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Khan
Resources Inc., through a subsidiary, owns 58% of the Dornod property.
The Uranium
story on the Dornod property starts in 1988. Two separate deposits were
developed and shipped ore until 1995, making the value of the property a
known quantity. No new exploration is necessary. The underground mining
operation will use proven technology and production will be able to
result in a low unit cost.
The Dornod
property covers 261 hectares in Mongolia which sits between two of the
world’s largest Uranium markets; Russia and China. Although the rail
lines that once existed were dismantled when the Russian government left
the area, the beds for the tracks are still there and will not be overly
difficult to rebuild.

On December
30, 2004, Khan received a final NI 43-101 Report prepared by Roscoe
Postle Associates Inc. ("RPA") confirming the value of the Dornod
property.
Management of
Khan plans on developing a producing uranium mine at Dornod that will
include on-site a modern “state-of-the-art” milling and processing
facility. These facilities are projected to produce approximately 4 - 5
million lbs. of "U308", i.e. Yellowcake, annually, over a mine life of
10 years.
The
combination of the access to hungry markets, the low cost of production
and the surety of the Uranium deposits make Dornod a tremendous
opportunity.

Highlights of
the RPA report
Two uranium
deposits are hosted by Paleozoic sandstones, siltstones and
conglomerates on the Dornod Property. Based on our review of past
exploration and production data RPA concludes that:
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Both
deposits are situated within the inner Mineral License which covers
an area of 261 ha.
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At the
No. 2 deposit, a significant Mineral Resources has been estimated
from 450 diamond drill holes.
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At the
0.236% U3O8 cut-off grade and 1 m minimum vertical thickness of
mineralization, the No. 2 deposit contains some 296,000 tonnes of
Inferred Mineral Resources at an average grade of 0.302% U3O8.
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At the
No. 7 deposit, a significant amount of surface and underground
exploration has outlined a higher grade deposit.
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At the
0.236% U3O8 cut-off grade and 5 m minimum vertical thickness of
mineralization, the No. 7 deposit contains some 2.9 million tonnes
of Inferred Mineral Resources at an average grade of 0.381% U3O8.
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Normally,
based on the close drill hole spacing, most (if not all) of these
resources would be classified as Indicated Mineral Resources.
Because of the absence of actual drill core at the present time,
however, RPA has classified them into Inferred Mineral Resources.
Upon completion of the recommended confirmation drilling program,
these resources would likely be upgraded into Measured and Indicated
Mineral Resources.
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Several
additional uranium deposits and showings have been discovered in the
general Dornod area. Four of these deposits (No. 2A, 5, 8 and 9) -
in addition to the No. 2 and 7 deposits - are situated in the area
of the present property (Mineral Licence U27).
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There is
a halo of lower-grade mineralization around the deposit at the
0.236% U3O8 cut-off grade used for this study. At the 0.118% U3O8
cut-off grade, RPA estimates that there are additional resources in
the order of 2.7 million tonnes at an average grade of 0.163% U3O8
contained within the No. 7 deposit. At the present time, RPA also
considers these to consist of Inferred Mineral Resources.
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Past
exploration work has been carried out in a systematic manner and
well documented. These data are acceptable to estimate Mineral
Resources and, upon completion of a Prefeasibility study, Mineral
Reserves may be estimated.
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Results
of diamond drilling completed to date indicate that the trend of
uranium mineralization at the No. 2 deposit continues along strike
to the south, towards the No. 7 deposit, which is situated about 1
km south of the No. 2 deposit.
For the full
RPA report
click here. |