Project Summary
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Commodity:
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Battery-grade lithium carbonate
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Location:
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La Corne Township, 60 km north of Val d'Or, Quebec
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Size of property:
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19 claims, 405 hectares
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Ownership:
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100% Canada Lithium Corp.
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The Quebec Lithium Project, operated under Quebec Lithium Inc. and owned 100% by Canada Lithium Corp., is located in the northeast corner of La Corne Township, approximately 38 km southeast of Amos, 15 km west of Barraute and 60 km north of Val d'Or. Access to the site is via a paved road from Val d'Or, a mining friendly community that has over 100 years of mining history and a population of some 32,000 people. The city hosts an airport and significant support infrastructure. Quebec is one of the top-rated mining jurisdictions in the world and electricity costs, a key input in mining operations, are among the lowest in North America.
Current Status
Construction of the mine and process plant began in August 2011 and was completed early in 2013. Commissioning is now in the latter stages, while first production of lithium carbonate is anticipated to occur in the second quarter of 2013. The planned production rate is 20,000 tonnes of battery-grade lithium carbonate per annum. (Please view "Picture Gallery" on the website for the latest images from the minesite.) However, this is not the first lithium extraction that has occurred on the property.
The deposit was mined and processed on-site between 1955 and 1965, producing spodumene and lithium carbonate products for sale to the North American market. In 1974, Surveyer, Nenninger et Chenevert Inc. ("SNC") was contracted by Sullivan Mining Group to write a feasibility report on the rehabilitation of the former Quebec Lithium Mine. SNC calculated a historical reserve estimate of 15,736,938 tonnes grading 1.14% Li
2O. This estimate is not compliant with NI 43-101 standards and therefore cannot be relied upon.
On December 6, 2011, Canada Lithium Corp. announced an updated National Instrument 43-101 compliant Mineral Resource estimate prepared by AMC Mining Consultants that incorporated results from a 56-hole, 10,300-metre drill program undertaken that summer. At a 0.8% Li2O cut-off, the table below shows the Measured, Indicated and Inferred Mineral Resources:
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AMC December 2011 |
| Category |
Tonnes |
Li2O % |
| Measured (M) |
6,914,000 |
1.18 |
| Indicated (I) |
26,325,000 |
1.19 |
| Total M+I |
33,239,000 |
1.19 |
| Inferred |
13,757,000 |
1.21 |
The table above represents the mineral resource as it now stands and which is included in all corporate documents as the current mineral resource estimate.
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.
The AMC mineral resource estimates were 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. Mitchell Lavery, P.Geo., is the Qualified Person for the Québec Lithium Project in accordance with NI 43-101.
The mineral resource estimates 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.
On June 13, 2011, Canada Lithium announced a new proven and probable mineral reserve estimate contained in an updated Feasibility Study prepared by BBA Inc. The estimate was based on 80% ore recovery, a waste dilution factor of 20% at 0.05% lithium oxide and a cut-off grade of 0.6%. The new mineral reserve estimate, together with a mineral reserve estimate of a prior Feasibility Study, is as follows:
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Updated Feasibility Study |
Updated Feasibility Study |
Prior Feasibility Study |
Prior Feasibility Study |
| Category |
Tonnes |
Li2O % |
Tonnes |
Li2O % |
| Proven |
6,605,000 |
0.92 |
3,930,000 |
1.12 |
| Probable |
10,459,000 |
0.95 |
11,520,000 |
1.19 |
| Total |
17,064,000 |
0.94 |
15,450,000 |
1.17 |
Tonnes rounded to the nearest thousand.
Due to the changes in the geometry of the mineralised zones in the new resource model, the increased dilution factors and the lower mining recovery factors, the updated Feasibility Study mineral reserve grade is now 0.85% Li2O, compared to the prior Feasibility Study mineral reserve grade of 1.17% Li2O. In addition, the updated Feasibility Study Life-of-Mine stripping ratio has increased to approximately 5.5:1, compared to the prior Feasibility Study stripping ratio of 3.6:1.
In addition to the proven and probable reserves in the table above, additional low-grade reserves grading between 0.25% Li2O and 0.60% Li2O (as disclosed in the table below) will be stockpiled and subsequently processed from Year 13 to the end of the mine life. The low-grade mineral reserve is as follows:
| Category |
Tonnes |
Li2O % |
| Proven |
1,199,000 |
0.39 |
| Probable |
2,072,000 |
0.38 |
| Total |
3,271,000 |
0.38 |
Tonnes rounded to the nearest thousand.
The aggregate proven and probable mineral reserves total 20,335,000 tonnes at 0.85% Li2O.
Qualified Persons
The June Technical Report was integrated and prepared by Technology Management Group Inc. under the supervision of Peter Woodhouse, P.Eng., a registered professional engineer in the Province of Ontario, and independent Qualified Person under the standards set forth by National Instrument 43-101.
Mitch Lavery, P.Geo., is the Qualified Person for the Project in accordance with NI 43-101.
The mineral reserve estimate and mine plan was prepared by BBA Inc., under the supervision of Colin Hardie, P.Eng., Engineering Manager. Mr. Hardie is an independent Qualified Person as defined by NI 43-101.
The Proven and Probable Mineral Reserve estimates 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 inverse distance squared.
As announced on June 13, 2011, the updated Feasibility Study contemplates an open-pit mine and processing plant that will have an initial mine operating life of approximately 14.9 years. The planned annual output for the Project remains at approximately 20,000 tonnes (44 million pounds) per year of battery-grade lithium carbonate (Li2CO3).
The key parameters from the updated Feasibility Study are shown in the table below, with a comparison to the Prior Feasibility Study.
