Default Status Report Pursuant to National Policy 12-203
TORONTO, May 16 /CNW/ - Canada Lithium Corp. (TSX: CLQ) (OTCQX: CLQMF)
announces the following:
AMC mineral resource estimate for the Québec Lithium Project (the
"Project") confirms material reduction from previous estimate announced
October 28, 2010
BBA Inc. now completing updated mineral reserve estimate, modelling and
Effect of mineral resource reduction on the project will be addressed
within the updated reserve modelling.
Upon completion of updated mine plan and reserve modelling, an updated
NI 43-101 Feasibility Study Technical Report will be completed
Mine and plant capital costs confirmed at approximately $201.7 million
A 10,000-metre, 50-hole drill program is under way with two rigs on-site
The Company reports that AMC Mining Consultants (Canada) Ltd. ("AMC")
has completed an independent mineral resource estimate for the
Project. The AMC mineral resource estimate, together with the previous
October 28, 2010 estimate, is as follows:
Mineral Resources Reported by Class (0.8% Li2O cut-off)
October 28/10 Estimate
October 28/10 Estimate
Grade (% Li2O)
Grade (% Li2O)
Total M + I
Notes: Mineral resources that are not mineral reserves do not have
demonstrated economic viability.
Tonnes rounded to the nearest thousand.
The AMC resource figures are constrained by a pit shell, whereas the
October 2010 resource model was not.
The mineral resource review undertaken by AMC (see press release dated
March 16, 2011) involved the re-evaluation and re-estimation of the
mineral resource estimate previously announced on October 28, 2010.
The October 28, 2010 resource estimate involved a commonly used inverse
distance squared (ID2) modelling technique that should have delineated the main pegmatite
dyke systems within what in geological terms are known as constrained
boundaries. These boundaries are defined from sampled drill-core
sections and, where relevant, underground workings, and should contain
only mineralized material. Within these boundaries, or "mineralized
envelopes," resource volumes were calculated using a block model and
grades estimated using ID2 methods. This is an accepted and widely used industry practice.
Based on this methodology, only mineralized material with an associated
Li2O grade lying within these envelopes should be incorporated in the
resource estimate. The review by AMC identified certain issues with
regard to the mineral resource estimate previously announced on October
28, 2010. Some of the mineralized envelopes, as originally developed,
were broad, included some waste material and, in certain cases, did not
conform to the pegmatite dyke boundaries. Therefore, some
reinterpretation of the original model was required. In addition, some
of the intervals within the dyke boundaries, which had not been sampled
or assayed, were not assigned a zero grade. Consequently, some of the
resource blocks should have been classified, in whole or in part,
as waste material rather than having Li2O grades assigned to them.
The Company will file a NI 43-101 compliant mineral resource estimate
technical report within 45 days of this release.
BBA Inc. is currently reviewing the resource model prepared by AMC and
completing mineral reserve estimates and mine planning. The results of
this work, together with the mineral resource estimate announced today,
will comprise part of an updated N1 43-101 Feasibility Study Technical
Report that will be prepared once all of the updated information is
Update on Project Development
During the past six weeks, mine and plant design has continued according
to schedule. In addition, BBA Inc. has commenced an updated mineral
reserve estimate based on AMC's mineral resource estimate. Project
commissioning, based on the current timetable, is still being scheduled
to commence in December 2012, assuming key equipment orders are
finalised by the end of May 2011.
Canada Lithium noted that the Québec Lithium Project's construction
capital costs remain unchanged from the previously announced $201.7
million (Feasibility Study estimate announced December 17, 2010), with
GENIVAR Inc. in charge of the EPCM.
As a result of the time taken to prepare the revised mineral resource
estimate, GENIVAR has proposed a revised construction schedule, with
site work on the project near Val d'Or, Que., commencing in the third
quarter of 2011, as opposed to the May commencement date previously
announced. The proposed schedule for commissioning of the mine and
processing plant indicates commissioning should be under way by late
2012 and initial lithium carbonate product sales could be under way
during the first quarter of 2013. This schedule assumes that delivery
timetables for the major key equipment purchases are finalised by the
end of May 2011.
There are currently two drill rigs operating at the Québec Lithium site
and a 10,000-metre, 50-hole drill program is under way, infilling and
upgrading a portion of the 20.9-million-tonne inferred mineral resource
to an indicated mineral resource category. Seven holes have been
completed to date. Geotechnical drilling related to the optimal
location of the Tailings Management Facility, overburden stockpiles and
processing plant location will commence shortly.
In a press release dated April 29, 2011, Canada Lithium Corp. (TSX: CLQ;
OTCQX: CLQMF) (the "Company") announced that the Ontario Securities
Commission ("OSC") had noted the Company in default of its continuous
disclosure obligations under Ontario securities law due to the
Company's announcement on February 28, 2011 that an internal review had
indicated a material reduction in the measured, indicated and inferred
mineral resource for its Quebec Lithium Project (the "Project") that
was announced on October 28, 2010.
