Black Bull Resources Inc.
TSX VENTURE : BBS

Black Bull Resources Inc.

October 16, 2006 09:26 ET

Black Bull Resources Inc. Announces Restructuring Plan

SHELBURNE, NOVA SCOTIA--(CCNMatthews - Oct. 16, 2006) - Black Bull Resources Inc. (TSX VENTURE:BBS) has announced that at their meeting on October 14, 2006, the Board of Directors decided that the Company will temporarily cease quartz processing operations at its East Kemptville, Nova Scotia mine site. The Company is taking this action in order to conserve cash resources and focus expenditures on developing a new sales strategy, securing financing, adding new equipment to improve plant and feedstock utilization, and broaden the diversity of products the plant can produce.

Additionally, the Company has announced a management restructuring which will include the closure of its Halifax office and consolidation of its management functions in Shelburne. The management changes include elimination of certain positions including the VP Operations role and others as well as restructuring compensation arrangements with the staff that will remain in the employ of the Company.

Joseph MacDonald, outgoing Interim CEO, in announcing the decision said, "We regret the impact of the interruption in production on our customers and of course we regret deeply the impact of layoffs and position eliminations on our hourly and management personnel and the local community. We believe, however, that cessation of processing operations is unavoidable in the short term to conserve cash and rethink our product strategy and sales coverage in the marketplace."

The operations closure is planned for October 27, 2006, and will last for an undetermined period.

During the closure, the Company will retain core management staff who will continue to focus on developing an alternative strategy and building an order book to support a future financing and re-opening of the mine and processing site.

Robert Cudmore, CFO, has agreed to act as Interim CEO as well as CFO effective October 16, 2006, and will report to the Board in that capacity during this transition period.

Joseph MacDonald and Richard Shearer, both directors of the Company will lead the development of alternative strategy options for the Board to consider within a 60 day period. Following receipt and consideration of their report, and subject to a new financing, the Board will announce the plans for the future development of the Company.

About Black Bull Resources Inc.

Black Bull Resources Inc. is a Canadian mining company based in Nova Scotia that operates the White Rock Mine near Shelburne. The Mine produces a bright-white, high-purity quartz, marketed under the Scotia White™ trademark which is used in a range of value-added, specialty products.

The White Rock Property also contains an identified resource of kaolin and mica which the Company plans to further develop.

Further detailed information may be obtained from the Company's website www.blackbullresources.com or corporate filings at www.SEDAR.com.

FORWARD-LOOKING STATEMENTS: This news release contains certain forward-looking statements. All statements, other than statements of historical fact, included herein, including without limitation statements regarding the Company's mining properties, development results or future plans, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed elsewhere in documents that are available to the public.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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