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Sparton Resources Inc. (TSX
VENTURE:SRI) (the "Company")
reported today that it has signed an agreement with the Xiaolongtang
Guodian Power Company of Yunnan PRC ("XLT") for a three phase program
to test and possibly commercialize the extraction of uranium from waste
coal ash at that company's thermal power station in central Yunnan
Province. As reported previously, (see Company news release dated
December 19, 2006) Sparton and its partner ARCN, the remote sensing and
research branch of the China National Nuclear Corporation ("CNNC") had
previously identified the Xiaolongtang and nearby power stations as a
possible major supply of uraniferous coal ash that, if amenable to
economic uranium extraction methods could develop into a significant
supply of uranium ("U") for China's developing nuclear power program.
This document is believed to
be unique in the Chinese
nuclear industry in that it may be the first time a western partnered
organization has entered into an agreement that may result in uranium
production in PRC.
Under the terms of the
Letter of Intent, XLT and the
Sparton - CNNC group will undertake a three phase program to evaluate
the coal ash at the XLT station for uranium extraction. The first phase
will involve various methods of leach testing of ash samples taken from
all the burners at the station, and this work is currently underway.
XLT has provided over 100kg of material and all technical data related
to the waste ash production. Sparton will also investigate the
possibility of extracting other valuable heavy metals from the ash
including such metals as strontium and rare earths during this program.
Duplicate samples will be tested in China at the Beijing Central
Analytical Laboratory and also in North America for quality control.
The second phase will
involve detailed process
engineering and preparations for a bulk test of a larger volume of ash
material which will be managed by Sparton. XLT will provide local site
infrastructure and engineering assistance in construction and
permitting of a pilot scale test plant and will coordinate the program
with the Yunnan environmental authorities.
If Phases One and Two are
encouraging XLT will have the
option in Phase Three to join with Sparton and its partners in the
formation of a separate company to commercially develop production of
uranium from its ash material, or become a supplier of the ash to the
production plant on agreed terms. The relevant agreements in Phase
Three will involve sales contracts as well as financing of a production
plant which will be managed by the Sparton. The Company and its
partners have already successfully registered a process application
with the PRC patent authorities for uranium extraction form waste coal
ash material which has been accepted.
ABOUT XIAOLONGTANG GUODIAN
POWER
XLT is owned by China
Guodian National Power Group
("CGG"), a state owned company which is China's third largest electric
power producer. CGG owns and operates over 200 power stations producing
electricity from thermal coal (as at XLT), several hydro power
installations, and a number of wind power electric generating stations.
The company is very progressive and recently has set up an internal
operating and research department to review, study, and possibly
implement the construction of its own nuclear power generation
stations. Recent developments in the Chinese Central Government's
policies regarding new power generating stations have indicated that
construction of new coal fired stations will actually be prohibited in
areas of high environmental concern. XLT views the agreement with
Sparton and its partners as significant and completely consistent with
its parent's long term energy production planning.
As well, if the project
proceeds to production it will
result in a cleanup of the radioactive waste material already
stockpiled at the station and remediate the future production of
radioactive ash. It is expected that the cleaned ash after extraction
of uranium and possibly other valuable heavy metals, will be suitable
for sale by the station for use in cement and other filler applications
for domestic use. Currently only small amounts of waste ash are sold
from the station for non domestic use in construction materials. The
evaluation team has also collected samples from nearby power stations
using the same coal and analytical results are expected shortly.
The Company is extremely
pleased how rapidly this
program has developed. The XLT project is expected to become a flagship
for evaluating other high uranium waste deposits in China.
Sparton's exploration
and evaluation programs in China
are being carried out under the direct supervision of A. Lee Barker, P.
Eng., P Geol., the Company's President and CEO who is a Qualified
Person under National Instrument 43-101.
FOR FURTHER INFORMATION PLEASE
CONTACT:
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