Adriana Resources Inc.

Adriana Resources Inc.

August 04, 2006 09:30 ET

Adriana Reviews Lac Otelnuk Iron Property

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 4, 2006) - Adriana Resources Inc. (the "Company") (TSX VENTURE:ADI) is pleased to announce the commencement of the first phase work program of the Lac Otelnuk Iron Property (the "Property") as recommended by Watts, Griffis and McOuat Limited ("WGM"), a Toronto-based firm of consulting geologists and engineers, with considerable experience and expertise in the evaluation of iron deposits. The initial work program will take place in the summer and fall of 2006 and will entail the construction of a 40 man camp, line cutting, sampling, mapping and the initiation of an environmental baseline study in anticipation of a phase one drill program in 2007.

The Company also announces it has executed an Amending Agreement to the Option Agreement between the Company and Bedford Resource Partners Inc. ("Bedford") originally announced on December 2, 2005. The Company and Bedford are working together to explore and develop the Property. Copies of the agreements can be found on

To earn a 100% interest in the Property, the Company must complete the following:

i) Expend $4,000,000 on the Property by December 31, 2011, including $500,000 by December 31, 2006 (amended from $1,000,000 by December 31, 2006 in the original agreement);

ii) Issue 2,000,000 shares of the Company by November 30, 2007, including 650,000 in December 2005 (issued), 650,000 by November 30, 2006 and 700,000 by November 30, 2007; and

iii) Pay a royalty of 2.5% on gross revenue from the sale of iron produced with advance royalties commencing on November 30, 2006 in the amount of $150,000 annually to be paid quarterly until commencement of production. The original agreement had an escalating advance royalty initially at $150,000 in the first year and escalating to $1,000,000 a year by November 30, 2016. The advance royalty has been amended to an annual advance payment of a flat $150,000 a year through to the commencement of production.

The Property is located 170 kilometers north of the town of Schefferville. The northern terminus of the Quebec North Shore and Labrador Railroad, a common carrier, is located in Schefferville. The Bedford property consists of 129 mining claims totalling 6,219 hectares in area. The Company has staked an additional 509 mineral claims contiguous to the Bedford claims. The overall Property now covers a strike length of approximately 45 kilometers of iron formation, as defined by outcrops and interpreted from government aeromagnetic survey data, and covers 289 square kilometers.

The Property hosts two significant magnetite iron-formation taconite deposits, which are part of the same mineralizing system, and are known to extend for at least 25 kilometers on strike. The deposits are sub-horizontal and the two most important combined iron formation subunits are approximately 15 to 38 meters thick as reported in historic exploration reports. They were partially delineated by limited diamond drilling carried out by King Resources Company in the 1970s. There are additional iron formation sub-units immediately beneath the sub-units that host the historic "mineral resources", and these lower sub-units may hold potential for additional "mineral resources".

The historic "mineral resource" estimates were prepared by Metals, Petroleum & Hydraulic Resources Consulting Limited (later "MPH"), which managed the exploration programs for King. They were variously referred to as "reserves", "mineable reserves", "drill proven" and "drill indicated" and are documented below.

Tonnes Magnetic Soluble I. F.
Zone Long Tons (rounded) Fe % Fe % Thickness(i)
North 613,600,000 623,000,000 25.08 33.92 50 ft (15m)
South 1,126,600,000 1,145,000,000 25.76 33.06 100ft (30m)
(i) Average true thickness, as reported by MPH, used in preparing
the estimates.
Note: Historically, tonnages for iron deposits were reported in
long tons and this was the case for Lac Otelnuk. WGM has converted
long tons to metric measure using a factor of 1.016 long tons equals
1 tonne and rounded the resulting tonnages to reflect their uncertain

These historic "mineral resource" estimates were prepared prior to the implementation of National Instrument 43-101 ("NI 43-101"). WGM has neither audited these estimates nor made any attempt to classify them according to NI 43-101 standards or the Council of the Canadian Institute of Mining, Metallurgy and Petroleum definitions ("CIM Standards"). They are presented because the Company and WGM consider them to be relevant and of historic significance. These estimates should not be relied upon and are provided as contextual information only.

WGM prepared the NI 43-101 report on the property which can be viewed at Mr. John Sullivan, P.Geo, a Qualified Person under NI 43-101, has approved the technical content of this News Release.

Information concerning the Company is also available on Pacific Imperial's website at


Michael J. Beley, President

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release that address future financings, production reserve potentials, future work programs or exploration drilling, are forward-looking statements. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy of this release.

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