CAU Canyon Resources Corp

GOLDEN, Colo., Aug. 28 /PRNewswire-FirstCall/ -- Canyon Resources Corporation (AMEX:CAU), a Colorado-based mining company, is pleased to announce that its Converse Joint Venture ("Converse"), has executed the Sand Creek JV Exploration, Development and Mine Operating Agreement (the "Agreement") with High Plains Uranium (TSX.V: HPU). The Sand Creek JV covers an area of interest of approximately 92,000 acres (37,300 hectares), located east and south of Douglas, in Converse County, Wyoming. The objective of the Sand Creek JV is to move rapidly to explore and develop uranium resources in this area of known uranium occurrences. Converse was formed in January 2006, by Canyon and New Horizon Uranium Corporation, a private company based in Golden, Colorado, to explore and develop uranium properties in Converse and Niobrara Counties of Wyoming. New Horizon may earn a 50% interest in Converse by spending a minimum of $1.0 million on project activities over a three year timeframe with minimum expenditures required in each year. Canyon Resources controls Converse until such time that New Horizon has met this commitment. New Horizon may earn an additional 20% interest in Converse by spending an additional $1.0 million over the following two years after earning its initial 50% interest. Finally, New Horizon may earn an additional 5% interest in Converse, for a total of 75% interest, by completing a Feasibility Study. Canyon would retain a 25% participating interest in Converse if New Horizon completes these commitments. Canyon is not required to contribute funds to Converse during New Horizons earn-in period. The Sand Creek JV covers less than 10% of the total area of interest currently being explored by Converse. Under the terms of the Agreement, High Plains will contribute its surface and mineral holdings within the defined area. Converse will also contribute its holdings as well as geologic data, drill logs and engineering studies, relating to the defined area. The resultant Sand Creek ownership interest will have Converse retaining 70% ownership interest, High Plains 30%, with revenues and expenses allocated accordingly. The joint venture partners in Sand Creek will market their respective share of production and New Horizon will serve as the initial operator of the Sand Creek JV. Uranium mineralization has previously been identified in the White River Formation that trends through the Sand Creek JV area. That trend is believed to be highly prospective and is the same formation containing Cameco Corporation's Crow Butte in-situ leach (ISL) operation in Nebraska. A seismic geophysical program of six survey lines totaling 21,000 feet was completed this month to assist in location of approximately 30 drill holes as part of New Horizons 2006 Converse exploration program. This work was completed over an area that will be included in the Sand Creek area of interest. A permit application has been submitted by New Horizon to Wyoming Department of Environmental Quality and drilling is planned to commence in October. These drillholes have been located based on interpretation of work done by Canyon and its joint venture partners in the early 1980s, which will be partially confirmed by the recent geophysical program. Converse has completed a draft NI 43-101 report by a qualified person estimating resource potential on its acreage within the defined area. These reports will be submitted on behalf of New Horizon to the TSX-Venture Exchange for review and approval and then released for use by Canyon and High Plains. "We are pleased to consummate the Sand Creek JV with High Plains," said James Hesketh, President and CEO of Canyon. "New Horizon has continued to diligently work on the Converse project, most of which will be included in the Sand Creek area of interest. This work includes the geophysical field work and drilling permit applications as well as continued surface and mineral rights acquisitions to facilitate development of these important projects," he added. This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934 as amended. Such forward-looking statements include, among others, projections of favorable geologic formations, environments and similarities to existing uranium deposits. Factors that could cause actual results to differ materially from these forward-looking statements include, among others: the variability of natural geological settings, the volatility of uranium prices; potential operating risks of mining, development and expansion; the uncertainty of estimates of mineralized material and uranium deposits; and environmental and governmental regulations; availability of financing; the outcome of litigation, as well as judicial proceedings and force majeure events and other risk factors as described from time to time in the Company's filings with the Securities and Exchange Commission. Most of these factors are beyond the Company's ability to control or predict. FOR FURTHER INFORMATION, SEE http://www.canyonresources.com/ or contact: James Hesketh, President, 303-278-8464 Valerie Kimball, Investor Relations 303-278-8464 DATASOURCE: Canyon Resources Corporation; High Plains Uranium CONTACT: James Hesketh, President of Canyon Resources Corporation, +1-303-278-8464; or Valerie Kimball, Investor Relations, +1-303-278-8464, for Canyon Resources Corporation Web site: http://www.canyonresources.com/

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