Sparton Resources Inc.

Sparton Resources Inc.

December 02, 2010 10:14 ET

Sparton Signs Agreement for Evaluation of Vanadium Development Programs in Xiushui County Jiangxi Province, China

TORONTO, ONTARIO--(Marketwire - Dec. 2, 2010) - SPARTON RESOURCES INC. (TSX VENTURE:SRI)(the "Company") is pleased to announce today that it has executed a Memorandum of Understanding (MOU) with the local government of Xiushui County, Jiangxi Province and owners of the Jiangxi Rentian Mining Company vanadium operations to undertake a comprehensive technical and commercial review of Rentian's operations and the general vanadium development program in the area.

Xiushui County has five vanadium related projects currently under development including Sparton's Guojiaping vanadium exploration program which is joint-ventured with Jiangxi Nuclear Exploration Team 267 (see news releases dated August 3, 2010 and August 11, 2010). Rentian has the most advanced project and has developed and test operated a new (completed late 2009), fully permitted, medium sized vanadium oxide processing facility in the county with a production capacity of approximately 800-1000 tonnes per year of chemical grade (+98.5%) V2O5. The operations are currently shut in due to lack of working capital. Rentian's assets also include two permitted mining operations, one open pit and one underground, which host vanadium mineralization and were the sources for the test material processed in the plant prior to shutdown.

Sparton's team of consulting metallurgists, mining and geological engineers and its commercial manager visited the area during the week of November 18th, 2010 and provided the Xiushui Government and Rentian with a comprehensive proposal for the evaluation and possible restructuring of the vanadium production assets and mining operations. This proposal was accepted by all parties and officially recognized in the MOU.

Sparton's staff have provided a comprehensive checklist of required data to the county and Rentian in order to properly complete the review. The Company has also started a comprehensive sampling program of raw vanadium feed material in the two mines and has sampled in the plant at various stages in processing operation to review the plant performance.

This work is expected to take approximately 6 weeks to complete.


Sparton recognizes a significant opportunity in this program as the Rentian plant is in excellent condition and was built to specifications designed, engineered and commissioned by Wuhan University, one of China's leading mineral processing institutions. There is a complete installation of modern process control and monitoring equipment, and full supporting infrastructure at the site. All operating and environmental permits are in place. Subject to a positive review of all aspects of operations, the Company sees the project as an investment opportunity that can fit well with the future development of the large vanadium deposit at Guojiaping (10 km from Rentian) and potentially lead to Sparton being a consolidator of vanadium production in the area.

Sparton Resources Inc. is a Canadian mining and exploration company involved in gold exploration in Canada and, operating (through its subsidiaries) a producing germanium mine in China. It is developing a very large vanadium deposit in China and has spearheaded reactivation of secondary uranium recovery businesses in China and Canada from radioactive waste such as coal ash, mine waste and tailings, and other types of material.

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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" in the Company's 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 any obligation to update any forward-looking statements, save and except as may be required by applicable securities laws.

This news release and the information contained herein does not constitute an offer of securities for sale in the United States and securities may not be offered or sold in the United States absent registration or exemption from registration.

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