrants exercised were $97,500 for the three months ended March 31, 2024 compared to $37,500 for the three months ended March 31, 2023.

Statement of Financial Position

At March 31, 2024, the Company had total assets of $79,851,516, which is a decrease of $1,976,569 from $81,828,085 in total assets at December 31, 2023. This decrease is primarily due to decrease in restricted cash of $4,200,369, cash of $1,188,212, and prepaid expenses of $182,761, partially offset by increase in exploration and evaluation assets of $3,533,634 during the three months ended March 31, 2024.

Prepaid Expenses

On October 9, 2023, the Company entered into an agreement with AGV Falcon Drilling SRL and prepaid $51,791,411 for drilling services of up to 15,500 meters at its Antofalla and Rincon West properties. The Company made the prepayment using the Argentina Pesos it had received from the Stellantis Investment (see page 1) to hedge against the devaluation of the Argentina Peso in Argentina's high inflationary environment and reduce the Company foreign exchange risk exposure. The value of the prepaid drilling expense was determined using the official foreign exchange rate between the Argentina Peso and Canadian dollar.

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Exploration and evaluation assets

For the year ended December 31, 2023, the Company made advance payments on the Pipo-Alcalina V Option of its Antofalla North Lithium Project and Rincon-Pocitos Option of its Pocitos Project. The Company made the advance payments using the Argentina Pesos it had received from the Stellantis Investment (see page 1) to hedge against the devaluation of the Argentina Peso in Argentina's high inflationary environment and reduce the Company foreign exchange risk exposure.

Selected Quarterly Financial Information

	2024		2023			2022
	Mar. 31	Dec. 31	Sep. 30	Jun. 30	Mar. 31	Dec. 31	Sep. 30	Jun. 30
	$	$	$	$	$	$	$	$
Revenues	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Loss	(3,859)(1)	(51,322,160) (2)	(1,171,982)(3)	(2,337,873)(4)	(1,166,468)(5)	(5,619,918)(6)	(1,369,133)(7)	(828,448)(8)
Loss per Common
Share Basic and Diluted	(0.01)	(0.39)	(0.01)	(0.02)	(0.01)	(0.05)	(0.02)	(0.01)

1. Variance from prior quarter primarily due to decrease in loss on sale of marketable securities of $35,129,016, foreign exchange loss of $12,170,801, exploration expenditures of $3,554,328, consulting fees of $487,955, corporate development and investor relations of $450,959, and interest income of $917,843, partially offset by increase in fair value adjustment gain on derivative liability of $556,687, and legal and professional fees of $245,653.
2. Variance from prior quarter primarily due to increase in loss on sale of marketable securities of $35,034,066, foreign exchange loss of $13,259,053, exploration expenditures of $3,679,347, corporate development and investor relations of $657,803, consulting fees of $443,195, partially offset by decrease in legal and professional fees of $686,560, increase in fair value adjustment of derivative liabilities of $1,517,920, and interest income of $867,972.
3. Variance from prior quarter primarily due to decrease in exploration expenditures of $824,381, corporate development and investor relations of $92,891, partially offset by increase in foreign exchange gain of $1,041,186 and legal and professional fees of $711,285.
4. Variance from prior quarter primarily due to increase in exploration expenditures of $980,279, partially offset by decrease in foreign exchange gain of $402,923, and corporate development and investor relations of $160,437.
5. Variance from prior quarter primarily due to decrease in share-based compensation of $1,755,526, exploration expenditures of $1,522,324, corporate development and investor relations of $317,996, interest income of $75,263, partially offset by increase in foreign exchange gain of $834,450.
6. Variance from prior quarter primarily due to increase in exploration expenditures of $1,595,717, share-based compensation of $1,811,209, corporate development and investor relations of $397,399, and foreign exchange loss of $183,573, partially offset by decrease in interest income of $189,799.
7. Variance from prior quarter primarily due to increase in exploration expenditures of $627,375, foreign exchange loss of $89,668, and corporate development and investor relations of $79,580, partially offset by increase in interest income of $312,094.
8. Variance from prior quarter primarily due to increase in exploration expenditures of $152.637, corporate development and investor relations of $143,859, partially offset by decrease in foreign exchange loss of $259,610, and interest income of $95,956.

Liquidity and Capital Resources

The Company has experienced recurring operating losses and has accumulated retained earnings of $10,475,476, working capital of $52,282,200, and shareholders' equity of $64,034,475 at March 31, 2024. In addition, the Company has negative cash flow from operating activities of $1,985,282. Working capital is defined as current assets less current liabilities and provides a measure of the Company's ability to settle liabilities that are due within one year with assets that are also expected to be converted into cash within one year. These factors create material uncertainties that may cast significant doubt about the Company's ability to continue as a going concern. The Company's continued operations, as intended, are dependent upon its ability to raise additional funding to meet its obligations and commitments and to attain profitable operations. Management's plan in this regard is to raise equity financing as required. There are no assurances that the Company will be successful in achieving these goals.

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