Western Lithium Funded For Pre-Feasibility Study and Planned Demonstration Plant

Thu May 19, 2011 8:02am EDT

* Reuters is not responsible for the content in this press release.

Western Lithium USA Corporation (TSX: WLC)(OTCQX: WLCDF) ("Western
Lithium" or the "Company") is pleased to announce that it has received
approximately C$7.9 million through the conversion of warrants during
2011. The Company has a treasury of approximately C$14.5 million and
there are no remaining warrants for conversion. It is anticipated that
the Company is now adequately funded to complete its two major milestones
in 2011, which includes a pre-feasibility study scheduled for completion
in mid-summer, and a demonstration plant scheduled for the fall of 2011.

    The pre-feasibility study currently underway is an update to the
Preliminary Assessment and Economic Evaluation (see PAEE, January 2010),
which demonstrated a competitive capital and operating cost structure for
lithium carbonate production at the Company's wholly-owned Kings Valley
Lithium Project in Nevada, USA. The design capacity contemplated by the
pre-feasibility study will be 13,000 tonnes of lithium carbonate per
annum, which management believes is a reasonable market entry production
rate, over an estimated 20-year mine life. The current study considers
less than 8% of the historical resource, making the project highly
scalable and establishes it as a potential major world hub for lithium
production. The new study will incorporate an additional 120 new drill
holes from the 2010 and 2011 infill drilling program. The pre-feasibility
study will include:

--  Higher lithium cut-off grades, potentially improving the average grade
    of the resource by 20 to 30% 
--  Optimization of energy costs 
--  Reduced start-up production rate to improve market entry dynamics and
    construction capital requirements 

    The lithium carbonate demonstration plant will establish the cost
competitiveness of Western Lithium's technology and potential process
control advantages of extracting lithium from the Nevada clay. Management
is looking at a facility in Germany as the potential site for the
demonstration plant. This facility, with much of the infrastructure
already in place, will be a cost-effective location and will expedite
completion of the demonstration plant by approximately six months.

    Jay Chmelauskas, President of Western Lithium commented, "Following
completion of the pre-feasibility study, we will advance straight into
full feasibility study work, targeting a production date inline with new
lithium demand requirements expected in 2015. Additionally, the Company
continues permitting activities with baseline environmental studies

    Mr. Chmelauskas continued, "Ford, GM, Toyota, Nissan, BMW and others are
now joining the ranks of Chinese automotive manufacturers vying to lead
the shift to automotive electrification. For example, this year, Toyota
begins replacing their nickel metal hydride batteries in the Toyota Prius
with more powerful and lighter lithium batteries. By 2014, all Toyota
Prius's will have plug-in lithium ion batteries that will power the car
for over 40 kilometres. In 2010, Toyota sold nearly 700,000 hybrid cars,
or approximately 10% of their total sales. The fundamentals for our
industry continue to demonstrate strong growth."

    Following completion of the Stage I development, there is a high
potential for future scalability based on the historic lithium resources
at the property. Western Lithium's Kings Valley property has one of the
largest known lithium deposits in the world, based on a historical
resource estimate done by Chevron Resources Corp. (Chevron) of 11 million
tonnes of LCE(2). This additional drilling supports work previously
carried out by Chevron in the 1970's and 1980's that identified five
lithium bearing hectorite clay lenses. 

    Western Lithium is developing the Kings Valley, Nevada lithium deposit
into potentially one of the world's largest(3) strategic, scalable and
reliable sources of high quality lithium carbonate. The Company is
positioning itself as a major U.S.-based supplier to support the rising
global demand for lithium carbonate that is expected from the increased
use of hybrid/electric vehicles.

  (1) Mineral resources that are not mineral reserves do not have
      demonstrated economic viability.
  (2) A qualified person has not done sufficient work to classify the
      historical estimate as current mineral resources, Western Lithium is
      not treating the historical estimate as current mineral resources
      and the historical estimate should not be relied upon.The Chevron
      historical resource estimate of 11 million tonnes of LCE is at
      average grades ranging from 0.31% to 0.37% Li, March 1985.There is
      insufficient information regarding the categories used in the
      historical estimates to make a meaningful comparison to current
      resource categories under CIM Definition Standards of Mineral
      Resources and Mineral Reserves.
  (3) Western Lithium has completed National Instrument 43-101 resource
      estimates on two portions of the property, one of which is
      envisioned for the initial stage of mine development.These resources
      cover part of the mineralization from a historical estimate of 11
      million tonnes of lithium carbonate equivalent (LCE) prepared by
      Chevron Resources Corp. in the 1980s that encompasses all of the
      King's Valley lithium lens deposits identified to date, and ranks in
      size behind deposits in Bolivia (47 million tonnes LCE), Chile (37
      million tonnes LCE), North Carolina (14 million tonnes LCE) and the 
      DRC (12 million tonnes LCE).Source:R. Keith Evans, 2010; Roskill
      Information Services Ltd., 2009; and company disclosures.A qualified
      person has not done sufficient work to classify the historical
      estimate as current mineral resources under National Instrument 43- 
      101, the Company is not treating the historical estimate as current 
      mineral resources and the historical estimate should not be relied

    Forward Looking Statements 

    Certain of the statements made and information contained herein is
"forward-looking information" within the meaning of the Ontario
Securities Act, including the results and timing of the pre-feasibility
study and pilot plant development. Forward-looking information is subject
to a variety of risks and uncertainties which could cause actual events
or results to differ from those reflected in the forward-looking
information, including, without limitation, risks and uncertainties
relating to risks inherent in mining including environmental hazards,
industrial accidents, unusual or unexpected geological formations, ground
control problems and flooding; risks associated with the estimation of
mineral resources and reserves and the geology, grade and continuity of
mineral deposits; the possibility that future exploration, development or
mining results will not be consistent with the Company's expectations;
the potential for and effects of labour disputes or other unanticipated
difficulties with or shortages of labour or interruptions in production;
actual ore mined varying from estimates of grade, tonnage, dilution and
metallurgical and other characteristics; the inherent uncertainty of
production and cost estimates and the potential for unexpected costs and
expenses, commodity price fluctuations; uncertain political and economic
environments; changes in laws or policies, delays or the inability to
obtain necessary governmental permits; and other risks and uncertainties,
including those described in each management discussion and analysis.
Forward-looking information is in addition based on various assumptions
including, without limitation, the expectations and beliefs of
management, the assumed long term price of lithium; appropriate equipment
and sufficient labour and that the political environment where the
Company operates will continue to support the development and operation
of mining projects. Should one or more of these risks and uncertainties
materialize, or should underlying assumptions prove incorrect, actual
results may vary materially from those described in the forward-looking
information. Accordingly, readers are advised not to place undue reliance
on forward-looking information. 

    The TSX has neither approved nor disapproved the contents of this press
release. Neither the TSX nor its Regulation Services Provider (as that
term is defined in the policies of the TSX) accepts responsibility for
the adequacy or accuracy of this press release.

Western Lithium USA Corporation
Brian Bergot
VP, Investor Relations
604-681-3091 (FAX)

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