Here we have a site collection with site admins and we have some sub sites under it, every sub site is governed by different site owners (and admin’s as well but they do not step into another territory)
When a site owner tries to save any list as template he gets Access denied
The issue lies with the List template gallery in the Main site o look at that log on to main site > site actions > site settings > Galleries > List template gallery
We saw that the Site collection admin was running it with unique permissions and the site owner for the sub site was given Read access out there
We then added him as contribute on list template gallery and it fixed the issue for us
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