Basin Project
Overview

The Basin Project is made up of 3 mining claim blocks on BLM-administered land and 1 lease and 2 mineral exploration permits on state-administered land. In total the project embraces 17km². The project is grouped into Basin East (Basin East, Basin East Extension and Basin North) and Basin West (Basin West and Basin West Extension)

Basin East Project
Overview

Basin East Project (“BEP”) (including Basin East (BE), Basin North (BN) and Basin East Extension (BEE)) is located in central western Arizona, USA, around 6 miles from the operating Bagdad copper mine. The project is favourably located in terms of infrastructure, 6 miles north of Highway 93, a power line and a natural gas pipeline are adjacent to the project area.

The project consists of one mineral lease and two mineral exploration permits on Arizona State land and 28 placer mining claims and 27 lode mining claims on federal land administered by the BLM. The project area encompasses a total area of 6 km2.

Project highlights

2016 Project Highlights

Zenith Minerals sampled cuttings piles from five historical drill holes which returned results of 465 ppm Li – 3,577 ppm Li. Additionally initial surface sampling of exposed prospective saponite clay horizons returned Li values in 400 ppm li to 1680ppm Li.

2017 Project Highlights

Continuation of the 2016 surface sampling showed results of over 1,500 ppm Li. Geophysics was completed in order to determine the thickness of the clay units. During August 2017, samples grading up to 1,680 ppm Li were sent for leaching tests, preliminary results showed that extraction of up to 90% is possible.

2018 Project Highlights

During April and May 2018, a 14-hole reverse circulation drilling program was completed. SRK Consulting (UK) Limited (“SRK”) was engaged to prepare a Maiden Resource Estimate (“MRE”), resulting in an inferred MRE being developed. Lithium grades averaged 818 ppm Li, with 185,000 tonnes LCE contained metal.

2021 Project Highlights

The Company completed a 10 hole drilling programme at BE in 2021 and received final assay results from this programme in January 2022.

The 10-hole programme at BE, consisted of seven new holes and three twinned holes, designed to test the 2018 RC drill programme that was used to estimate the BE Inferred Resource in 2018. The three twinned holes also tested the Lower Clay zone which was not tested by 2018 drill holes as the holes were not drilled deep enough to test the zone.

The results from our 2021 drill programme at BE indicate that the Upper Clay zone thickens towards the west and north-west towards our other claims. The initial results of our geophysics programme have added further insights to our geological models at our sedimentary assets and have helped demonstrate that the thickness of our Upper Clay zone potentially increases to the west and north-west towards our other claims, Bradda has received permission to drill at BEE and BN, and drilling will commence shortly.

Combined with the 2021 drill programme a new metallurgical testwork programme was carried out by SGS, which demonstrated the ability to extract more than 98% of lithium mineralisation into a leach solution in under one hour.

Basin East photos

2021 core programme, new hole Upper Clay zone highlights:

	Total Upper Clay zone grade (ppm)	Total Upper Clay zone thickness (m)	High-grade Interval Li grade (ppm)	High-grade Interval Intersection length (m)
Hole BCE21-07	850 ppm Li	62.2m	850 ppm Li	62.2m
Hole BCE21-08	1,019 ppm Li	47.0m	1,395 ppm Li	18.2m
Hole BCE21-09	953 ppm Li	81.4m	1,495 ppm Li	23.6m
Hole BCE21-10	769 ppm Li	8.2m	769 ppm Li	8.2m

The four holes above were drilled to a total depth of 412m from surface (BCE2107 108m, BCE21-08 102m, BCE21-09 119m and BCE21-10 83m).

Updated Mineral Resource Estimate

Following the 2021 drilling programme, an updated mineral Resource estimate (MRE) has been reported by SRK Consulting in accordance with the terminology and definitions given in the JORC Code (2012), comprises: an Indicated Mineral Resource of 17.6 Mt at an average grade of 912 ppm Li and 3.4% K for a total of 85 kt LCE and an Inferred Mineral Resource of 57.6 Mt at an average grade of 717 ppm Li and 3.3% K for a total of 220 kt LCE. The statement, presented in Table 1 was prepared by Mr Martin Pittuck of SRK, who is considered a Competent Person for this style of mineralisation.

SRK applied basic technical and economic assumptions for open pit mining (mining and selling costs, mining recovery and dilution, pit slope angles) and processing factors (Li recovery, processing costs), to determine which portion of the block model has reasonable prospects for economic extraction as required by the JORC Code. To achieve this, the Mineral Resource has been subject to a pit optimisation study and cut-off grade analysis.

The 2022 Mineral Resource update follows the completion of a 10 hole 1,110m diamond core drilling programme which was completed in November 2021 (RNS dated 17/11/2021). The 185kt LCE 2018 MRE was calculated based on a 14-hole 924m reverse circulation ("RC") programme.

The drilling coverage at BE has increased by c.20% in area since 2018 and has provided some deeper intersections to add some previously missed Lower Clay. Furthermore, newly acquired geophysical data has allowed extrapolation of the MRE further from the drillholes than was possible previously. The combination of these changes has resulted in an increase in the MRE.

