Lithium Americas Corp.
TSX : LAC

Lithium Americas Corp.

August 26, 2010 08:30 ET

Lithium Americas Corp. Completes Exploration Program at Cauchari-Olaroz

Highlights

- The 53 drill hole exploration program has been completed

- Lithium grade results of the last 6 holes exceed previous results

- Company has begun a production drilling program to test the productive capacity of the aquifers

- Upgraded resource estimate expected in fourth quarter of 2010

TORONTO, ONTARIO--(Marketwire - Aug. 26, 2010) - Lithium Americas Corp. (TSX:LAC) ("Lithium Americas" or the "Company"), is pleased to report it has completed its advanced exploration program on its Cauchari-Olaroz properties in Argentina. The Company's 2009 exploration program was focused in the central part of the 43,451 hectares (ha) covering the vast majority of the Cauchari Salar (salt lake) and approximately one third of the Olaroz Salar.

"Our 2009 drilling programs have identified a significant lithium/potassium resource and provided us with a vast amount of information on the production qualities and geochemistry of our salares," stated Waldo Perez, President and CEO of Lithium Americas Corp. "With the completion of the 2010 advanced exploration phase of our program, the completion of our on- site labs and our pilot-scale evaporation facility, we are now ready to move to the next phase of development with the initiation of our production drilling program. Our team in Argentina is working closely with ARA WorleyParsons to aggressively develop our world-class lithium deposit and move the project to feasibility."

Drilling Results Summary

The Company's 2010 drilling program included a total of 24 reverse circulation ("RC") drill holes and 29 diamond drill holes ("DDH"). In total, Lithium Americas' exploration team has drilled an aggregate of 53 holes, totalling 9,899 meters ("m"). Most of the holes were located in and around the area of Cauchari, where the Company's lithium/potassium inferred resource estimate was completed, in order to increase the size and the confidence of the resource. The deepest hole is a diamond drill hole that tested the salar to a depth of 450m and continues encountering salt and sandstones layers.

The 2010 RC and DDH holes were drilled in locations that enabled the Company to obtain lithium/potassium brine results from an area that is approximately double the width (from 2 kilometres ("km") in width to 4 km in width) of the original area used in calculating the inferred resource estimate. Additionally, the new 2010 RC and DDH holes achieved depths that were on average 230m (approximately 40 percent deeper than the 2009 holes).

Geochemical results in the last six holes received from Alex Stewart Laboratories are listed below. Results for two more holes are pending. The lithium grade in the brine ranges between 991 milligrams per litre (mg/l) and 645 mg/l with a weighted average in all holes of 709 mg/l lithium and 0.64 percent potassium. These results exceed previously reported results, indicating higher grade zones within the aquifers.

Hole # Depth Length K (mg/L) Li (mg/L) Mg (mg/L) Mg/Li
DDH-13 50-140 90 5940 650 1921 2,96
PE-14 147-158 11 6626 750 1899 2,53
  160-228 68 6287 709 1862 2,63
  42-62 20 7602 911 3032 3,33
PE-19* 64-132 68 6347 738 2456 3,33
  155-267 112 5948 657 1920 2,92
  18-30 12 6712 747 2706 3,62
  60-67 7 6181 693 1727 2,49
PE-20* 70-127 57 5707 645 1785 2,77
  129-132 3 6529 704 1952 2,77
  134-150 16 6363 697 2226 3,19
  155-204 49 6193 691 2193 3,17
  92-112 20 5619 661 1298 1,96
PE-21 113-134 21 5587 735 1412 1,92
  135-222 87 7162 825 1694 2,05
  90-197 107 7200 696 1492 2,14
PE-22 198-230 32 6394 729 1760 2,41

* Preliminary Partial Results Published on July 8, 2010

Air lift tests done on RC holes PE-14, PE-17, PE-19, PE-20, PE-21 and PE-22 prove an average yield of 5.2 litres per second over the entire hole, maximum yields of 13 litres per second, and minimum of two litres per second. All six holes have increasing yields at depth. These encouraging results suggest that production-level yields can be achieved across the aquifers. Porosity tests in the diamond drill cores continued to yield drainable porosity values between 6 percent and 25 percent, comparable to the results published before.

Additional information on the location of the drill holes can be found in the updated corporate presentation in the investors section of the Company's web site at www.lithiumamericas.com.

Production Drilling Program

The Company has already initiated a large diameter rotary production drilling program with the objective of establishing the aquifer hydrological parameters that will allow the Company to design the production well field.

