DWQ-2024-003825

1

Table of Contents

Attachment A - Area of Review ................................................................................................... 2
Attachment B - Corrective Action Plan ........................................................................................ 7
Attachment C - Construction Plan .............................................................................................. 10
Attachment D - Injection Well Operating Plan and Procedures ................................................. 15
Attachment E - Well Simulation Program .................................................................................. 20
Attachment F - Monitoring, Recording, and Reporting Plan...................................................... 23
Attachment G - Contingency Plan .............................................................................................. 31
Attachment H - Plugging and Abandonment Plan ...................................................................... 34
Attachment I - Financial Responsibility and Well Closure Cost Estimate ................................. 37

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ATTACHMENT A
Area of Review

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Contents
1.0 Summary ............................................................................................................................... 4

Figures:
Table A-1 - Proposed UIC Class V Injection Well Locations ................................................... 4
Figure A-1 - General Location of A1 Lithium’s SBR Wells ...................................................... 5
Figure A-2 – A1 Lithiums’s Area of Review (AOR) ................................................................. 6

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Area of Review
1.0 1.0 Summary
This Attachment A demonstrates the location of A1 Lithium’s Class V Spent Brine Return
(SBR) wells in Grand County, Utah, authorized by the Division of Water Quality pursuant to
UIC Permit No. UTU-37-AP-1D61E74. The Class V SBR wells will inject into the Paradox
Formation from the top clastic zone 23 to the bottom of clastic zone 27. The maximum zone of
influence that may occur in 5 years is approximately 1 mile from each well in any direction, as
shown in Figure A-2. Proposed well locations are included in Table A-1. Figure A-1
demonstrates the general location of A1 Lithium’s SBR wells. Figure A-2 demonstrates the
Area of Review (AOR), including A1 Lithium’s proposed Class V SBR wells and the project
area.
Table A-1. Proposed UIC Class V Injection Well Locations (UTM Zone 12S).
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Figure A-1. Location of A1 Lithium’s project, including the proposed UIC spent brine disposal wells near Moab, Utah. A1 Lithium’s Permit boundaries are shown
in black. Proposed UIC disposal wells are yellow pins. The 1 Mile AOR is in magenta. Artificial penetrations in the AOR are flagged, labeled, and shown as Red
Pins.
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Figure A-2. A1 Lithium's proposed UIC permit area. Proposed UIC well locations (P1 through P4) are labeled. The majority of the permit
boundary rests on BLM land. SITLA land is indicated by blue squares.
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ATTACHMENT B
Corrective Action Plan
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Contents
1.0 Introduction ........................................................................................................................... 9
2.0 Purpose of a Corrective Action Plan ..................................................................................... 9
3.0 Current Need for Corrective Action...................................................................................... 9
4.0 Developing a Corrective Action Plan ................................................................................... 9
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Corrective Action Plan
1.0 Introduction
This Attachment B describes the purpose of a corrective action plan, A1 Lithium’s current need for
corrective action, and the process to which A1 Lithium must adhere in developing a corrective action
plan.
2.0 Purpose of a Corrective Action Plan
A1 Lithium has identified all artificial penetrations into the permitted injection zones for the spent
brine disposal operation that lie within the Area of Review (AOR), as outlined in Attachment A. A1
Lithium shall develop a corrective action plan and undertake corrective action for wells that are
improperly sealed, completed, or abandoned to prevent movement of injection fluid into underground
sources of drinking water.
3.0 Current Need for Corrective Action
At the effective date of this permit, there are no wells within A1 Lithium’s AOR that require
corrective action nor the development of a corrective action plan.
4.0 Developing a Corrective Action Plan
A1 Lithium shall comply with Part III.K of this permit. A1 Lithium shall notify the Utah Division of
Water Quality (DWQ) within 24 hours of discovering a well or wells within the AOR that may need
corrective action. A1 Lithium shall develop and submit a modified corrective action plan to DWQ
within 30 days of determining that a well or wells need to be corrected.
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ATTACHMENT C
Construction Plan
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Contents
1.0 Introduction ......................................................................................................................... 12
2.0 Construction Plan ................................................................................................................ 12

