Critical Elements Lithium (TSX-V: CRE)(OTC: CRECF) CEO Jean Sebastian Lavallee and Chairman Eric Zaunsherb on Permitting & Catalysts at the Rose Lithium-Tantalum Mining Project

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Critical Elements Lithium, Mr. Jean Sebastian Lavallee and the Chairman of Critical Elements Lithium, Mr. Eric Zaunsherb. Eric, Jean Sebastian, how are you today?

J.S. Lavallee: Pretty good. How are you?

Gerardo Del Real: I am well, thank you both for asking. It's great to have the both of you on. Congratulations are in order, obviously a big, big milestone was achieved earlier this week. I would love for you to go ahead and explain what that milestone was. And then let's talk about all the hard work that led up to it. And then frankly, the hard work that remains following the next shoe, which we all anticipate to drop soon, right?

J.S. Lavallee: Yes. So the decision from the Minister of Environment and Climate Change of Canada is one of the big authorization you need in order to be able to build a mine. So that's one of the most important authorization needs for the project. And then parallel to that there is a process that we've been involved also since 2017 with the provincial authorities. So that's the next big milestone that we expect coming soon.

Gerardo Del Real: Excellent. Let's talk about just the quality of work that you've done up until now de-risking the project and the community relations and the way that you've approached that. Because it's, and this is pun intended obviously, it's so critical to be able to do the work early and to make sure that the quality of that work shows up early in order to be able to get to the point that you're at now, right?

J.S. Lavallee: Yes, but that's a process that it's probably one of the most important things to get involved in working with the local community. And that's something that we start right from the beginning in 2010 when we made the discovery, building the communication channel and make sure that the community are aware of our progress on the project. We signed a pre-development agreement with the community of Eastmain, the Cree government and the Grand Council in 2012. Then we keep going with the project, building communication, presenting in the different communities surrounding the project. Then in 2019, we signed the impact and benefit agreement with again the Grand Council of Cree, the Cree government and the Cree nation of Eastmain. So that's a big portion of the project, and we're pretty pleased to have their support and working with them as it will also bring a lot of support and lots of worker contract for the project. So their expertise is very important for us.

Gerardo Del Real: And obviously a win-win just economically, right? You've done it the right way. You did it from inception and now the community, as well as the company, both are in position to benefit economically moving forward, assuming that everything goes as we assume it will. And then that final shoe drops here soon, right?

J.S. Lavallee: Yes. But for sure there will be a lot of like economic incentives for the different community. As you know, it's a big project, we'll create more than 250 jobs that will be large contract. Just by example, the concentrate transportation, the Cree community and the Cree are real entrepreneurs. They own several business like airline companies, transportation, oil companies. So they will be able to provide lot of material and lot of expertise and workers for the project. And that's very important to us as we build the relation since the beginning. And we’ve also been able to learn over the time with them, with all that say the relation we built, the importance of their culture and that's very important to us.

Gerardo Del Real: The decision statement, Eric, was issued on August the 11th. But prior to that, obviously you had been extremely busy in the last two releases prior to that decision were really interesting to me. The one on July the 12th was Critical Elements retaining an ex Rockwood Lithium expert for the hydroxide engineering market study. The one prior to that on June 18th was Critical Elements engaging GoldSpot Discoveries to apply its AI exploration technologies at the project. Can you explain a bit of the motivation behind each of those releases?

Eric Zaunsherb: Sure. And I think what it highlights, first of all, is the importance of people. If you look at the great job that Jean Sebastian did in moving this permitting process through, working jointly with the people in government, as well as those in Cree nation government, that is a process that has to be done extremely carefully. And I give Jean Sebastian and his team great credit for having achieved that. So then coming back to your question about the July 12th news release, looking at hiring of lithium hydroxide experts, Gerrit Fuelling is actually an expert in pricing and the market for all of these lithium products. And he is a product himself of the great Rockwood Lithium enterprise that was run by their Chief Executive Officer and President Dr. Steffen Haber, who is now our President as well. And so having this quality of people involved like Steffen, he has had the ability to tap into the network that he built in building Rockwood Lithium, and Gerrit is an example of that.

So he brings a huge amount of expertise. Obviously that's going to help us in not just the lithium hydroxide engineering market study, but also going forward and understanding the intricacies of the market. And as you can imagine in today's world where we see OEMs ramping up their plans for electrification, for decarbonization of transport, in that environment you've got such great demand building. And in fact, some of the brokerage firms on Bay Street and Wall Street are looking at 50% deficits in lithium supply going forward. Having Gerrit on the team to talk about that market and advise us is an extremely important aspect of it.

And then you asked about GoldSpot Discoveries. I think, we're all human beings. We have limits as to how many factors that we can look at at any one time. So it's been fascinating to watch as artificial intelligence or machine learning is brought into the equation of exploration. Obviously we already have the Rose deposit and a number of discoveries have been made very proximal to Rose, but to take all that information over 700 square kilometers and boil that down to generate smart targets for further exploration, I think this was a great initiative on the part of Jean Sebastian and it's very exciting to see what the market might not place any value on at this point in time. But to see drill holes go into the ground and test some of these smart targets is quite an exciting endeavor.

Gerardo Del Real: It sounds like the company clearly believes in the exploration upside that exists at the project. I know that initially when co-owner of Resource Stock Digest, Nick Hodge looked at this company late last August if I'm not mistaken, I think it was trading around the 29 cent level. And a part of what attracted him was he couldn't believe the caliber of talent involved with the company at the time. And clearly he was right. I mean, you've worked diligently, you've engaged the community. You've gotten it at the point where we all expect that final permitting decision to be favorable and be announced soon. And it seems like there's still a lot of runway to explore and develop the project.

Eric Zaunsherb: Absolutely. I mean, it's clear in our mission statement, our vision for the company is to be a large supplier of sustainable and responsible supplier of lithium to the market. And by large, Rose is just simply the first. And we intend to explore the potential. We intend to prove the concept that indeed there's a lot of potential within that ground. I'm sure you've got something to add to that Jean Sebastian.

J.S. Lavallee: Yes. But if you look at the amount of exploration we've done on the rest of the properties since the discovery of Rose being limited, we already find some new zone, new showings, we sampled them, and it looks very promising for the future. So for sure as a next step, as Rose is moving forward, we will increase exploration and do more drilling in order to develop a second one.

Gerardo Del Real: Excellent. Eric, Jean Sebastian, congratulations. Anything else to add?

J.S. Lavallee: I think it's important too before we leave to mention, like you said, there's the second authorization that we are working on with the provincial process, but also in parallel to that, we're also working on the engineering study for the conversion plan that we expect to conclude over the coming next couple of months for the conversion from spodumene concentrate into lithium hydroxide, there is a lot of milestone and news coming over the next couple of weeks and months.

Gerardo Del Real: A lot to look forward to. Eric, anything to add to that?

Eric Zaunsherb: No, I think Jean Sebastian laid it out perfectly well.

Gerardo Del Real: Gentlemen, thank you so much for your time. Congrats again, and I suspect we'll be having a similar conversation again here soon.

J.S. Lavallee: Great. Thank you Gerardo.

Gerardo Del Real: Thank you.

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