The program, which began mid-August, is expected to be completed at the end of Q4, 2010 and includes three 17 inch production wells and fifteen 5 ¼ inch piezometric wells used to monitor the production wells as they drain down the aquifers.

At the conclusion of the program, the Company will have the data necessary to establish the fundamental economic and operational parameters of the project such as pumping rates in the aquifers, number of holes required to enter into production and estimated production rates. This data will be used to calculate the "extractable reserves" and convert the resource estimation into a reserve estimation by adding economic parameters.

About the Company

Lithium Americas Corp. is an exploration company focused on the exploration of lithium, potassium, borax and other minerals in South America. The Company's principal and most advanced property comprises a significant portion of two adjacent Argentinean dry salt lakes (salares), Cauchari and Olaroz, covering 43,451 ha located in the Puna Plateau. The Puna Plateau is the most prolific brine reserve region globally, hosting approximately 84 percent of the world's lithium brine reserves. Based on an NI 43-101 compliant inferred in situ resource estimate of 1.58 x 1012 litres with average grade of 584 mg/L lithium and 4,860 mg/L potassium (equivalent to 4.9 million tonnes of lithium carbonate and 7.7 million tonnes of potassium), Lithium Americas' principal property is one of the largest known lithium brine deposits in the world. The Company believes the Cauchari and Olaroz property has the potential of becoming a world-class lithium deposit in both size and quality.

John Kieley, P. Geo. is the internal Qualified Person on the project who has reviewed this news release and is responsible for the technical information reported herein.

Certain information contained in this news release is based on the Company's NI 43-101 compliant technical report titled "Amended Inferred Resource Estimation Of Lithium and Potassium at the Cauchari and Olaroz Salares, Jujuy Province, Argentina" dated February 15, 2010, prepared for Lithium Americas Corp. by Mark King, a "qualified person" pursuant to NI 43-101, which can be viewed on the Company's website or at www.sedar.com, under the Company's profile. Inferred resources have a great amount of uncertainty as to their existence, and great uncertainty as to their economic feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or prefeasibility studies, except in rare cases. Investors are cautioned not to assume that part or all of an inferred resource can be upgraded to an indicated or measured resource or is economically mineable.

Sampling and Analytical Protocols: Sampling and analytical protocols were implemented and supervised by or under the direction of John Kieley, the Corporation's internal Qualified Person as defined by National Instrument 43-101. All of the geochemical samples were collected by geologists taking into account the nature of the material being sampled. The brines samples were collected from the cyclone in a plastic container and then transferred into a new 1-litre plastic bottle which was then tightly closed. All samples were tagged with a pre-numbered ticket and stored in a secure location at the field office for no more than 10 days in cold dark storage. The samples were transported by Alex Stewart Assayers Argentina S.A. ("ASAA") laboratories from the field office site to their facilities in Mendoza (Argentina) where they were analyzed. ASAA is an ISO 9001-2000-certified laboratory with headquarters in England. The brine samples were analyzed by ICP analysis. All samples were assayed for 13 elements by ICP and AA. Accuracy and precision of results is tested through the systematic inclusion of blanks, standards and duplicates. Sulphate was assayed using the gravimetric method, chloride by the argentometry method and volumetric analysis (acid/base titration) was used for carbonates (alkalinity as CaCO3). Laboratory measurements were conducted for Total Dissolved Solids ("TDS"), density, and pH. Drainable porosity tests were carried out on intact diamond drill core every 3 meters on all undisturbed samples through the "Relative Water Release Capacity" method ("RWRC")" analysed by Daniel B. Stephens Inc. Laboratory (DBS) in New Mexico, USA. The method calculates changes in volumetric moisture content as samples (initially fully saturated) drain over a three-day period under a vacuum suction. The drainable porosity is considered to be equal to the difference between volumetric moisture contents at the start and finish of the test .The samples were collected in a plastic tight container and shipped from Jujuy Province, Argentina by DHL to the DBS labs in the USA.

This press release contains forward-looking statements, which can be identified by the use of statements that include words such as "could", "potential", "believe", "expect", "anticipate", "intend", "plan", "likely", "will" or other similar words or phrases. The Company does not intend, and does not assume any obligations, to update forward-looking statements, whether as a result of new information, future events or otherwise, unless otherwise required by applicable securities laws. Readers should not place undue reliance on forward-looking statements. Readers should review the Company's prospectus dated May 6, 2010, for a list of risks associated with the Company and its business.

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