Exploration Update - Gallinas Mountains REE Project

TSX.V: STI

REGINA, July 16, 2012 /CNW/ - Strategic Resources Inc. ("Strategic") is pleased to provide the following exploration update on its Rare Earth project situated in Lincoln County, New Mexico:

The recently completed drilling program in the Gallinas Mountains was designed to assess the potential of one of several explosive volcanic brecciated zones identified by R. Schreiner (US Bureau of Mines - 1993 Report. See www.rareearthreports.ca to read this report).

These explosive breccia targets represent a change in focus from the vein type occurrences that were examined as part of the previous drilling program.

In total, four holes were drilled. During drilling, recovered core was strongly brecciated and altered. The brecciation is thought to have been formed by the massive release of gaseous material during the volcanic intrusive event that created the Gallinas Mountains some 30 Ma ago. Post-magmatic REE carbonate/fluorite bearing solutions then altered the brecciated rock over geologic time.  A summary of each hole follows:

Hole 1- drilled to 98.8 linear feet, Vertical Orientation.

From (feet)	To (feet)	Thickness (feet)	TREO ppm	(HREO/TREO)	Sr ppm
26.5	98.8	72.3	2750	9.8%	691
		including
39.68	54.18	14.5	9267	4.5%	743
		and
54.18	72.88	18.7	1680	15%	423

Hole 2- drilled to 85.5 linear feet, for a true thickness 61.8 feet,

Azimuth N40W, 35 degrees from vertical

From (feet)	To (feet)	True thickness (feet)	TREO ppm	HREO/TREO	Sr ppm
surface	85.5	61.8	1801	16%	488
		including
36.00	49.85	13.85	4402	12%	548

Hole 3-drilled to 185.5 linear feet, for a true thickness of 133.3 feet,

Azimuth N90W, 35 degrees from vertical

From (feet)	To (feet)	True thickness (feet)	TREO ppm	HREO/TREO	Sr ppm
10	185.5	133.3	1632	19%	476
		including
25.80	36.40	10.6	8026	5%	596
		and
115.0	121.2	6.2	3367	10%	753

Hole 4-drilled to 95 linear feet. Vertical Orientation

From (feet)	To (feet)	Thickness (feet)	TREO ppm	HREO/TREO	Sr ppm
10	95.0	85.0	1109	28%	1300
		including
40.25	55.15	14.90	1675	19%	572
89.5	91.5	2.0	1241	18%	465

The above tables show Total Rare Earth Oxides (TREO). TREO are broken down into Light Rare Earth Oxides (LREO) and Heavy Rare Earth Oxides (HREO). The LREO consists of Ce2O3, La2O3, Nd2O3, Pr2O3. For the purposes of this press release, the HREO is confined to the four most commonly noted heavy rare earths in the assays namely, Dy2O3, Er2O3, Yb2O3, and Y2O3.

Assays were completed at ALS Global Laboratories in Vancouver, BC using Lithium-Borate fusion followed by aqua regia digestion and ICP multi-element assay. Pulps were also submitted to Saskatchewan Research Council where XRF analysis was used to more accurately determine the heavy rare earth elements.

Key observations to be inferred from this drilling program include:

• the altered, explosive brecciated zone encountered is approximately 100 feet thick in the area of the four drill holes.
• the brecciated rock resulted in less than optimal core recovery which suggests that reverse circulation drilling should be used in future.
• the heavy rare earth elements most commonly observed were Yttrium, Dysprosium, Erbium and Ytterbium
• the strontium enrichment noted in these assays may also be a potential economic target. Strontium, though not classed as a REE, is used in the manufacture of high strength magnets and has many properties similar to REEs.

Another observation is that on each of the holes drilled, intersects of extraordinarily hard ferric material were encountered. This hard ferric material severely damaged drill bits and tooling. This material, when encountered, was approximately one-half inch thick and likely a veinlet occurrence. An XRF assay of some of this recovered material indicates an iron oxide content of 95%. At this juncture the relation of such ferric material to the altered brecciated REE complex requires more study.

The positive attributes revealed from this drilling program along with the close proximity of the project to infrastructure bodes well for future activity. At this time of writing, the permitting process is well underway with the US Forest Service and the State of New Mexico for a deeper phase 2 drilling program that will seek to further define the size and scope of the REE mineralized, brecciated rock.

The Qualified Person for this project is Tony Kovschak, M.Sc, CPG.

Strategic Resources is a Canadian based junior exploration company with a Rare Earth exploration project in Lincoln County, New Mexico. More information about the company is available on line at www.strategicresourcesinc.ca.

Disclaimer:

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward looking statements:

This news release may contain certain forward-looking inferences or statements.  These forward-looking inferences or statements are subject to a variety of risks and uncertainties beyond the Corporation's control or prediction and could cause actual events or results to differ materially from those anticipated in such forward-looking statements.  Although the Corporation believes that the assumptions inherent in the forward-looking statements are reasonable, undue reliance should not be placed on these forward-looking statements.  

Malcolm Bucholtz, President & CEO,
Tel: [phone]

[email protected]