Bayswater Uranium Corporation
TSX VENTURE : BAY
FRANKFURT : B2V

Bayswater Uranium Corporation

August 28, 2006 08:15 ET

Bayswater Reports First New Uranium Discoveries on its Labrador Land Holdings

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 28, 2006) - Bayswater Uranium Corporation (TSX VENTURE:BAY)(FWB:B2V) (the "Company") reports that initial survey results from its Labrador Central Mineral Belt Uranium Project has generated over 100 priority airborne radiometric anomalies with signatures and in geologic settings characteristic of IOCG and Rossing deposit models. These anomalies are variously shaped including typical linear and stubby zones up to 10 km in length within the Central Claim Block that covers a portion of the historic uranium district; and linear, arcuate, stubby, ovoid and ring-shaped zones up to 10 km in length or diameter in the North and Northwest Claim Blocks. Follow-up prospecting of these anomalous targets is currently underway.

A summary of recent discoveries from follow-up work to date is as follows:

- Anna Lake Prospect: Uraniferous boulder field, previously reported from the Company's compilation of prior work, confirmed with associated radiometric anomaly that extends for several km

- Stipeck River Zone A Prospect: Uraniferous highly radioactive zone in historic uranium district measuring 10 to 20 metres wide and traced for 200 metres into overburden covered areas along strike

- Stipeck River Zone B Prospect: Uraniferous highly radioactive 2 to 4 metre wide zone traced for 200 metres along strike and located 3 km along strike from Zone A above

- Kanairiktok Bay Prospect: Rossing-type discovery in North Claim Block consists of abundant uraniferous and highly radioactive alaskitic bodies distributed in crescent-shaped mineralized zone several km long

- Stomach Lake Prospect: Huge uraniferous radioactive boulder field in Northwest Claim Block indicates substantial Rossing-type mineralized source area

- Drill targets shaping up for testing on above targets

- Extensive airborne radiometric anomalies along strike the Michelin deposit and Jacques Lake, Otter Lake and Melody Hill Prospects of Aurora Energy indicate considerable potential for further discoveries of IOCG-type mineralized zones in the historic uranium district.

- Numerous airborne radiometric anomalies in North and Northwest Claim Blocks indicate excellent potential for discovery of other Rosing-type targets

The Company's airborne geophysical survey is continuing with two helicopter-supported systems and should be completed by early September. Although the data requires processing and final survey maps and interpretation won't be available until late in the fall, the data is of sufficient quality to select anomalous targets for follow-up and evaluation.

For a brief description of the IOCG and Rossing exploration deposit models refer to the Company's news release of January 16, 2006.

Preliminary results from the Company's initial evaluation of its uranium discoveries to date are detailed below.

IOCG TARGETS

Anna Lake Boulder Train: This target was identified as a result of the Company's compilation of previous work on its claims. It has been previously described in a News Release dated May 17, 2006. The target consists of an extensive uraniferous boulder train in gossaneous garnet-biotite schist with grab sample values of up to 3.05 % U3O8. Although the Company does not have assay results returned from its sampling of this boulder train the prospecting crews confirmed the character and radioactivity of the mineralization. Results from the current airborne survey over this target indicate a coincident radiometric and magnetic anomaly that is several kilometers long. Further follow-up of this target, including ground geophysics, is required to develop drill targets. A permit application for this work has been submitted.

Stipeck River Uranium Trend: Follow-up prospecting of a series of radiometric anomalies within the northern portion of the Central Claim Block have identified three uranium targets of interest along a strike length of approximately 3 km.

Stipeck River Zone A Prospect: This prospect consists of a highly radioactive zone traced for 200 metres along strike into overburden covered areas at both ends. The zone is 10 to locally up to 20 metres wide. It consists of a graphitic and sulphidic shear structure hosted within an argillaceous unit in a conglomerate-sandstone sequence. The mineralized zone is continuously mineralized along strike and across its width and typically returns spectrometer readings of greater than 35,000 cps with highest values based on hand held spectrometer measurements of up to 0.7% U. Approximately 50 samples have been collected from the target with assays pending. A HLEM(Max-Min) survey is planned in order to trace the potential strike extent of the mineralized zone. Permitting has been submitted for further surveying and drill testing of this target.

Stipeck River Zone B Prospect: This prospect is characterized by a 2 to 4 metre thick, uraniferous, silicified sandstone unit traced for 200 metres along strike. The sandstone unit is hosted within a folded sedimentary sequence of conglomerates and cherts. The uraniferous unit typically returns up to greater than 5,000 cps with highest spectrometer values of 0.12% U. This showing occurs 3.0 km southwest and along strike from the Stipek Zone A Prospect. Sampling is ongoing and assays of the preliminary sampling are pending. Permitting has been submitted for further surveying and drill testing of this target.

