WYN DEVELOPMENTS FINALIZES PREVIOUSLY ANNOUNCED 21 1/3% PARTICIPATION AGREEMENT IN THE PROPHET RIVER AREA OF NW B.C. - SLAVE POINT WELL TO BE TESTED NON-BROKERED PRIVATE PLACEMENT OF UP TO CAD$4,150,000.00
Vancouver, British Columbia, Canada - April 04, 2006 - Wyn Developments Inc. ("Wyn Developments" or the "Company") has finalized an agreement to participate in the drilling of a Slave Point test well in the Prophet River district of northeastern British Columbia. This development is further to the Company's news release issued February 2nd, 2006, "Wyn Developments Expands Natural Gas Development Potential in Northeastern British Columbia."
Under the terms of this Agreement, Wyn will pay 33 1/3% of the working interest cost to earn a 21.67% working interest in a Slave Point test well to earn 11 sections of leases (Block A) to the deepest depth drilled and the right to participate in the drilling of an option well to earn an additional 10 sections of leases (Block B) to the deepest depth drilled under similar terms. The Operator of this well, a North American Major Oil and Gas Producer will test multiple potential pay zones of natural gas including the Slave Point Formation and drilling is anticipated to commence within 4 - 6 weeks. This working interest is subject to a non-convertible 2.5% gross overriding royalty to the 100% working interest. The Operator has the right to convert their 35% working interest to a 12.5% non-convertible gross overriding royalty within 30 days of receipt of production test information. If the Operator converts its working interest to a royalty, the Company's working interest will increase from a 21.67% working interest to a 33 1/3% working interest.
Upon the execution of this Agreement, the following will apply; Wyn Developments will issue, in the name of the Farmor, Tenaka Drilling Consortium, a number of fully paid and non-assessable common shares of the Company in three defined stages for the following amounts:
- $75,000 CAD upon TSX-Venture Exchange approval;
- $75,000 CAD upon completion of test well spudding; and
- $200,000 CAD subsequent to proven and probable reserves in excess of 75 BCF of gas that are established (all zones) on any or all of the Operator Lands.
The shares issued will be based on the average market price on the date of issuance.
Non-Brokered Private Placement
Wyn intends to raise up to C$4,150,000.00 through the following:
5,000,000 (non-flow-through) units at $0.38, each unit consists of one common share and one 1/2 warrant at a price of $0.50, for a maximum of C$1,900,000. and;
5,000,000 flow through units at $0.45, each unit consists of one common share and one 1/2 warrant at a price of $0.50, for a maximum of C$2,250,000 Funds raised will be used for the Company's obligation under the Participation Agreement for the Prophet River Slave Point Test Well Development and general working capital.
The private placement is subject to exchange and regulatory approval and a finders fee may be payable in accordance with TSX Venture Exchange policy.
The Company looks forward to participating in this Prophet River Region test well and the continued development of the Bougie Trutch natural gas prospect, also located in Northeastern British Columbia.
About Canada Rare Earths
Canada Rare Earths is a growth company focused on the exploration and development of rare earth elements at its 100% owned Goeland Rare Earths Project within the Montviel carbonatite complex, Montviel Township Quebec, immediately adjacent to Geomega's (TSX-V: GMA) recent rare earth discovery. The Goeland property located 215 km north of Val-d'Or, is road accessible and consists of 47 claims totaling approximately 2,600 hectares. Since the acquisition of the Goeland Project, the Company, in a short period of time, has successfully established itself in one of the largest Carbonatite complexes in North America. Worldwide, carbonatite-related deposits are a major host for rare earths elements ("REE"). The world's most advanced and prolific REE deposits in production or development, Bayan Obo (China), Molycorp's Mountain Pass (USA), Lynas's Mount Weld (Aus), and Rare Earth Element Resource's Bear Lodge project, are all hosted by carbonatites.
For more information on Canada Rare Earths, please contact our Head Office.
On Behalf of the Board of Canada Rare Earths Inc.
Chad McMillan
President & CEO
Neither 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. All of the above is subject to TSX.V and regulatory acceptance.
FORWARD LOOKING STATEMENTS
Cautionary Note Regarding Forward-Looking Statements: Certain disclosure in this release, including statements regarding the Company's Pre-Development Agreement and the exploration of the Goeland Project, constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities legislation. In making the forward-looking statements in this release, the Company has applied certain factors and assumptions that the Company believes are reasonable, including that the Company is able to obtain any required government or other regulatory approvals and any required financing to complete the Company's obligations pursuant to the Pre-Development Agreement and planned exploration activities, that the Company is able to procure equipment and supplies in sufficient quantities and on a timely basis and that actual results of exploration activities are consistent with management's expectations. However, the forward-looking statements in this release are subject to numerous risks, uncertainties and other factors relating to Canada Rare Earth's operation as a mineral exploration company that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Such uncertainties and risks may include, among others, actual results of the Company's exploration activities being different than those expected by management, uncertainties involved in the interpretation of drilling results and geological tests, delays in obtaining required government or other regulatory approvals or financing, inability to procure equipment and supplies in sufficient quantities and on a timely basis, equipment breakdowns and bad weather. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Readers are cautioned not to place undue reliance on forward-looking statements. Canada Rare Earths does not intend, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.
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