Skye Resources Inc.

Skye Resources Inc.

August 10, 2007 18:21 ET

Skye Resources Announces Second Quarter Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 10, 2007) - Skye Resources Inc. ("Skye" or "the Company") (TSX:SKR) today released its unaudited consolidated interim financial statements for the three months and six months ended June 30, 2007. The Company is reporting for the three and six months ended June 30, 2007 a loss of $5,888,000 and $11,619,000 respectively (basic and diluted loss per share of $0.13 and $0.27) compared to the 2006 comparative periods losses of $5,792,000 and $12,853,000 (basic and diluted loss per share of $0.20 and $0.46) for the three and six months ended June 30, 2006. The loss for the quarter is principally related to exploration and indirect development costs (the costs of Skye's Guatemalan subsidiary, Compania Guatemalteca de Niquel, S.A. ("CGN")), for Skye's Fenix nickel laterite project in Guatemala and general and administrative costs and non-cash stock-based compensation expense. In the quarter the Company capitalized US$10,194,000 of Fenix Project direct development costs (engineering, project management team and other direct costs) bringing the total of capitalized expenditures for the six months period to US$14,385,000.

During the quarter CGN received approvals for the environmental impact assessments relating to the processing plant and related activities at the Fenix Project and received confirmation from the Ministry of Economy that imports of equipment and materials will not be subject to import duties or value added tax. CGN received the construction permit in July. Basic engineering is almost complete subject to Skye's internal reviews and risk analysis. Skye is on schedule to initiate production in late 2009.

David A. Huggins, Chief Operating Officer, has advised the Board of Directors that, after a forty-four year career in the mining industry, he plans to retire by February 28, 2008 but expects to be available for a period of time thereafter in an advisory capacity. In order to facilitate a smooth succession, action is being taken to identify and secure an appropriate candidate to fill that position.

Skye's unaudited consolidated interim financial statements and Management's Discussion and Analysis (MD&A) for the period ended June 30, 2007 will be filed on SEDAR and available for download at

About Skye

Skye is an international mining company focused on becoming a new mid-tier nickel producer. Skye acquired the rights to its Guatemalan lateritic nickel project (the Fenix project) in December 2004 and in October 2006 completed a feasibility study for a ferro-nickel project at Fenix using proven conventional smelting technology. In June 2007 Skye received its environmental permits for the project, and expects to initiate construction during the second half of 2007 with initial production in late 2009.

Cautionary Notices:

This news release contains certain forward-looking statements that involve risks and uncertainties, such as statements of Skye's plans, objectives, strategies, expectations and intentions. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions, as they relate to Skye, or its management, are intended to identify such forward-looking statements. Many factors could cause Skye's actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. 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 Skye or persons acting on its behalf are expressly qualified in their entirety by this notice.

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