It seems, to a certain extent, that such is the case with Canada Lithium Corp. (TSE:CLQ), (PINK:CLQMF). It looks the company is, maybe, unaware of how many mineral resources it actually owns. This is hardly admirable, although it is not an insolvable issue and is definitely not a reason to panic.
Yesterday, Canada Lithium announced the appointment of Roscoe Postle and Associates Inc. to undertake an independent review of its previously announced mineral resources. This evaluation is needed because an earlier internal review indicated a material reduction in the resources included in the 43-101-compliant report issued last October.
The good thing is that the review is expected to be completed within two weeks. A detailed audit, including a new 43-101 report will follow – however, this could require up to several months to complete.
It means additional expenses for the company – a spending that could have been avoided.
In view of these facts, the performance of the stock on the market looks relatively stable. After the recent fall, over the last two sessions CLQ managed to go 5.47% up, closing yesterday at $1.35 per share. Nevertheless, at present CLQ is worth about 33% lower than at the last day of 2010.
However, Canada Lithium has enough reasons to remain positive. It secured much needed funds for the future activities on its Quebec Lithium Project. In early February, it completed a bought-deal financing for total proceeds of $126.5M.
This is surely a huge financial boost but probably further measures will be needed. Commissioning of the mine and plant is planned for late 2012, with full production anticipated not earlier than 2013. Until then, Canada Lithium can count to realize no revenues and no profit.
