| NYSE:SVM USD$ 7.86 | +0.47 |
| TSX:SVM CAD$ 8.12 | +0.47 |
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2004SKN Updates High Grade Silver-Gold Projects in Henan, Central ChinaApril 26, 2004 VANCOUVER, British Columbia April 26, 2004 SKN Resources Ltd. ("SKN") is pleased to announce that its wholly owned subsidiary, Victor Mining Ltd, has signed a final cooperative joint venture contract with a subsidiary company of the Henan Provincial Governmental Geological Bureau ("HPGGB"), to acquire a 70% interest in the high grade "YING" silver-gold project, located in Henan Province, central China. The Ying Project consists of the SGX Silver and YDG Silver-Gold Properties. The SGX Property is comprised of five exploration permits covering 52.4 square kilometers (km) and the YDG Property, which is about 85 km southeast of the SGX prospect, consists of three exploration permits totaling 27 square km. The properties are located about 200km south of Zhenzhou, the capital city of Henan Province, and are easily accessible by road. HPGGB's Resource Estimate and Geology In late 2003, HPGGB completed a resource estimate on the Ying project. On April 21, 2004 Mr. Chris Broili, C.P. Geo. & L.P. Geo., completed a National Instrument 43-101 technical report on the Ying Project. In the report, Mr. Broili did not carry out an independent resource study, however, he has reviewed the extensive HPGGB data in detail and concluded that the Chinese resource estimate was professionally prepared, followed the rules promulgated by the Geological Survey of China and that the Chinese estimates can appropriately be referred to as Inferred and Indicated resource categories within the framework of CIM guidelines. In the NI 43-101 Technical Report, Mr. Broili made the following statements: "On the SGX property, about 40 mineralized veins were identified by surface channel sampling and underground channel sampling with about 1 meter average width. Mineralization is hosted in a set of quartz-carbonate veins cross-cutting Precambrian age mafic and felsic gneisses. In the western part of the project quartz-carbonate veins with silver-lead-zinc mineralization are manifested as 22 mapped vein-alteration zones. On the surface they exist as long (usually 1 km or greater) NNE trending structures, commonly filled by altered andesite dikes and quartz-carbonate veins, and more uncommonly as altered gneiss along these structures with local quartz-carbonate veins. Six of the better explored veins at SGX have resource estimates listed in Table 1."
"On the YDG property, about 35 mineralized veins were identified by surface channel sampling and underground channel sampling with about 1 meter average width. Mineralization is hosted in a set of quartz-carbonate veins cross-cutting Precambrian age mafic gneisses and volcanic flows. The system consists of quartz-carbonate veins with lead-zinc-silver mineralization trending NNE with a shallow (22-45°) westerly dip. The country rock these veins crosscut is mostly basalt and andesite flows metamorphosed to lower greenschist facies and locally containing ~1% pyrite. The altered zones persist along the length of these NNE trending structures with quartz abundance varying along the length. On the surface the alteration along the vein consists of chloritization and sericitization of wallrock as well as limonite staining common in the quartz-carbonate veins. For the four better explored veins at YDG, the resource estimate result is listed in Table 2."
The in situ metals on the SGX Property are the equivalent of 15,194,024 Indicated ounces of silver and 114,577,968 Inferred ounces of silver, and on the YDG property are the equivalent of 337,330 Indicated ounces of silver and 37,174,850 Inferred ounces of silver, calculated using US$6.0/oz Ag, US$0.28/lb for Pb, and US$0.35/lb for Zn. Mr. Broili also made following comments on the HPGGB's resource estimate: "The HPGGB's resource estimate has been based on the assumption that the whole veins are uniformly mineralized. More realistically 30%-50% of veins, comprising high-grade mineralized pockets can be economically exploited. Therefore, the HPGGB's resource estimate diluted mineral resource grades by more than three times while increasing tonnage." "One example is the Y1 vein from the YDG area. In the HPGGB's resource estimate, Y1 Vein contains 289,504 tonnes of Inferred Resource grading at 502 g/t Ag, 4.99 g/t, Au, 2.12% Pb, and 1.84% Zn, and 170,424 tonnes of Indicated Resource grading 327 g/t Ag, 6.51 g/t Au, 2.05% Pb, and 2.03% Zn. At least three high grade pockets were identified. One of the high grade pockets was defined by tunnels on 10 different levels from 420 to 900 meter elevations at the south part of the 2,300 metre long Y1 vein to have an area of 200m in length, 500m in down-dip extension, and 0.3 to 2.2 m in thickness. HPGGB's sampling program from these tunnels within the high grade pocket is summarized in the Table 3."
