Canada Lithium Corp. project update; drilling intersects 66.3 metres grading
1.29% Li2O

TSX: CLQ; U.S. OTCQX: CLQMF

TORONTO, July 5 /CNW/ - Canada Lithium Corp. (TSX: CLQ; U.S. OTCQX: CLQMF) announced today that the major components of the definitive Feasibility Study (FS) for the re-development of the Quebec Lithium mine are now under way and on schedule for completion in the First Quarter 2011.

The major components of the FS are as follows:

Resource Drilling Program:

The program, aimed primarily at testing extensions of the known resource both at depth and along strike, also includes some infill drilling for increased resource definition within the initial pit design. The program was initiated in late April and 49 holes totalling 6,724 meters have been completed to date. The assay results for the program will be completed by August 2010 and an updated NI 43-101 resource report will be available in October 2010.

Some highlights of the assay results received to date are as follows:

    
    -------------------------------------------------------------------------
    Hole ID       From (m)      To (m)     Intersection* (m)      Li2O (%)
    -------------------------------------------------------------------------
    QL-S10-034      18.25       31.65                   13.40          1.61
    -------------------------------------------------------------------------
    QL-S10-009     143.70      210.00                   66.30          1.29
    -------------------------------------------------------------------------
    QL-S10-013     146.94      181.27                   34.33          1.30
    -------------------------------------------------------------------------
    QL-S10-014      77.46       94.80                   17.34          1.88
    -------------------------------------------------------------------------
    QL-S10-014     132.35      159.00                   26.65          1.56
    -------------------------------------------------------------------------
    (*down hole depths not corrected to true width; holes drilled at
      approximately 45 degrees to vertical)
    

Samples were analyzed by ALS Laboratory Group in Vancouver using their ME-MS61 method (4-acid digest with an ICP finish). CLQ's quality control checks are in progress, and analyses received to date indicate that the accuracy and precision of the data are high.

As reported in a press release dated March 4, 2010, the Deposit contains Measured and Indicated Mineral Resources of 31.6Mt at 1.11% Li2O and an additional Inferred Mineral Resource of 38.9Mt at 1.12% Li2O (exclusive of the results from the current drill program noted above).

Geotechnical Drilling:

Golder Associates has commenced supervision of the geotechnical drilling of the sites for the tailings management facility, process plant location and open pit area.

Pilot Plant Metallurgical Testwork:

SGS Laboratories at Lakefield has completed pilot plant flotation testwork. Material from this programme has undergone test-roasting and SGS has commenced pilot plant hydro-metallurgical testing. Upon completion of the hydro-metallurgical pilot plant testwork, marketing samples will be sent to potential end users in Asia, Europe and North America.

Engineering:

BBA Inc. in Montreal has commenced the engineering design, site layouts and infrastructure stages of the FS. Mine design work will commence once the updated NI 43-101 resource report is completed.

Corporate:

The Company is pleased to announce the appointment of Chris Irwin as the Company's Interim Chief Financial Officer following the departure of William Jupp. Mr. Irwin will act in the interim capacity until the appointment of a new CFO.

Mitch Lavery, P.Geo., is the Qualified Person for the Quebec 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, using the polygonal method.
    

The mineral resource estimate was prepared by Michelle Stone, Ph.D., P. Geo., of Caracle Creek International Consulting Inc., an independent Qualified Person as defined by NI 43-101. The effective date of the estimate is March 4, 2010.

About Canada Lithium Corp.

Canada Lithium Corp. is a Canadian-based resource and exploration company trading under the symbol CLQ on the TSX and CLQMF on OTCQX in the U.S. The Company is currently preparing a definitive Feasibility Study on the Quebec Lithium Project, which will include environmental, metallurgical, geological and engineering studies. It has an agreement with Japanese metals trading firm, Mitsui and Co. Ltd., to market a portion of Canada Lithium Corp.'s product in China, Korea and Japan. Metallurgical tests have produced battery-grade lithium from deposit samples. The Project is 60km north of Val d'Or.

Neither the TSX Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-looking Information

The statements made in this press release may contain certain forward-looking statements concerning potential developments affecting the business, prospects, financial condition and other aspects of Canada Lithium Corp. The actual results of the specific items described in this release, and the company's operations generally, may differ materially from what is projected in such forward-looking statements. Although such statements are based upon the best judgments of Canada Lithium Corp. management as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the Company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the Company. Canada Lithium Corp. disclaims any obligation to update information contained in any forward-looking statement.

%SEDAR: 00007891E

SOURCE Canada Lithium Corp.

For further information: For further information: Peter Secker, President and CEO, (416) 361-2821; Olav Svela, Director, Investor Relations, cell: 905-442-8663, office: (416) 361-2821, email: osvela@canadalithium.com; Christine Stewart, Renmark Financial Communications Inc., (416) 644-2020, email: cstewart@renmarkfinancial.com; Please visit the Canada Lithium website at www.canadalithium.com.

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Canada Lithium Corp.

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