THE PROVINCE OF QUEBEC HOSTS ONE OF WORLD’S LARGEST KNOWN HARD-ROCK LITHIUM DEPOSITS

Canada Lithium announced that, following the latest drill program, total measured and indicated mineral resources at the Quebec Lithium Project near Val d’Or, Quebec, have increased by approximately 48% to 46.7 million tonnes grading 1.19% Li₂O (at a 0.80% Li₂O cut-off). It also represents a 7% increase in grade from previous estimates. The total inferred mineral resource has also been expanded to an approximate 57.6 million tonnes grading 1.18% LiO, a rise of about 48% in tonnage and 6% in grade compared to the previous estimate announced March 4, 2010.

“We have now confirmed that this project ranks, in terms of size, among the top two or three known hard-rock lithium deposits in the world,” said President and CEO Peter Secker.  “We clearly have the flexibility to expand production significantly in the future if markets warrant.”

He also noted that the higher grade in all mineral resource categories may result in higher economic returns as the mine and processing plant commence operations in late 2012.

A summary of the Quebec Lithium Deposit mineral resource estimate is as follows:

The revised resource estimate reported above resulted from a 45-hole program comprising 6,938m of drilling initiated in August of this year. The program focused on drill targets that extended the strike length of the known deposit (as of a March 4, 2010 release) and on infill drilling to increase the level of confidence in the resource within the measured and indicated categories.

The resource comprises a series of steeply dipping spodumene-bearing pegmatite dykes that bifurcate and coalesce. Dyke true thicknesses range up to tens of metres. The composite body extends more than 1.5 km in approximately a NW-SE direction over a width of approximately 500m. There is one main persistent dyke that strikes obliquely to this main orientation.

The project development timetable is on schedule, with the final Feasibility Study (FS) expected in January 2011.  Subject to financing and final permitting, a positive FS is expected to lead to construction start-up by May 2011, with project commissioning in the fourth quarter of 2012 and full production in 2013.

Resource Estimation Methodology

The mineral resource estimate for the Quebec Lithium deposit was completed by Michelle Stone, P.Geo. (Special Authorization # 171), Geologist, Canada Lithium Corp., using accepted, industry-standard methods that conform with National Instrument 43-101. The resource model was developed using Gemcom Surpac (v6.1.4). Core samples from the 2010 drilling program were analyzed for Li₂O at ALS Chemex in Vancouver. Duplicate pulps samples were sent to Agat Laboratory in Mississauga for check analyses.  All sample results are monitored with an appropriate QA/QC program and passed the quality checks.

The resource models for the Quebec Lithium Deposit have been generated from a database containing confirmed historic and recent drill hole results from both underground and surface diamond drilling. Detailed solid shapes representing the spodumene-mineralization were constructed in addition to a larger envelope that contained thinner and/or less persistent or drill-tested dykes. The Li₂O grade for these solid shapes was estimated into a 5m x 5m x 5m block model using inverse distance squared methodology with search ellipses oriented parallel with the strike and dip of the two main geological trends, and a polygonal estimate based on the historic mineral resource cross sections in the area of the close-spaced underground drilling.

Blocks were classified based as follows:

Measured in spodumene-bearing pegmatite within stopes and within 20m of the historic underground workings. Detailed pegmatite dykes in which the average distance between sample pairs used to estimate the grade is 20m were also classified as measured mineral resources.

Indicated detailed dyke blocks with the average distance between sample pairs used in the grade estimation of 80m, in addition to blocks within the boundary of the historic resources confirmed by the 2009 drill program (dykes intersected within approximately 60m of the workings, underground drilling and surface drilling, and to a vertical depth of approximately 200m from surface); and blocks in the envelopes with 40m average distance between sample pairs used in the grade estimate.

Inferred detailed dyke blocks with 160m average distance between sample pairs used in the grade estimate and envelope blocks with 80m average distance between sample pairs used in the grade estimate.

The specific gravity used to calculate the tonnage was 2.73, based on the results of metallurgical testwork completed by SGS Canada. 

The mineral resource estimate above has been prepared by Michelle Stone, Ph.D., P. Geo., Geologist, Canada Lithium Corp., a Qualified Person as defined by NI 43-101. 
Ms. Stone has read and approved the contents of this release.  A Technical Report compliant with National Instrument 43-101 standards describing the resource estimation and providing details of the 2010 drill program, as well as the associated QA/QC review, will be filed on SEDAR http://www.sedar.com within 45 days of this release.

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.

Canada Lithium Corp. is a Canadian-based “clean tech” mine developer trading under the symbol CLQ on the TSX and on the U.S. OTCQX market under the symbol CLQMF. The Company is nearing completion of a definitive Feasibility Study (FS) by engineering firm BBA Inc. of Montreal on its Quebec Lithium Project near Val d’Or, the geographical heart of the Quebec mining industry. A positive FS would lead to construction of an open pit mine and processing plant capable of producing by late 2012 approximately 43 million pounds per year of battery-grade lithium carbonate to meet the growing needs of the emerging global market for electric and hybrid electric vehicles. 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 from deposit samples have produced battery-grade lithium.

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