DEVELOPING NEW AND EXCITING STRATEGIC MINERAL PROJECTS TO HELP MEET AMERICA'S FUTURE NEEDS

The global economy is facing an unprecedented confluence of events that stands to re-shape the way people think and do business. China, India and their neighbors are leveraging their huge populations and transforming their societies to create an urban middle class of epic proportions. As this middle class of people continues to swell in numbers, the resulting demand for energy and in fact all commodity resources will remain robust.

Strategic minerals ( ie Rare Earth elements, Fluorite, Lithium, Vanadium, Tungsten etc...) play a critical role in the global economy with applications ranging from alloy elements to permanent magnets to laptops to cellphones to rechargeable batteries and everything in between. But, imagine a global economy where there is a tight squeeze on the supply of these minerals because one dominant supplier controls the vast majority of the output. We are witnessing first hand this very type of scenario as China flexes its muscles and postures itself to reduce its strategic metal exports so as to safeguard its future supply. Where will the global economy in general and America in particular source future strategic minerals from ? A sobering question to be sure ... The US Gov't is taking this supply issue seriously and Washington lawmakers are now starting to look at ways for America to identify its own domestic sources of strategic minerals.

With this in mind, in 2009 Strategic Resources opted to focus its efforts in the State of New Mexico. In fact, in 1915 the US Geological Society identified a trend of alkalic rocks extending from Alaska to Mexico. This trend of alkalic rock runs right through the State of New Mexico. A more comprehensive look at this alkalic trend also shows that it hosts many of the Rare Earth projects in places like Alaska, British Columbia, Wyoming and California that investors are familiar with.

Nuclear power is also poised to play a leading role in meeting the growing energy demands of the global economy. Presently 1/6th of the worlds electricity comes from 440 existing nuclear reactors. By 2050, industry experts suggest the world will need to have several hundred more nuclear power plants up and running. In the USA alone, the 104 nuclear reactors in operation require 45 million pounds of Uranium annually. The US only produces about 10% of this amount domestically and relies on the recycling of old Soviet warheads and on Government stockpiles to meet demand. Both of these supply sources are finite. A day of reckoning lays ahead for America. Where will it source its future Uranium supplies?

However, since Uranium was first recognized, mankind has had a love-hate relationship with it. Despite the growing role it is playing as a valuable energy source, the recent unfortunate events in Fukushima, Japan have served to accentuate all that is bad about Uranium. For many Uranium explorers, this has come at an inopportune time. However, the fundamentals cannot be denied. The Uranium market will recover and as it does, New Mexico as an Uranium exploration locale will again come to the fore.

New Mexico Rare Earth & Strategic Mineral Exploration

Strategic's main project is located in the Gallinas Mountains of Lincoln County in the central part of New Mexico. This area has been the subject of volcanic intrusive activity over geologic time which has resulted in mineralization that contains Fluorite along with various Rare Earth elements. The most attractive parts of the Gallinas Mountains are those areas where intrusive breccia pipes have formed. Following brecciation, post-magmatic fenite fluids came to surface. This fenitization is important in that it strongly implies the presence of a body of rare-earth-bearing carbonatite at depth. In fact, in 1993 the US Bureau of Mines penned a report in which it stated "fenitization is one of the most characteristic features associated with carbonatites". This report went on to state that sizeable rare earth projects in places like Quebec, the former USSR, Africa and India are all associated with fenitization. A small preliminary drilling program was carried out in Q2, 2011 to assess the geology adjacent to some fault zones. Future drilling in late 2011 or early 2012 will focus specifically on the brecciated pipe areas.

New Mexico Uranium Exploration

Strategic Resources has a small block of claims in the Red Basin/deBaca trend area of New Mexico - a geologically significant area that runs from Datil, New Mexico to Springerville, Arizona. Serious Uranium exploration along this trend began in the late 1950's when Federal Resources carried out a 10,000 foot drilling program. Old literature from the period confirms that Federal delineated a small 200,000 pound inferred Uranium occurence based on 27 holes. Gulf Oil (Nuclear Fuels Division) arrived on scene in 1968 and followed up on the work of Federal and drilled off what academic research papers describe as a series of medium sized ore bodies totalling several million pounds of Uranium. Mineralization in this area occurs at a transition interval between the Point Lookout Sandstone formation and the Cretaceous Age Crevasse Canyon Shale formation.

Gulf's success attracted a host of other players including Pioneer Nuclear, Occidental Petroleum, and Energy Reserves Group. Just as these other players were gaining momentum, the Uranium cycle of the 1970's peaked and exploration activity ceased. Strategic Resources is following a generalized model that suggests Uranium mineralization migrated over time to a point below the water table where it encountered organic reducing material.

A small drilling program completed in early 2011 suggests that this generalized model is valid given the good alignmenmt of drill results with those from the late 1950s. Given the current state of affairs in the Uranium sector, Strategic plans to simply keep this claim block in good standing. Once the Uranium sector improves again, additional drilling will be contemplated.