Sigma Lithium Resources Corporation announced the exceptional results of a Preliminary Economic Assessment (the “PEA”) for an expansion of its Grota do Cirilo Project (the “Project”), doubling its annual production capacity of battery-grade, high-purity, environmentally sustainable 6% lithium concentrate (“Green Battery Grade Lithium Concentrate”) to approximately 440,000 tpa (66,000 LCE). The expansion of Project achieves significant operational economies of scale resulting from adding a second environmentally friendly dense media separator processing line train to its digitally automated production plant (the “Production Plant”). The second line is expected to produce an average of 222,000 tpa (33,000 LCE) of Battery Grade Green Lithium Concentrate (“Phase 2”), doubling the initial planned annual production capacity of 220,000tpa (33,000 LCE) (“Phase 1”). Phase 1 is described in the Sigma’s technical report titled “Grota do Cirilo Lithium Project, Arac¸uai´ and Itinga Regions, Minas Gerais, Brazil, National Instrument 43-101 Technical Report on Feasibility Study Final Report” dated October 18, 2019 (the “2019Feasibility Study Report”). The exceptional PEA results demonstrate the cost benefit of vertically integrating the second production line and utilizing as a feedstock spodumene ore from the Project’s second deposit Barreiro (the “Second Deposit” or “Barreiro”), mining an average of 1.68Mt per year during 12.7 years of mine life. Barreiro is a high-purity, high-grade lithium deposit, with 20.485Mt of measured & indicated mineral resources at 1.43% Li2O and 1.909Mt of inferred mineral resources and shallow, near surface mineralization ideal for open pit mining. The Second Deposit’s mineral reserve is expected to be declared later this quarter when the ongoing pre-feasibility study (“PFS”) is completed. The PEA projects capital expenditures of US$44.5 million (year 0) including plant and mine construction, based on an optimized mine plan. Incremental expenditures of US$28.9 million (additional mine stripping on year 5) and $9.6 million (additional mine stripping on year 6) is expected to be covered by the Company’s internal cash flow generation. As Phase 2 construction is planned sequentially to the commissioning and production ramp up of Phase 1, the Company is expected to be fully operational with Phase 1 by the time Phase 2 is commissioned. Therefore, additional working capital for commissioning of the second DMS line as well as certain deferred capital expenditures may potentially also be covered by the internal cash flow generation of the business. During Detailed Engineering for Phase 1, the Company evaluated operational and capital expenditure trade-offs to be achieved in the expansion of the Production Plant capacity, including design features to allow for the seamless incorporation of a second production line. Metallurgical HLS tests performed on the spodumene ore for Phase 2 in sizes of 6.3mm and 10mm achieved excellent lithium recoveries of 70.2% and 66.1%, respectively, producing a 6% Li2O battery-grade spodumene concentrate within the highest levels of specifications demanded by the chemical lithium market without the use of flotation or hazardous chemical reagents, in the concentration process. This is consistent with Sigma’s intention to continue to process its lithium ore in a “green” environmentally friendly and sustainable manner. The Company has been working with SGS and Primero to prepare a PFS for the Phase 2 production, targeting its completion in June 2021, further continuing towards feasibility analysis in the second half of 2021. The Company and Primero completed all the metallurgical and variability DMS pre-feasibility test work at SGS laboratories. The Project is located in one of the world’s largest mining provinces in southeast of Brazil: with full mining infrastructure and highways linking the Project to a commodities shipment capable port. Site infrastructure has been mostly in place and is currently being upgraded for Phase 1 production. The Project is powered by 100% clean energy: transmission towers and lines on site link the Project to a hydroelectricity plant 50km away.