"At the SGX Property, many high grade pockets are also defined for the S6, S14, 16 and S8 veins by underground workings and a drill hole. The high-grade pockets are up to 200 meters in length and 150 meters in down-dip extension, and range from 0.3 to 1.0 meters in thickness. As shown in Table 3 for Vein S14 and S16, all these high grade pockets have significantly higher grades than those averaged in the HPGGB's resource estimate. Also noted in the table are Broili's (Table 4) and, Myles Gao's {SKN's President - see March 8, 2004 News release} check results that further confirm HPGGB's data and the existence of the high-grade pockets. Future exploration should focus on defining the high- grade pockets to reflect actual characteristics of mineralization and upgrade the mineable reserves". "Metallurgical test program completed on the project indicated that ores from both the SGX and YDG properties can be easily processed using a conventional flotation flowsheet." In the "Recommendation" section of the Report, Mr. Broili states: "The work carried out by HPGGB has identified two properties of significant Pb, Zn, Ag and Au mineralization. To advance the project, it is considered that there is reasonable understanding of the distribution of the mineralization and the controls so that the first phase program will be middle staged. To this effect, seven main work programs are recommended to advance the Ying Project with a budget of US$1,160,000." Mr. Broili recommended " to develop 4,710 meters of exploration tunnels to further define the deeper mineralization on selected veins: 2,710 meters at the SGX property and 2,000 meters at the YDG property, in combination with 3,000 meters of diamond drilling on 50 to 100 m intervals on high grade pocket sections." "The work carried out by HPGGB has identified two properties of significant Pb, Zn, Ag and Au mineralization. To advance the project, it is considered that there is reasonable understanding of the distribution of the mineralization and the controls so that the first phase program will be middle staged. To this effect, seven main work programs are recommended to advance the Ying Project with a budget of US$1,160,000." Mr. Broili recommended " to develop 4,710 meters of exploration tunnels to further define the deeper mineralization on selected veins: 2,710 meters at the SGX property and 2,000 meters at the YDG property, in combination with 3,000 meters of diamond drilling on 50 to 100 m intervals on high grade pocket sections."
Mr. Broili also recommended conducting mineral processing and metallurgical testing on bulk samples from both the SGX and YDG properties and implementing a scoping study to determine the feasibility of constructing mills on each of the two properties. Myles Gao, P.Geo, President of SKN, is the Qualified Person on the project. Cooperative Joint Venture Contract Under the terms of the Joint Venture Contract with the Chinese partner, SKN holds the right to acquire 70% of the Ying Project by funding exploration and development of the Project and making cash payments over a period of four years with a first year minimum contribution of US$750,000. After SKN has earned its 70% interest, contributions to fund the exploration and development of the Project will be made pro rata. The interest of the Chinese property owner can be diluted to not less than 10% if it elects not to make cash contributions. The acquisition of the Ying Project remains subject to regulatory approvals, including Chinese government approvals. SKN Resources Ltd. is actively exploring for precious metal opportunities in China and is currently drilling at its Tuobuka Gold Project, Yunnan, China. Statements in this press release other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, constitute forward-looking statements. Forward-looking statements are based on numerous assumptions and are subject to all of the risks and uncertainties inherent in the Company's business, including risks inherent in mineral exploration and development. As a result, actual results may vary materially from those described in the forward-looking statements. SKN RESOURCES LTD. For further information: Rui Feng, Chairman & CEO, Phone: (604) 669-9397, Fax: (604) 669-9387, Email: info@sknresources.com, Websites: www.sknresources.com, www.newpacificmetals.com. The TSX Venture Exchange has not reviewed and does not accept, responsibility for the adequacy or accuracy of this release. The information posted in news releases was accurate at the time of posting, but may be superseded by subsequent news releases.
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