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Updated Feasibility Study |
Prior Feasibility Study |
| Average Annual Li2CO3 production (t) |
20,000 |
20,000 |
| Life of Mine (Years) |
14.9 |
14.8 |
| Net Present Value pre-tax (US$ million) |
190 |
270 |
| Construction Capital Cost (US$ million) |
202 |
202 |
| Average operating costs (US$/t milled) |
45.09 |
50.58 |
| Average operating costs (US$/t Li2CO3) |
3,164 |
2,600 |
| IRR pre-tax (%) |
22 |
24 |
| Simple Payback pre-tax (years) |
4 |
4 |
| Mineral Reserve Grade (Li2CO3) |
0.85% |
1.17% |
| Stripping Ratio |
5.5:1 |
3.6:1 |
The Project has a pre-tax net present value (NPV) of approximately US$190 million, (at an 8% discount rate). The reduction in NPV of US$80 million under the updated Feasibility Study is primarily due to increased operating costs, resulting from higher stripping ratios and increased dilution and ore loss factors. As a result of changes in the geometry of the mineralised zones in the new resource model and increased dilution factors plus lower mining recovery factors, the Project's internal rate of return (IRR) has declined to 22% from 24%. The simple pre-tax payback period remains at four years.
Initial site construction is planned to commence in Q3, 2011, with process plant commissioning currently scheduled to be under way by the end of 2012 and full production expected by the end of 2013, subject to financing and final permitting.
The work undertaken by or on behalf of Canada Lithium since acquiring the property in May 2008 and the circumstances leading up to the independent mineral resource and mineral reserve estimates are described in greater detail below.
2. History
Between 1955 and 1965, the Project operated as an underground mine, drawing ore from a system of spodumene-rich dykes. The mine, with its 150-m-deep shaft and lateral workings on three levels was operated under the former Quebec Lithium Corporation and included a surface concentration plant and refinery. It produced ceramic-grade and chemical-grade spodumene concentrates, lithium carbonate, lithium hydroxide monohydrate as well as a small quantity of lithium chloride and feldspar. Primarily marketed to the glass and ceramics industries, spodumene is an intermediate stage product in the processing chain. Alternatively, it can be further refined to battery-grade lithium carbonate for use in electric and hybrid/electric cars, in a myriad of consumer electronic products (laptops, digital cameras, iPods, cellphones, rechargeable hand tools and so on). Metallurgical tests by SGS Lakefield of samples from the Company's Quebec Lithium Project produced battery-grade 99.9% lithium carbonate (see press release dated Sept. 21, 2010).
When mining operations were suspended, the ore reserve was estimated by the operating company at the time to be 15,612,300 tonnes at a grade of 1.14% Li
2O in the proven, probable and possible categories calculated down to the 150-metre level. (This "historical" reserve has not been reviewed by a Qualified Person, as per the requirements of NI 43-101 and, therefore, should not be relied upon.) The reserve was calculated using an 85% recovery rate and a 7% dilution factor. Over a period of 10 years of operation, the ore hoisted from underground averaged a grade of 1.25% Li2O.
3. Geology and Resources
The Quebec Lithium Project consists of 12 contiguous claims covering 404.69 hectares. The rocks exposed on the property are Precambrian and consist of volcanic, sedimentary and intrusive rocks. The northern part of the property is underlain by volcanic rocks of a basic to intermediate composition, recrystallised in places to hornblende schists near their contact with the intrusive rocks. The contact has a general east/west direction and a flat dip to the north. Biotite schists of a probable sedimentary origin are found in the western part of the property. Rocks ranging from peridotite to granitic rocks in composition are intruding the volcanics. Peridotite occurs mainly alongside the contact between the volcanics and the more acidic intrusive rocks.
The southern part of the property is underlain by the acidic intrusive rocks which form
the Preissac-Lacorne batholith. These acidic rocks have been locally divided into the following types:
- Muscovite granodiorite, coarse grained, containing numerous pegmatites
- irregularly shaped and low in content of spodumene.
- Biotite granodiorite, fine grained, gneissic.
- Hornblende mica granodiorite, medium-grained and containing most of the spodumene pegmatite dykes of commercial importance.
The deposit outcrops on surface and the original owners drilled over 400 diamond exploration holes from surface and underground. Drilling has intersected mineralised pegmatites to depths of over 320m.
Fig 1. Surface Geology
It is anticipated that the initial operation will consist of open pit mining to a depth of 150 metres below surface, utilising 150-tonne haul trucks and hydraulic excavators. Mining will be carried out at a rate of 2,950 tonnes per day. Mined ore from the pit will be crushed and stockpiled for treatment in the lithium carbonate processing plant.
Fig 2. Long Section
Optimisation studies will continue.
Fig 3. Preliminary Open Pit Design
The lithium carbonate processing facility on site will treat crushed pegmatite ores to produce an intermediate 6.5% spodumene product that will be upgraded, on site to produce lithium carbonate.
The following steps will be utilised in the process, using conventional processing technology and equipment:
- Grinding
- Flotation
- Feed Preparation
- Sulphating Roast
- Leaching and Residue Removal
- Precipitation
- Li2CO3 production
- Marketing and sales
(The figure above shows part of the preliminary flowsheet)
Hydromet Flowsheet
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CLQ Product |
| Li2CO3 |
Min |
99.60 |
| Cl |
Max |
0.0048 |
| Na |
Max |
0.016 |
| Ca |
Max |
0.016 |
| Mg |
Max |
0.0081 |
| S |
Max |
< 0.01 |
| Fe |
Max |
< 0.0002 |
8. Environment
In August 2009, Canada Lithium appointed Genivar Inc. to undertake an Environmental Impact Study (EIS), to assess and outline all environmental concerns and constraints for the Company's proposed mining operation. The environmental study was conducted in conjunction with the pre-feasibility study completed in March, 2010.
