Tungsten

[Tackler]

Sultan receives approval for Invincible purchase

2005-05-27 16:18 ET - News Release

Mr. T.J. Malcolm Powell reports

SULTAN RECEIVES EXCHANGE ACCEPTANCE FOR TUNGSTEN MINE ACQUISITION (TUNGSTEN @ US$17.50/LB) (MOLYBDENUM @ US$38.50/LB)

Sultan Minerals Inc. has received TSX Venture Exchange acceptance for its purchase of 100-per-cent interest in the Invincible tungsten mine, located approximately six kilometres south of Salmo, B.C.

Under the terms of the purchase agreement, Sultan purchased the property for $3,000 and 9,000 common shares of Sultan common stock. In exchange for the above cash and share payments, Sultan acquires a 100-per-cent right, title and interest in and to the property, subject only to:

a 2-per-cent net smelter return royalty (NSR), which Sultan may, at its discretion, reduce to a 0.5-per-cent NSR by the payment of $150,000 to the seller after the completion of a positive feasibility study; and an annual advance royalty payment of $3,000, which will commence in year 2010.

No common shares will be issued as bonuses, finders' fees or commissions in connection with this transaction. The common shares issued pursuant to the agreement have a four-month hold period that will expire on Sept. 25, 2005.

Tungsten

The 7.4-hectare Invincible mine property is situated adjacent to Sultan's Emerald tungsten mine, which was Canada's second largest tungsten producer from 1943 to 1973. The mine is accessible by means of a 1.5-kilometre-long decline that extends north from the decommissioned Emerald tungsten mine. Placer Dome operated the Invincible tungsten mine from 1971 until 1973, when it was decommissioned due to falling tungsten prices. Over its two-year life the mine produced 283,000 tonnes grading 0.65 per cent WO3. Recoverable reserves still existed at the time of mine closure and Placer Dome's historic mine records state that "the ultimate production if the mine had continued until exhaustion of all known reserves would have been 343,000 tonnes grading 0.66 per cent WO3." The historic mine records also show that geological conditions favourable for tungsten mineralization may extend north of the property for more than 2,000 metres on to claims presently owned by the company.

Note: These are historical reserves only and do not conform to guidelines for reserves according to National Instrument 43-101, nor should it be assumed that any such reserves will be developed on the property.

Molybdenum

Mine records report that during the development of the Invincible mine in 1971 a molybdenite bearing stockwork of vertical quartz veins was encountered within an intrusive body seen in the main Invincible mine haulage decline. The extent of the zone is unknown but a similar stockwork of widespread molybdenite occurs about 700 metres along strike to the east in a similar intrusive that underlies the East Dodger tungsten mine. Mapping of the Dodger drift revealed molybdenite in a stockwork of east-west trending quartz veins for the entire distance that the drift was in intrusive, about 330 metres. In the Dodger area, a 57-metre-long channel sample taken along a development drift by Sultan in 1995 was found to carry 0.05 per cent Mo, with a 12.1-metre section running 0.11 per cent Mo. During development work by Placer Dome in the 1970s, molybdenite was also intersected in diamond drill core and one remarkable drill core sample ran 4.44 per cent Mo over a four-metre length including a section of 20.8 per cent Mo over 0.8 metre. Readers are cautioned that the molybdenum assays from Placer Dome's work, quoted in this release, are historical in nature and were compiled before the implementation of NI 43-101 reporting standards.

With spot molybdenum prices currently above $80 (U.S.) per kilogram, Sultan is investigating the possibility that a large molybdenum bearing stockwork exists within the intrusive body beneath the tungsten ore deposits. Sultan is currently modelling the historic drill data and plotting the location of all previous molybdenum occurrences. An exploration program consisting of underground sampling and diamond drilling is planned. Please refer to news as reported in Stockwatch on March 2, 2005, and April 18, 2005.

Perry Grunenberg, PGeo, of P&L Geological Services of Lac Le Jeune, B.C., is the company's project supervisor and qualified person for the purpose of National Instrument 43-101, standards of disclosure for mineral projects.