Western Lithium Casey Recommendation: Buy PP Symbol Current Price 06-01-2009 first recommended 2008-12-29 Gain / Loss to date V.WLC $0.71 $0.19 + $0.52 + 273.68% WLCDF.PK $0.65

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Recent Company News

5-31-2009
(C$0.70, 62.2M SO, 81.7M FD, C$43.5M MCap, www.westernlithium.com)

On May 28, Western Lithium Canada Corp. announced that it commenced drilling of several core holes at its Kings Valley, Nevada, lithium property using sonic drilling technology to test the technology as it prepares for its 2009 drilling campaign. The current drill program will provide larger samples for metallurgical testing and clay characterization and will twin previous holes where the subsurface geology and lithium clay intercepts are known. The 2009 drilling campaign is designed to enable the project to advance through scoping studies to a prefeasibility study.

Sonic drilling employs high-frequency resonant vibrations and has been used to drill formations containing industrial clays, nickel laterite, iron ore, manganese, uranium, coal and disseminated gold.

"The technology behind sonic drilling enables the retrieval of highly representative continuous samples from soft rock formations, which is particularly suitable for the hectorite clay at our lithium property in Nevada," said Dennis Bryan, Western Lithium's senior vice-president of development. "In addition, this method will provide larger diameter samples more amenable for bulk metallurgical testing than conventional methods."

Western Lithium is planning to drill approximately 30 core holes in 2009 in an infill drilling program on the stage I (PCD) lens to bring the existing National Instrument 43-101 indicated and inferred resource estimate to the prefeasibility study level. In addition, large-scale trenching is planned to obtain bulk samples and to test suitable mining methods for the deposit. The 2009 drilling and trenching program is expected to commence in the fall at an estimated cost of approximately $750,000 with a prefeasibility study to follow in 2010.

Comments: We're glad to see the WLC show getting more visibly on the road and look forward to the results of their economic assessment program.

4-22-2009
(C$0.55, 51.2M SO, 58.6M FD, C$28.2M MCap, www.westernlithium.com)

Western Lithium Canada Corp today reported that, due to market conditions, it has amended the terms of its private placement. The company now proposes to issue up to 10 million units at a price of 50 cents. Each unit will comprise one common share and one common share purchase warrant. Each warrant will entitle the holder to purchase an additional common share for a period of two years at a price of 60 cents. The company has engaged Haywood Securities Inc. to act as agent for the offering, and has agreed to pay Haywood a cash commission equal to 6 per cent of the gross proceeds of the private placement. The company will also issue to Haywood that number of agent's warrants as is equal to 6 per cent of the number of units sold. Each agent's warrant will entitle Haywood to purchase one common share for a price of 60 cents for a period of 12 months. All of the securities issued pursuant to the private placement will be subject to a hold period expiring four months and a day after the closing date.

Proceeds of the private placement will be used to finance continuing engineering and development studies for the company's lithium project in Nevada, including additional drilling of the lithium deposit to conform to National Instrument 43-101 requirements, and for general corporate purposes.

Comments: We've said to Buy WLC under 50 cents, and this PP gets you that price, plus a full two-year warrant at only 60 cents. If you are a qualified investor and want to speculate on the Lithium trend, see if you can get some of this placement.

4-08-2009
(C$0.62, 51.2M SO, 58.6M FD, C$31.7M MCap, www.westernlithium.com)

On April 7, Western Lithium Canada Corp. announced that it will be proceeding with a brokered private placement to raise $4.03-million by issuing up to 6.2 million units at a price of 65 cents per unit, plus an overallotment option of up to $1.04-million. Each unit will comprise one common share and one-half of a common share purchase warrant. Each whole warrant will entitle the holder to purchase an additional common share for a period of 12 months at a price of 80 cents.

Proceeds of the private placement will be used to finance continuing engineering and development studies for the company's lithium project in Nevada, including additional drilling of the lithium deposit to conform to National Instrument 43-101 requirements. Proceeds will also go toward general corporate purposes.

Comments: This is not a surprising move, given the stock's recent up-tick. We're not terribly excited by the terms of the offering, in terms of wanting to buy any ourselves, but if the company can cash up with only the half warrants, that will be good for us as existing shareholders (minimum dilution). You can get almost as much leverage by grabbing shares on the dips to lows like the 44 cents they hit in late March, and not have the 4-month hold period, so that's still what we recommend doing.

