As reported earlier, one of the two drills in operation on the Matoush property, wholly-owned by Strateco Resources, has been assigned to the MT-34 zone area.

Due to the very high grades obtained in Hole MT-34 (1.36% U3O8 over 27.50 m including 6.03% U3O8 over 4.80 m) relative to the other grades and thicknesses for the zone, the influence of Hole MT-34 in the September 2008 resource estimate done by Scott Wilson Roscoe Postle Associates Inc. (Scott Wilson RPA) was voluntarily limited.

Furthermore, because a 50 m x 70 m drill grid was used in the area of Hole MT-34 in 2008, this resource could not be categorized as an indicated resource. The four holes drilled in June 2009 and the fifth hole currently underway should allow the total MT- 34 zone resource to be increased and a portion of the resource to be upgrade ed from inferred to indicated.

Hole MT-09-012, whose pierce point lies just a few metres from Hole MT-08-050 due to strong deviation, returned an intersection of 0.42% eU3O8 over 26.9 metres, including 0.66% eU3O8 over 12.9 metres and 2.41% eU3O8 over 1.3 metres.

In comparison, Hole MT-08-050 previously intersected 0.44% eU3O8 over 21.6 m, including 1.88% eU3O8 over 1.8 m, with chemical analysis showing 0.49% U3O8 over 21.3 m, including 1.99% U3O8 over 2.0 m.

Hole MT-09-016, whose pierce point lies midway between holes MT-08-050 and MT-08-034, returned an intersection of 0.61% eU3O8 over 25.7 metres, including 1.30% eU3O8 over 7.4 metres.

Hole MT-09-019, with a pierce point in the upper part of the ACF-4 near the contact with the CBF, 35 m north of Hole MT-08-51 (0.40% eU3O8 over 5.1 m), intersected 0.26% eU3O8 over 14.1 metres, including a section of 0.95% eU3O8 over 2.8 m.

Hole MT-09-017 was drilled on the same section, but was abandoned due to excessive deviation.

Hole MT-09-014 returned an intersection of 0.08% eU3O8 over 5.1 m. This hole lies at the lower limit of the MT-34 zone.

Hole MT-09-020 is now being drilled to test the extension of Hole MT-08-034 up dip from the MT-34 zone in the direction of the upper part of the ACF-4.

Another hole is planned on the MT-34 zone at a vertical depth of -470 m between holes MT-08-47 and MT-08-55, alongside the MT-34 zone in an area where no resources were estimated.

In the MT-06 area, 1.0 km south of the MT-34 core zone, a second drill drilled four holes spaced at approximately 70 metres around Hole MT-09-06, which had returned 8.9 metres grading an average of 0.21% eU3O8, including 1.1 metres at 0.96% eU3O8. The four recently completed holes (MT-09-011, 013, 015 and 018) all intercepted the Matoush fault, with anomalous uranium values.

This second drill is dedicated to systematic exploration of the Matoush structure, which has been traced over a distance of more than 12.5 km.

Since the drilling program began in February 2009, 16,600 metres of the planned 30,000 metres of exploration drilling in 2009 have been completed.

Increase in Drilling Budget

The success of the drilling program completed in early 2009 on the southern part of the Matoush structure (Eclat property; see press release dated April 22nd, 2009) and knowledge of the property geology indicate that the Matoush structure could potentially contain sufficient uranium resources to feed an ore processing plan at a rate superior to the forecasted production of 750 tonnes per day in the scoping study (November 2008) for approximately 2.3 million pounds of U3O8 per year.

Strateco Resources plans to carry out 60,000 metres of surface drilling per year in 2010 and 2011, in parallel with underground exploration work. The results of the surface drilling program should allow the maximum capacity of the Matoush ore processing plant to be established.

In 2010, Strateco Resources plans to begin the environmental studies required for mill and tailings pond construction. These studies are required to obtain a mine construction permit.

Strateco Resources is eligible for exploration tax credits equal to approximately 50% of surface exploration expenses until such time as it achieves commercial producer status.

Licence and other Permits

In June 2009, detailed engineering plans for the surface and underground infrastructures were completed in the scope of the application for a licence from the Canadian Nuclear Safety Commission (CNSC).

The ramp plan has also been revised and completed, and Strateco Resources has received confirmation from Quebec authorities that the landing strip construction near the Matoush camp is exempt from the environmental impact study.