PRESS RELEASE Equity Research Report on Global Uranium Companies

SYDNEY, AUSTRALIA -- (MARKET WIRE) -- June 27, 2006 -- Resource Capital Research ("RCR"), an equity research company which focuses on small resource companies, today launched a major quarterly research report covering 24 global uranium exploration and development companies with a focus on Australia, Canada and the USA. Over 170 junior and mid cap explorers, development and production companies are identified.
The report reviews companies active in established uranium districts globally, including Australia, Canada, USA, Mongolia and Namibia. The following US traded companies: US Energy Corp (NASDAQ: USEG), Unor Inc. (TSX-V: UNI), CanAlaska Ventures (TSX-V: CVV), (OTCBB: CVVLF), and Western Prospector Group (TSX-V: WNP) are covered in the report. A feature article reviews sandstone style deposit projects being advanced or mined by a number of companies, viz., Cameco (CCO, Inkai, Kazakhstan), UrAsia Energy (UUU, Akdala, South Inkai, Kharassan, Kazakhstan), SXR Uranium One (SXR, Honeymoon/East Kalkaroo, SA), Heathgate (Beverley Uranium Mine, SA), Stellar Resources (SRZ, SA), Southern Gold (SAU, SA) and US Energy (USEG, USA).
To access the free summary report, go to www.rcresearch.com.au/feature. To purchase the complete 72 page detailed report titled "Uranium Sector Review" please email johnwilson@rcresearch.com.au -- The spot uranium price is US$45.00/lb, an increase of 27% year to
date.
-- 180 new nuclear power reactors are currently proposed or planned
worldwide. This compares with 441 nuclear power reactors
currently in operation.
-- The uranium price is forecast to reach US$54/lb in 2006, an
increase of 20% over the current spot price and US$60/lb by May
2007, an increase of 33% from the current spot price.
-- The upper end of the "forward" curve, ie US$60/lb, appears to be
priced into shares that have current or near term production
potential (next 3 years) and where sales contracts allow spot
market participation.
-- The market valuation of our selection of 68 Australian uranium
juniors is down 9% in the past month, up 3% over 3 months and up
84% over the past year.
-- By comparison, the market valuation of 100 selected Canadian
uranium
juniors is down 13% in the past month, down 10% over the past 3
months and up 97% over the past year.
-- China National Nuclear Corporation (CNNC) and Uranex NL (UNX)
announced the signing of a Letter of Intent in 2Q06 and BHP is
understood to be negotiating an offtake agreement in relation to
expanded production at Olympic Dam.
-- A decision to develop Honeymoon (SA) by SXR is expected early
3Q06.
Equity Market Performance
(Click here for details)
The market valuation of our selection of Australian uranium juniors (68 companies) is down 9% over the past month, up 3% over the past 3 months, and up 84% over the past year. This compares with a selection of 100 Canadian uranium juniors, down 13% over the past month, down 10% over the past 3 months, and up 97% over the past year.
In the past 3 months the majors have moved independently: Cameco is up 8%, Energy Resources of Australia (ERA) is down 6% and Paladin (PDN) is down 6%.
The outlook for equity markets in general remains tenuous. Should equity markets continue to soften, smaller resource stocks will likely be disproportionately affected. As such, exploration companies with near term news flow and sufficient cash to fund programs are favored. Against this background, we expect the market for physical uranium to continue to strengthen through 2007, benefiting development companies and producers.
Uranium Price Outlook
The spot uranium price is US$45.00/lb, an increase of 13% from US$40.00/lb at the end of March 2006, and up 27% from the beginning of the year.
Forward indicators suggest the uranium price will reach US$54/lb in 2006, an increase of 20% over the current spot price and US$60/lb by May 2007, an increase of 33% from the current spot price.
These are largely unchanged from 3 months ago, though indicators in April '06 at their high suggested US$66/lb and US$70/lb.
Market forecasts for the long term price of uranium are generally around US$30/lb. Given potential rising demand for nuclear power plants (180 new nuclear reactors are currently proposed or planned worldwide) and the potential for delays to forecast new uranium production, we consider there is upside risk to this long term price forecast.
Company Activity
The upper end of the "forward" curve, ie US$60/lb, appears to be priced into shares that have current or near term production potential (next 3 years) and where sales contracts allow spot market participation.
