Toro Energy Limited - To Acquire Key Uranium Tenements Adjacent To Flagship Wiluna Uranium Project, Western Australia

09:49 AEST Feb 17, 2011 ABN Newswire (C) 2004-2011 Asia Business News PL. All Rights Reserved.

Perth, Australia (ABN Newswire) - Toro Energy Limited (ASX: TOE) (PINK: TOEYF) (\'Toro\') announce the execution of a comprehensive Letter of Intent with MPI Nickel Pty Ltd (\'MPI\') which sets out the commercial and legal framework for the purchase of certain mining tenements (\'Uranium Tenements\') adjacent to the Centipede deposit at Toro\'s Wiluna Uranium Project in Western Australia. MPI is a subsidiary of Norilsk Nickel Australia Pty Ltd and holds a:

- 100% interest in tenements M53/590 and M53/693; and

- 90% interest in tenement M53/336.

Toro will purchase the Uranium Tenements and associated database from MPI, while MPI will retain the rights to all non-uranium minerals (other than as a by-product of uranium mining of co-mingled ores). In consideration for the transfer of MPI\'s interest in the Uranium Tenements, Toro has agreed to pay MPI:

- A$4.5 million cash; and

- 2% NSR royalty on any production in excess of 4.5mlb U3O8 from the Uranium Tenements.

In addition, Toro and MPI will establish an Access Agreement which will allow access by MPI to Toro\'s recently acquired Lake Way and Millbillillie pastoral leases for exploration purposes.

Two of the three mining tenements (M53/590 and M53/693) were granted during the period when uranium was specifically excluded from the mining rights. This exclusion is no longer required by the Western Australian Government and it is Toro\'s intention to have the uranium exclusion removed in due course.


Geology and Resources

The three tenements to be acquired under this proposal cover a project area named Millipede where previous drilling identified uranium mineralisation in the 1980\'s. Once this agreement is finalised, Toro will look to announce a new resource, compliant with the JORC code, over the project area during the first half of 2011.

It is clear from the historical drilling and geological mapping that the shallow calcrete-sediment hosted uranium mineralisation defined at Centipede trends onto the Uranium Tenements.

Millipede is part of a well defined regional scale palaeochannel extending from the Dawson and Hinkler Well deposits down through to the Centipede deposit. The geology of the area, the historical drill results and Toro\'s experience with these deposit types provide the Company with a high level of confidence that additional extensions to the Centipede deposit will be defined at Millipede.

In the same way the acquisition of the Dawson - Hinkler Well project was an important milestone for Toro, Millipede is a strategic acquisition and very important for the broader Wiluna Project development in the medium-term.

However, much work remains to be done before the Millipede Project can be advanced to production. Further drilling, resource definition, environmental and heritage studies need to be carried out before a development proposal can proceed. These new tenements do not form part of the Wiluna Uranium Project for which Toro is currently seeking approval from the Western Australian and Australian Governments.

Toro\'s Managing Director, Mr Greg Hall, said that the acquisitions from U308, MMG and now MPI consolidate Toro into a very strong position in the Wiluna region.

\'Toro is very pleased to have agreed commercial terms with Norilsk Nickel Australia on the acquisition of the Millipede Uranium Tenements. While the uranium exploration target at Millipede is small by international standards, the acquisition is an important one for Toro and adds to the robustness of the Wiluna Uranium Project, which is currently focusing on the development of the Lake Way and Centipede deposits,\' Mr Hall said.

\'The Wiluna Uranium Project is evolving into an exciting uranium mine development with the intended aim of delivering first production from 2013, into an expanding nuclear power market with considerable supply constraints into the middle of this decade. Toro believes it will have the timing just right.\'

For the complete Toro Energy Limited announcement including table and figures, please refer to the following link:
http://www.abnnewswire.net/media/en/docs/65240-ASX-TOE-181897.pdf


About Toro Energy Limited:

Toro Energy Limited (ASX:TOE) (PINK:TOEYF) is a modern Australian uranium company with progressive project development, acquisition and growth. The company is based in Adelaide, South Australia with a project office in Perth, Western Australia.

Toro's flagship and wholly-owned Wiluna uranium project (includes existing mining lease) is 30 kilometres southeast of Wiluna in Central Western Australia.

Wiluna contains two shallow calcrete deposits, Lake Way and Centipede, with prefeasibility and optimisation studies completed and a definitive feasibility study underway. Toro has commenced the Approvals process targeting the Company's first uranium production by late 2012/early 2013.

Toro has three other exploration and development projects in Western Australia, and owns uranium assets in Northern Territory, South Australia and in Namibia, Africa. Toro is well funded with a supportive major shareholder in OZ Minerals.



Contact:

Greg Hall
Managing Director
Toro Energy Limited
Tel: +61-8-8132-5600
info@toroenergy.com.au
http://www.toroenergy.com.au