Global Uranium Corp.
TSX VENTURE : GU

September 22, 2011 12:32 ET

Global Uranium Signs Letter of Intent to Acquire Coal Project in Alabama

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 22, 2011) - Global Uranium Corporation (TSX VENTURE:GU) (the "Company") announces that it has signed a letter of intent ("LOI") with two vendors to purchase surface rights and mining rights related to 400 acres containing up to three coal seams having an aggregate thickness of up to five feet. The project is located in Jefferson County, Alabama.

Coal samples taken on the property have been analyzed by SGS Laboratories and the coal is considered to be a medium grade metallurgical coal.

Mining operations currently exist recovering coal from these seams on adjacent properties. Coal from these operations is currently being sold to Walters coke and ABC coke plants in Birmingham, Alabama. The prices received for the coal range from $145/ton to $250/ton depending on blend. Current operations are averaging $190/ton delivered.

The terms of the LOI include:

  1. Purchase Price. Subject to the Company's due diligence being satisfactory, it will purchase all vendors' rights and benefits related to the coal project in consideration of the purchase price of US$3,000,000.

  2. Due Diligence. The Company has the right to conduct due diligence investigations related to the project including access to the property and all exploration and mining information, data, analyses, maps, reports, books and records, and documents. The Company also has the right to conduct such tests, investigations, exploration and other activities as it deems necessary to review the extent and quality of coal on the property.

    In consideration for the Company's right to conduct due diligence investigations, the Company will pay the vendors the cash sum of US$10,000, and subject to the approval of the TSX Venture Exchange, will issue to the vendors 50,000 common shares.

  1. Drill Program. The vendors intend to drill four holes on the Property in October 2011 and have booked a drill to carry out the drilling. The purpose of the drilling is to determine seam thickness and quality of coal on the property. The Company has agreed to pay the estimated $30,000 cost of the drilling program and coal analysis.

  2. Closing Conditions. The closing of the purchase of the coal project is subject to fulfillment of the following conditions:

    1. the Company will have completed satisfactory due diligence on the coal project not later than 90 days after the date of the LOI;

    2. the parties will have negotiated in good faith and signed a formal Agreement not later than 14 days after the date that the Company has given notice to the vendors that its due diligence is satisfactory; and

    3. the TSX Venture Exchange will have accepted the acquisition of the coal project by the Company.

ABOUT GLOBAL

Global Uranium Corporation is an exploration and development company currently focusing on the acquisition of advanced stage properties with special emphasis on metallurgical coal projects. The Company's strategy is to maximize shareholder value through successful exploration and development.

In addition to this proposed acquisition, the Company is also investigating other met coal development projects in North America and Asia.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Global Uranium Corporation
    George Heard
    CEO, President & Director
    604-632-0085
    gwheard@shaw.ca