2-26-2009
(C$0.74, 51.2M SO, 57.3M FD, C$37.9M MCap, www.westernlithium.com)

On February 25, Western Lithium Canada announced that additional drilling on the upper more northerly lenses (WLC Stages II through V), which were originally identified by Chevron Resources in the early 1980's, has confirmed the presence of lithium. WLC had previously announced the southern-most Stage I (PCD) lens contained Indicated Resources of 48.1 million tonnes grading 0.27% lithium, or the lithium carbonate equivalent (LCE) of 688,000 tonnes LCE and Inferred Resources of 42.3 million tonnes grading 0.27% lithium, for an equivalent of 606,000 tonnes LCE, both at a cut-off grade of 0.20% Lithium.

"The results of this recent drilling on the upper lenses gives a greater level of confidence in what Chevron originally reported, and positions the Company with a potentially very significant lithium deposit," said Western Lithium's President, Jay Chmelauskas. "This drilling on the upper lenses supports the envisioned staged development of the project."

WLC has completed drilling a series of exploration core holes in the northern four lithium lenses previously identified by Chevron. These are the North, North Central, South Central and South lenses referred to by WLC as Stages II through V. They are located from approximately 8 to 24 km north of the Stage I (PCD) lens and are approximately 300 meters higher in elevation. The purpose of the drilling program, carried out in late 2008, was to help verify Chevron's initial results and thereby reinforce the confidence level of their original findings. WLC's previous detailed evaluation and drilling program on the Stage I (PCD) lens in 2008 supported Chevron's estimate of grade and extent of lithium mineralization for the southernmost lens. A total of five holes were drilled in this most recent program, one each in the North, North Central and South Central, and two holes in the South lens. The South lens is the largest lens identified by Chevron as having over one million tons of lithium metal.

To minimize surface disturbance and permitting requirements the five holes were all drilled along existing roads. Locations were chosen that were in relatively close proximity to known Chevron holes so comparisons could be made.

Results of WLC's drilling confirm the presence of lithium in the upper Chevron lenses.

* Drill hole Li-01 was in the North lens (Stage V) and averaged 1600 ppm lithium over a 50 meter interval starting at a 4 meter depth. This hole was within 200 meters of an original Chevron hole that averaged 2100 ppm lithium over a 60 meter interval.

* Drill hole Li-02 was in the North Central lens (Stage IV) and averaged 2400 ppm lithium over a 40 meter interval starting at a depth of 8 meters. This hole was within 15 meters of an original Chevron hole that averaged 2600 ppm lithium over a 61 meter interval.

* Drill hole Li-03 was in the South Central lens (Stage III) and averaged 2600 ppm lithium over a 40 meter interval starting at a depth of 21 meters. This hole was within 6 meters of an original Chevron hole that averaged 2600 ppm lithium over almost the identical interval.

* Drill hole Li-04 was in the South lens (Stage II) and averaged 2000 ppm lithium over a 46 meter interval starting at a depth of 8 meters. This hole was within approximately 90 meters of an original Chevron hole that averaged 2400 ppm over an interval of 64 meters.

* Drill hole Li-05 was also in the South lens (Stage II) and averaged 2400 ppm lithium over a 33 meter interval starting at a depth of 8 meters. This hole was within 30 meters of an original Chevron hole that averaged 2900 ppm lithium over a similar interval.

The upper four lenses (WLC Stages II through V) comprise relatively unaltered claystones and volcaniclastic sandstone which are the dominant rock types. Lithium-rich beds are generally 1 to 10 meters thick with some as much as 30 meters thick. Much of the area encompassing the upper lenses has little or no overburden with the claystone outcropping in places. Colluvium up to 10 meters thick occasionally covers the claystone.

Further engineering work is currently underway to determine scoping level economics, expected later this year, to process the lithium bearing clay and determine an optimal process flow sheet for development.

Comments: These holes are mostly lower grade and less thick than the older ones, but still confirm that the lithium is there. The thicknesses are still substantial and the mineralization starts very near surface -- all very good. Assuming the company can deliver the positive economics we expect from the main lens it is working on, these holes will help investors "connect the dots," giving the company some value for the other lenses. We'd still try to get in on weakness, but this story is looking good.