Spider Resources Inc.
TSX VENTURE : SPQ

Spider Resources Inc.

October 27, 2005 16:19 ET

Spider Resources Inc.: October President's Message

TORONTO, ONTARIO--(CCNMatthews - Oct. 27, 2005) - Spider Resources Inc. (TSX VENTURE:SPQ) -

Spider Resources Inc. is quoted for trading on the TSX-V exchange under the exchange symbol "SPQ", there are currently 212,603,280 shares issued.

This will be the first in a series of regular updates and commentaries on the field progress of Spider Resources Inc. regarding its joint venture properties with KWG Resources Inc. We have been active on a number of fronts to lay the groundwork that we believe will create shareholder value in the future. Our property holdings have each yielded significant results to date from the historical work we have completed that give us reasons to be very optimistic going forward, so I am pleased to take this opportunity to outline our plans and expectations.

McFaulds Lake Property - James Bay Lowlands, Ontario

We were very pleased with the results from our winter drilling programs that were completed earlier this year, which successfully targeted volcanic massive sulphide anomalies (VMS) and encountered up to 4% copper grades across significant intervals, before we were forced to halt drilling for the spring breakup. Only limited exploration activity has ever been completed at the McFaulds Lake project prior to our exploration efforts. Since the initial discovery of massive sulphide style mineralization in 2002, we have discovered a total of 8 massive sulphide occurrences. Two of these have undergone detailed drilling, and have been subjected to various geophysical surveys and studies. Our nearby neighbours Probe Mines Ltd and Macdonald Mines and Exploration have also confirmed that they have intersected VMS style mineralization, on their respective properties, indicating that the McFaulds Lake area may be on its way to becoming the newest VMS camp in Canada.

Both, McFaulds #1, as well as the nearby McFaulds #3 occurrences, have undergone an initial scope of resources review by an independent consulting group. The initial results of this review suggest that, based on the copper and zinc grades reported to date, McFaulds #3 is approaching a combined grade that may support a mining operation in the remote and logistically difficult geographic location that we are exploring, however the tonnage of McFaulds #3 has come up short of what might sustain a mining operation on a stand alone basis. Grade sensitivity analysis was recommended and will be undertaken shortly. This grade sensitivity analysis is essentially, a review of the encountered average grades for the tested three dimensional body, as contained in the volume of rock, converted into a tonnage. Simply put, we need more tonnage at the grades we are encountering in McFaulds #3 in order for this occurrence to make sense economically.

As a result of the detail drilling pattern, observed alteration patterns, down-hole geophysics, airborne and ground grid geophysical survey work completed on McFaulds #3, it has been suggested that this particular occurrence remains open to great depth. Dr. Chris Hale, chief consulting geophysicist for JVX Ltd. of Richmond Hill, summarizes the gravity survey work that he directed over the McFaulds #3 as follows:

"Gravity profiles are consistent with a mass excess below a depth of 600m on Grid #3... deeper drill holes in the 600m to 1000m range may be necessary to reach this mineralization and deeper drilling is recommended."

Consequently, we believe that the main sulphide body of this occurrence will lie much deeper, below 600 metres. However, to test to this depth on the property will require a larger drilling rig, and a larger budget for exploration expenditures. Because we have completed only limited near surface drilling thus far, there is not enough data to work with, for the purposes of preparing a final resource estimate. While results to date have been promising they are as yet insufficient to support a major mining operation on a stand alone basis.

In addition, there are still several other untested geophysical anomalies on our property holdings that we also believe could merit additional focus and attention.

Our efforts will thus be focused on other near-surface mineral occurrences, and we will be planning a drill program to test the high priority targets along this new VMS belt. To this effect we have recently employed Ken Witherly of Condor Consulting Inc. of Lakewood, Colorado, to provide a review of all of the geophysical survey work completed within the project area and make recommendations, including prioritizing the other geophysical anomalies as drill targets.

Our immediate plans are to winterize the McFaulds camp in preparation for a winter drilling program. We anticipate approximately $1,000,000 will be assigned to fund this round of exploration. We are in the process of selecting targets and hope to commence the next round of drilling in early January.

Kyle Lake and MacFadyen Properties - James Bay Lowlands, Ontario

We enjoyed early success from our 1995-2001 programs at Kyle Lake, and the nearby Kyle #3 kimberlite. We then focused our diamond exploration attention the MacFadyen Property in 2004 and early 2005, where we tested a number of kimberlites that were previously discovered on the property, whilst discovering three new kimberlites. Our recent sampling efforts at the MacFadyen series of kimberlites have identified good macro diamond results so far. There will be much more work ahead in our efforts to advance the project to the point at which a development decision can be reached, but we are encouraged that DeBeers has achieved success on their program at their nearby Victor Mine Property, as it validates our confidence that commercial production may be possible from this new diamond district.

Wawa Joint Venture - Central Ontario

We are involved in a joint venture arrangement with KWG, advancing the exploration of several unique diamond occurrences on our property holdings located near Wawa, Ontario. To date we have completed property-wide sampling activity that proved the existence of macro diamonds from our property, within 38 separate diamond occurrences, including a 0.33-carat diamond that was recovered and announced in May 2005. Our immediate focus is to do a scoping study targeting the main occurrence that we have identified from our exploration work. We are planning a bulk-sampling program that involves a scoping study to fully understand the physical, chemical and other properties of the various diamond and non-diamond bearing rock types that are evident in the main occurrences, to test for an appropriate extractive process with the objective of establishing economic liberation of commercial sized diamonds from the host rocks. An initial process engineering budget of $150,000 has been proposed and approved for this program to commence immediately.

Spider Resources Inc has recently closed a private placement to raise capital for general corporate purposes, and has also recently completed a flow through placement to provide the initial funding for our exploration programs. We have tremendous confidence in the potential of our properties from the results we have achieved in our exploration work, and look forward to moving our projects forward into next year. The market conditions are very favourable for mineral exploration in Canada and elsewhere at this time, and we will be working hard for our shareholders to seize this opportunity for significant new discoveries that will add shareholder value.

For more information on Spider Resources Inc. and its exploration projects please visit our website www.spiderresources.com

The TSX Venture Exchange has NOT reviewed this release and it does not accept responsibility for its adequacy or accuracy.

Contact Information

  • Spider Resources Inc.
    Neil Novak
    President and CEO
    (416) 815-8666
    or
    Spider Resources Inc.
    Jim Voisin
    Communications Manager
    (519) 699-5352
    www.spiderresources.com