Figures:
Figure C-1 – US 16-1 Well Construction Diagram .................................................................. 13
Figure C-2 - Proposed US 16-1 Rework Diagram ........................................................................ 14

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Construction Plan
1.0 Introduction

This Attachment C describes A1 Lithium’s injection well construction plan.
2.0 Construction Plan

A1 Lithium's injection well construction plan is forthcoming. While A1 Lithium is still developing its
construction plan based on the construction of existing well Utah State well 16-1. The original 16-1
and its proposed rework plan have been included in Figure C-1 and C-2. The injection wells will be
completed and cemented through the Mesozoic strata and perforated into the target clastic sequences
in the Paleozoic Paradox Member of the Hermosa Formation. Multiple clastic beds may be perforated
to achieve the target injection capacity. A packer will be used to isolate the injection zone from the
upper casing string.

A1 Lithium shall comply with Part III.C of this permit. No less than 30 days prior to A1 Lithium’s
planned construction of a well, A1 Lithium shall provide the Utah Division of Water Quality (DWQ)
Individual Construction Plans for each well to be constructed, for review and approval by the
Director. Well construction shall only begin after A1 Lithium receives written approval from the
Director. A1 Lithium will notify DWQ of the construction schedule once it is finalized. A1 Lithium
shall provide DWQ with two weeks’ notice prior to any actual construction activity, so a
representative or representatives of the Director of DWQ can witness and supervise the well
construction activity.
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Figure C-1. US 16-1 well construction diagram.
14

Figure C-2. Proposed US 16-1 Rework Diagram

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ATTACHMENT D
Injection Well Operating Plan and Procedures

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Contents
1.0 Introduction ......................................................................................................................... 17
2.0 Operating Plan .................................................................................................................... 17

Figures:
Table D-1 - A1 Lithium’s DLE production brine chemistry. ................................................... 19

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Injection Well Operation Plan and Procedures
1.0 Introduction

This Attachment D describes A1 Lithium’s approved and enforceable Operating Plan.

2.0 Operating Plan

A1 Lithium will pump spent lithium brine solution from the Direct Lithium Extraction (DLE) plant
through pipelines to the injection wellheads and into the injection zone. As further defined in Part
III.E of this permit, the injection zone is between clastic zone 23 and clastic zone 29. Injection is
expressly limited to the injection zone. The spent brine will be sent to the injection wells shown in
Figure A-1. Injection into any new injection well will not commence until A1 Lithium has fulfilled
all applicable conditions of this permit and has received written authorization from the Utah Division
of Water Quality (DWQ).

Injection flow rates will not exceed 2000 gallons per minute or 300 gallons per minute per well.
Injection pressures will not exceed the fracture gradient of .75 psi per foot of well depth. This fracture
gradient is based on information provided in Intrepid Potash Moab’s July 6, 2020, Class III UIC
Permit Review and the Technical Report for permit number UTU-19-AP-1C3C2E8. That review
provided that “Agapito Associates Inc., (2001) calculated a fracture gradient of 1.31 pounds per
square inch per foot (psi/ft) based on hydraulic fracturing tests performed on wells 19, 20 and 21
(Attachment A)”. However, the permitted fracture gradient was lowered by 60 percent for Intrepid
because of the proximity of solution mining operations and underground workings. There is no
solution mining or underground workings beneath A1 Lithium’s injection site, and the fracture
gradient for clastic zone 31 was tested at 0.73 psi/ft. Accordingly, A1 Lithium will adhere to a
fracture gradient of 0.75 psi per foot of well depth.

A1 Lithium will determine site and well specific fracture gradients, including Maximum Allowable
Surface Injection Pressure (MASIP), during formation testing and report these test results to DWQ
within 30 days of making such determinations. A1 Lithium shall calculate MASIP to ensure that
pressure in the injection zone during injection does not initiate new fractures or propagate existing
fractures in the injection zone. No injection pressure will be revised until DWQ approves the permit
modification. The injection pump will be set to automatically shut down when flow rate or pressure
comes within 5 percent of the recommended maximums of 2,000 gallons per minute and 0.75 psi per
foot of well depth, respectively. The injection flow rate and injection pressure will be monitored
continuously, as described in the Monitoring, Recording, and Reporting Plan (Attachment F).

