JOINT NEWS RELEASE
SPIDER RESOURCES INC.
KWG RESOURCES INC.
********************** Spider and KWG agree to amend joint venture, parties select individual projects for advancement TORONTO, ONTARIO - Spider Resources Inc. (TSX VENTURE:SPQ) and KWG Resources Inc. (TSX VENTURE:KWG) have achieved parity in their joint venture and have agreed to amend and revise their Ontario Joint Venture as previously constituted in 1992, and amended in April 2003.
From almost $37 million invested in exploration during that time, the partners have generated six separate exploration projects in their joint venture.
The companies now intend to treat each of the six projects as a separate joint venture, independent of the others.
Spider and KWG have agreed to each select projects from these six new joint ventures to enable each company to either increase or decrease its pro rata interest based upon their own strategic objectives.
The six main properties that have been developed by the joint venture include the following: MacFadyen kimberlite property, the Kyle kimberlite properties, McFaulds Lake VMS properties, Diagnos initiative properties, Freewest option property and the Wawa property.
Spider will continue with the exploration of the volcanogenic massive sulfide "VMS" belt near McFauld's Lake in northern Ontario, as well as the diamond discoveries at Wawa, and also at the five Kyle kimberlites in the James Bay Lowlands.
Spider will also begin exploration of four newly-acquired kimberlite target areas in the general vicinity of McFaulds Lake and Kyle Lake, that were identified by a combination of magnetic airborne surveying and data analysis commissioned with Diagnos Inc.
Spider will also initiate exploration on the new Freewest Resources Inc. optioned VMS properties near McFaulds Lake, where $200,000 must be expended by February 28, 2006 to complete the initial option requirement to earn 50 percent in this project from Freewest.
KWG will continue with the exploration for diamonds at the MacFadyen kimberlite property, located 8 kilometers north of the advanced Victor diamond mine development project of De Beers Canada Exploration Inc., where the joint venture has identified five diamondiferous kimberlites. Additional exploration targets exist on the property.
KWG has agreed to have its interest diluted by not contributing to Spider's exploration programs.
Conversely, Spider has agreed to have its interest diluted by not contributing further to KWG's exploration programs.
This will enable both parties to focus on projects that they want to advance, without the requirement of the other party's approval.
Both parties are now deemed to have a 50 percent interest in each of the joint venture projects and will be immediately vested with an equal capital interest based on accumulated expenditures in each project.
All future expenditures on the individual projects by the operator will be added to these historical expenditures to determine either party's then current interest level.
The non-contributing party in each case will suffer dilution down to 33.33 percent, then be entitled to contribute at its pro rata interest level or suffer further dilution down to 10 percent working interest.
Once 10 percent interest level is reached, the interest will be automatically converted into a one percent net proceeds from production in the case of diamonds, or a one percent net smelter royalty in the case of precious metals (for primary precious metal deposits), or a 0.5 percent net smelter royalty in the case of base metals.
This amendment to the joint venture is subject to formal documentation and regulatory approval.
As a result of recent (October 2005) financings, Spider is sufficiently funded to commence exploration and management looks forward to an exciting new exploration season, starting in early 2006, initially focusing on the McFaulds Lake area, and the nearby new kimberlite exploration targets. Exploration crews are being readied for an early start in January.
Spider Resources Inc. is a tier 2 junior resource company, quoted for trading on the TSX Venture Exchange under the symbol "SPQ" and there are currently 212,603,280 shares of Spider issued and outstanding.