Level 4, 5 Mill St Perth WA 6000 PO Box 7752 Cloisters Square WA 6850 Sherlock Bay Nickel Corporation Limited Phone: (+61 8) 9322 2288 ABN 46 008 942 809 Fax: (+61 8) 9324 2164 Email: [email protected] www.sbnc.com.au ASX ANNOUNCEMENT 20 April 2006 The Manager Company Announcements Office Australian Stock Exchange Limited 4th Floor, 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam UPDATE ON WESTERN PILBARA URANIUM PROSPECTS Sherlock Bay Nickel Corporation Limited (“SBNC” or the “Company”) is pleased to announce that is has commenced the planning of exploration programmes for its Mt Salt and Copper Bore Well uranium prospects. This planning is being conducted concurrent with the process for progression of the Exploration Licence Applications (“ELAs”) covering the prospects to granted status. Both prospects are located in the Western Pilbara region of Western Australia in settings conducive for “roll-front” or unconformity type redox front uranium deposits. A key component of any exploration programmes will therefore be the identification of priority targets for early drill testing of the interpreted buried uranium mineralisation. SBNC fully supports the recent Nuclear safeguards and cooperation agreements between Australia and China. These agreements pave the way for the export of uranium mined in Australia to help responsibly meet the long term energy needs of the growing Chinese economy. Through its recently established Beijing representative office, SBNC intends to commence discussions with potential Chinese partners in relation to potential uranium opportunities in Australia. Mt Salt Uranium Prospect The Mt Salt uranium prospect is located near the West Pilbara coast around 100km southwest of Dampier, immediately to the west of the large Balmoral magnetite deposit, over a part of which SBNC has a separate iron ore mining rights negotiating and due diligence agreement with Mineralogy Pty Ltd. An ELA covering around 15,971 hectares has been lodged over the area. Based on open file reports of the Western Australian Mines Department, the Mt Salt prospect consists of a radiometric anomaly system with dimensions of some 20km in strike and 4-5km in width. It strikes parallel to the coast and is developed on the flanks of the Mt Salt mound spring. Update On Western Pilbara Uranium Prospects Page 2 An airborne radiometric survey by the Australian Geological Survey Organisation in 1995 registered a significant “Uranium channel” radiometric anomaly over the area. This anomaly was confirmed by ground spectrometer, scintillometer, field rock and alluvium sampling, analytical, and radiometric spectral studies undertaken in 1996-97 which registered a very high amplitude total count and potassium-40 channel anomaly with a medium Uranium channel anomaly response. The anomaly is located close to the north-eastern edge of the on-shore Carnarvon Basin within a relatively thin sequence of Recent to Cretaceous sediments. The Manyingee uranium “roll-front” resource is located some 170km southwest of Mt Salt in a similar structural environment on the eastern edge of the Carnarvon Basin. Proterozoic low grade metamorphic basement, including intrusive granites, underlies the area at relatively shallow depth, and also crops out some 12km east of the prospect where it forms the western edge of the predominantly Archaean age granite-greenstone Pilbara Craton. Rock chips and cemented alluvium from within the anomaly system returned low (but anomalous) uranium assays, but all contain very significant grades of radium-226 (a uranium decay series daughter isotope). The radium-226 is postulated as having been sourced from adjacent buried uranium mineralisation via solution, telethermal water transport, and deposition in the surface evaporation zone – at suitable structural locations adjacent to the active and palaeo mound springs. The Western Australian Mines Department’s open file further states: “Given the size of the Mt Salt radiometric anomaly there is an excellent possibility that the postulated buried uranium mineralisation is a very large resource and of significant grade.” Copper Bore Well Uranium Prospect The Copper Bore Well uranium prospect is located some 100km to the southeast of Onslow, and 150km south of the Mt Salt prospect. An ELA covering some 10,130 hectares has been lodged over the area. The prospect hosts previously identified copper-uranium mineralisation in shear zones in the Boolaloo batholith and adjacent to a contact with overlying Ashburton Formation sediments. During the late 1970’s Esso completed some air track drilling of the shear zone down to 26m deep with best results being 2m @ 1.43% Cu, 4.5g/t Ag, 62ppm U; and 3m @ 2.50% Cu, 9.3g/t Ag and 120ppm U. Esso proposed a drilling programme to test the projection of the uraniferous shear zone into the overlying sediment, but this drilling was never carried out and these sediments are a priority exploration target. The sediments contains lithologies conducive for creating reducing reducing conditions required for “roll front” or unconformity type redox front uranium ore bodies. SBNC will provide further details on the status of the granting of the Mt Salt and Copper Bore Well Exploration Licences and the proposed exploration programmes in due course. Any queries can be directed to Darren Hedley on +61 8 9322 2288. Yours faithfully Darren Hedley Managing Director
SHN Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
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