Injection fluid is limited to spent brine from the Direct Lithium Extraction (DLE) process generated
by the A1 Lithium Minerals Project. A1 Lithium’s DLE spent brine chemistry is included in Table D-
1. Prior to injection, spent brine will be depleted with respect to lithium, bromide, and potentially
other salts. Small amounts of rinse water will be added and will dilute the spent brine to the
concentrations shown in Table D-1. The amount of dissolved mineral mass recovered is only a small
fraction of the total dissolved solids, so the overall concentrations of spent brine are approximately
constant from production to injection.

A1 Lithium will keep the permit area secure and prevent unauthorized persons from entering or
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accessing the permitted area or tampering with, disabling, or destroying the well, wellhead, or any
other equipment within the A1 Lithium's care, custody, or control.
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Table D-1. A1 Lithium’s DLE production brine chemistry.
Major
Extractable
Minerals

LI (ppm) Br (ppm) B (ppm)
Min Max Min Max Min Max
170 210 3,500 4,000 1,400 1,700

Major Salts
Na (ppm) K (ppm) Ca (ppm) Mg (ppm) Cl (ppm) Fe (ppm)
Min Max Min Max Min Max Min Max Min Max Min Max
18,000 20,000 25,000 29,000 45,000 50,000 35,000 40,000 220,000 260,000 200 250

Minor
Components

SO4 (ppm) Sr (ppm) Ba (ppm) Zn (ppm) HCO3 (ppm) F (ppm)
Min Max Min Max Min Max Min Max Min Max Min Max
50 100 1,500 1,800 1 4 3 4 1,200 1,400 30 35

Brine
Properties

TDS (ppm) Density (g/cm3) pH
Min Max Min Max Min Max
350,000 400,000 1.27 1.28 4.5 5.0

Key:
ppm = parts per million
g/cm3 = grams per cubic centimeter Min = minimum concentration
Max = maximum concentration
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ATTACHMENT E
Well Stimulation Program

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Contents
1.0 Introduction ......................................................................................................................... 22
2.0 Planned Well Stimulation ................................................................................................... 22
3.0 Routine Well Stimulation ................................................................................................... 22
4.0 Requirements Prior to Well Stimulation ............................................................................. 22

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Well Stimulation Program
1.0 Introduction
This Attachment E describes the process A1 Lithium must adhere to prior to planned and routine
well stimulation.
2.0 Planned Well Stimulation
No formation stimulation is planned for the injection zone of A1 Lithium’s disposal facility. A1
Lithium only anticipates minor well stimulation for maintenance, rehabilitation, perforation, and
redevelopment.
3.0 Routine Well Stimulation
A1 Lithium may conduct well surging, swabbing, incidental salt encrustation dissolution, and other
routine maintenance as needed.
4.0 Requirements Prior to Well Stimulation
A1 Lithium will notify the Utah Division of Water Quality (DWQ) of any plans to conduct well
stimulation and will submit those plans to DWQ. DWQ, in its full discretion, will approve or deny
the Well Stimulation Plan. A1 Lithium must receive approval of the Well Simulation Plan from
DWQ prior to A1 Lithium conducting well stimulation.

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ATTACHMENT F
Monitoring, Recording, and Reporting Plan

