Company Information for Sparton Resources Inc

TSX.V-SRI

www.spartonres.ca

Company stock charts - 12 Month chart

TSX.V; SRI

View full financial data

Company Statement

Sparton Resources Inc. is a diversified mineral and energy company that focuses on the acquisition and development of projects and properties with readily identifiable mineral occurrences in advanced exploration stage or require development.

Sparton's precious metal portfolio concentrates on exploration in proven, low risk producing areas in Nevada, China, and Mexico. Its energy related business assets include an interest in the undeveloped Chebucto natural gas field in offshore Eastern Canada, a production royalty on the Blizzard uranium deposit in British Columbia, and evaluation and recovery of By-Product Uranium from non-conventional uranium sources such as phosphates and coal ash.
For the By-Product Uranium program, Sparton already has agreements in place in 8 countries worldwide including China, 6 countries in Central Europe, and the Republic of South Africa.

The company's strategy is to greatly increase shareholder value by bringing projects to full feasibility evaluation or, with partners, into commercial production.

Current Operations

CHEBUCTO NATURAL GAS
Natural gas consumption is continuing to grow worldwide. Sparton is the only public junior exploration company in Canada that owns a percentage of a major natural gas reserve in the offshore Nova Scotia gas production area region, and this very valuable discovery continues to remain a key element in the Company's asset portfolio in Canada.

Exxon Mobil (operator) and Shell are majority owners
Possible production in 2010
Current Net Asset Value (10% discount rate) > $0.40 per Sparton share
Sparton share of stated reserves approximately 19.4 BCF

The above summary is based on Sparton's current and issued share capital and a valuation with an effective date of May 11, 2005 prepared by APA Petroleum Engineering Inc., Calgary Alberta.

The 240 square kilometre Chebucto Gas Field is part of the Nova Scotia Sable Offshore Energy Project (SOEP) Area, and is located approximately 14 kilometers southeast of the nearest SOEP production platform, the North Triumph field.

BLIZZARD URANIUM ROYALTY
In June 2005, Sparton and Santoy Resources Ltd. entered into an agreement to purchase 100% interest in the core claims covering the Blizzard uranium deposit in the Greenwood Mining Division of south-central British Columbia . Two months later the companies completed the consolidation of their interest in the Blizzard project. Under the terms of the agreement Santoy received the right to earn 100% interest in the property in return for issuing Sparton one million Santoy shares, one million Santoy share purchase warrants exercisable at $0.75 and a production royalty of $0.30 per pound of uranium produced by the project. Subsequently as a settlement to litigation filed in relation to the ownership of the Blizzard core claims Santoy agreed to transfer a majority interest in the Blizzard Property to Boss Gold International, which will finance and oversee the ongoing work programs.

The Blizzard uranium deposit was discovered by Lacana Mining Corporation in 1977-78. Sparton's senior management were closely involved with the original discovery. The deposit is a "basal-type", hydrogenic uranium deposit, interpreted to have been formed by the concentration of uranium minerals leached from nearby highly radioactive intrusive rocks and deposited in an old riverbed channel, which was preserved from glacial erosion by a cover of younger volcanic rocks.

A total of 21,184 metres of drilling in 478 reverse circulation and diamond drill holes were completed on the deposit. In August 1979 Kilborn Engineering issued an Engineering Feasibility Study based on the extensive drilling and engineering studies on behalf of a joint venture comprised of Norcen Energy Resources, Lacana Mining Corporation, Campbell Chibougamau Mines, E & B Explorations and Ontario Hydro.

The drilling information was used to estimate an historic resource of 2,200,000 tonnes grading 0.214 percent U 3 0 8 , using a cut-off grade of 0.025% U 3 0 8 including 15% mining dilution (for an estimated 10.4 million pounds of U 3 0 8 ).

The deposit may be amenable to exploitation by the widely used, low environmental impact, in situ solution leaching recovery process ("ISL" recovery) involving only minimal surface disturbance. The Kilborn feasibility study did not consider ISL as an extraction option, but was based on conventional open pit mining methods. Evaluating the use of ISL recovery methods for Blizzard will be a priority for the future program.

WHISKEY URANIUM-COPPER
Sparton began work on its 100%-owned Whiskey project in central New Brunswick, Canada in February 2007.

The 2400-ha property was acquired as part of Sparton's plan to investigate non-conventional metallic resources and the association of copper and uranium occurrences in phosphate-rich host rocks.

