It's more on a 1 TB drive you can provision 2, 1 TB partitions on it. Each will think it has 1 TB, but it only consumes the current space actually on disk
The way it's explained is wrong, lvm doesnt have a set partition structure like were used to, what it does is basically take the whole disk and then rather than split it into partitions (with hard limits) it uses a volume that can change dynamically but only shows what's actually in use. So say you have one disk of 40gb but tell lvm to use three volumes it will adjust the volumes based on the usage. That's about the best i can explain it, the problem at the moment is the /boot can't use LVM as grub can't read from there.