2022 MINERAL RESOURCE STATEMENT

Classification	Domain	Tonnes Mt	Mean Grade Li (ppm)	Mean Grade K(%)	Contained Metal LCE (kt)	Contained Metal K (Mt)
Indicated	Upper Clay	12.0	730	3.6	46	0.4
	Upper Clay HG	5.7	1,296	2.8	39	0.2
	Lower Clay	-	-	-	-	-
	SubTotal	17.7	912	3.4	85	0.6
Inferred	Upper Clay	29.6	766	3.4	121	1.0
	Upper Clay HG	2.6	1,345	3.1	18	0.1
	Lower Clay	25.4	597	3.1	81	0.8
	Sub Total	57.6	717	3.3	220	1.9
	Total	75.2	763	3.3	305	2.5

Mineral Resource statement has an effective date of 22 February 2022.
A Mineral Resource is reported using a cut-off grade of 300 ppm Li and constraining the model to an optimised open pit shell, which was generated using the following assumptions: lithium carbonate metal prices of 18,000 USD/tLCE; State of Arizona royalty (selling cost) of 6%; operating costs of 5,000 USD/ tLCE or 27 USD/ tore; Li recovery of 75%; mining dilution and recovery of 5% and 95%; and pit slope angle of 45°.
Tonnages are reported in metric units.
Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.
Conversion factor of Li metal to lithium carbonate (LCE) = 5.323

HIGH GRADE

The updated MRE total of 305 kt LCE, includes 58 kt of LCE in a High-Grade zone within the Upper Clay zone with an average grade of some 1,300 ppm Li, the identification of this High-Grade zone gives Bradda Head further optionality, this High-Grade zone could have important economic implications for a potential future mining operation. The shallow nature of the High-Grade zone would likely result in a low strip ratio, enabling High-Grade ore to be scheduled early in a possible mine plan as it sits in the upper part of the deposit.

EXPLORATION POTENTIAL

In the MRE model, the Upper Clay zone and higher-grade zone are thickest at the north-western edge, and they remain open to the West and North-West and are expected to continue under cover in the adjacent BEE claim. Geological mapping and geophysical surveys indicate similar clay layers are present in Bradda Head's other claims beyond BEE in BW and BN. As such, with further drilling we see excellent potential to increase the resource base substantially.

An Exploration Target for the Basin Project of between 300 to 1,300 Mt of material grading between 600 to 850 ppm Li, equivalent to between 1 and 6 Mt LCE, has been identified covering the claims BN, BE, BEE and BW and BWE. This is based on an assessment of the updated Mineral Resource LCE per unit area, an estimated range of likely grades based on the MRE and an assessment of the extent of mapped clay and hanging wall lithologies in the undrilled parts of the Basin Project license areas.

NEXT DRILLING STEPS

BHL's drilling area at BE covers only 2.4% of our 46.6km2 of sedimentary lithium claims in Arizona comprising the Basin and Wikieup Projects. The plan at Basin in 2022 is to increase coverage to c.6% of our 46.6km2 and BHL anticipates further resource growth in 2022.

The Company has obtained permits for 120 holes at BEE, of which it expects to drill 20 holes in H2 2022. The Company has permission to drill 10 holes at its BN claim, and we anticipate that drilling will commence in H2 2022. The difference in the scale of the programme is that the BEE project area is embraced by a state lease, whereas BN is embraced by Zenolith mining claims on BLM-administered land.An additional 14-hole sonic drill programme (1,175m) was earlier this year approved at Basin East which will form part of the resource estimate at BEE and BN when they are permitted and drilled later this year. BEE is adjacent to Basin East, and BN joins with BEE's northern border.

Basin West
Basin West

Basin West Project (BWP) which combines Bradda’s Basin West (BW) Basin West Extension (BWE) claims is located in central-western Arizona, USA. The project consists of 130 placer mining claims and 141 lode mining claims on land administered by the Bureau of Land Management (BLM), covering a total area of 11km2.

Project Highlights

During April 2018, 68 samples were collected from outcrops of clay, altered tuffs and sediments covering a wide area. These samples contained lithium grades ranging between 36-1,310 ppm Li.

During October and November 2018, an additional 11 samples were collected from the northern and north-western parts of the project area. The samples had average grades of 386 ppm Li, with a high grade of 800 ppm Li.

Average potassium grades noted in the samples collected are 2.4%, which is slightly lower than those identified in the Basin East MRE.

Next Steps

Bradda is in the process of preparing a Plan of Operation with the BLM. Cultural resource and biological surveys are underway. Data from these surveys will be used to develop a viable, permissable exploration plan that will protect other natural resources and accomplish geologic data needs. After the well-designed plan is developed, it will be filed with the BLM. The plan will be used to develop a proposed action for the environmental review by BLM. Once approved, the Plan will be valid for the life of the project.

Phase 1 will consist of drilling 60 -drill holes (split between RC and sonic), to initially test broad areas in which mapping and surface sampling found lithium-bearing clay at surface. Metallurgical testing will be completed on splits of the cores.

Based on the drill results, a metallurgical study will be completed, which may lead to the development of a maiden Inferred Mineral Resource Estimate.