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Contents
1.0 Introduction ........................................................................................................................... 25
2.0 A1 Lithium’s Monitoring Program - Generally .................................................................... 25
3.0 Injection/Extraction Volumes, Pressures, and Temperatures Monitoring ............................ 25
4.0 Injection Zone Monitoring .................................................................................................... 25
5.0 Groundwater Level Monitoring ............................................................................................ 26
6.0 Mechanical Integrity Testing ................................................................................................ 26
7.0 Loss of Mechanical Integrity ................................................................................................ 26
8.0 Interim Mechanical Integrity Testing ................................................................................... 26
9.0 Reporting............................................................................................................................... 27
Figures:
Figure F-1 - Injection Pump Manifold Schematic .................................................................... 28
Table F-1 - Injection Line Component Table ........................................................................... 29
Figure F-2 - Monitor Well Schematic ....................................................................................... 30
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Monitoring, Recording, and Reporting Plan
1.0 Introduction
This Attachment F describes A1 Lithium’s monitoring, recording, and reporting plan.
2.0 A1 Lithium’s Monitoring Program – Generally
A1 Lithium's monitoring program is designed to provide representative data of the monitored
systems to track and control the chemistry, volume, and pressure of injection of fluids, wellbore
conditions, and fluid distribution. The monitoring program consists of the following major
components:
•Continuous monitoring of injection total dissolved solids, flow rates, volumes,
temperatures, and pressures for each injection well. The injection pumps record the flow
rate and pressure data on a downloadable digital storage device.
•Groundwater level and quality monitoring at monitor wells completed into the Mesozoic
formations.
•Quarterly injectate brine chemistry samples for laboratory analysis.
•Samples collected quarterly from the Green River upstream and downstream of the permit
area will also be submitted to a third party certified analytical laboratory.
•Conducting well mechanical integrity testing (MIT) at least once every 5 years at
completion or workover and then at least once every 5 years thereafter, unless interim tests
are requested or deemed necessary by the Director.
A1 Lithium will report results of its monitoring to the Utah Division of Water Quality (DWQ) in
the reports that it submits quarterly. The schedule for submitting quarterly monitoring reports is
included in Part III.G of this permit. Other records, such as calibration and maintenance records,
are created and stored.
3.0 Injection/Extraction Volumes, Pressures, and Temperatures Monitoring
The principal component of A1 Lithium's monitoring program consists of continuously monitoring
the total dissolved solids (TDS) or specific conductance flow, volumes, temperatures, and pressures
at each well. Injection brine flow rate, volume, pressure, and temperature are monitored at each
well head by inline conductivity probes, flow meters, pressure transducers, and thermistors that
record these parameters digitally every 5 minutes. Locations of the in-line conductivity probes, flow
meters, pressure transducers, and thermistors are shown schematically on Figure F-1. The data
gathered from these devices is sent to and stored by a central process control center located at the
production facility for continuous monitoring by an operator 24 hours a day, 365 days a year.
4.0 Injection Zone Monitoring
A1 Lithium will monitor the flow of injectate being injected into the injection zone by one
continuously recording flow meter installed in the flow line between the injection pump (Figure F-
1)and the wellhead. Typically, the flow is monitored with totalizing flow meters, a pressure
transducer, and a thermal probe.
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5.0 Groundwater Level Monitoring
Groundwater levels above the injection zone will be monitored using pressure transducers installed
in monitoring wells, as shown in Figure F-2. One or more wells will be located between the
injection wells and the Green River. The wells will be screened in one or more of the permeable
Mesozoic sandstone formations and below the Mancos Formation. A1 Lithium will use 2 automatic
data recorders to collect water level readings that will be transmitted to the central control office. A
significant rise in water levels above threshold limits will alert the operator to shut off the injection
pumps. A1 Lithium will then investigate the cause of the unexpected water level rise and report the
incident to DWQ within 24 hours. A1 Lithium will collect and test water quality samples for
conductivity and TDS to determine if injection fluids are entering the upper groundwater system. If
necessary, a corrective action plan will be developed and implemented as described in Attachment
B and Part III.K of this permit.
6.0 Mechanical Integrity Testing
A1 Lithium will undertake mechanical integrity testing (MIT) of all injection wells at least once
every 5 years to demonstrate both internal (Part 1) and external (Part 2) mechanical integrity of the
well per 40 CFR § 146.8(a)(1) and 40 CFR § 146.8(a)(2). A1 Lithium will notify DWQ prior to
MIT. The standard of mechanical integrity is outlined in Part III.H of this permit.
A1 Lithium will perform internal MIT by using sealed casing pressure tests. The bottom of the
casing will be sealed with a plug, downhole inflatable packer, or other suitable device. The casing
will be filled with water, and the top of the casing will be sealed with a threaded cap, mechanical
plug, or downhole inflatable packer. The well casing will then be pressurized with water or air and
monitored with a calibrated pressure gauge. Internal casing pressure will be increased to 125
percent of the maximum operating pressure of the well field or 125 percent of the maximum
operating pressure rating of the well casing (which is always less than the maximum pressure rating
of the pipe), whichever is less.
To demonstrate internal mechanical integrity, a well must maintain 90 percent of the determined
maximum pressure for a minimum of 30 minutes to pass the test. If the pressure drops by less than
10 percent during the 30-minute period, the well casing will have demonstrated acceptable
mechanical integrity. If there are obvious leaks, or the pressure drops by more than 10 percent
during the 30-minute period, the seals and fittings on the packer system will be checked, reset, or
both, and another test will be conducted. If, following a second test, there remains obvious leaks or
the pressure drops by more than 10 percent during the 30-minute period, the well fails to
demonstrate mechanical integrity or to meet the MIT criteria.
External MIT will be performed by an approved method, as set forth in 40 CFR § 146.8. DWQ, in
its full discretion, may approve the final and most appropriate method for demonstration of external
mechanical integrity.
Other supplemental MIT tests will monitor reservoir pressures and comparison with expected
pressures in geopressured zones. This is a standard procedure in producing oil and gas wells, such
as the Rose Petroleum (Utah) well (API 430193157500).
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7.0 Loss of Mechanical Integrity

