SOURCE: U Mining Resources Inc.

August 23, 2007 08:30 ET

U Mining Resources Inc. Signs Letter of Intent to Acquire an Initial 40% Interest in a US Bio-Diesel Facility Valued at $25 Million

Company to Acquire Additional 15% of Facility Upon Finalization of Binding Agreement

NEW YORK, NY--(Marketwire - August 23, 2007) - U Mining Resources Inc. (PINKSHEETS: UMNG) today announced that it has signed a letter of intent to acquire an initial 40% interest in a US Bio-Diesel facility valued at approximately $25 million. This imminent acquisition will provide U Mining with a strong foothold in the burgeoning Bio-diesel industry and form the foundation of its Green Energy Division.

The facility is in a prime location due to its close proximity to low cost raw material supply and five state and federal highways. It is dedicated to the large scale production of two bio-diesel blends that significantly reduce environmentally harmful emissions compared to conventional diesel. One of the blends can reduce CO2 emissions by 78% and lower the carcinogenic properties of diesel fuel by 94%. Other key advantages of bio-diesel compared to conventional diesel are: (1) it is biodegradable; (2) could lower US dependence on imported oil and increase its energy security; (3) contributes to an engine's lubricity or its ease of movement; and (4) it is safer since it is non-toxic and has a higher flashpoint. The plant employs multi-feedstock processors that, coupled with stringent cost controls of raw feed-stocks, results in a produced price well below that of the national and regional price indexes.

The facility's regular monthly production capacity is estimated at 17.6 million gallons of the bio-diesel blends or about 212 million gallons per year. The facility is comprised of 1,300 acres; 240 acres improved with extensive infrastructure. The property has 175,000 square feet of industrial space, a complete sewer system and a dual spur railroad bed leading directly into one of the larger facilities. In addition, the facility includes a laboratory, ambulance, fire station, self-contained water system with pumping station and asphalt paved service roads.

The bio-diesel blends will be targeted towards the following four customer categories that have expressed a high level of demand for the innovative fuels: Retail, Wholesale, Commercial and Governmental. Based on the expected sales and a net margin of 40 cents and 20 cents per gallon on each blend, the facility is projected to achieve a Gross Profit (pre-tax) of $62.4 million per year with $106 million of federal tax credits usable to the owner of the business. The profits will be strategically re-invested to rapidly grow the brand and extend sales far beyond the regional area via a nationwide licensing program.

U Mining is currently completing the due diligence process in order to finalize the binding agreement with the vendor, which would provide the Company with an additional 15% ownership interest in the facility.

For more information on U Mining Resources Inc., please visit the Company's corporate website at www.umining.com, and/or speak with one of the Investor Communications Representatives at U Mining's Investor Relations firm Equiti-trend Advisors. Reps are available on market days from 9:30 a.m. to 5:30 p.m. EDT by calling (800) 953-3350.

Forward-Looking Statements:

Please be advised that statements made herein, other than historical data, constitute forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those stated or implied by such forward-looking statements. The potential risks and uncertainties include, among others, potential volatility in the company's stock price, increased competition, customer acceptance of new products and services offered by the company, and uncertainty of future revenue and profitability and fluctuations in its quarterly operating results. Please also be advised that the company's stock is not currently registered with the Securities and Exchange Commission.

Contact Information

  • Contact:
    U Mining Resources Inc.
    Investor Relations firm Equiti-trend Advisors
    (800) 953-3350