PRESS RELEASE

Bacanora establishes partnership with Hanwa

By
Monday, April 10, 2017

PRESS RELEASE

(This is an abridged version of the press release. For the full version click here)

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BACANORA MINERALS LTD. ("Bacanora" or the "Company") (TSX-V: BCN and AIM: BCN), the Canadian and London listed lithium exploration and development company focused on building an international lithium group, is delighted to announce that it has entered into a strategic partnership (the "Agreement") with Hanwa Co., LTD. ("Hanwa"), a leading Japan-based global trading company and one of the larger traders of battery chemicals in the Asian region, with reported net sales of more than ¥1,500 billion in 2016.

The Agreement is comprised of both an initial 10% equity investment in Bacanora and an Off-take Agreement for up to 100% of the battery grade lithium carbonate ("Li2CO3") produced at the Sonora Lithium Project ("Sonora" or the "Project"). The Company is targeting to produce 17,500 tonnes of Li2CO3 per annum ("Stage 1"), commencing in 2019. After two years of producing at this level, the Company plans to lift production to 35,000 tonnes per annum ("Stage 2")[1].

Overview

· Milestone Off-take Agreement for up to 100% of Li2CO3 produced at Sonora:

o Hanwa to purchase 70-100% of lithium carbonate produced during Stage 1

o Tonnage based contract for battery grade lithium carbonate at market pricing, with final pricing to be finalised prior to commencement of production

o Option to increase the off-take tonnage by up to 100% at Stage 2 production

· Company-level investment demonstrates Hanwa's commitment to Bacanora and represents the entry of a new long term, supportive investor to the register:

o Hanwa to acquire an initial 10% interest in Bacanora, raising approximately £10,175,000 (approximately C$16,896,000) in proceeds to the Company via the placement of 12,333,261 shares at a price of 82.5 pence (approximately C$1.37) per share (the "Placing")

o Hanwa is entitled to present a nominee for election to the board of directors of Bacanora and has a pre-emptive right to maintain its 10% equity interest

o Hanwa shall have an option to increase its equity interest in Bacanora to 19.9%.

· The Agreement provides a funding platform for the Project - Hanwa represents a cornerstone investor and will aid in the procurement of long term project debt funding

· Validates the quality of the battery grade (+99.5%) lithium carbonate product and Bacanora's production process

o Hanwa has received numerous samples of the Company's battery grade product and has distributed samples to a number of their customers

Bacanora Chairman Mark Hohnen stated, "This partnership with one of Japan's leading battery chemical traders is transformational for Bacanora: it significantly reduces the overall risk profile of the Project; validates our production process; and provides us with an excellent platform with which to fund the future development of Sonora, our advanced lithium project in Mexico. Importantly, a long-term, supportive relationship has been established between ourselves and Hanwa, who will take a 10% interest in our Company and also purchase between 70-100% of the total lithium carbonate production from our unique asset, highlighting their confidence in our processing methods and our ability to execute on the exciting opportunity that Sonora presents. This will be priced at market prior to production.

"Crucially, this relationship provides Bacanora with a further aligned cornerstone investor ahead of project financing and establishes a mantel from which we hope to leverage towards project debt financing out of Japan to contribute towards the construction of a significant lithium carbonate operation in Mexico. We are delighted to have delivered on our stated objective to secure a partner within the buoyant Asian lithium carbonate market and look forward to continuing this theme in the coming months, as we work towards the completion of our Feasibility Study."

Further Information

The Agreement

Hanwa has established a long-term strategic relationship with Bacanora in relation to its Sonora Lithium Project in Mexico. The ongoing Feasibility Study at Sonora is focused on delivering an operation capable of initially delivering 17,500 tonnes pa of Li2CO3 for the first two years of operations, followed by 35,000 tonnes Li2CO3 pa thereafter. Under the terms of the Agreement, Hanwa will initially acquire 10% of the issued share capital of Bacanora and acquire between 80 - 100% of the Li2CO3 produced at Sonora. In terms of the off-take agreement, pricing will be finalised in line with global Li2CO3 prices prior to Sonora being brought into production.

Hanwa's investment to acquire 10% of Bacanora's outstanding shares is anticipated to be undertaken by the end of April 2017. Hanwa also has an option to increase its equity investment by up to an additional 9.9% of new shares to be issued at market prices at the time of exercise. Further details regarding the completion of the equity investment will be provided in due course.

Importantly, Hanwa has committed to utilising its strong relationships in Asia in order to assist Bacanora in securing the debt financing component of the funding package required to enable development to commence following completion of the Feasibility Study. Preliminary introductions made to date by Hanwa have been positive first steps towards securing such additional future financing requirements.

About Hanwa

Hanwa is a Japanese trading company which supplies a broad spectrum of products, including steel, non-ferrous metals, food, fuel, chemicals, lumber, machinery and many other items, to an equally diverse range of customers. The company has solid positions in all of these businesses. As a trading company that performs many important roles, Hanwa will continue to enter more business fields in response to changes in the operating environment in order to meet the needs of customers.