UC Resources Ltd.

UC Resources Ltd.

September 29, 2010 09:00 ET

UC Resources Ltd. Re-Starts Production at La Yesca Mill

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 29, 2010) - UC Resources Ltd. (TSX VENTURE:UC) ("UC") is pleased to report that the mill at La Yesca, Mexico, has now been re-started using diesel generator electric power. The diesel generators were found to be necessary after production testing had commenced at the La Yesca mill site and the CFE power supply proved unreliable during the rainy season. The company had been assured that consistent power would be available following repairs prior to the mill testing period but multiple power failures within 24 hour periods over many days necessitated a revised plan. The companies existing generator system was not sufficient for the new larger ball mill so a larger generator was sourced and installed. This issue should resolve itself after the rainy season is over in a few weeks and then the mill will switch back to line-power and we will be ready for next year's rainy season.

As with the previous start-up earlier this summer the company expects to precipitate gold and silver within days as demonstrated from the initial test period prior to the power issues from which numerous dore pucks were produced. The company aims to move toward commercial production as quickly as possible and should be at the target 220 tpd within 2 weeks if all goes well and based on the earlier test period. Once stable run rates are attained at the target throughput with target recoveries, the company will then be testing maximum throughput rates in the months ahead which could increase performance.

An update on the legal action regarding the Copalquin project in Mexico, a decision has been rendered in favour of Minera Planet Exploration (a 100% owned subsidiary of UC Resources Ltd.). As stated by our Mexican lawyers "Regarding Copalquin legal issue, we inform you that within the Ordinary Commercial Judgement No. 699/08, promoted by Compañía Minera Copalquín, S.A. de C.V., against Minera Planet Exploration, SA de CV, brought before the Six Civil Judge of the District Morelos, Chihuahua, Mexico; an agreement was issued last September 9, 2010, in which the forfeiture was decreed by the body and thus terminating the trial before cited and ordered the case closed. In view of the above, Minera Planet Exploration, SA de CV, is acquitted of the payment of alimony in this trial".

Compañía Minera Copalquín, S.A. de C.V., has subsequently appealed the decision to a higher court while Minera Planet Exploration (UC Resources) has applied to the court for costs and damages to be assessed against Mr. Matas and his company. The company considers this action frivolous, and without merit.

Historically UC Resources reported the following drill results associated with the Copalquin property, La Soledad Mine, in the summer of 2006, a 5.15 meter wide mineralized zone containing quartz, silicified andesite breccia, native gold and acanthite (silver sulfide mineral). The mineralized zone averaged 44.6 g/t of gold (1.43 ounces/tonne), and 1,564 g/t silver (50.29 ounces/tonne). Within this zone there is a 1.75 meter wide section that averaged 112.8 g/t gold (3.63 ounces/tonne) and 4,337 g/t silver (139.45 ounces/tonne). The true width of the mineralized zone is believed to be approximately 95% of the reported interval.

Drilling on the La Colorada mine area of the Xora claim near the La Yesca mill has now completed hole 3 with the results from the first hole, which was approximately 180 metres from the mine entrance, being informative structurally but without mineralization the vein structure targeted having been missed. Assays for both hole 2 and hole 3 are pending and will be reviewed prior to commencing a planned 6 hole program after a short 2 week break. This 6 hole program that will be funded by a grant by the Geological Department of Mexico. The grant previously announced as being for $92,000 Canadian dollars has now been expanded up to $120,000 Canadian dollars with the possibility of multiple renewals based on results.

The area associated with the three initial drill targets have all historically been mined to varying extents, with La Colorada having a non-compliant 43-101 resources calculation which was compiled by the Mexican Ministry of Mines, by way of wall rock chip sampling, of 11,000 tonnes grading .7 g/t Gold and 619 g/t silver.

UC Resources is an active explorer of base metals and chromite in the McFaulds Lake area ("Ring of Fire") of the James Bay Lowlands, Ontario, as well as an explorer and a near term producer of precious metals in Mexico.

On behalf of the Board of Directors,

Jim Voisin, President & CEO

UC Resources Ltd.

We seek safe harbour.

Investors are invited to visit the UC Resources IR Hub at http://www.agoracom.com/ir/UCResources where they can post questions and receive answers or review questions and answers already posted by other investors. Alternatively, investors are able to e-mail all questions and correspondence to UC@agoracom.com where they can also request to be added to the investor e-mail list to receive all future press releases and updates in real time.

Contact Information

  • UC Resources Ltd. - Vancouver Head Office
    Damien Lowry
    604.681.7265 or Toll Free: 800.366.8566
    604.608.6163 (FAX)