Pele: Timmins Overview

The Timmins Nickel Project consists of certain unpatented mining claims and interests located approximately 35 kilometres south of Timmins in Northern Ontario. The project ties on to the south and east of the past producing Texmont Nickel Mine and encompasses nearly half of the original mine property. Several former and currently producing nickel mines have emerged from the world-renowned komatite-associated deposits of the Timmins area.

In May 2008, Pele and Fletcher Nickel Inc. entered into an Option Agreement pursuant to which Fletcher, in exchange for 100-percent of the property, has agreed to:

• Pay Pele an aggregate of $600,000 in cash in eight quarterly payments of $75,000
• Issue Pele 600,000 common shares in the capital of Fletcher
• Make a second issuance of Fletcher common shares on May 15, 2009 having a value of $325,000

Upon completion of the sale, Pele will retain a 1.5-percent Net Smelter Returns royalty of which Fletcher may buy back 1-percent for $1-million.

The Option Agreement for the Timmins project illustrates Pele’s strategy to joint-venture and/or monetize its non-core assets as it focuses on developing its Elliot Lake Uranium Mine Project.