Talison Lithium Reports Fiscal 3Q 2011 Results Including Record Revenue, Earnings and Cash Flow Salares Drilling Results Pending

PERTH, WESTERN AUSTRALIA -- (Marketwire) -- 05/12/11 -- Talison Lithium Limited ('Talison' or the 'Company') (TSX: TLH) announces financial results for the third quarter ended March 31, 2011 and details of a conference call to discuss the financial results.

Third Quarter Highlights

Talison today released its financial results as at and for the three and nine month interim periods ended March 31, 2011(1). For a detailed discussion of the Company's financial results, refer to Management's Discussion and Analysis which can be found on Talison's website and SEDAR profile.

Financial Results

--  Sales revenue for the three months ended March 31, 2011 ('Third
    Quarter') of A$29.2 million, an increase of 78% over the same prior year
    period, as a result of increases in sales volumes and average sale
    prices.

--  EBITDA(2) for the Third Quarter of A$6.3 million, representing a 123%
    increase, over the corresponding period in the prior year, due to higher
    sales volumes, a higher average sale price, and a reduction in the unit
    cost of sales.

--  Operating cashflow for the Third Quarter of A$8.1 million, an increase
    of A$5.5 million compared to the corresponding period in the prior year.

--  Net profit after tax for the Third Quarter of A$3.9 million.

--  Basic earnings per share for the Third Quarter was A$0.038 and for the
    nine months ended March 31, 2011 was A$0.181.

--  Cash and cash equivalents as at March 31, 2011 of A$110.9 million.

Production and Sales Results

--  Lithium concentrate production for the Third Quarter of 88,315 tonnes
    (approximately 13,100 tonnes lithium carbonate equivalent or 'LCE'),
    representing a 33% increase over the corresponding period in the prior
    year.

--  Lithium concentrate sales for the Third Quarter of 97,001 tonnes
    (approximately 14,400 tonnes LCE), representing a 74% increase over the
    corresponding period in the prior year.

Stage 2 Expansion - Greenbushes Lithium Operations

--  Board approval for the Stage 2 expansion of the Greenbushes Lithium
    Operations which will increase production capacity to approximately
    740,000 tonnes per annum of lithium concentrate (approximately 110,000
    LCE).

Salares 7 Project

--  Completion of the first drilling program at the Salares 7 Project in
    Chile, with results expected to be available before the end of June
    2011.

Subsequent to Quarter-End

On May 4, 2011, Talison announced an updated lithium Minerals Resources and Mineral Reserve statement in relation to the Greenbushes Lithium Operations. Lithium Proven and Probable Mineral Reserves increased by 157% (measured on the basis of tonnes of contained LCE) to 31.4 million tonnes at a grade of 3.1% lithium oxide ('Li2O')(3). The increase in lithium Mineral Reserves supports the Stage 2 expansion of the Greenbushes Lithium Operations and extends the mine life by 10 years to 22 years at the expanded production rate.

Third Quarter Financial Results Conference Call

Talison will host a conference call to discuss the financial results on Tuesday, May 17, 2011 at 9.00am. (Eastern Time). The call is being webcast by Thomson Reuters and can be accessed at Talison's website or at www.earnings.com.

Teleconference call details are as follows:
Toll Free: North America - 800-706-7748
Toll Free: International - 1-617-614-3473
Participant Code: 98998600
Chairperson: Peter Oliver, Chief Executive Officer and Managing Director

Replay
Available from: May 17, 2011, 1.00 PM
Available to: May 19, 2011
North America Dial In: 888-286-8010
International Dial In: 1-617-801-6888
Passcode: 13464688

About Talison

Talison is a leading global producer of lithium. Talison mines and processes the lithium bearing mineral spodumene at the Greenbushes Lithium Operations in Western Australia. In addition, Talison explores for lithium at the Salares 7 lithium project made up of seven salars (brine lakes and surrounding concessions) located in Region III, Chile. Talison has an extensive, well established global customer network and a leading position in the growing Chinese market.

