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Leading Edge Materials (TSX-V: LEM) Expands Landholdings at Bergby Lithium Project and Announces $2 Million Financing

November 21, 2016

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Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is Leading Edge Materials' (TSX-V: LEM)(OTC: LEMIF) CEO Mr. Blair Way. Blair, thank you for joining me today.

Blair Way: Hi, Gerardo. Nice to be having a chat again.

Gerardo Del Real: Well, I appreciate you coming back on. I know it's Friday, but I wanted to have you back on, because there were a couple of pieces of news that I wanted to go over. The first, earlier this morning you announced a $2 million financing. We can talk about that a little bit, but I would like to speak more in detail about a news release from November the 4th, which reads, "Leading Edge Materials Expands Landholding at Bergby Lithium Project in Sweden." What is the strategy behind you increasing the landholding there?

Blair Way: Certainly. We announced on the 19th of October about the actual Bergby Project, and we've been doing a bit of work on the ground. Really, the work that we've been doing is indicating to us that we are quite enamored with what we're finding. Therefore we decided it makes sense to just protect our land a bit and stake some more ground around it. As we extrapolate beyond what we're able to do in the early stages here, we're hopeful that maybe we'll extend into some of this additional ground that we've staked. Really, it's a reflection of our interest and confidence in the Bergby Project, and we've just staked more ground around it to make sure we protect it.

Gerardo Del Real: Excellent. Now, that confidence is a result of mapping and sampling that you've been doing. Is that correct?

Blair Way: That's correct. We still, obviously, have a great deal of work to do on the property. The work that we've done to date, and some of the boulder sampling and the results that we have released ... And we're expecting to get some more ... Timing-wise probably in the coming weeks, whether it makes it before Christmas or it's Christmas ... So anytime coming. Certainly, we expect to have some more data coming on some of the work that we're doing on the ground since we announced it 19th of October. Since we announced staking the additional ground, we'll have also done some further gathering in the other areas, as well.

Gerardo Del Real: Excellent. Now, we all know that Woxna and the Graphite Project is the flagship. With the financing that was announced this morning, would I be correct in assuming that there's a potential to define some drill targets and possibly drill next year if you continue to receive these positive results?

Blair Way: Yes. As you mention, we are undertaking a financing, and we'll keep the readers and people updated as we progress through that process. Yes, the use of funds is certainly for our flagship project, which is our Graphite and our high-purity projects that we're undertaking in order to demonstrate compliance or qualification with the graphite battery cell manufacturers. Then the Bergby Project also ... We are looking at what would be the next steps, whether it's drilling or some other geophysics or something like that. We're still going to determine that. Once we've nailed it down, we'll certainly let investors know what the plan of action is. Certainly, this financing will allow us to also facilitate some of these sort of works to ensure we can move them ahead as quickly as possible.

Gerardo Del Real: Excellent. This lithium project ... It's got some strategic significance because, if I'm not mistaken, about 25 kilometers north of the town of ... Nearby the Woxna Graphite Project, if I'm not mistaken. Is that correct?

Blair Way: Correct. From an exploration work activity point of view, it's the added benefit. It is very nearby our Woxna processing facility. Some of the infrastructure and capacities that we have at our site that we can utilize, which will just make the exploration project a little more efficient. Also, the actual Bergby property itself is located very well in regards to existing infrastructure such as roads, and power and ports. It's 25 kilometers north of the town of Gävle. In Gävle, there's a full capacity for shipping and transportation. It's a very decent-sized town. Absolutely, it's a property that you don't always ... It's a feature that you don't always get with a property, such as having this infrastructure there already. That is another reason for us to be quite optimistic about the Bergby Project.

Gerardo Del Real: Excellent. Now in regards to the Woxna Graphite Project, I know that you're in the process of getting through that qualification process. Where are you now in regards to that, and what can we expect here in the next few months, possibly?

Blair Way: As we've discussed before, it's quite an in-depth process of working with the end users, and also working with the laboratories. Ultimately the end user doesn't want to see a sample of a material until we've demonstrated through numerous rounds of test batteries and the test programs that go along with the batteries that ... We produce the test battery and then run them through a number of life-cycle tests and other test work to ensure that our product is suitable for the utilization in the cell-manufacturing process.

We are now working with the lab as we've mentioned before. I was actually with the lab yesterday, so we've gone through the program ... Have a little bit of an update of where we are in some of our additional material that's arrived at their site. We were just talking through ... It's a larger sample ... It's almost 400 kilograms of material, so almost half a ton. These are the size of samples that we need to have to work with as we progress down the larger and larger test programs of cells and then larger number of cells we have to manufacture.

I'll be able to provide updates as we advance through these various stages. Whether we'll have anything terribly meaningful before Christmas ... I guess it's ... We may do, it's just it's always a bit unpredictable as we work through a program like this. But certainly it'll be in the early new year when we'll have the next round of information to share.

Gerardo Del Real: It sounds like things are moving along at a good pace. Thank you so much, Blair, for coming on. Is there anything that I missed ... Anything you'd like to add?

Blair Way: No, I think we've covered the latest news. We've had quite a decent bit of activity going on, and obviously we have to follow through on all these new ground that we've staked on, and continue to keep investors updated on the Bergby Project, the Vena Project.

Certainly the focus on our graphite and making sure we find both the right ... Are able to demonstrate that we have the right material, we've got the right customer, we can produce in the right quantities and obviously the right prices, meaning that our cost to produce and the cost to sell it are ... There's a gap in there so we have a profitability, which is obviously the name of the game when we're going to be selling materials to customers. We need to produce it for a lower cost than what they buy it for. Sounds like an obvious statement, but working through the various details on the production of this high-purity spherical graphite for the lithium ion batteries is just that. It's a process. In order to ensure that we are going down the right path with the right material.

Gerardo Del Real: Excellent. You've added a cobalt project, you've added a lithium project with the financing. It's a great complement to the Woxna Graphite flagship project. Exciting times at Leading Edge Materials.

Blair Way: For sure. We've got a full plate, and we've got lots to do, and we're looking forward to keeping investors informed as we progress through all this scope of work.

Gerardo Del Real: Blair, thank you so much for your time.

Blair Way: Thanks Gerardo, great to have a chat.

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