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Prophecy Acquires 80% of Vanadium-Titanium-Iron Project in Ontario

January 14, 2010 - Prophecy Resource Corp. (TSX.V: PCY; OTC: PCYRF; Frankfurt: 3P1) has entered into an option agreement with Randsburg International Gold Corp. (TSX.V: RGZ) whereby Prophecy can earn an 80% interest in the Titan Vanadium-Titanium-Iron project located in Ontario, Canada.

The Titan project is located in eastern Ontario approximately 120 km east-northeast of Sudbury, straddling the boundary between Angus and Flett Townships, with access to excellent infrastructure.  The Titan property consists of 1,052 contiguous hectares (2,600 acres) comprising 17 patented claims and 3 mining claims.

Magnetite, ilmenite, titanium dioxide, and vanadium mineralization at Titan occurs in a southeast plunging body in gabbro to leucotroctolite in the northeastern corner of the Fall Lake complex.  The Titan deposit is located at the northern end of an aeromagnetic anomaly that is approximately1,200 by 800 meters in area.

A total of 4,898 assay intervals are recorded from 38 core holes drilled by Randsburg on the property.  Drilling highlights reported by Randsburg included 142 meters of 0.27% Vanadium (0.48% Vanadium Pentoxide) from hole RA-5-21 and 174 meters of 0.26% Vanadium (0.46% Vanadium Pentoxide) from hole RA-5-10. The mineralization started from surface to an open vertical depth of 500 meters. The complete horizontal and vertical extent of the deposit is still to be determined.  Information on the geology at Titan and assay results reported by Randsburg are available below.

A Technical Report dated February 12, 2007 prepared by Mines Development Associates for Randsburg calculated a National Instrument 43-101 compliant Inferred resource for the Titan project.  This Technical Report can be accessed under Randsburg’s filing at www.sedar.com.

Under the agreement, Prophecy shall have the right to acquire an 80% interest in the Titan Project by paying Randsburg an aggregate of $500,000 and incurring $200,000 in Exploration Expenditures by December 31, 2010.  This transaction is subject to completion of due diligence and acceptance for filing by the TSX Venture Exchange.

John Lee, Chairman of Prophecy states: "Vanadium and Lithium car batteries are the green wave of the future.  We are fortunate to acquire one of the few Vanadium deposits available anywhere in the world.  Titan fits perfectly with our business strategy of acquiring advanced mineral assets to provide Prophecy investors financial leverage on rising metal prices. We intend to explore and expand the Titan Vanadium resource in 2010."

This news release has been reviewed and approved by Bill Morton, P.Geo., a director of Prophecy and a Qualified Person under National Instrument 43-101.

About Prophecy Resource Corp.

Prophecy has entered into an agreement to acquire the Lynn Lake Nickel Project in Manitoba, which contains a National Instrument 43-101 compliant Measured and Indicated resource of 17 million tonnes with an average grade of 0.62% Nickel and 0.31% Copper at a 0.4% nickel cut-off grade. The Lynn Lake Technical Report, dated December 5, 2007, was prepared by Wardrop Engineering Inc. for Independent Nickel Inc. and is available under Independent Nickel’s filings at www.sedar.com.    

Prophecy has also earned a 60% interest in the Okeover Copper-Molybdenum property in B.C. where, in 2006, Dr. N.C. Carter, PhD, P.Eng, completed a technical report on the Okeover Property pursuant to NI 43-101 that estimated an inferred mineral resource of 86.8 million tonnes grading 0.31% copper and 0.014% MoS2 at a 0.20% copper cut-off grade.  This report is available at www.sedar.com.  

ON BEHALF OF THE BOARD OF DIRECTORS

Prophecy Resource Corp.

“JOHN LEE"          
John Lee
Chairman

 


Airborne mag survey.
Click to enlarge



Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


Mineral resources that are not mineral reserves do not have demonstrated economic viability. Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this release.  

 Forward Looking Statements: This news release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, including, without limitation, statements potential mineralization, the estimation of mineral resources, the realization of mineral resource estimates, interpretation of prior exploration and potential exploration results, the timing and success of exploration activities generally, the timing and results of future resource estimates, permitting time lines, metal prices and currency exchange rates, availability of capital, government regulation of exploration operations, environmental risks, reclamation, title, and future plans and objectives of the company are forward-looking statements that involve various risks and uncertainties. . Although Prophecy believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Forward-looking statements are based on a number of material factors and assumptions. Factors that could cause actual results to differ materially from those in forward-looking statements include failure to obtain necessary approvals in respect of the Transaction, unsuccessful exploration results, changes in project parameters as plans continue to be refined, results of future resource estimates, future metal prices, availability of capital and financing on acceptable terms, general economic, market or business conditions, risks associated with operating in foreign jurisdictions, uninsured risks, regulatory changes, defects in title, availability of personnel, materials and equipment on a timely basis, accidents or equipment breakdowns, delays in receiving government approvals, unanticipated environmental impacts on operations and costs to remedy same, and other exploration or other risks detailed herein and from time to time in the filings made by the companies with securities regulators. Readers are cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral exploration and development of mines is an inherently risky business. Accordingly the actual events may differ materially from those projected in the forward-looking statements. For more information on Prophecy and the risks and challenges of their businesses, investors should review their annual filings that are available at www.sedar.com.

"Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this release."

This press release does not constitute an offer to sell or a solicitation to buy any of the securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (“the U.S. Securities Act”) or any state securities law and may not be offered or sold in the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

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*Ulaan Ovoo: 174 million tonnes  of measured and 34 million tonnes of indicated coal. Ulaan Ovoo’s resource numbers are from the Behre Dolbear & Company (USA), Inc  report referenced in the Dec 2010, 43-101 Prefeasibility Study by Wardrop Engineering. Chandgana consists of two properties-Chandgana Tal and Chandgana Khavtgai. Chandgana Tal consists of 141 mt of measured resource. Chandgana Khavtgai consists of 509 mt measured and 539 mt indicated resource. Chandgana Khavtgai’s resource estimates are based on the September 2010 NI 43-101 Chandgana Khavtgai Technical Report by Kravits Geological Services, LLC. The report is authored by Christopher M. Kravits CPG, LPG of Kravits Geological Services, LLC., who was an independent Qualified Person under NI 43-101 at the time of report preparation. And the Chandgana Tal resource estimate is also based on the September 2007 NI 43-101 Chandgana Tal Technical Report by Behre Dolbear & Company (USA), Inc..The report is authored by Mr. Gardar G. Dahl, Jr., CPG of Behre Dolbear & Company (USA), Inc., who is an independent Qualified Person under NI 43-101.