(1) Information in this press release is in relation to the financial condition and results of operations of Talison Lithium Limited ('Talison' or the 'Company') as at and for the interim period ended March 31, 2011. This press release should be read in conjunction with the unaudited interim consolidated financial statements of Talison and the related notes thereto as at and for the interim period ended March 31, 2011 (collectively, the 'Financial Statements'). The financial information contained in this press release is derived from the Financial Statements, which were prepared in accordance with International Financial Reporting Standards ('IFRS'). All amounts in this press release are expressed in Australian dollars ('A$') unless otherwise identified. References to 'C$' are to Canadian dollars and references to 'US$' are to United States dollars.

Prior to acquiring the Greenbushes Lithium Operations on August 12, 2010, Talison was a dormant entity and did not trade in any capacity. However, the acquisition of the Greenbushes Lithium Operations has been determined to be a common control transaction which the Company has elected to account for on a continuity of interest basis. While continuity of interest accounting is not required by IFRS, it is also not prohibited by IFRS. Continuity of interest accounting is common practice under Canadian generally accepted accounting principles for such transactions. As a result of Talison's election to use continuity of interest accounting, the results of the Greenbushes Lithium Operations prior to the date the Company acquired the Greenbushes Lithium Operations (being, from July 1, 2010 to August 11, 2010) have been included in the Financial Statements. In addition, the Financial Statements include as comparatives the results of the Greenbushes Lithium Operations for the three and nine month periods ended March 31, 2010. The results of the Greenbushes Lithium Operations prior to August 12, 2010 have been extracted from the group financial statements of Talison Minerals Pty Ltd ('Talison Minerals'), which became a wholly-owned subsidiary of Talison on August 12, 2010.

Readers of this press release are cautioned that certain statements in this press release may relate solely to the debt and capital structure of Talison Minerals before Talison acquired the Greenbushes Lithium Operations by acquiring Talison Minerals on August 12, 2010 in connection with a substantial debt and equity restructuring of Talison Minerals and may be of no consequence to the ongoing operations of Talison. For further information refer to Management's Discussion and Analysis of the financial condition and results of operations of Talison Lithium Limited as at and for the interim period ended March 31, 2011 (which can be found on Talison's SEDAR profile at www.sedar.com).

(2) The term 'EBITDA' is a non-IFRS financial measure. For a reconciliation of EBITDA to its IFRS-compliant income statement, refer to 'Non-IFRS Performance Measures' in Management's Discussion and Analysis of the financial condition and results of operations of Talison Lithium Limited as at and for the interim period ended March 31, 2011(which can be found on Talison's SEDAR profile at www.sedar.com).

(3) The table below shows Talison's lithium Mineral Reserves calculated as of March 31, 2011.

Greenbushes Lithium Operations - Lithium Mineral Reserves
---------------------------------------------------------------------------
                      Update - March 31, 2011     Previous - March 31, 2010
---------------------------------------------------------------------------
---------------------------------------------------------------------------
                               Li2O                          Li2O
                  Tonnage     Grade       LCE   Tonnage     Grade       LCE
Category              (Mt)       (%)      (Mt)      (Mt)       (%)      (Mt)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Proven Mineral
 Reserves             0.2       3.9      0.02       0.1       3.9      0.01
---------------------------------------------------------------------------
Probable Mineral
 Reserves            31.3       3.1      2.38       9.5       3.9      0.92
---------------------------------------------------------------------------
Total Proven
 and Probable
 Mineral Reserves    31.4       3.1      2.39       9.6       3.9      0.93
---------------------------------------------------------------------------
Notes:
1.  There may be some rounding errors in totals.
2.  For the updated calculation (as of March 31, 2011) a 2% Li2O cut-off
    grade has been applied.
3.  Proven Mineral Reserves comprises the Run of Mine and Fine Ore
    stockpiles. All the Probable Mineral Reserves are contained within the
    Indicated Mineral Resources.
4.  Mineralization was classified according to the definitions in National
    Instrument 43-101 and the guidelines published by the Council of the
    Canadian Institute of Mining, Metallurgy and Petroleum (the CIM
    Standards).

A National Instrument 43-101 compliant technical report with respect to the update of Talison's lithium Mineral Resources and Mineral Reserves at the Greenbushes Lithium Operations will be filed on SEDAR within 45 days of Talison's May 4, 2011 press release. Readers are cautioned not to rely solely on the summary of the updated lithium Mineral Reserves contained in this press release, but should read the new technical report regarding the Greenbushes Lithium Operations when it becomes available on SEDAR.

