Thursday, May 17, 2007
Strathmore US Completes LOI with American Uranium Corporation Inc. FOR $33 Million Commitment at Pine Tree-Reno Creek Wyoming Uranium Project
Strathmore Minerals Corp is pleased to announce that its subsidiary, Strathmore Resources (US) Ltd. ("Strathmore"), has entered into a Letter of Intent ("LOI") to form a joint venture with American Uranium Corporation Inc. ("AUC") to explore and develop Strathmore's Pine Tree-- Reno Creek properties (the "Pine Tree" project). The Pine Tree project is located in Campbell County, Wyoming, in the central Powder River Basin, within the Pumpkin Buttes Uranium District. The total land package has combined several nearby properties (Pine Tree, Four Mile Creek, West Reno, State and Private leases) and now comprises approximately 16,000 acres (6,475 hectares).
The Pine Tree-Reno Creek property historical resource estimate exceeds 13 million pounds U308. Previous work completed by various operators during the 1980's has identified several areas of additional mineralization that provide new exploration targets that could potentially increase the size of the resource. Ground water studies completed on the Pine Tree and West Reno properties during the 1980's suggest that much of the uranium is amenable to in-situ recovery. Cameco's Smith Ranch uranium ISR operation is located approximately 30 miles south of the Pine Tree project and AREVA's idled Christensen Ranch Uranium ISR operation is located approximately 20 miles to the northwest. The following historical resources were previously tabulated in Strathmore' February 2nd, 2007 press release "Strathmore Updates Shareholders on U.S. and Canadian Uranium Properties, Year End 2006.
Property |
Resource |
Tons |
Grade
% |
Pounds |
Pine Tree |
Historical: Demonstrated |
1,947,000 |
0.070 |
2,646,000 |
|
Historical: Inferred |
625,000 |
0.060 |
750,000 |
Sec. 36 |
Historical: Demonstrated |
1,300,000 |
0.050 |
1,300,000 |
West Reno |
Historical: Demonstrated |
3,571,000 |
0.065 |
4,000,000 |
SWD Claims |
Historical: Demonstrated |
497,000 |
0.090 |
944,000 |
|
Historical: Inferred |
271,000 |
0.080 |
400,000 |
FMC Claims |
Historical: Demonstrated |
1,992,000 |
0.090 |
3,670,000 |
|
TOTAL |
10,203,000 |
0.067 |
13,710,000 |
Strathmore will grant AUC sole and exclusive right to earn a 60% interest in the Pine Tree Project. The terms of the transaction are summarized as follows:
- AUC will reimburse Strathmore 100% of all reasonable expenditures incurred by Strathmore relating to the Pine Tree Project, to a maximum of $300,000, plus any funds spent for the purpose of any additional property leases between the date of this agreement and closing of the JV agreement;
- AUC will issue to Strathmore 6,000,000 common shares in the capital stock of AUC;
- Once AUC has spent a total of US$5,000,000 in the first 3 years of the agreement, it will have earned an initial 22.5% interest in the Pine Tree Project. In addition, AUC will have satisfied the requirements of earning joint venture partner status with Strathmore.
- AUC will incur a total of $33,000,000 in expenditures on the Pine Tree Project over a 6 year period, subject to the project having at least 13 million lbs of U3O8.
- Following the third anniversary of the closing date, Strathmore will retain an independent third party firm to calculate the resource. If the third party evaluation is less than 13 million lbs. U308, then the remaining US$28 million that AUC must spend on the Pine Tree Project between the 3rd and 6th anniversary of closing will be reduced proportionately.
- Strathmore will remain operator of the project until AUC has completed its 60% earn-in commitment.
- Strathmore has retained a right to earn back 11% of the Property whereby it will have up to 90 days of a bankable feasibility study by paying $14,000,000 to AUC.
The parties will use their best efforts to obtain all regulatory and other approvals and close within 90 days or as soon as mutually agreed upon.
Mr. Dev Randhawa, Chairman and CEO of parent Strathmore Minerals Corp. commented, "This is another step in Strathmore's goal to advance its many projects, while reducing its expenditure commitments and risk profile".
Mr. David Miller, President of parent Strathmore Minerals Corp. added, "Pine Tree - Reno Creek Project encompasses one of the best areas of uranium mineralization in the Powder River Basin not controlled by Cameco or AREVA. Strathmore has spent 3 years assembling the subject properties and we are now ready to move forward with their development. American Uranium will start with some great properties in the middle of a uranium mining friendly state. Strathmore's staff looks forward to working with AUUM."
American Uranium Corporation (OTCBB:AUUM) is a Nevada based uranium company.
The foregoing historical resource estimates were completed prior to the implementation of NI 43- 101. Given the quality of the historic work completed on the properties discussed herein, the Company believes the resource estimates to be both relevant and reliable. However, a qualified person has not completed sufficient work to classify the historic mineral resources as current mineral resource, and is not treating the historic resources as current. Hence, they should not be relied upon. The technical information in this news release has been prepared in accordance with the Canadian regulatory requirements set out in National Instrument 43- 101 and reviewed by David Miller, President and Chief Operating Officer for Strathmore Minerals Corp., a qualified person under National Instrument 43-101.
STRATHMORE MINERALS CORP. is a Canadian based resource company specializing in the strategic acquisition, exploration and development of uranium properties. Headquartered in Kelowna, British Columbia, the Company also has U.S. based Development Offices in Riverton, Wyoming and Santa Fe, New Mexico. STRATHMORE MINERALS CORP Common Shares are listed on the TSX Venture Exchange under the symbol "STM".
This news release may contain forward-looking statements. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.
ON BEHALF OF THE BOARD
"David Miller"
David Miller, President and COO
For Investor Relations:
Bob Hemmerling/Craig Christy
1-800-647-3303
info@strathmoreminerals.com
www.strathmoreminerals.com
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