Chilean Salar Overview

• In December 2009, Pan American Lithium acquired a 99% ownership interest in South American Lithium Company S.A. Cerrada (“Salico”) which, in turn, holds interests in a total of nine brine salars in in Region III, Chile (containing Li and other metals). Through this acquisition, the Company has an opportunity to advance exploration to a stage where a feasibility report can be prepared on one or more of the salars:

• Laguna Verde Project — Region III, Chile —  Surface Brine Lake:
  • 190 km from Copiapo on serviceable roads at 4,230m elevation
  • Inferred resource estimate at average lithium grade of 212.40 mg/litre computed to be 512,960 metric tons of lithium carbonate equivalent⁽¹⁾
  • Inferred resource estimate at average potassium grade of 4,881 mg/litre computed to be 4,223,134 metric tons of potassium chloride equivalent⁽¹⁾
  • Exploration opportunity to expand target through exploration drilling of deeper brines below lake and in surrounding geothermal basin
  • Current average price lithium carbonate (LICO₃): ~ $5,200/metric ton; Source: as per "The Lithium Site," http://www.lithiumsite.com/Lithium_Market.html, July 8, 2010)
  • Current price potash (high grade potassium chloride): ~$367 per metric ton (Source: as per Reuters quote regarding potash pricing of KTS, a German salt miner and the world's 4th largest potash supplier, June 11, 2010)

• Laguna Brava Project — Region III, Chile — Shallow Brine Lake:
  • Inferred resource estimate at average lithium grade of 313 mg/litre computed to be 13,580 metric tons of lithium carbonate equivalent⁽¹⁾
  • Inferred resource estimate at average potassium grade of 3,356 mg/litre computed to be 46,623 metric tons of potassium chloride equivalent⁽¹⁾
  • Exploration opportunity to expand target through exploration drilling of deeper brines below lake and in surrounding geothermal basin

• Additional Brine Projects with Lithium Potential (all in Chile Region III):
  • Lagunas del Jilguero: small existing lake with deep brines undrilled
  • La Laguna: small existing lake with deep brines undrilled
  • Rio de la Sal: rights to surface flow and alluvial water resources at lower elevations
  • Salar de Piedra Parada: significant work done in 1990’s on precious metals in uplifted sediments
  • Laguna Escondida
  • Salar Ignorado

In connection with the closing of the acquisition, Salico granted a 2% net smelter return royalty to the vendor on future production from eight salars, and a 2% net smelter return royalty to another vendor on one salar, payable following commencement of commercial production to a maximum of US$6 million on a per salar basis. In addition, at the Piedra Parada salar, where Salico obtained contractual rights to exploit lithium and light metals, Salico granted a 2% net smelter return royalty to the vendor on the proceeds from the sale of lithium and light metals to a maximum of US$6 million. Prior to commencement of commercial production at any salar, Salico may re-purchase one-half of each net smelter return royalty for US$2 million on a per salar basis. Salico is obligated to pay the vendor a payment of US$2,000 per month as a lease and rental remittance fee to maintain the Piedra Parada concessions through the exploration stage, which payments will increase to US$5,000 per month at such time as these concessions are converted to exploitation status.

⁽¹⁾ See NI 43-101 Technical Report filed on SEDAR on June 14, 2010, authored by QP John Hiner, L.P. Geo. here: http://www.sedar.com/search/search_form_pc_en.htm (search for "Pan American Lithium") for more information

⁽²⁾ Salico has been granted contractual rights from a private Chilean company to extract and exploit lithium, light metals and commercial salts with respect to Salar Piedra Parada; the private company owns senior mineral concessions at Piedra Parada on over 2,100 hectares, and has overstaked concessions on 1,500 additional hectares at Piedra Parada which are subject to the senior rights of a third party