Australian lithium producer, Pilbara Minerals Limited (ASX: PLS) (Pilbara Minerals or the Company), is pleased to announce that the key conditions precedent and other completion criteria for the formation of the JV between POSCO and Pilbara Mineralsare now satisfied.

Please refer to Annexure A for details pertaining to the agreed JV terms previously announced on 26 October 2021. The formation of the JV and completion of Pilbara Mineral's initial 18% equity subscription in the JV Company (with an option to go to 30%) was conditional on satisfaction of certain conditions precedent.

These included the provision of a detailed construction and ramp up budget (Construction and Ramp Up Budget) acceptable to the Company for the construction and 18-month ramp-up of the Conversion Facility, as well as Pilbara Minerals filing necessary regulatory approvals with the Korea Trade Investment Promotion Agency (KOTRA) for approval of its initial 18% investment in the JV Company.

Construction and Ramp Up Budget

Since entering into the Shareholders Agreement in October 2021, additional engineering and design work undertaken by POSCO has contributed to the detailed budget for the construction and 18-month ramp-up of the Conversion Facility. The Construction and Ramp Up Budget has now been provided to the Companyby POSCO to satisfy this condition precedent to the formation of the JV.

Based on the studies and engineering work undertaken since October 2021, the capital development costsfor the Conversion Facility are estimated at USD$670-720M1 contingency allowance). After allowing for initial working capital and pre-production financing costs, the total funding requirement for the JV is now expected to be approximately USD$750-800M. As previously announced, the JV Company will be funded from a combination of equity from both POSCO (initial 82% equity interest) and Pilbara Minerals (initial 18% equity interest), as well as debt funding. Non-recourse external debt is expected to be secured by POSCO and the JV Company from Korean commercial banks following the establishment of the JV. At the time the JV is established a maximum gearing ratio of 58% of external debt is anticipated, but with the ability for the JV to increase the level of debt to 65%, should additional funding be required. This ensures capital development cost increases of up to 20% (should they arise) of the capital development costs reflected in the Construction and Ramp Up Budget will be able to be funded from external debt. Pilbara Minerals' initial 18% equity participation in the JV will be largely funded from the A$79.6M 5-year Convertible Bond being provided by POSCO. Funds will be drawn down under the Convertible Bond upon formation of the JV and completion of other closing conditions, which are expected to be satisfied in mid-April 2022.

Given final detailed engineering, design and procurement works are currently being completed, Pilbara Minerals has prudently decided to apply a capital contingency of 15% to its share of the capital development costs included in the Construction and Ramp Up Budget. This represents a total capital contingency for Pilbara Minerals 18% Share of US$18M. In the event this contingency is ultimately required, then the Company expects this amount to be funded from the 65% gearing ratio agreed with POSCO as part of the JV debt funding structure. Based upon the Construction and Ramp Up Budget received from POSCO, operating costs of the Conversion Facility are still expected to continue to be largely consistent with industry peers, following completion of its ramp up.

Pilbara Minerals Managing Director and CEO, Ken Brinsden, said: 'Pilbara Mineral's longstanding relationship with POSCO continues to go from strength-tostrength, and we are pleased to partner with them to grow lithium chemicals production to support the massive demand growth that is building around the globe. 'With commissioning expected late 2023, this joint venture places both Pilbara Minerals and POSCO in a very strong position to participate as one of the few near-term lithium fine chemicals producers with underwritten raw materials supply that will emerge in the coming two years. It's exciting for both the team at Pilbara and our shareholders to be able to extend our reach in the industry beyond spodumene and merchant markets.'

Next Steps for Completion

In accordance with regulatory requirements in South Korea, Pilbara Minerals has now filed its foreign investment report with the Korea Trade Investment Promotion Agency (KOTRA) and received the necessary approval for its initial 18% investment in the JV Company. This was the last remaining material condition precedent to be satisfied before the parties could complete their equity subscription in the JV Company (Completion).

At Completion, using funds drawn down from the Convertible Bond being provided by POSCO, Pilbara Minerals will initially subscribe for an 18% interest in the JV Company, with a call option (at Pilbara Minerals' election) available to increase its interest to 30% in the future. This call option will be available for up to 18 months after the successful ramp-up of the Conversion Facility to 90% of nameplate capacity. The call option will initially be exercisable at cost(plus 3.58% interest per annum) up until the date the Conversion Facility receives independent battery certification from tier 1 battery producers, and thereafter at fair value. This structure provides an important benefit to Pilbara Minerals, including added flexibility to stage itsinvestment over time to reduce itsinitial exposure during the construction and ramp-up phases of the Conversion Facility.

Contact:

David Hann

Tel: +61 (0)8 6266 6266

FORWARD LOOKING STATEMENTS AND IMPORTANT INFORMATION

This announcement may contain some references to forecasts, estimates, assumptions and other forward-looking statements. Although the Company believes that its expectations, estimates and forecast outcomes are based on reasonable assumptions, it can give no assurance that they will be achieved. They may be affected by a variety of variables and changes in underlying assumptions that are subject to risk factors associated with the nature of the business, which could cause actual results to differ materially from those expressed herein. All references to dollars ($) and cents in this announcement are to Australian currency, unless otherwise stated. Information in this announcement regarding production capacity of the Pilgangoora Project are underpinned by the Company's existing Ore Reserves that have been prepared by a Competent Person in accordance with the JORC Code (2012 Edition) and were released by the Company to ASX on 6 October 2021 (Material Increase in Ore Reserve).

ABOUT PILBARA MINERALS

Pilbara Minerals is the leading ASX-listed lithium company, owning 100% of the world's largest, independent hard-rock lithium operation. Located in Western Australia's resourcerich Pilbara region, the Pilgangoora Project comprising the Pilgan and Ngungaju processing plants produces a spodumene and tantalite concentrate. The significant scale and quality of the operation has attracted a consortium of high quality, global partners including Ganfeng Lithium, General Lithium, Great Wall Motor Company, POSCO, CATL and Yibin Tianyi. While it continues to deliver a low-cost, quality spodumene to market, Pilbara Minerals is pursuing a growth and diversification strategy to become a sustainable, low-cost lithium producer and fully integrated lithium raw materials and chemicals supplier in the years to come. Through execution of this strategy, Pilbara Minerals is positioned to become a major player in the rapidly growing lithium supply chain, underpinned by increasing demand for clean energy technologies such as electric vehicles and energy storage as the world pursues a sustainable energy future.

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