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2006 Press Releases

Laramide Acquires US Uranium Royalties

Laramide Resources Ltd is pleased to announce that it has acquired a portfolio of uranium royalties in the Grant’s Mineral District of New Mexico, USA from United Nuclear Corporation, a wholly owned indirect subsidiary of General Electric Company (GE) since 1997. The royalty portfolio covers three separate parcels of mineral leases (Section 8, Section 17, and Mancos) in the Churchrock area of McKinley County which is located 20 miles northeast of Gallup, New Mexico. The properties are presently owned by a subsidiary of Uranium Resources Inc (“URI”), a US publicly traded uranium producer, who acquired them from United Nuclear in a series of transaction between 1986 and 1991. URI is presently engaged in the late stages of a feasibility study on the Section 8 lease and has stated publicly that it expects to complete the study prior to the end of 2006; environmental permitting efforts at Section 8 are also well advanced.

The royalty interests being acquired are sliding scale gross revenue royalties with minimum levels of 5% and maximum levels of 24% depending on the spot price of U3 O8. Stated reserves on the property are not compliant with Canadian 43-101 reporting standards but historic resources being utilized as the basis for the feasibility study are 18.6 million pounds on all of the parcels with 6.5 million of that on Section 8 which is anticipated to be developed using the insitu-leach (ISL) production method.

Terms of the acquisition call for Laramide to pay United Nuclear US $9.25 million in cash, structured as follows :

  • US$3.5 million at closing (paid);
  • US $3 million on issuance of the final regulatory permit required to allow production to commence on Section 8;
  • US $1.25 million on issuance of the final regulatory permit required to allow production to commence on Section 17; and
  • US $1.5 million on issuance of the final regulatory permit required to allow production to commence on Mancos (also known as Sections 7,12, and 13)

Stated Laramide President Marc C. Henderson “We are please to acquire additional uranium interests in the Grant’s area as we believe it is likely to once again become an important source of secure, domestic production to fuel the US reactor fleet. New Mexico has historically been the biggest source of US uranium production (350 million pounds produced between 1959 and 1981) and is currently undergoing a dramatic revival of exploration and development activity spurred by a rise in uranium prices which shows no signs of abating.”

Laramide is currently active in Grant’s where it is in the midst of a ten hole drilling program on its La Jara Mesa. Five of the ten holes were completed prior to the scheduled Christmas Break with initial results expected to be available sometime in January.

For further information contact:

Marc C. Henderson, President John Cook , Laramide Advisory Board
Toronto, Canada +1 (416) 599 7363 Toronto, Canada +1 (416) 200-8073

 

Or visit our web site at www.Laramide.com

This press release contains forward-looking statements. The actual results could differ materially from a conclusion, forecast or projection in the forward-looking information. Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information.