ABN 23 108 456 444
30 Ledgar Road, Balcatta, Western Australia 6021 PO Box 717 Balcatta WA 6914
Telephone:(618) 9240 7266 Facsimile:(618) 9240 2406
www.contactresources.com.au
02 May 2006
ASX RELEASE
AGREEMENT TO ACQUIRE URANIUM INTERESTS
The Board of Contact Resources Ltd (“Contact”) is pleased to announce a Heads of
Agreement with ASX listed Range Resources Limited (Range) to acquire up to 65% of the
share capital of Range’s Peruvian subsidiary, S.M.R.L. Corachapi (Somirelco). Somirelco’s
key asset is the Corachapi uranium deposit located in Peru.
As announced to ASX on 25 July 2005, Range has calculated an initial inferred JORC
resource of 1.600M tonnes at 0.15% U3O8 for 2,400 contained metal tonnes.
PROJECT SUMMARY
The Corachapi uranium deposit is located in the Puno area in the province of Carabaya,
Southeast Peru. It is 1,600 kilometres southeast from the capital city, Lima. The U3O8
mineralisation areas are located in a gently inclined plateau between 4,600 and 4,700
meters above sea level.
Puno, which includes the districts of Corani and Macusani, is identified as containing
significant uranium mineralization. Somirelco owns the Corachapi, Taypicorani, Taititira
uranium prospects (contiguous to each other), with the Kihitian prospect (approximately
15kms to the east) currently under application giving a total concession area of
approximately 1,600 hectares in the Macusani District, south eastern Peru.
Uranium mineralization is present in the concession areas and sufficient work has been
done in the area in the past to enable the Company to target a JORC compliant resource at
Corachapi within the near future. Leases surrounding these prospects are presently being
explored for uranium by a number of international companies including Canadian listed
Vena Resources Inc and Strathmore Minerals Corporation.
Technical Details of the Corachapi Deposit
There are two zones of mineralization. The first is “Cornisa Oeste” being 1.2 kilometres
long (plus 0.9 kilometres with a lower grade) and 0.25 kilometres wide, located in the
middle of the concession, and “Quebrada Corral” being 1.6 kilometres long and 0.2
kilometres wide, located in the NE of the concession.
The Peruvian Institute for Nuclear Energy (IPEN) discovered this prospect within its
National Prospecting Plan between 1960 and 1975. Additional exploration was conducted
by IPEN and IAEA (United Nations) between 1982 and 1987. Previous exploration includes
drilling, various evaluation studies and a heap-leaching test..
The Corachapi uranium deposit consists of secondary uranium mineralization mainly
autunite, a bright yellow-green mineral readily visible in the numerous cross uniting
trenches that form part of the previous work by IPEN in the Macusani area.
Acquisition Terms
Subject to due diligence and shareholder approval, Contact will acquire 51% of the issued
capital of Somirelco for consideration comprising the issue of 5 million ordinary shares and
5 million options (to acquire shares at 20 cents exercise price each on or before 30th June
2008) and a cash payment of A$850,000. The Company has also paid Range a non
refundable deposit of A$50,000 upon signing the Heads of Agreement.
The Company has the right to acquire a further 14% interest in the share capital of
Somirelco from Range by sole funding A$500,000 in exploration expenditure over a two
year period giving it a total interest of 65%.
The Company has a 45 day due diligence period and a shareholders meeting will be
convened for mid May 2006 to approve the transaction.
Range has agreed to a voluntary escrow period of 6 months from the date of allotment of
the consideration shares and options.
PROJECT MOVING FORWARD
The Company will engage local geological consultants to assist with the project moving
forward, including the formal due diligence program. With uranium prices at a 20 year high
and shortages of supply predicted for the mid to long term, the Company sees its
involvement in uranium exploration as timely with the potential to add significant value to
the Company.
Ron Gajewski
Chairman
The information in this report that relates to exploration results, mineral resources or ore reserves is based on
information provided to the Company by Range Resources Ltd. Range Resources Ltd consents to the
inclusion in this report of the matters based on its information in the form and context in which it appears.
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