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LITHIUM EXPLORATION GROUP INC. 3200 N. Hayden Road, Suite 235, Scottsdale,
Arizona 858251

August 20, 2013   Tero Oilfield Services Ltd. Box 28 Wardlow, Alberta T0J 3M0
Attention: Garry Hoffman, President

Re: Letter of Intent for the acquisition of Tero Oilfield Services Ltd. (“Tero”)
by Lithium Exploration Group, Inc. (“Lithium”)

Dear Garry:

Further to our recent meetings and discussions, this Letter Agreement (the
“Agreement”) confirms our mutual intention and agreement to enter into a
definitive agreement whereby Lithium will acquire 75% of the issued and
outstanding shares of Tero (the “Transaction”). This letter is intended to
create legally binding obligations on the Parties and will serve as the basis
for the negotiation and preparation of a definitive agreement between Tero,
Lithium and the shareholder of Tero (the “Selling Shareholder”) leading to the
completion of the Transaction.

1.

The Transaction

The Transaction will provide that Lithium will acquire 75% of the issued and
outstanding common shares of Tero for aggregate purchase consideration of
$1,500,000 comprised of a cash deposit of $50,000, an additional cash payment of
$950,000 and a secured convertible debenture in the amount of $500,000 (the
“Purchase Price”).

2.

Payment of Purchase Price and Loan

        (a)

Lithium will pay the Purchase Price to the selling shareholder as follows:

        (i)

A non-refundable deposit in the sum of $50,000 to be paid within ten (10) days
following the date of execution of this Agreement;

        (ii)

On or before December 1, 2013 and on the closing of the Transaction (the
“Closing”), the payment of cash in the sum of $950,000; and

        (iii)

On the Closing, issuance by Lithium to the selling shareholder of a Convertible
Secured Debenture in the amount of $500,000.

  (b) As additional consideration Lithium will advance to Tero a $500,000 loan
for the retirement of Tero’s debt to Smith Group Holdings Ltd.

3.

The Debenture

The Debenture to be issued by Lithium to the selling shareholder on Closing
shall be a Secured Convertible Debenture which shall be due and payable on
December 1, 2014, subject to certain terms and conditions with respect to the
conversion of the Debenture into Common Shares of Lithium. If the selling
shareholder makes a decision to convert the Debenture, upon conversion, the
Debenture shall be Convertible into Common Shares of Lithium at a price to be
determined and agreed by the Parties prior to the Closing of the Transaction. If
the Debenture is not converted, the Parties agree that it may be repaid at a
later date or upon the expiry of the Term of the Debenture.

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4.

Non Completion

In the event that the Transaction cannot be completed as a result of any failure
or breech by Lithium, Tero shall be entitled to retain the Deposit.
Notwithstading the foregoing, failure to enter into a Formal Agreement (as
defined below) or to Close the Transaction shall not in itself be deemed breach
of this Agreement by Lithium.

5.

Negotiation of a Definitive Agreement

The Parties shall diligently, in good faith and using commercially
reasonableefforts, negotiate the terms and conditions of a formal definitive
agreement (the “Formal Agreement”) to replace this Agreement and to be executed
on or before September 30, 2013. The Formal Agreement will provide the basis for
the Parties to carry out the Transaction and will contain provisions that are
customary for a Transaction of this nature, including representations and
warranties of each Party.

6.

Standstill

Until this Agreement is either superseded by the Formal Agreement or terminated
pursuant to Section 8 below, Tero agrees that it will;

(a)

Not solicit any offers or have any discussions with any third parties regarding
the sale of its shares, assets or business or any other form of business
combination or divestiture; and

      (b)

Conduct its business only in, and not take any action except in, the usual,
ordinary and regular course of business consistent with past practices. Other
than the disposition of assets and payment of liabilities unrelated to the
disposal well and facilities.

      7.

Due Diligence and Access to Information

      (a)

It shall be a condition precedent to the Closing of the Transaction thatLithium
shall have conducted a due diligence review of the assets, liabilities,
environmental condition of operations, reclamation and site restoration
practices, business affairs and financial condition of Tero and shall have been
satisfied therewith. This condition precedent is for the sole benefit of Lithium
and may be waived by Lithium, in whole or in part, at its discretion.

      (b)

Upon signing of this Agreement by Tero and until the Closing of the Transaction,
Tero will allow Lithium and its respective authorized legal representatives,
including legal counsel and financial advisors, access to all information, books
or records relevant to the Transaction and Tero. Each Party agrees that all
information and documents so obtained will be kept confidential and the contents
thereof will not be disclosed to any person without the prior written consent of
the disclosing Party.

