Southwestern Resources Corp.

Southwestern Resources Corp.

April 04, 2006 19:19 ET

Southwestern Resources Corp.: Report on Acquisition of Securities of Superior Diamonds Inc. in Shares for Debt Settlement-Normal Course Issuer Bid

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - April 4, 2006) - Southwestern Resources Corp. (TSX:SWG) announced that it has reached an agreement with Superior Diamonds Inc. to settle a long-term debt of $200,000 by issuing 444,444 common shares of Superior Diamonds to Southwestern at a price of $0.45 per share.

Southwestern is the largest shareholder of Superior Diamonds, and prior to the settlement, Southwestern held 6,403,399 shares or 18.6% of its outstanding shares. After the settlement, there are 35,609,896 shares of Superior Diamonds issued and outstanding, of which 6,847,843 shares, or 19.2%, are held by Southwestern. In addition, pursuant to a transaction in 2005, Southwestern holds warrants to purchase an additional 444,444 common shares in the capital of Superior Diamonds. If Southwestern were to exercise all of the share purchase warrants, it would hold an aggregate of 7,292,287 shares, representing 20.2% of the outstanding shares of Superior Diamonds. The settlement shares are subject to a four-month hold period.

Southwestern has acquired the settlement shares for investment purposes and has no current intention to increase or decrease its shareholdings.

In a separate transaction, Southwestern recently cancelled 80,000 common shares it acquired as a result of all purchases the Company made through the facilities of the Toronto Stock Exchange pursuant to the Normal Course Issuer Bid announced on May 25, 2005.

Southwestern Resources Corp. is exploring in several countries for precious and base metals. The Company has a number of significant projects including the Boka Gold Project in China with Team 209, where a major drilling program is being conducted, the Liam Gold-Silver Project in Peru with Newmont Peru Limited and the Antay Porphyry Copper-Gold Project in Peru with Anglo American Exploration Peru S.A. as well as the 100% owned Accha Zinc Project in Peru. The Company is also exploring for porphyry copper-gold in a large area of southwestern Yunnan Province, China under a Joint Venture with Newmont Overseas Exploration Limited.

Forward-Looking Statement

Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed under the heading "Risk Factors" and elsewhere in the Corporation's periodic filings with Canadian securities regulators. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The Company does not assume the obligation to update any forward-looking statement.

Contact Information

  • Southwestern Resources Corp.
    John G. Paterson
    President & CEO
    (604) 669-2525
    (604) 688-5175 (FAX)
    Southwestern Resources Corp.
    Timo Jauristo
    VP, Corporate Development
    (604) 669-2525
    (604) 688-5175 (FAX)