The updated lithium Mineral Reserves were prepared by Messrs. Andrew Purvis (BSc (Hons), MSc, MAusIMM), General Manager Geology, Talison, and Stephen Green (B. Eng, MAusIMM), Manager, Mining and Environment at the Greenbushes Lithium Operations each of whom is a full-time employee of Talison and a 'Qualified Person' in accordance with National Instrument 43-101. The lithium Mineral Reserves were calculated based on a 2% Li2O cut-off grade and the costs and recoveries for the second stage expansion of the Greenbushes Lithium Operations. The updated lithium Mineral Reserve calculations were reviewed by Mr. Peter Ingham (MSc, BSc, FAusIMM, MIMMM, CEng), General Manager Mining, of Behre Dolbear Australia Pty Ltd. Mr. Ingham is independent of Talison and a 'Qualified Person' in accordance with National Instrument 43-101.

Scientific and technical information in this press release was reviewed by Andrew Purvis, General Manager Geology, Talison.

Please refer to Talison's press release dated May 4, 2011 for more information.

Cautionary Note Regarding Forward-Looking Statements

Certain information contained in this press release, including any information as to Talison's mineral reserve and mineral resource estimates, strategy, projects, plans, prospects, future outlook, anticipated events or results or future financial or operating performance, may constitute 'forward-looking information' within the meaning of Canadian securities laws. All statements, other than statements of historical fact, constitute forward-looking information. Forward-looking information can often, but not always, be identified by the use of words such as 'plans', 'expects', 'is expected', 'budget', 'scheduled', 'estimates', 'forecasts', 'intends', 'anticipates', 'predicts', 'potential', 'continue' or 'believes', or variations (including negative variations) of such words, or statements that certain actions, events or results 'may', 'could', 'would', 'should', 'might', 'potential to', or 'will' be taken, occur or be achieved or other similar expressions concerning matters that are not historical facts. The purpose of forward-looking information is to provide the reader with information about management's expectations and plans. Readers are cautioned that forward-looking statements are not guarantees of future performance. All forward-looking statements made or incorporated in this press release are qualified by these cautionary statements.

Forward-looking statements are necessarily based on a number of factors, estimates and assumptions that, while considered reasonable by Talison, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Such factors, estimates and assumptions include, but are not limited to: anticipated financial and operating performance of Talison, its subsidiaries and their respective projects; Talison's market position; future prices of lithium or lithium concentrates; estimation of mineral reserves and mineral resources; realization of mineral reserve and mineral resource estimates; timing, amount and costs of estimated future production; grade, quality and content of concentrate produced; sale of production; capital, operating and exploration expenditures; costs and timing of the expansion of the Greenbushes Lithium Operations; exploration and development of the Salares 7 lithium project; costs and timing of future exploration; requirements for additional capital; government regulation of exploration, development and mining operations; environmental risks; reclamation and rehabilitation expenses; title disputes or claims; absence of significant risks relating to Talison's mining operations; the costs of Talison's hedging policy; sales risks related to China; currency; interest rates, and limitations of insurance coverage. While Talison considers these factors, estimates and assumptions to be reasonable based on information currently available to it, they may prove to be incorrect and actual results may vary.

Readers are cautioned that forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Talison and/or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such risk factors include, amount others, those described in the Financial Statements and under the heading 'Risk Factors' in the annual information form of Talison for the year ended June 30, 2010 dated January 12, 2011, each of which can be found on Talison's SEDAR profile at www.sedar.com. While Talison considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect and actual results may vary.

Although Talison has attempted to identify statements containing important factors that could cause actual actions, event or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking information contained herein is made as of the date of this press release based on the opinions and estimates of management on the date statements containing such forward-looking information are made. Except as required by law, Talison disclaims any obligation to update any forward-looking information, whether as a result of new information, estimates or opinions, future events or results or otherwise. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information.

Contacts:

Talison Lithium Limited

Todd Hilditch

Investor Relations Director

604 443 3831
Todd.Hilditch@talisonlithium.com
www.talisonlithium.com