A1 Lithium shall comply with Part III.G and Part III.H of this permit. A1 Lithium will notify DWQ
if any well fails MIT following the reporting procedures described below. If a well casing does not
meet the MIT criteria, A1 Lithium shall: (i) cease operation of the well immediately; (ii) take steps
to prevent losses of brine into USDWs; and (iii) within 90 days after loss of mechanical integrity,
restore mechanical integrity or plug and abandon the well in accordance with the Plugging and
Abandonment Plan approved by the Director. Well plugging and abandonment procedures are
described in Attachment H. A1 Lithium may resume operation of the well after demonstrating
mechanical integrity and receiving written approval from the Director. If A1 Lithium cannot
demonstrate mechanical integrity using an acceptable test following well repairs or well reworking,
A1 Lithium shall plug and abandon the well.

8.0 Interim Mechanical Integrity Testing

In addition to the initial testing after well construction, A1 Lithium will conduct MIT on its wells
following any repair where a downhole drill bit or under-reaming tool is used. Any well with
evidence of subsurface damage will require new MIT prior to restarting injection. MIT for each
well will be conducted at least once every five (5) years.

9.0 Reporting

A1 Lithium will report continuous monitoring to DWQ quarterly, which shall include the contents
specified in Part III.G of this permit. A1 Lithium will send these records to DWQ electronically, in
accordance with the schedule for submitting quarterly monitoring reports under Part III.G of this
permit.

MIT documentation will include the well designation, test date, test duration, beginning and ending
pressures, and the signature of the individual responsible for conducting each test. MIT
documentation will be available for inspection by DWQ personnel upon request and will not be
unreasonably withheld by A1 Lithium. A1 Lithium will report MIT results within 60 days after
completing MIT, and in accordance with Part III.G.7 of this permit.
28
Figure F-1. Injection Pump Manifold Schematic.
-
29
Table F-1. Table describing the components of the injection line schematic included in Figure F-1. ASARCO 1993. In Situ
Copper Mining Project Casa Grande Arizona. Phase I and II Technical Report. Volume I Sections 1-6. Submitted to the
U.S. Bureau of Mines. Submitted by ASARCO April 19, 1993.
SECURITY CAP
SURF'Arr!!i1'1!!ie"Ci'IT"P:====M7""'7T-1 16-INCH I.D. BLANK Slm CASING
CEMENT 14--INCH BOREHOLE-----�
CASING CENTRALIZERS (Spaced at '4-0-footIntervals)
CEMENT
10 1/4-INCH I.D. BLANK Slm. CASING
8 1 / 4-INCH I.D. BLANK Slm. CASING
Flll MATERIAL 8 1/ 4-INCH I.D. PERF'ORA m> Slm CASING
.1 -
I I I I I I
.-.. -__� .. ---. ,;_•··,'·:1.·�
DEPTH BELOW LAND SURF' ACE, IN FEET
0 20
493
548 551
3!8
JiOIFPf11/P/NC r.anurn tn-11-to
-----.....__
DRILL CUTTINGS PERCENT GRAVEL. SAND, AND SILT AND CLAY
0 20 40 50 80 100
1�1NCH BOREHOLE
Flll MATERIAL
Figure J-2. Monitor well schematic. ASARCO 1993. In Situ Copper Mining Project
Casa Grande Arizona. Phase I and II Technical Report. Volume II Section 8.
Submitted to the U.S. Bureau of Mines. Submitted by ASARCO April 19, 1993.
Pressure Transducer -
30
31