The February 28th announcement stated that the Company had appointed Roscoe, Postle &
Associates ("RPA") to undertake a preliminary independent review of the
October 28, 2010 mineral resource estimate. On March 16, 2011, the
Company announced that RPA had confirmed that there were significant
issues with the geological modelling that had produced the mineral
resource estimate announced on October 28, 2010. The Company also
confirmed that it had appointed AMC Mining Consultants (Canada) Ltd.
("AMC") to independently conduct a resource estimate of the Project and
expeditiously prepare a new NI 43-101 compliant technical report.
In its press release of April 29, 2011, the Company reiterated its
previously announced belief that the independent resource estimate
being prepared by AMC would indicate a material reduction in the
measured, indicated and inferred mineral resource estimate for the
Project that was announced on October 28, 2010.
The OSC has noted that the Company will remain in default until it files
a new National Instrument 43-101 ("NI 43-101") compliant technical
report on the updated feasibility study for the Project which will
include the independent resource estimate for the Project that has been
prepared by AMC. The new NI 43-101 compliant technical report on the
feasibility study will replace the existing technical report on the
feasibility study filed by the Company on January 11, 2011 which
contains the mineral resource estimate announced by the Company on
October 28, 2010.
As previously announced in its press release of April 29, 2011, the
Company applied to the Canadian securities regulatory authorities
pursuant to National Policy 12-203 Cease Trade Orders for Continuous Disclosure Defaults ("NP 12-203") requesting that a management cease trade order be imposed
upon the Chief Executive Officer ("CEO") and the Chief Financial
Officer ("CFO") of the Company in lieu of a general cease trade order
in respect of the Company's continuous disclosure default. On May 10,
2011, the OSC imposed a temporary management cease trade order on the
CEO and CFO. The Company intends to continue satisfying the
alternative information guidelines prescribed by NP 12-203 by issuing
bi-weekly default status reports in the form of news releases so long
as it remains in default of continuous disclosure requirements.
In addition, the Company reports that a Statement of Claim has been
filed in the Ontario Superior Court of Justice in respect of the
proposed class action lawsuit that was previously announced on April
The AMC mineral resource estimate was prepared by Dinara Nussipakynova,
P.Geo, Senior Geologist, AMC, under the supervision of Mr J Morton
Shannon, P.Geo., Geology Group Manager and Principal Geologist, AMC.
Ms Nussipakynova and Mr. Shannon are independent Qualified Persons as
defined by NI 43-101. Mr Shannon has read and approved the contents of
Mitchell Lavery, P.Geo., is the Qualified Person for the Québec Lithium
Project in accordance with NI 43-101. Mr. Lavery has read and approved
the contents of this news release.
*The mineral resource estimates in this press release were prepared in
accordance with the CIM "Definition Standards on Mineral Resources and
Mineral Reserves" adopted by the CIM Council on December 11, 2005, and
the CIM "Estimation of Mineral Resources and Mineral Reserves Best
Practice Guidelines," adopted by CIM Council on November 23, 2003, in
compliance with NI 43-101 guidelines.
About Canada Lithium Corp.
Canada Lithium Corp. holds a 100% interest in the Québec Lithium Project
near Val d'Or, the geographical heart of the Québec mining industry.
The Company plans to build an open-pit mine and processing plant
on-site. Metallurgical tests have produced battery-grade lithium
carbonate samples. The Company trades under the symbol CLQ on the TSX
and on the U.S. OTCQX under the symbol CLQMF.
Cautionary Statement Regarding Forward-Looking Information
This press release contains "forward-looking information" within the
meaning of applicable Canadian securities legislation. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or statements that
certain actions, events or results "may", "could", "would", "might" or
"will be taken", "occur" or "be achieved".
Forward-looking information is based on reasonable assumptions that have
been made by the Corporation as at the date of such information and is
subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance or
achievements of the Corporation to be materially different from those
expressed or implied by such forward-looking information.
Forward-looking information in this press release includes, among other
things, disclosure regarding the anticipated timing for completion of
the independent review and audit and the review of the existing mine
plan of the Company.
Although the Company has attempted to identify important factors that
could cause actual results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can be
no assurance that such 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. The Corporation does not
undertake to update any forward-looking information referenced herein,
except in accordance with applicable securities laws.
SOURCE CANADA LITHIUM CORP.
For further information:
For further information please contact:
Peter Secker, President and CEO (416) 361-2821
Olav Svela, Director, Investor Relations (416) 361-2821 or (416) 479-4355 or email email@example.com
Christine Stewart, Renmark Financial Communications Inc. (416) 644-2020 or email firstname.lastname@example.org
Please visit the Canada Lithium website at www.canadalithium.com.
Corporate Office: 401 Bay Street, Suite 2010, P.O. Box 118, Toronto, ON, M5H 2Y4