Stipeck River Zone C Prospect: This target consists of widespread localized uraniferous zones with total count readings locally up to greater than 35,000 cps. Best spectrometer values range from 0.1% to 0.8% U. The mineralized zones are hosted in complexly folded and faulted rocks sedimentary units equivalent to those of Zone A and Zone B showings. Intense quartz veining and stockwork veining containing pyrite and minor chalcopyrite are spatially associated with these uranium showings. Stipek River Zone C Prospect is located about 1/2 km northeast of the Zone B showing. Assays are pending with further work underway.

Other Radiometric Targets: Numerous high priority radiometric anomalies have been identified within the Central Claim Block that extend intermittently for at least 45 kilometers, to the limits of our current survey in progress, along the southwestern geologic extensions of known deposits and prospects in the eastern portion of the historic district-namely, along the strike extensions of the Michelin deposit, Jacques Lake and Otter Lake prospects and Melody Hill prospect of Aurora Energy Resources Inc. (TSX VENTURE:AXU). These targets will be evaluated as part of our ongoing follow-up program this summer and fall. Only a portion of the Company's airborne survey has been completed over the historic uranium district and the Company anticipates numerous additional radiometric anomalies for follow-up will be generated further to the southwest, including the area adjoining land held by Crosshair Exploration & Mining Corp. (TSX VENTURE:CXX).

ROSSING TARGETS

Airborne surveying of the North and Northwest Claim Blocks has been completed except for recently staked marginal claims and fill-in surveying at 100 metre line intervals in radiometrically anomalous areas. These claim blocks have potential primarily for Rossing type deposits. Rossing targets are characterized by favourable alaskitic intrusives localized in high grade metamorphic terrain, including migmatites and pegmatitic phases, with associated gneissic domes and major fault structures. Radiometric anomalies are associated with such deposits; and extensive multielement lake sediment anomalies, present on the Company's claims, are believed reflective of such deposit environments.

North Claim Block

The results of the airborne survey within the North Claim Block indicate two magnetically inferred "granite-gneiss domes"-one associated with the oval-shaped uranium and associated multielement lake sediment anomaly centered within our claims previously described in the Company's news release of May 17, 2006; and, the other associated with a separate and smaller similar multielement lake sediment anomaly to the northeast. Major regional fault structures bound these domal structures along there northwest and southeast margins.

Radiometric Targets: Numerous and extensive radiometric anomalies, ranging up to 10 km in length, characterized by Rossing-like signatures occur coincident with the oval-shaped lake sediment anomaly, including the McGrath Lake Area as described in News Release dated May 17, 2006, and with the separate anomaly to the northeast as described above. Follow-up of one of these radiometric anomalies has led to discovery of a promising uranium mineralized area (Kanairitktok Bay Prospect) located along the western margin of the northern-most "granite-gneiss dome" and related lake sediment anomaly as referred to above.

Kanairiktok Bay Prospect: This uranium mineralized area is characterized by a localized although widespread cluster of radioactive alaskitic-aplitic dykes, lenses, boudins and masses within and along the southwestern margin of a zoned oval-shaped "anorthosite" body that measures about 5-10 km in length in a northeast-southwest direction. The mineralized area appears to be a general crescent-shaped zone that extends for several kilometres. Radioactive intrusive phases within this zone return total counts of up to greater than 25,000 cps with spectrometer values of up to 0.5% U. Preliminary work performed on this zone includes continuous channel sampling for which assays are pending. Drill targets are beginning to take shape on this target as further ground work is carried out.

Northwest Claim Block

The airborne survey of the Northwest Claim Block has identified two large major centers of radioactivity (Stomach Lake Area and Weekes-English Lake Area) coincident with areas of highly anomalous uranium values in regional lake sediments and lake waters as previously reported (News Release dated January 16, 2006). Major regional fault structures and intersecting patterns of faults dominate the structural setting of these large promising target areas. Also, other local linear to stubby radiometric anomalies of interest occur elsewhere within the Northwest Claim Block.

The Stomach Lake target is characterized by a composite northeast-southwest trending linear zone about 20 km long and 2 to 4 km wide that tends to widen to the northeast; whereas, the Weekes-English Lake area target is a composite ring-shaped feature about 10 km in diameter. The latter target is also characterized by symmetrical linear to stubby extensions for up to 15 km along a northeast-southwest direction. Both of these targets are spatially associated with regions of partial ring-shaped masses of granitic and migmatitic rocks. Prospecting has just commenced on these targets.

