Thu Feb 23, 2006 Option Agreement Signed With International Uranium Corporation On Sims Lake Property, West Central Labrador
Vancouver, BC - Consolidated Abaddon Resources Inc. (TSX.V: ABN) and International Uranium Corporation (TSX: IUC) are pleased to announce that an Option Agreement has been signed between the companies pertaining to Consolidated Abaddon's Sims Lake minerals claims (the Property) totaling 4,390 hectares located northwest of Churchill Falls in west Labrador, Canada.
IUC has been granted the sole and exclusive right and Initial Option to acquire a 51% interest in the uranium rights to the Property over a period of 2 years, subject to regulatory approvals. As consideration for the grant of the Initial Option, IUC shall pay Consolidated Abaddon the sum of $20,000 and incur exploration expenditures in the amount of $225,000 on or before January 2007, and pay the sum of $20,000 and incur exploration expenditures in the amount of $225,000 on or before January 2008. The funds to be expended in this Initial Option Agreement are to be used for a drill program to test airborne and ground conductors discovered earlier by Consolidated Abaddon. It is expected that this drill program will commence by the middle of May 2006.
Provided IUC has exercised the Initial Option, IUC shall be entitled to acquire an additional 24% interest in the Sims Lake property to bring its total interest in the Property to 75%. As consideration for the grant of the Second Option, IUC shall incur exploration expenditures on the Property of $1,000,000 on or before January 1, 2010.
The parties acknowledge that IUC may spend greater than the annual requirement specified which over expenditures shall be applied to future earn-in requirements.
Consolidated Abaddon shall maintain a 2.0% net smelter Royalty over the Property. IUC shall have the right to purchase 0.5% of the Royalty for the sum of $500,000 up to a maximum of 1% of the Royalty exercisable any time prior to, or within 30 days of IUC formally approving commercial development of the Property.
It is the intent of Consolidated Abaddon and IUC that they will negotiate, in good faith, and enter into a formal Option Agreement within 30 days of this agreement.
The Sims Lake property covers parts of the known Sims Group where uranium was discovered near the Sims - Knob Lake Group unconformity in the early 1980's. The Sims Group is a flat lying clastic sequence of late Proterozoic age that overlies deformed sediments of the early Proterozoic Knob Lake Group. The similarity in ages and relationships between these groups of rock makes the setting analogous to many other Proterozoic basins around the world that host 'unconformity-type' uranium deposits, most notably the Athabasca Basin of Northern Saskatchewan. The depth to the unconformity in the Sims Lake basin, however, is only 50 to 150 meters deep.
Consolidated Abaddon acquired this property in the winter of 2004-2005 for the purposes of expanding their search for uranium assets. An airborne radiometric and electromagnetic survey conducted by the Company in July 2005 identified conductors that are interpreted to lie in Knob Lake Group rocks underlying the Sims Group. Consolidated Abaddon completed in October 2005 a ground evaluation of uranium targets consisting of a detailed scintillometer survey, a VLF survey, and detailed prospecting and mapping. Numerous boulders of fractured, gossanous graphitic sediments of the Knob Lake Group containing elevated uranium values were responsible for the bulk of the radiometric anomalies from the airborne survey. Of particular significance was the ground truthing of an airborne electromagnetic conductor located at the base of the Sims Group.
Consolidated Abaddon Resources Inc. is a Canadian uranium exploration company actively involved with the development of uranium properties in the ATHABASCA BASIN of northern Saskatchewan and the SIMS BASIN of west Labrador. The Company is also developing a gold property in the RED LAKE MINING DISTRICT of northwestern Ontario.
For further information on International Uranium Corporation (TSX.V: IUC), visit their web site at www.intluranium.com.
ON BEHALF OF THE BOARD OF DIRECTORS
James G. Pettit
For further information contact myself or:
Consolidated Abaddon Resources Inc.
Toll Free: 800-567-8181
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS NEWS RELEASE.
This news release contains certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents filed from time to time with the British Columbia Securities Commission and the United States Securities & Exchange Commission.
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