Fjordland Exploration Inc.

Fjordland Exploration Inc.

August 02, 2006 07:45 ET

Fjordland Enters Agreement to Acquire Interest in Copper-Gold-Uranium Project, Yukon

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 2, 2006) - Fjordland Exploration Inc. (TSX VENTURE:FEX) reports it has entered into a letter agreement with Commander Resources Ltd. (TSX VENTURE:CMD) to earn up to an 80% interest in the Olympic-Rob project located in Yukon, Canada. The Olympic-Rob Property comprises 3,675 hectares covering an IOCG (iron-oxide-copper-gold) target that is geologically similar to BHP Billiton Ltd.'s (NYSE:BHP) giant IOCG Olympic Dam deposit, a multi-mineral orebody containing the world's largest uranium deposit.

"This acquisition provides Fjordland with a large, near-term, copper-gold-uranium discovery opportunity in an region that is attracting increasing exploration and market interest," stated Victor Tanaka, President of Fjordland Exploration. "The Property is essentially drill ready and, contingent on drill availability, can be tested before year end."


The geological sequence on the Olympic-Rob Property has similar geology, age, geometry and trace element signatures to BHP's Olympic Dam deposit that contains about 2 billion tonnes grading 1.6% copper, 0.6 grams per tonne gold and 0.06% U3O8. In addition to copper and gold, Olympic Dam is one of the world's largest uranium producers and contains the single largest uranium reserve in the world.

As the name implies, the Olympic-Rob Property comprises two separate zones - the Olympic and the Rob. They cover Wernecke Breccias, a geological rock type associated with IOCG Olympic Dam-type deposits. Other exploration companies exploring geological similar properties in this prospective Wernecke region of the Yukon include Cash Minerals Ltd (TSX VENTURE:CHX) and Fronteer Development Group Inc. (TSX:FRG).

Olympic Zone

The Olympic zone covers an irregularly-shaped, iron-rich, hematite-magnetite breccia complex that extends over 10 square kilometres. Widespread copper mineralization occurs within the matrix of the breccia bodies and along fractures. Historical sampling on the property returned significant copper values from the western portion of the large magnetic anomaly that occurs within the breccia zone including assays up to 5.0% copper over 1.5 metres, 7.0% copper over 4 metres in chip samples, and up to 21.4% copper in grab samples. Copper minerals identified are chalcopyrite, bornite and malachite. The many showings are enveloped by a continuous copper-in-soil geochemical anomaly that covers about 2.5 square kilometres.

Rob Zone

On the Rob zone, 5 kilometres south of Olympic, significant uranium values are known from outcrop and boulder samples that were collected in 1977 and 1979 by Union Miniere Exploration and Mining Corporation Limited (UMEX). The historical data reports uranium values in soils greater than 1.5 ppm uranium over the central 500 metres of the grid coincident with a 100 ppm copper-in-soil anomaly.

Within the core of the uranium soil anomaly, 21 of the rock samples collected assayed greater than 0.01% U308 and eight samples contained greater than 0.06% U3O8. The highest values recorded in that survey were 1.57% U3O8, 1.01% U3O8, 0.54% U3O8, 0.46% U3O8 and 0.32% U3O8, along with copper values ranging from 0.3% Cu to 1.8% Cu.

A presentation of the Olympic-Rob Property is available at
yk_ppt/05YKjuly.htm. (Due to the length of this URL, it may be necessary to copy and paste this hyperlink into your Internet browser's URL address field.)

Terms of the Agreement

Under the terms of the agreement, Fjordland may earn an initial 60% interest in the property by paying Commander $250,000, issuing 1.6 million shares of Fjordland in stages until December 31, 2009, and incurring exploration expenditures on the property totaling $7 million over a five year period ending December 31, 2011. Of this, $50,000 and 350,000 shares are payable to Commander upon receipt of regulatory approval and Fjordland must incur $600,000 in exploration expenditures by December 31, 2007, including a minimum of 2,000 metres of drilling. At least $75,000 in exploration expenditures must be completed by December 31, 2006.

Once Fjordland has earned a 60% interest, a joint venture may be formed or, within 60 days of vesting, Fjordland may elect to earn an additional 20% interest, for a total of 80%, by issuing to Commander either 1 million shares or $3 million, and by carrying all further costs through to completion of a bankable feasibility study. Upon completion of the bankable feasibility study, as well as final payment of $7 million to Commander, Fjordland will be vested its 80% interest. If Fjordland vests at 80%, a joint venture will be formed, however, Commander will have the election at any time up to commencement of commercial production, to convert its 20% interest into a 2% NSR subject to a buy-down provision to 1% for $10 million cash payable to Commander.

If Fjordland elects not to increase its interest to 80%, Commander may then elect, within 60 days of notification by Fjordland, to earn back 20% to an aggregate 60% interest by funding 100% of the next $3 million in exploration expenditures on the property. If a 60:40 joint venture is formed, each party shall fund its share of on-going costs pro-rata. Should either party's interest be reduced below 10%, its interest shall convert to a 10% NPI. If the agreement terminates prior to Fjordland vesting an interest, the property will be returned to Commander with two years of assessment work filed.

The agreement is subject to TSX Venture Exchange approval.

About Fjordland Exploration Inc.

Fjordland Exploration is a mineral exploration company focused on the discovery of gold, silver and base metal deposits. The Company has a 60% interest in the 26,936 hectare Woodjam gold-copper property located in central British Columbia, Canada and is operator of the project; Wildrose Resources Ltd. (TSX VENTURE:WRS) holds the remaining 40% interest. Fjordland also holds 100% earn-in options in three gold-silver properties located in Nevada and California, USA. Shares of Fjordland Exploration trade on the TSX Venture Exchange with the symbol "FEX". For further information visit the Company's website at

Victor Tanaka, President

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

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