Kachi Project Faces Regulatory Timing Risks Despite Strong Cash and Tech Advances

• Progress on Exploitation Environmental Impact Assessment (EIA) for Kachi project
• 45% reduction in calendar year 2025 cash outgoings compared to 2024
• Strong cash position of AUD 15.3 million with no debt
• Technological advancements from partner Lilac Solutions expected to lower costs
• Significant unused financing facilities of AUD 75.8 million provide financial flexibility

Regulatory Progress at Kachi

Lake Resources NL continues to make meaningful strides in advancing the Exploitation Environmental Impact Assessment (EIA) for its flagship Kachi Lithium Brine Project in Argentina. The recent formal approval of the Ramsar site zonification, designating the Carachi Pampa lagoon as Zone 3, permits regulated productive use under environmental guidelines. This milestone, coupled with ongoing close coordination with the Catamarca Ministries of Environment and Mining, positions Lake to secure final EIA approval in the first half of 2026, a critical step toward project development.

Financial Discipline and Liquidity

Lake Resources reported a net cash decrease of AUD 2.9 million for the December quarter, ending with a robust cash balance of AUD 15.3 million and no debt. Notably, the company achieved a substantial 45% reduction in cash outgoings for calendar year 2025 compared to 2024, reflecting disciplined cost management and operational efficiencies. This financial prudence is further supported by significant unused financing facilities totaling approximately AUD 75.8 million, including standby equity capital and proceeds from recent option exercises, providing Lake with considerable flexibility to fund ongoing and future activities.

Technological Advances with Lilac Solutions

Lake’s partnership with Lilac Solutions, which holds a 20% stake in the Kachi project, continues to yield promising technological developments. Lilac’s release of its fifth-generation ion exchange technology (Gen 5 Lilac IX) is expected to reduce capital and operating costs by improving brine pretreatment, media productivity, and cycle life while maintaining high lithium recovery rates. Post-quarter, Lilac also announced the commissioning of a commercial-scale ion exchange media manufacturing line in Nevada and secured a 10-year lithium carbonate offtake agreement, underscoring the commercial viability of their direct lithium extraction technology.

Market Tailwinds and Strategic Positioning

The lithium market has experienced a dramatic rebound since November 2025, with lithium carbonate prices surging by 87% to over USD 21,000 per tonne. This price rally, driven by supply constraints and rising demand from the energy storage sector, bodes well for Lake’s project economics. Additionally, Argentina’s recent election outcome, endorsing President Milei’s reform agenda, signals a supportive environment for foreign direct investment in mining, potentially accelerating project approvals and development.

Looking Ahead

Lake Resources is actively exploring power supply options to reduce operating costs further, including engagement with local power providers. The company also plans to continue organisational right-sizing to maintain financial discipline as it pursues final EIA approval. With strong liquidity, technological innovation, and an improving regulatory and market backdrop, Lake is well-positioned to advance Kachi toward becoming a tier-one lithium asset.

Bottom Line?

As Lake Resources edges closer to final regulatory approval and leverages technological advances, the next 6 to 12 months will be pivotal in translating potential into production readiness.

Questions in the middle?

• When exactly will the Exploitation EIA receive final approval, and what risks remain in the regulatory process?
• How will Lilac’s Gen 5 ion exchange technology impact the overall capital expenditure and operating costs at Kachi?
• What are Lake’s plans for utilising its substantial unused financing facilities amid volatile lithium market conditions?