URSA Major Minerals Incorporated

URSA Major Minerals Incorporated

December 20, 2006 08:57 ET

URSA Major Minerals Incorporated Signs Agreement with Xstrata Nickel on Processing of Ore and Concentrates from Shakespeare Project, Sudbury Area, Ontario

TORONTO, ONTARIO--(CCNMatthews - Dec. 20, 2006) -

This press release is not for distribution to any U.S. news wire service or for dissemination in the United States.

URSA Major Minerals Incorporated (URSA Major)(TSX VENTURE:UMJ) is pleased to announce that it has entered into a memorandum of agreement with Xstrata Nickel for the milling of ore and subsequent purchase by Xstrata Nickel of nickel and copper concentrates expected to be produced from the Shakespeare nickel-copper project.

The agreement provides for the initial milling of an approximately 50,000 tonne bulk sample at Xstrata Nickel's Strathcona mill and the subsequent processing of concentrates. Should the bulk sample meet expectations with respect to grade, recovery, co-mingling requirements, Xstrata Nickel and URSA Major will consider the custom milling of further ore from the Shakespeare deposit. Additionally, once URSA Major has commissioned a mill to produce nickel and copper concentrates, the agreement provides terms for the smelting of URSA Major's concentrates for a period of seven years.

"We are very pleased to have reached this agreement with Xstrata Nickel, which is a major milestone in the development of the Shakespeare project. The Xstrata Nickel agreement paves the way for initial production from the Shakespeare deposit in 2007 and the milling of ore at the Strathcona mill. Contingent on our permitting and sustained robust metal prices, we can anticipate some early cash flow from the project while we pursue the building of a mill on site. The deal provides URSA Major with a major purchaser for all of the expected Shakespeare nickel and copper concentrates. This significantly reduces project risk and is very important for our financing objectives" stated Richard Sutcliffe, URSA Major's CEO.

The memorandum of agreement is subject to concluding a formal off-take agreement and in addition, the extraction of a bulk sample is subject to ongoing permitting requirements.

At the Shakespeare project, URSA Major completed a positive full feasibility study in January 2006 and is currently advancing the property toward a production decision. The feasibility study is available on the company's website at www.ursamajorminerals.com. As reported on October 26, 2006, URSA Major is submitting applications for the permitting of two open pits (Shakespeare East and West Zones), a mill to process up to 4,500 tonnes per day, co-disposal waste management facility and related site infrastructure.

This release was prepared by management of the Company who takes full responsibility for its contents.

Some statements contained in this release are forward-looking and, therefore, involve uncertainties or risks that could cause actual results to differ materially. Such forward-looking statements include comments regarding mining and milling operations, mineral resource statements and exploration program performance. Factors that could cause actual results to differ materially include metal price volatility, economic and political events affecting metal supply and demand, fluctuations in mineralization grade, geological, technical, mining or processing problems, exploration programs and future results of exploration programs, future profitability and production.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information

  • URSA Major Minerals Incorporated
    Richard Sutcliffe, Ph.D., P.Geo,
    President & CEO
    (416) 864-0615
    (416) 864-0620 (FAX)
    URSA Major Minerals Incorporated
    Chris Chadder, C.A.
    (416) 864-0615
    (416) 864-0620 (FAX)
    Email: info@ursamajorminerals.com
    Website: www.ursamajorminerals.com
    URSA Major Minerals Incorporated
    Gus Garisto
    Investor Relations
    Cell: (416) 805-3106