The area was explored throughout the 1970s and early 1980s by both large and small companies and by individuals. Historical data indicate that numerous boulders of altered mineralized conglomerate, altered phosphate-rich shales and impure sandstones were found in several areas of the claims. Assays averaged 1% copper, 0.3% uranium and 0.1% yttrium. The source of the boulders was never found.

Mineralization consists of copper oxides and pitchblende in iron oxide-stained conglomerate. Sampling programs returned assay values of up to 0.05% lead, 0.04% zinc, 0.095% U 3 O 8 and 13.25% P 2 O 5 . Several areas of anomalous base metal and uranium values were also outlined in the claim area from geochemical sampling programs. These appear to be associated with fracture and shear zones.

Previous geophysical programs using radiometric methods also outlined numerous anomalous zones.

The region is underlain by young sedimentary formations, which rest unconformably over sheared and fractured granitic basement rocks. These rock units and the basal zone of this unconformity are excellent targets for “red bed” style copper-base metal mineralization as well as unconformity-hosted uranium mineralization similar to that of the uranium-rich Athabasca Basin in northern Saskatchewan.

Sparton's initial winter work program consists of detailed ground magnetic and VLF-EM geophysical surveys to locate shallow and deep seated structural elements which could be related to mineralized areas. Following compilation and interpretation of this data and all historical information a summer field program will be organized. Locating the source of the high-grade boulders will be the first priority this summer.

URANIUM SECONDARY RECOVERY
In early January 2007, Sparton announced the signing of an agreement with the Xiaolongtang Guodian Power Company of Yunnan , People's Republic of China for a three-phase program to test and possibly commercialize the extraction of uranium from waste coal ash at the company's thermal power stations in central Yunnan province.

The Xiaolongtang, Dalongtang and the Kaiyuan stations, all located within 20 km of each other burn coal from a centrally located open pit lignite coal mine that contains anomalously high uranium content. The plants are located approximately 250 km southeast of the Yunnan provincial capital of Kunming.

This coal has a high ash content (approximately 20-30%), and the coal uranium content varies from about 20-315 parts per million (ppm) and averages about 65 ppm. Both the bottom ash and fly ash samples tested by Sparton contain approximately 0.46 pounds of U3O8 per tonne. These analyses were done in China and Canada and verified by the Company's consulting engineering firm, Lyntek Inc. of Denver, Colorado, USA. Lyntek specializes in uranium extraction process engineering and has been involved in over 30 recovery projects in 10 different countries.

Due to its high radioactivity levels the waste ash is not suitable for cement uses in residential applications. Small amounts are sold for outdoor applications such as bridge abutments, but most is stockpiled in dry re-vegetated disposal areas. The Xiaolongtang station produces 600,000 to 800,000 tonnes of fly and bottom ash annually, and has accessible stockpiles of about five million tonnes of recoverable ash.

A sixth burner is now in operation at Xiaolongtang and the station is expected to produce about 900,000 tonnes of ash annually.

Using available analytical data, the annual coal ash production from these stations, assuming an average uranium content of 0.45 pounds per tonne and recoveries of 70% , contains about 145 tonnes or about 320,000 pounds of uranium oxide (U3O8) valued at current prices (April, 2007)at over USD$30 million.

Sparton has commissioned a full independent technical report and leaching test program for the Xiaolongtang area ash material under the direction of Lyntek. Coal ash samples from various burners at the Xiaolongtang power station have now been tested by Lyntek and the initial results indicate that over 70% of the uranium contained in fly ash is soluble in simple acid extraction solutions. Fly ash represents about 90% of the total ash production from these stations. These first results are extremely positive and indicate the same predicted uranium extraction rates as are being reported for various ISL (In Situ Leach) uranium mining projects currently in production. Based on these results testing will continue and is expected to proceed to the pilot plant stage.

A uranium extraction facility would help clean up potential or existing environmental hazards, create a new supply of domestic uranium, and create value as cement and concrete filler material. Sparton would benefit from management fees and possible royalties plus an equity ownership in the company operating the facility.

Sparton's team is continuing to acquire samples from other high uranium ash stations in other areas of China and new results will be available on an ongoing basis. Since signing the agreement in China, Sparton has signed agreements to do similar programs in 6 countries in Central Europe and the Republic of South Africa.

LUXI GOLD PROJECT
The LUXI GOLD BELT is in a Carlin or Nevada-type geological environment. Carlin type deposits are sediment-hosted gold deposits that contain disseminated gold with grains undetectable by the naked eye, located in impure limestones, dolomites, calcareous shales or similar rock types, and are associated with anomalous arsenic, antimony, mercury and thallium. These types of very large gold deposit were first discovered in the Carlin area of Nevada in the early 1960s and 1970s. Sparton management has extensive exploration experience and a track record of successful discovery and development of numerous disseminated type gold deposits in Nevada.

