Canada Lithium Announces Project Update

TSX: CLQ; U.S. OTC: CLQMF

TORONTO, April 4, 2013 /CNW Telbec/ - Canada Lithium Corp. ("Canada Lithium" or the "Company") (TSX: CLQ) (U.S. OTC: CLQMF) announced today that wet commissioning and initial tests of most of the major hydrometallurgical plant circuits have been completed successfully at its operations near Val d'Or, Québec.

Plant Commissioning Update

Commissioning of the plant's "front end," which includes the crushing, grinding and flotation circuits, is ongoing. During commissioning, the process plant produced spodumene in January, February and March of 2013. During March 2013, the Company mined approximately 32,000 tonnes of ore at a head grade of 0.95% (as compared with the mineral reserve grade of 0.94%) and an estimated 400,000 tonnes of waste rock to complete Stage One of the Tailings Management Facility (TMF).

The EPCM stage is now substantially completed and systems testing of the plant's "back end," or hydrometallurgical circuit, is ongoing with the only commissioning delay to date being with respect to the kiln, which converts alpha spodumene (the end product of the crush/grind/flotation circuit) to beta spodumene. Pre-heating of the kiln has been completed and it is now being operated intermittently at medium operating temperatures for mechanical testing. Final commissioning of the kiln is pending final inspection by officials from the Canadian Standards Association (CSA Group), which the Company had anticipated for the end of March 2013.  The Company is actively working with CSA Group to complete the inspection. CSA inspectors are scheduled to be on-site early next week.

Commissioning of the plant's hydrometallurgical circuit is ongoing, predominantly the lithium sulphate circuit, sodium carbonate circuit and the various stages of precipitation, leaching, filtration and packaging. These circuits are now operating and the first lithium carbonate product was successfully produced using out-sourced lithium sulphate.

Commissioning of the project will continue through the upcoming months. The Company's objective remains to meet its target of first carbonate shipments to China in late April 2013 at an initial reduced level as commissioning tonnages build. The Company continues to expend working capital to maintain the plant in a ready state to commence processing and currently anticipates full ramp-up to a production rate of 20,000 tonnes of battery-grade lithium carbonate per annum by the end of the fourth quarter of 2013.

Representatives of offtake partner Tewoo were on-site last week to review logistics and transportation strategies for the delivery of lithium carbonate product in the coming months to the Ports of Vancouver or Prince Rupert.

Tailings Management Facility (TMF) Update

Golder Associates, the Company's TMF geotechnical consultant, has completed an evaluation of the water discharge that occurred from the process-water cell of the TMF on March 19, 2013, and is preparing a remedial action plan which is anticipated to be completed by the end of this week and submitted to the Ministère du Développement durable, de l'Environnement de la Faune et des Parcs (MDDEFP) early next week.  Canada Lithium anticipates that the remediation work can be completed within 10 days of MDDEFP approval and without affecting plant commissioning.

A diagram of the flow sheet is on the Canada Lithium website www.canadalithium.com. Copy the link below into a web browser and scroll to the flow sheet section: http://www.canadalithium.com/s/QuebecLithium.asp

About Canada Lithium Corp.

The Company holds a 100% interest in the Québec Lithium Project near Val d'Or, the geographical heart of the Québec mining industry. It has completed construction and is in the commissioning phase of an open-pit mine and on-site processing plant with estimated capacity to produce approximately 20,000 tonnes of battery-grade lithium carbonate annually. Metallurgical tests have produced battery-grade lithium carbonate samples. A five-year off-take agreement for a minimum of 12,000 tonnes per year was recently signed with Tewoo-ERDC, one of China's largest commodities traders. A second off-take for up to 5,000 tonnes per year was recently signed with Marubeni Corp., a major Japanese commodities trading company. Lithium carbonate is used in lithium-ion batteries that power consumer electronics (laptops, tablets, etc.), power-grid storage facilities and electric and hybrid vehicles.  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 Canadian securities legislation. Forward-looking information is based upon the Company's beliefs, estimates and opinions as at the date of this press release, which the Company believes are reasonable, but no assurance can be given that these will prove to be correct. Furthermore, the Company undertakes no obligation to update or revise forward-looking information contained herein if these beliefs, estimates and opinions or other circumstances should change, except as otherwise required by applicable law.