PDN's share price (A$3.93/share) discounts uranium price expectation of around US$60/lb.
Other near term producers include International Uranium Corp (USA) which has announced commencement of mining activities at its former Colorado Plateau mines and SXR Uranium One (South Africa).
A number of juniors are advancing development projects. Equinox Resources (EQN) is positioned to produce by-product uranium from its copper project in Zambia by 2008. Berkeley Resources (BKY) has a strategic alliance with AREVA over BKY interests in Spain and further news is expected. OmegaCorp (OMC) is rapidly advancing its Kariba Project in Zambia. Redport (RPT) and Nova Energy (NEL) each have advanced stage calcrete projects in WA. Paladin Resources is expected to commence commissioning of the Langer Heinrich calcrete project in Namibia in September, 2006. Tournigan Gold Corp (TVC) has completed a scoping study on its Jahodna Project in Slovakia and a step out drilling program is underway. US Energy Corp. announced a large exploration program to secure mill feed for its Shootaring Canyon uranium mill in Utah, which it aims to reactivate 2008.
PepinNini Minerals (PNN) completed a scoping study at Crocker Well (SA) and has good potential to expand JORC resources through 2006. Summit Resources (SMM, QLD) is expected to announce ongoing resource expansions in 2006.
Australia China uranium export deal
An agreement between Australia and China which clears the way for uranium sales to China was signed in early April '06. Chinese investment in Australian uranium juniors is likely to follow. China National Nuclear Corporation (CNNC) and Uranex NL (UNX) announced the signing of a Letter of Intent to form a strategic alliance, with the company's extensive Tanzanian holdings of particular interest. An offtake agreement with BHP in relation to expanded production at Olympic Dam is also understood to be in negotiation. Security of uranium supply is paramount to China's expanding nuclear power industry, and cost is a secondary issue.
Companies with JORC resources will be of strategic interest to power utilities from China (and elsewhere). We understand that many companies are in dialogue with Chinese investors.
Events of the past 3 months include: -- Financial industry investors are continuing to build physical
positions in uranium. viz., Uranium Participation Corp. which in
addition to uranium oxide (U3O8) now also invests in converted
uranium hexafluoride (UF6).
-- Energy Metals Limited (EME) established a strategic alliance with
Canadian producer Denison Mines (DEN). Unor Inc (formerly Hornby Bay
Exploration) announced a strategic alliance with Cameco.
-- Canadian companies continue to expand into Australia. Mega Uranium is
currently closing the acquisition of Hindmarsh Resources (HMR) and
announced the acquisition in 2Q06 of a private company with land
holdings in the Georgetown region of Queensland, near its Maureen
uranium deposit. Buffalo Gold Ltd. (BUF.U) has recently built a
portfolio of early stage prospective uranium properties in
Queensland and the NT. Further activity is anticipated.
-- A decision on the development of Honeymoon (SA) by SXR is now
expected with a board meeting scheduled for early 3Q06. If approval
is given, as is expected, this will be Australia's fourth uranium
mine.
-- High ranking officials of the Australian Labor Party continue to
suggest a change in policy on uranium timed for the Labor Party
national conference early in 2007. Bill Ludwig, president of the
Australian Workers Union, declared he has the numbers to overturn
the party's "no new mines policy."
"Given potential rising demand for nuclear power plants (180 new nuclear reactors are currently proposed or planned world wide) and the potential for delays to forecast new uranium production, we consider long term uranium price forecasts, currently around US$30/lb, are likely to be revised upwards," John Wilson, Managing Director of RCR, noted.
About Resource Capital Research
Resource Capital Research ("RCR") (www.rcresearch.com.au) was founded in 2004 and is based in Sydney. RCR provides investors with in-depth reports on current investment opportunities in the mining sector both in Australia and globally. We focus on small resource companies, ranging from exploration stage, through development and production. John Wilson the principal of the firm and analyst has eight years experience analyzing mining companies in Sydney and on Wall Street for major investment banks. The report is available at www.rcresearch.com.au. The next uranium sector review will be published in the September Quarter, 2006.

For further information please contact:
John Wilson,
Analyst, Resource Capital Research,
Phone: (+61- 2) 9252 9405,
Email: Email Contact
SOURCE: Resource Capital Researc