Stomach Lake Prospect: Limited follow-up prospecting of the northeastern portion of the Stomach Lake radiometric anomaly has led to discovery of a very large and extensive, potentially fanned, uraniferous boulder field. Radioactive boulders consist of pink alaskitic granite and migmatite with total counts of up to 10,000 cps with highest uranium values based on hand held spectrometer measurements of 0.2% U. The potential source area of this boulder field is to the southwest and further extensive prospecting is planned. The extent and volume of mineralized material and angular nature of many of the boulders indicates a proximal and substantial Rossing-type mineralized body.

OTHER NEWS

The Company also reports that additional claims comprising a total of 822 claims have been staked to cover potential extensions of targets of interest adjacent to its current land holdings. Also, 36 claims have been staked in a separate block to the east of Kaipokok Bay south of Postville within the historic uranium district (Kaipokok Bay Claim Block). These claims cover the potential extension of an airborne radiometric anomaly located adjacent to the west, north and northeast sides of the claim block. The new claims are underlain by granitic rocks. Aurora Energy holds land that nearly surrounds the claims. All these additional claims are being surveyed with airborne geophysics by Fugro.

The Company is also pleased to report that it has been approved for Junior Exploration Assistance under the Mineral Incentive Program in the Province of Newfoundland & Labrador in respect to a government contribution towards the cost of its airborne geophysical survey of its large Labrador land holding.

In other news, the Company has entered into an agreement with a consultant to acquire a data package in reference to mineral resources in Europe for $25,000 payable either in cash or through the payment of 1/2 cash or 1/2 in common shares at the discretion of the Company.

The Company's exploration activities are conducted under the supervision of George M. Leary, M.Sc. P. Eng. (BC), president of the Company, and Vic Tanaka, B.Sc. P.Geo.(B.C.), COO of the Company. Both are qualified persons
under NI 43-101. George M. Leary, president of the Company, is the qualified person responsible for the technical information in this news release.

About the Labrador Central Mineral Belt

The Central Mineral Belt (CMB) of Labrador, Canada, located approximately 135 kilometres north of Goose Bay, has a long history of uranium and base metals exploration. Uranium was first discovered in the belt in the 1950's. With further exploration in the 1960's and 1970's with rising uranium prices, exploration in the CMB increased significantly and several uranium deposits were discovered including the Kitts, Michelin, Inda, Nash, Rainbow and Moran Lake deposits by Brinco. The Moran Lake deposits were later drilled by Shell Canada Ltd. (TSX:SCH). Currently the Michelin uranium deposit is being developed by Aurora Energy Resources Inc. (TSX VENTURE:AXU) which at the end of January, 2006 announced a NI 43-101 compliant measured and indicated resource of 22.2 million lbs U3O8 plus an additional inferred resource of 13.4 million lbs U3O8 all at an average grade of 0.113% U3O8 to a depth of approximately 600 metres. Crosshair Exploration and Mining (TSX VENTURE:CXX) is exploring the Moran Lake deposit with an initial NI 43-101 compliant inferred resource of 688,000 lbs U3O8 at a grade of 0.25% U3O8 in the Upper C Zone. Bayswater Uranium is the largest landholder in the CMB with over 4,200 sq km. Aurora controls about 800 sq km and Crosshair approximately 640 sq km.

About the Labrador Central Mineral Belt Uranium Project

The Labrador Uranium Project is one of Bayswater's key projects with over 4200 sq km of contiguous land along and adjacent the historic Labrador Central Mineral Belt uranium district highlighted by resource drilling on the Michelin deposit by Aurora Energy Resources Inc. and Crosshair Exploration & Mining Corp. on the Moran Lake deposit; and, by development of major prospects by Aurora and others working in the district. The Company's land holdings have potential for Olympic Dam and Rossing type uranium deposits. Several new mineralized zones and a large number of recently defined unexplored radiometric anomalies occur within the Company's land holdings. Also, additional radiometric anomalies will likely be generated from favourable areas being covered by the Company's ongoing airborne survey by Fugro Airborne Surveys Corp. Results from the survey as well as the Company's follow-up prospecting of high priority targets will be announced as results become available and have been reviewed by the Company. The Company is by far the largest land holder in this important uranium district.

About Bayswater Uranium Corporation - The Super Junior Uranium Company™

As the only uranium explorer to have major landholdings in each of Canada's most important producing and exploration regions - the Athabasca Basin, the Central Mineral Belt, and the Thelon Basin - Bayswater Uranium Corp. is well positioned to be a market leader in uranium exploration. Bayswater combines the experience of its technical and managerial teams with a large, highly prospective and diverse property base. The result is a Super Junior Uranium Company™ with the share liquidity and market capitalization to provide value to both the retail and institutional investor. For further information visit www.bayswateruranium.com.

On behalf of the Board of:

BAYSWATER URANIUM CORPORATION

George M. Leary, President

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents herein.

Contact Information