ATTACHMENT G
Contingency Plan

32

Contents
1.0 Introduction ........................................................................................................................... 33
2.0 Contingency Plan .................................................................................................................. 33

33

Contingency Plan
1.0 Introduction

This Attachment G describes A1 Lithium’s Contingency Plan.
2.0 Contingency Plan

A1 Lithium has developed this Contingency Plan for disposal wells in the event of conditions that
require its wells to be temporarily or permanently shut-in. A1 Lithium will contain any surface
leaks or spills according to the facility spill prevention, control, and counter measure plan, which is
separate from UIC regulations. An injection well will be temporarily or permanently shut-in or
taken out of service for the following:

- Routine maintenance;
- Flow and pressure increase to the threshold pressure limit;
- Significant decreases or increases in permeability and injectivity;
- Unforeseen technical issues or threshold parameter measurements in monitor wells; or
- Injectate water quality changes that exceed threshold limits.

If a well needs to be temporarily or permanently shut-in, A1 Lithium will immediately disconnect
the well from all sources of brine or water and cap the well at the surface. Continuous monitoring
of in line pressure, flow, and TDS, as described in Attachment F, will detect these conditions if
they arise.

If a well needs to be shut-in under emergency conditions, the piping system is designed to take the
unexpected pressure with a factor of safety. All injection brines in the system will be routed to an
overflow holding pond near the lithium production plant. A1 Lithium will contract service crews to
perform emergency repairs if on-site personnel are not capable or available.

In the event of a well failure or a well that is not repairable, A1 Lithium will plug and abandon the
well in accordance with the Plugging and Abandonment Plan, Attachment H. Prior to plugging and
abandoning a well, A1 Lithium will prepare and submit a condition report to the Utah Division of
Water Quality (DWQ) for final approval of the modified or unmodified plugging and abandonment
plan. A schematic of the wellhead sensors and valve controls is shown in Figure F-1.
34

ATTACHMENT H
Plugging and Abandonment Plan

35

Contents
1.0 Introduction ........................................................................................................................... 36
2.0 Procedure for Plugging and Abandoning Well ..................................................................... 36
3.0 Contents of the Well Condition Report ................................................................................ 36

36

Plugging and Abandonment Plan
1.0 Introduction

This Attachment H describes A1 Lithium's Plugging and Abandonment Plan for its injection
wells. This plan meets the requirements of Utah Administrative Code R317-7-6.6.

2.0 Procedure for Plugging and Abandoning Well

A1 Lithium must undertake the procedures for plugging and abandonment required by R317-7-6.6.
Prior to abandoning its Class V injection wells, A1 Lithium shall close the well in a manner that
prevents the movement of fluid containing any contaminant into an underground source of drinking
water, if the presence of that contaminant may cause a violation of any primary drinking water
regulation under 40 CFR Part 141 or Utah Primary Drinking Water Standards R309-200-5 or may
otherwise adversely affect the health of persons.

A1 Lithium shall dispose of or otherwise manage any soil, gravel, sludge, liquids, or other
materials removed from or adjacent to the well in accordance with all applicable Federal, State, and
local regulations.

A1 Lithium must notify the Director of its intent to close its wells at least 30 days prior to closure.
A1 Lithium will also notify the Director of the plugging timeline to give enough time to schedule
Utah Division of Water Quality (DWQ) personnel to witness and inspect the plugging operation.

