Kirrin Resources Inc.
TSX VENTURE : KYM

Kirrin Resources Inc.

March 05, 2010 08:00 ET

Kirrin Resources Announces Acquisition of Key Lake SW Project in Athabasca Basin

CALGARY, ALBERTA--(Marketwire - March 5, 2010) - Kirrin Resources Inc. (TSX VENTURE:KYM) announced today that it has entered into an option agreement with Majesta Resources Inc. ("Majesta") allowing Kirrin to earn a 70% interest in the Key Lake Southwest ("Key Lake SW") uranium property located on the southeastern margin of the Athabasca Basin in northwestern Saskatchewan, Canada. The agreement is subject to all necessary regulatory approvals.

Commenting on the acquisition, Kirrin President and CEO Derek Moran said: "This acquisition is the culmination of a long period of review of suitable properties in the Athabasca Basin. Expansion by acquisition and partnership is a major aspect of Kirrin's strategy. The junior uranium sector is in need of rationalisation: the market capitalisation of many companies is just too small. At Kirrin we look forward to discussing opportunities with like-minded parties in the coming months."

The Key Lake SW property comprises eight contiguous mineral claims that encompass 36,287 ha. The northern perimeter is adjacent to the Orchid Lake property held by Forum Uranium and the Riverlake property held by Triex Minerals. The southeastern perimeter is adjacent to the Key Lake Road property held by Forum Uranium. The northeast tip of the property is about 24 km southwest of the former Key Lake Gaertner and Deilmann uranium-nickel ore bodies. Highway 914, which extends from Lac La Ronge to Key Lake, passes less than 2 km from the eastern edge of the property. Primary access is via fixed-wing aircraft or helicopter available from Missinipe (approx. 195 km south) or La Ronge (approx. 230 km southeast).

The eastern margin of the Athabasca basin is home to the most productive uranium mines in the world with roughly 25% of the world's uranium production coming from this area. Kirrin's target is basement-hosted unconformity-type uranium. The area encompassed by Key Lake SW was subject to several phases of exploration between 1969 and 2009, including airborne magnetic-radiometric-VLF and INPUT EM surveys, as well as limited follow-up geology, sampling and drilling. Follow-up prospecting during 1969 to 1984 resulted in anomalous uranium in outcrop ranging up to 0.26% U3O8. Prior drilling includes 6 diamond drill holes by Pan Ocean Oil in 1978 near the central part of the property; 7 diamond drill holes by Mark V Petroleum and Mines Ltd. in 1978 in the easternmost part of the property near the northwest shore of Seager Lake; and 48 overburden holes by E & B Exploration in 1979 in the Seager to Jaschinsky lakes area. The Pan Ocean drilling intersected extreme kaolinization and regolith in one hole and in two other holes there is possible regolith that indicates the proximity of the Athabasca Group basal unconformity.

During March 2008, Majesta conducted a helicopter-assisted lake water and sediment sampling program at some 180 lakes. The samples were tested for radon and the lake sediments were analyzed by multi-element ICP for uranium and a suite of other elements. The lake sediment and water data was evaluated by Dr. Robert Morse, an Ottawa-based consultant. Dr. Morse identified several anomalous lakes, including, (a) radon up to 14.3 picoCuries/L in lake water, (b) radium up to 27.6 picoCuries/L and uranium up to 54 parts per million in lake sediment, and (c) locally elevated to anomalous concentrations of one or more suites of other elements that are commonly pathfinders for basement-hosted unconformity-type uranium deposits in the Athabasca Basin.

Kirrin may earn a 70% interest in the Key Lake SW property by spending $3,000,000 on exploration by December 31, 2015, making payments to Majesta of $268,000 by December 31, 2013, and issuing 350,000 shares to Majesta by June 30, 2010. Upon Kirrin fulfilling its earn-in obligations, the parties will form a 70:30 joint venture, with each partner contributing its pro-rata share of future expenditures, or Majesta may elect to convert to a 2.25% Net Smelter Royalty ("NSR"). Kirrin shall have the right to acquire up to 1.25% of the 2.25% NSR for consideration of $1.0 million per 1.0% NSR. If either party dilutes its interest to less than 10% in the joint venture, its interest shall be converted to a NSR of 0.75%.

Reg A. Olson, Ph.D., P. Geol. is the designated Qualified Person for Kirrin on the Key Lake SW project.

Additional information relating to Kirrin is available on Kirrin's web site at www.kirrinresources.com and on SEDAR at www.sedar.com.

Kirrin is engaged in rare earth element and uranium exploration in Newfoundland & Labrador, Quebec and Saskatchewan and in the expansion of its portfolio through acquisition, merger, strategic partnership or joint venture. Its strategy is well defined: enhancing shareholder value by combining technical expertise, corporate development skills and professional management. Kirrin's shares trade on the TSX Venture Exchange under the symbol KYM.

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Forward-looking information: Except for statements of historical fact, all statements in this news release, without limitation, regarding new projects, acquisitions, future plans and objectives are forward-looking statements which involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those expressed or implied by such forward-looking information. Risks include delays in obtaining or failure to obtain regulatory approval. Except as required by applicable securities legislation, the Company undertakes no obligation to publically update or revise forward-looking information, whether as a result of new information, future events or otherwise.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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