Forward-looking information relates to future events or to future conditions, performance or results of operations and reflects current expectations or beliefs regarding such matters including, but not limited to, information or statements with respect to: (i) the amount of mineral resources; (ii) exploration, development and production activities, including information regarding the potential mineralization and resources; (iii) the amount of future output over any period; (iv) net present value and internal rates of return of the mining operation; (v) assumptions relating to capital costs, operating costs and other cost metrics; (vi) assumptions relating to gross revenues, operating cash flow and other revenue metrics; (vii) assumptions relating to future price and demand for lithium and other macroeconomic metrics; (viii) exploration and development plans, including anticipated costs and timing thereof, time frames for completion, and anticipated time to production; (ix) mine potential and expected mine life; and * sources of and anticipated financing requirements.

All information other than matters of historical fact may be forward-looking information. In some cases, forward-looking information can be identified by the use of words such as "seek", "expect", "anticipate", "budget", "plan", "project", "estimate", "assume", "continue", "forecast", "intend", "believe", "predict", "potential", "target", "strategy", "goal", "may", "could", "would", "might", or "will" and similar words or phrases (including negative variations) suggesting future outcomes or statements regarding an outlook.

Forward-looking information is based upon certain assumptions by the Company or its consultants and other important factors that, if untrue, could cause the actual results, performances or achievements of the Company to be materially different from future results, performances or achievements expressed or implied by such information. Such information is based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the price of lithium, anticipated costs and ability to achieve goals. Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-looking information include, but are not limited to: (i) required capital investment and estimated workforce requirements; (ii) estimates of net present value and internal rates of return; (iii) future demand and market prices for lithium; (iv) receipt of regulatory approvals on acceptable terms within commonly experienced time frames; (v) anticipated timelines for the commencement of production; (vi) anticipated timelines for community consultations and the impact of those consultations on the regulatory approval process; and (vii) future exploration plans and objectives.

By its nature, forward-looking information involves known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements, or industry results, to differ materially from those expressed or implied by such forward-looking information. Some of the risks and other factors that could cause actual results to differ materially from those expressed in the forward-looking information contained in this press release include, but are not limited to, risks and uncertainties relating to: (i) the interpretation of drill results, the geology, grade and continuity of mineral deposits and conclusions of economic evaluations; (ii) results of feasibility studies, and the possibility that future exploration, development or mining results will not be consistent with the Company's expectations, (iii) the outcome of litigation in which the Company is or may in the future become involved; (iv) risks relating to possible variations in reserves, grade, planned mining dilution and ore loss, or recovery rates and changes in project parameters as plans continue to be refined; (v) mining and development risks, including risks related to accidents, equipment breakdowns, labor disputes (including work stoppages and strikes) or other unanticipated difficulties with or interruptions in exploration and development; (vi) risks related to the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses; (vii) risks related to future commodity demand and price and foreign exchange rate fluctuations; (viii) the uncertainty of profitability based upon the cyclical nature of the industry in which the Company operates; (ix) risks related to failure to obtain adequate financing on a timely basis and on acceptable terms or delays in obtaining governmental approvals or in the completion of development or construction activities; * risks related to environmental regulation and liability; (xi) political and regulatory risks associated with mining and exploration; (xii) risks related to the uncertain global economic environment; and (xiii) other risks and uncertainties related to the Company's prospects, properties and business strategy. Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those described in the forward-looking information, readers are cautioned that this list is not exhaustive and there may be other factors that the Company has not identified. Readers are cautioned not to place undue reliance on forward-looking information contained in this press release. All forward-looking information contained in this press release or incorporated by reference herein is expressly qualified by this cautionary note.

SOURCE: Canada Lithium Corp.