Skye Resources Inc.

Skye Resources Inc.

April 21, 2006 07:00 ET

Skye Granted Exploitation License for Fenix Project

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - April 21, 2006) - Skye Resources Inc. (TSX VENTURE:SKR) today announced that its subsidiary, Compania Guatemalteca de Niquel, S.A. ("CGN"), owner of the Fenix Project, has been granted an exploitation license covering 248 km2 of CGN's Niquegua Norte exploration license area. The license, which was granted by the Guatemalan Ministry of Energy & Mines, allows mining to take place at Fenix, and has an initial term of 25 years. The area of the exploitation license incorporates the mineral resources to be included in the feasibility study for a 50 million pound ferro-nickel project scheduled for completion in the third quarter of 2006.

"The granting of the exploitation license is another significant step towards the restart of the mine in 2008," said Ian Austin, President and CEO, Skye Resources. "The license leaves us on track to begin construction late this year once the feasibility study is complete."

CGN will shortly complete an Environmental Impact Assessment (EIA) for the refurbishment and expansion of the ferro-nickel processing plant at Fenix. This must be approved by the Guatemalan Ministry of Environment.

Skye also announced that its indirect interest in the Fenix Project has increased to approximately 92.4% as a result of Skye's funding all of the costs associated with the Fenix Project. The remaining interest is owned by the Government of Guatemala.

About Skye

Skye is an international mining company focused on becoming a new mid-tier nickel producer. The Company acquired the rights to the Fenix Project in December 2004 and is currently undertaking a feasibility study for a 50 million pound per year ferro-nickel operation using proven conventional smelting technology.

Cautionary Notice

This News Release contains certain forward-looking statements, including statements of the Company's plans, objectives, strategies, expectations and intentions, that involve risks and uncertainties. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions, as they relate to the Company, or its management, are intended to identify such forward-looking statements. Actual results, performance, achievements and developments may differ materially from those contemplated by these statements depending on, among others, risk factors listed from time to time in Skye's reports filed with applicable Canadian securities regulatory authorities. The forward-looking statements included in this News Release represent Skye's views as of the date of this News Release. While Skye anticipates that subsequent events and developments may cause its views to change, it specifically disclaims any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing its views as of any date subsequent to the date of this News Release. All subsequent written and oral forward looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by this notice.

Inco, the former 70% owner of the facilities and mineral rights that comprise the Fenix Project, takes no responsibility for nor makes any representation or warranty of any kind relating to the information contained in this news release.

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