3.0 Contents of the Well Condition Report

If a well requires abandonment, A1 Lithium will submit a well condition report that contains the
following:

1. The results of the well's most recent mechanical integrity test;
2. The location of any detected or suspected leaks or perforations in the casing;
3. The estimated location of any vertical migration of fluids behind the casing;
4. The adequacy of casing cement bonding across the salt formation, as determined from
cement bond logs run at the time of well construction or just prior to well abandonment; and
5. Any supporting data or test results concerning the well’s condition.

According to this Plugging and Abandonment Plan, A1 Lithium will cement the well from the
bottom of the well back to the well head and keep cement records documenting well plugging
completion using the balance method or another DWQ approved or requested method. Other well
closure activities, equipment, and materials are listed in Table I-1.
37

ATTACHMENT I
Financial Responsibility and Well Closure Cost Estimate

38
Contents
1.0 Introduction ........................................................................................................................... 39
2.0 Financial Responsibility Requirements ................................................................................ 39
3.0 Well Closure and Plugging and Abandonment Cost Estimate ............................................. 39
Figures:
Exhibit I-1 - Collateral Bond Agreement - Cash Bond .............................................................. 40
Table I-1 - Well Plugging and Abandonment Cost Estimate per UIC Injection Well ............... 48
39

Financial Responsibility and Well Closure Cost Estimate
1.0 Introduction

This Attachment I describes A1 Lithium’s financial responsibility requirements under Utah
Administrative Code R317-7 and 40 CFR Part 144.
2.0 Financial Responsibility Requirements

A1 Lithium will bond the injection facility closure and plugging and abandonment of injection
wells in accordance with R317-7-9.1.D.24, R317-7-9.4, 40 CFR § 144.52(a)(7), this permit, all
other applicable regulations, and Utah Division of Water Quality requirements. A copy of the pro
forma bond agreement is attached as Exhibit I-1.

3.0 Well Closure and Plugging and Abandonment Cost Estimate

A1 Lithium’s UIC well closure and plugging and abandonment costs per injection well are
estimated in Table I-1.
May 20519 Page 1 of 6

Bond/ Check Number:
Date:
State of Utah
Department of Environmental Quality
Division of Water Quality

Collateral Bond Agreement-Cash Account
Form ***
Operator Name:
Address:

City : State: Zip Code:
Phone Number:
Bonding Contact Name:
Title:
Email Address:

This Cash Account for (“Operator”), which is duly authorized and
qualified to do business in the State of Utah, is held and firmly bound unto the State of Utah through the Utah State Treasur er's Office (“State
Treasurer”), in the form of:

Check Number: ; Principal Amount $
(“Cash Account”) as a:

Cover all State and Fee wells drilled in the State of Utah; or

Operator Obligation
The condition of this obligation is such that the Operator (its heirs, executors and successors) is or will be engaged in the drilling, redrilling,
deepening, repairing, operating, and plugging and abandonment of a well(s) and restoring the well site(s) in the State of Utah for the purpose
of mineral production and/or the injection and disposal of fluids in connection therewith. See Utah Admin. Code R649-3.

Cash Agreement
This agreement describes the mutually agreed upon instructions of the below signed pa rties to the State Treasurer, regarding the control,
redemption, and release of the State Treasurer's above -described Cash Account, which is being used as principal to guarantee the availability
for proper plugging and abandonment of the well(s) and proper well site(s) restoration. It is the intention of the parties that the Cash Account
be utilized as principal to guarantee that the full principal amount will be available to the State of Utah, Division of Water Quality
(“Division”) for proper plugging and abandonment of the well(s) and proper well site(s) restoration. Upon demand and in the event the
Well Name:
API Number:
Section: Township: Range:
County: , Utah

Check Number:
Form 4B.2, May 2019 Page 2 of 5

Operator of the well site(s) is unable or unwilling to complete proper plugging and abandonment of the well(s) and proper wel l site(s)
restoration in compliance with applicable state law and regulations, the Division may redeem the Cash Account according to th e steps outlined
below.

Ownership and Renewal:
Ownership of the Cash Account is retained by the Operator, but it is payable to the Division and held by the State Treasurer for the benefit
of the Division, and is subject to the terms and conditions described in this agreement. The State Treasurer will provide monthly Cash
Account information to the Division for balance t racking purposes.