Exploration on the Luxi property is now carried out through a Chinese joint-venture company Yunnan Sparton Minerals Company Limited (YSM), which is a People's Republic of China-registered foreign joint venture company. YSM is owned 51% by Starry Limited, 39% by Sparton Resources International (SRI) and 10% by Yunnan Nuclear Exploration Team 201 (201). In November 2006 Sparton agreed to sell 41% of its then held 80% interest in Yunnan Sparton to Starry Limited for approximately $C2.8 million. At the same time 201 also agreed to sell 10% of its then held 20% interest to Starry. Starry is supported by one of China 's largest integrated gold producers. Exploration on the property continues to be carried out under the technical/direct supervision of Sparton management and in Q1 2007 a 2 million RMB ( $C310,000) budget was approved and a 3000 metre drilling program commenced.

YSM also has the right to earn a 75% interest in the 0.5 sq. km Deep Exploration Licence below the 1180 metre level of the Guanlingpo Mine Licence, by providing the mine owners with a positive feasibility study for new mine development in the licence areas.

Expenses for the project are now paid 57% by Starry and 43% by SRI. The 10% share interest held by 201 is a non-contributing carried equity interest in YSM

SIERRA ROSARIO
Sparton signed an option agreement in March 2004 with Northair Mines Ltd. giving Sparton the right to earn a 51% interest in the Sierra Rosario project. At least six gold and silver occurrences discovered by Northair staff occur within the property.

The project covers 500 hectares in the Sierra Madre Occidental Mineral Belt of Sinaloa Province in northern Mexico , approximately 25 kilometres northwest of the town of Choix ; and 40 kilometres east of the town of Alamos . Both areas have a strong precious metals mining history.

Sparton's first work program on the property was completed in 2005 and consisted of the collection of 565 soil and stream sediment samples, 60 rock and chip samples and approximately 20 line kilometres of electrical and magnetic geophysical surveys.

High grade gold-silver mineralization was explored in three zones on the property.

Work is now focussed on the San Rafael Zone in the northern part of the property. It contains strong gold-silver mineralization in a rhyolite porphyry that has been traced on surface for over 150 metres. The alteration at San Rafael measured approximately 250 by 120 metres, but the associated magnetic anomaly of the mineralized area and intrusive body is over 400 by 200 metres in area. Samples from a mine dump near old workings produced assays averaging 146 gpt silver, 0.71 gpt gold, and 0.2% copper from a total of 105 samples collected by Sparton in 2005.

During Q1 2007 road access to San Rafael will be established from the existing road to the La Josca Zone. Once this is completed and a water source located a drill program will be organized to test the targets in the San Rafael area. At least 1000 metres will be required to properly evaluate the known zones.

SBD PROJECT
In 2006 Sparton acquired the SBD claims in Lander County near Battle Mountain and the Coal Canyon claim group in Pershing County , east of the town of Lovelock.

The SBD claims comprise 29 lode claims covering approximately 2 square kilometres within the prolific Battle Mountain-Eureka Gold Trend. The claims are adjacent to Newmont's Trenton Canyon open pit mine and approximately 6 km northeast of Newmont's Phoenix Mine development infrastructure. Glamis' Marigold Mine is located about 5 km to the north.

Upon completion of data interpretation, a drilling program will test newly outlined target areas and further define the mineralization previously located in this very prospective land package. A Bureau of Land Management drilling permit was received in February 2007 and subject to weather conditions and drill availability work to test the targets is expected to start in Q2 2007.

COAL CANYON CLAIMS
The Coal Canyon claims are located east of Lovelock in the West Humboldt Range of Pershing County in the gold rich state of Nevada . The property is southwest of Jipangu Inc.'s (formerly Apollo Gold) Florida Canyon Mine where over 1 million ounces of gold have been produced, and the Willard and Rochester gold deposits. Previous exploration has outlined a northwest trending 1200 by 250 metre soil and rock chip gold geochemical anomaly with values up to 3 gpt gold and associated anomalous values in arsenic, antimony and mercury. The zone is associated with a large coincident area of intense hydrothermal alteration with extensive jasperoid development in impure calcareous sediments intruded by felsic and mafic sills and dykes which appear to have been emplaced along thrust faults. A second parallel mineralized zone approximately 500 by 150 metres in size has been defined by recent mapping to the east of the main anomaly.