      8.

Termination

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This Agreement shall terminate with the Parties having no obligations to each
other, other than in respect of the confidentiality provisions contained in
Section 11, in the following circumstances:

  (a)

By written agreement of the Parties; and

        (b)

Lithium not being reasonably satisfied with its due diligence review of Tero and
providing notice to Tero thereof.

9.

Transaction Costs

In the event that this Transaction does not close, each of the Parties will be
responsible for its own costs incurred by it in connection with the Transaction.

10.

Announcements

In general, unless required by law or securities regulations, neither Party
shall make any public or private announcement or communication in respect of the
Transaction until both Parties approve the announcement. Tero acknowledges that,
as a reporting issuer, Lithium will be required to give public disclosure about
the Transaction and Tero consents to any such disclosure as reasonably required
to satisfy Lithium’s reporting requirements with the SEC. Lithium agrees to
provide Tero with a draft of any proposed public disclosure regarding the
Transaction for its review and input at least 12 hours prior to dissemination of
such public disclosure.

11.

Confidentiality Agreements

Each Party agrees that any information provided to the other in connection the
negotiation and entering into the Formal Agreement for the Transaction will be
maintained in confidence, will not be disclosed to any other party, other than
each Party’s respective professional advisors, except where disclosure is
compelled by applicable laws and will not be used by the Party for any other
purpose other than the evaluation and completion of the Transaction. Each Party
will ensure that its respective officers, directors, employees and consultants
will agree to maintain all information in connection with this Agreement and the
Transaction confidential. All obligations regarding confidentiality will survive
termination of this Agreement.

12.

Unanimous Shareholders Agreement

The Parties agree that they will enter into a Unanimous Shareholders Agreement
upon the Closing of the Transaction which will provide for the ongoing operation
and management of Tero.

13.

General

      (a)

This Agreement will be governed by and construed in accordance with the laws of
the Province of Alberta and the laws of Canada applicable herein;

      (b)

Time shall be of the essence of this Agreement; and

      (c)

Upon the Closing of the Transaction, the business and assets of Tero shall be
substantially comprised of, but not limited to, those assets and properties set
out in Schedule A attached and the $500,000 promissory note payable to Smith
Group Holdings Ltd.

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If you are in agreement with the foregoing, please confirm that this Agreement
accurately sets forth your understanding of the terms of the proposed
Transaction and the other matters set forth in this Agreement, by signing a
duplicate copy of this letter below and returning it to us prior to 5:00 p.m.
(Calgary time) on August 22, 2013, failing which this Agreement shall be null
and void.

This Agreement may be executed in counterparts, each of when executed and
delivered (including by way of facsimile) is an original but all of which taken
together shall constitute one and the same instrument.

We look forward to working together.

Yours very truly,

LITHIUM EXPLORATION GROUP INC.

By: /s/ Alexander Walsh     Alexander Walsh, Chief Executive Officer  

Agreed and confirmed as of August 21, 2013

Tero Oilfield Services Ltd.

By: /s/ Gary Hoffman     Gary Hoffman, President  

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SCHEDULE A

This is Schedule “A” attached to and forming part of a Letter of Intent, dated
August 20, 2013 between Lithium Exploration Group Inc. and Tero Oilfield
Services Ltd..

AREA: Disposal well lease from MK Ranching. Located near Wardlow, Alberta.  

LANDS & RIGHTS
DESCRIPTION VENDOR’S
WORKING
INTEREST
TITLE DOCUMENTS

ENCUMBRANCES
100/11-32-024-12 W4M02 100%    

Well:

100/11-32-024-12 W4M02 Licensed as a Class 1B Disposal Well. Approval number
9570

Facilities and Pipelines:

Surface Facilities Associated with Class 1B Disposal Well. Approval Number WM079

Includes all equipment, fixed and mobile, used for the day to day operations of
the facility.

North Tank Farm c/w 2-1000 BBL & 2-750 BBL tanks, containment and piping. South
Tank Farm c/w 4-750 BBL tanks & 1-950 BBL Floc tank.

All pump houses c/w pumps, motors, filter pots, heaters.

Solids Processing receiving, mixing and holding tanks and equipment.

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All associated buildings and contents, Office, Operator Shack, MCC and
Electrical components, Sample Building.

Mobile equipment involved in solids processing, Vacuum Truck, Cat Loader,
Tractor and Tri-Axle Trailer.

All equipment used for down hole injection, pumps, motors, filtration system.

All tooling and miscellaneous equipment on site.

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