Lithium Australia (ASX: LIT) identifies extensive mineralisation at Ravensthorpe, Western Australia

• The Horseshoe Pegmatite shows strong similarity to nearby Galaxy Resources' (ASX: GXY) Mt Cattlin
• The Pegmatite is flat-lying with a footprint of 800 x 800 metres
• The Pegmatite contains both lepidolite and spodumene

• Costeansampling returned 10 m @ 1.1 % Li2Ofrom a zone of lepidolite-spodumene mineralisation

• The lepidolite-rich portions of the Horseshoe Pegmatite add to LIT's lithium mica inventory

SUMMARY

The Horseshoe Pegmatite Prospect, part of Lithium Australia's (ASX: LIT) Ravensthorpe Lithium Project is located 500 km southeast of Perth, Western Australia (Figure 1).

The lithium mineralisation is hosted by the Cocanarup pegmatite swarm, which is within the same geological sequence as Galaxy Resources' Mt Cattlin lithium mine located 18 km to the north- east.

A recently excavated costean has revealed lithium mineralisation which includes spodumene, lepidolite and elbaite, all of which can be processed with LIT's 100% owned SiLeach™ process.

The Horseshoe Pegmatite, once thought to be three separate pegmatite bodies, is now confirmed as a single, flat lying pegmatite with surface exposure of approximately 800 x 800 metres (Figure 2). The size of the pegmatite appears to be comparable to the Cattlin Creek Pegmatite currently being mined by Galaxy Resources.

Work to date confirms the widespread lithium

Figure 1 Regional geology of LIT's Ravensthorpe Project

enrichment within the Horseshoe Pegmatite and the discovery of spodumene suggests a similar composition to the Cattlin Creek Pegmatite

Figure 2: Horseshoe Prospect mapped geology and costean location

COSTEANING RESULTS

Thirty-six, 1 m composite channel chip samples were taken along the northern face of the costean. Analysis of a comprehensive suite of elements was performed: lithium (Li), rubidium (Rb), caesium (Cs), and tantalum (Ta) were determined by Peroxide Fusion digest followed by an ICP finish and all other elements were determined by fusion followed by XRF analysis.

The western third of the costean is lithium-enriched. Associated with the Li enrichment are variable enrichments of Rb, Cs, bismuth (Bi), beryllium (Be), and Ta. The first 13 m interval, represented by samples CC001 to CC013, is 13 m @ 0.82% Li2O, including 10 m @ 1.1% Li2O. A peak lithium assays of 2.91% Li2O corresponds to a 1 m spodumene- lepidolite interval (Figure 3). The main results are contained in Appendix 1 and the 2012 JORC Code Table 1 for the sampling is attached at the end of the exploration report.

Figure 3: Spodumene and lepidolite mineralization in the Horseshoe Pegmatite, Ravensthorpe, WA.

NEXT PHASE OF EXPLORATION

Drilling is planned for both the Horseshoe and Deep Purple prospects. All access and drill pads were prepared during the costean program.

Managing Director, Mr Adrian Griffin said:

"Exploration success at Ravensthorpe demonstrates the potential to find more lithium pegmatites, similar in size to those mined nearby at Mt Cattlin. The Ravensthorpe Project hosts numerous lithium pegmatites, and we look forward to commencing drilling some of these in the near future."

Adrian Griffin

Managing Director

Mobile +61 (0) 418 927 658

Adrian.Griffin@lithium-au.com

About Lithium Australia NL:

LIT is a dedicated developer of disruptive lithium extraction technologies. LIT has strategic alliances with a number of companies, potentially providing access to a diversified lithium mineral inventory. LIT aspires to create the union between resources and the best available technology and to establish a global lithium processing business.

MEDIA CONTACT:

Adrian Griffin Lithium Australia NL 08 6145 0288 | 0418 927 658

Kevin Skinner Field Public Relations 08 8234 9555 | 0414 822 631

Competent Persons Statement:

The information contained in the report that relates to Exploration Results together with any related assessments and interpretations is based on information compiled by Derrick Kettlewell on behalf of Mr Adrian Griffin, Managing Director of Lithium Australia NL. Mr Kettlewell is a Member of the Australasia Institute of Mining and Metallurgy and has sufficient relevant to the styles of mineralisation under consideration and to the activity which he has undertaken to qualify as a Competent Person.

Mr Griffin is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient experience relevant to the style of mineralisation under consideration and to the activity being reported to qualify as a Competent Person as defined under the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.

Mr Kettlewell consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The Company is not aware of any new information or data that materially affects the information in this report and such information is based on the information compiled on behalf of the company Managing Director Mr Griffin.