A well defined structural intersection zone is centred on the claim group. No drilling has ever been done on the property since it was first identified by modern exploration in 1994. Induced Polarization (IP) and Controlled Source Audio Magneto Telluric (CSAMT) surveys on the claims have recently been completed and the data is being processed and evaluated. When this is completed drilling will test any well defined targets generated from the geophysical data.

INNER MONGOLIA - CHINA
Sparton has entered into an agreement with Brigade 208 (208) of the Geology Bureau of the China National Nuclear Corporation (CNNC) to carry out a due diligence evaluation of 208's gold production and exploration areas in the northern part of inner Mongolia.

Sparton may acquire up to a 30% interest in the producing operations covered by a total of 2 sq. km of Mining Licences and a 70% interest in 140 sq. km of Exploration Licences which surround the existing mines. An evaluation and technical review is now underway on 208's precious metals programs and producing properties.

The local area government, Wulate Zhongqui Administrative Area (WAA), has given 208 the mandate to explore a 23,000 sq. km area under its jurisdiction, with the exception of a 36 sq. km area currently under development by Jinshan Gold Mines Ltd, at its “217” project. Jinshan is controlled by Ivanhoe Mines Ltd, and is building the largest open pit gold mine in China at 217, with planned production commencing in 2007, of about 50,000 tonnes of ore per day and recovery of over 3 tonnes (about 117,000 ounces) of gold per year by heap leach methods.

The WAA is within the eastern extension of the prolific Tianshan Gold Belt, which hosts a number of large gold deposits including the Kumtor deposit (8.5 million ounces of reserves and resources as of December 31, 2005) in Kyrgyzstan, the Murantau deposit (current reserves of 170 million ounces historic and current resources) in Uzbekistan, and the Axi deposit (1.7 million ounce reserve in 1993) in Kazakhstan.

The exploration licence is divided into three areas: the East, West and Nine Kilometre Area (NKA). The NKA hosts several gold occurrences none of which have been drill tested, but over 200,000 tonnes of heap leach material grading 1-2 gpt gold has been mined for testing purposes.

Tugurege Mine
The Tugurege Mine operates at about 200 tonnes per day producing ore from two vein systems. According to mine officials the known gold resource (non 43-101 compliant) at Tugurege to a depth of approximately 250 metres below surface is about 9.38 tonnes of gold and the mineralized vein systems are still open at depth and along strike. Production in 2006 at Tugurege was 260 kg of gold and 100 kg of silver. The structural zones hosting the veins are over 2.8 km long, but only about 30% of this distance has been tested. There is potential to increase resources along strike and at depth with further drilling.

Heap Leaching Operations
Four small leach pads from three locations are operated seasonally by 208. In 2006 they produced about 100 kg of gold and 1000 kg of silver. Ore is dug from weathered multiple quartz vein systems and placed on the pads without crushing. Recoveries average about 50-60% of the precious metals.

The mineralized zones hosting this material have never been drill tested or subjected to detailed resource evaluation. Should Sparton complete the acquisitions this work will be part of the future work programs.

Geographical Spread

China, Mexico, Canada

Board of Directors and Key Management

A. Lee Barker	MSc. P.Eng. P. Geol., President & CEO
Edward G. Thompson	P. Eng., Chairman
Jocelyn Cote	CFO
James C. McCartney	Director
Charles Ge	Director
Andrew C. Rickaby	Director
W. Brian Carter	Director
Glenn R. Brown	Technical Advisor

Company Address

55 University Avenue, Suite 605
Toronto, Ontario, Canada, M5J 2H7


Telephone:	416-366-3551
Facsimile:	416-366-7421
Email:	info[at]spartonres.ca
Website:	http://www.spartonres.ca

Capital

Shares Issued 50,187,771

Annual General Meeting

June

Year End

December 31st

Major Shareholders

Galileo Equity Management

Dundee Resource Fund

Company Management

Several large private shareholders.

Most Recent Statement

20/10/08 - Sparton Selected to Join Ontario Government Environmental Mission to China
11/08/08 - Sparton Locates New High Grade Copper-Moly Zone at Whiskey Project-New Brunswick
21/02/08 - Sparton Begins Drilling Program On New Brunswick Copper-Uranium Project
31/01/08 - Sparton Signs Three Key Agreements for Uranium and Germanium Production in China
14/01/08 - Sparton Closes Private Placement Financing
03/01/08 - Sparton Reports First Results from Coal Ash Waste Sampling Program in Lincang Germanium Area, Yunnan, China

To top