Laramide ropes uranium package (September 05, 2005)

Laramide Resources (LAM-V) has agreed to pay US$3.75 million for a package of four uranium properties held by Barrick Gold (abx-t) subsidiary Homestake in the western United States.

The Los Ochos, Melrich and La Sal properties are located, respectively, in the Colorado Plateau in Colorado and Utah and in the Grants District of New Mexico. The La Jara Mesa property is in Cibola Cty., New Mexico, and is the portfolio’s most significant property.

Homestake and others have extensively explored the La Jara Mesa sandstone-hosted roll-front-type deposit, with some 500 rotary holes and 18 diamond drill holes outlining an historic resource (prior to National Instrument 43-101). Some metallurgical test work and initial mine planning have also been completed.

Laramide is commissioning an independent engineering report to validate and update the existing resource to NI 43-101 standards. The report will also include recommendations for further exploration and development work.

Under the deal, Laramide is on the hook for US$1 million on closing, with the balance due on certain permitting milestones and the start of commercial production. The company has also committed to spend US$1.5 million on the properties over the next two years.

Any U3O8 production in excess of 8 million lbs. from La Jara is subject to a royalty of US25 per lb.

Laramide has paid a US$50,000 advance on the purchase price, and expects to close the deal by early October, pending due diligence.

Homestake was a significant U.S. uranium producer from the 1950s to the late 1980s.