Redemption:
The Cash Account may only be redeemed (i.e., called on demand) pursuant to the written instruction or demand of the Associate
Director of Water Quality for the Division (“Associate Director”) to the State Treasurer. Upon the instruction and demand of the
Associa te Director, the full amount of the Cash Account shall be transferred to the Division. The Operator agrees and irrevocably instructs the
State Treasurer that neither the Operator, nor any other person claiming an ownership interest in the Cash Account which is derived from the
Operator, shall have the authority to prevent the State Treasurer from carrying out the Associate Director's instruction to r edeem the Cash
Account.

Release:
The State Treasurer shall releas e the Cash Account only upon the written instruction of the Associate Director to the State Treasurer.
Upon release, the terms and conditions of this agreement are no longer in effect, the Cash Account shall be returned to the O perator, or its
legal succes sor-in -interest.

Accrued Interest :
Prior to release, all interest which accrues by the Cash Account shall remain in the Cash Account. In no event shall the Stat e Treasurer transfer
any amount from the Cash Account which would cause the redemption amount o f the Cash Account to be less than the initial amount. All tax
liabilities for accrued interest shall remain the sole responsibility of the Operator.
Check Number:
Form 4B.2, May 2019 Page 3 of 5

These Terms and Conditions are Agreed Upon By:

Company Officer Signature
Print Name:
Title:
Operator Name:

Date:

John Mackey , Director
Utah Division of Water Quality

Mail to:
Division of Water Quality
195 N 1950 W
P.O. Box 144870
Salt Lake City, UT 84116
Phone: [phone]
Date:

Check Number:
Form 4B.2, May 2019 Page 4 of 5

AFFIDAVIT OF QUALIFICATION
OPERATOR
ooOOoo

I,
Company Officer of
, being first duly sworn under oath, deposes and says that he/she is a
; and that he/she is duly authorized to execute and deliver the

foregoing obligations; and that said OPERATOR is authorized to execute the same and has complied in all respects with the laws of Utah in
reference to commitments, undertakings and obligations herein.

Signature
Print Name:
Title:

Subscribed and sworn to before me this day of , 20

Notary Public

My Commission Expires:

, 20

Attest:

STATE OF )
COUNTY OF )
Check Number:
Form 4B.2, May 2019 Page 5 of 5

) ss:
Check Number:
Form 4B.2, May 2019 Page 6 of 5

AFFIDAVIT OF QUALIFICATION
DIRECTOR
ooOOoo

I, John Mackey , being first duly sworn under oath, deposes and says that he is the Director for the Division of Water Quality ,
Department of Environmental Quality , State of Utah; and that he is duly authorized to execute and deliver the foregoing obligations; and that
s aid DIRECTOR is authorized to execute the same by authority of laws on behalf of the State of Utah.

John Mackey, Director
Utah Division of Water Quality

Subscribed and sworn to before me this day of , 20

Notary Public

My Commission Expires:
, 20

Attest:

STATE OF )
COUNTY OF )
Check Number:
Form 4B.2, May 2019 Page 7 of 5

) ss:
48
ITEM LABOUR EQUIPMEN
T
MATERIAL
S
DIRECT TOTAL
Reclamation of
drill pad (1st acre)
$14,400.00 $14,400.00
Decommissionin
g of Structures
(tanks and
fences)
$110.00 $1,275.00 $1,385.00
Reserve Pit $72.00 $870.00 $14.00 $956.00
Disposal of salt
water
$138.00 $956.00 $14.00 $3,250.00 $4,358.00
Re-seeding $150.00 $1,456.00 $968.00 $2,264.00
CONTRACTIN
G
TOTAL
$470.00 $2,972.00 $996.00 $18,925.00 $23,363.00
DRILLING RIG AND CEMENTING TOTAL
Drillhole Closure ($10/ft, $210/surface plug, $2,500/lg
hole)1
$78,210.00
Equipment (mob/demob) $16,000.00
DRILLING AND CEMENTING TOTAL $94,210.00
TOTAL RECLAMATION COST $117,573.00*
1Estimate based on total well depth of 7550 feet.
*Total reclamation cost is based upon current values and does not account for future
inflation.
Table I-1. Well plugging and abandonment cost estimate per UIC injection well.