Champion Minerals Acquires 15 Strategic Iron Mineral Concessions in Fermont, Quebec

May 27, 2008

May 27 (Marketwire) – CHAMPION MINERALS INC. (“Champion” or the “Company”) (TSX VENTURE:CHM) is pleased to announce the signing of a Binding Provisional Agreement (the “Agreement”) with Fancamp Exploration Ltd. and The Sheridan Platinum Group Ltd. (collectively, the “Vendors”), allowing Champion to acquire up to a 70% interest in 15 iron-rich mineral concessions totalling 261.5 km2 (see appended Table 1 outlining the mineral concessions) in the Fermont Iron Ore District of northeastern Quebec. The Property, also termed the Fermont Property (the “Property”), is situated 250 km north of the St. Lawrence River port town of Port-Cartier and centered 60 km southwest of Fermont.

This transaction represents Champion’s third major acquisition of strategic iron mineral concessions in the past year, making Champion one of the largest stakeholders of mineral concessions in the Fermont Iron Ore District of Quebec.

The Fermont Property hosts significant historic pre-National Instrument (“NI”) 43-101 Mineral Resources(i) of 610 million tonnes @ 32.2% iron, located in proximity to and locally contiguous to an operating and a number of former operating iron mines and projects currently being developed for iron mining. The pre-NI 43-101 Mineral Resources(i) are divided amongst 7 of the 15 mineral concessions:


Table 2 - Historic Mineral Resources - Fermont Property

-----------------------------------------------------------------
PROJECT NAME                      TONNES     GRADE      NUMBER OF
                                           (% iron)   DRILL HOLES
-----------------------------------------------------------------
 MOISE LAKE                  101,000,000      30.8             65
-----------------------------------------------------------------
O'KEEFE-PURDY-AUDREA LAKES    25,000,000      35.5             18
-----------------------------------------------------------------
 BELLECHASSE-MIDWAY           91,400,000      30.0            N/A
-----------------------------------------------------------------
 FIRE LAKE NORTH               40,600,00      32.0             15
-----------------------------------------------------------------
 AUDREY-ERNIE LAKES           23,000,000      33.2              2
-----------------------------------------------------------------
 BIG THREE LAKES              25,000,000      34.0            N/A
-----------------------------------------------------------------
 SILICATE-BRUTUS LAKES       304,000,000      29.4             18
-----------------------------------------------------------------
 TOTALS                      610,000,000      29.4            118
-----------------------------------------------------------------

(i) The mineral resources outlined here are non-compliant NI 43-101
Mineral Resources since they are historical in nature and should not
be relied upon. There is no direct evidence that these numbers or any
portion thereof will ever be achieved at any time with further 
exploration work.

 

The Moise Lake East mineral concession is adjacent to the east of Quebec Cartier Mines Mount Wright producing iron ore mine and it is also located southeast of Consolidated Thompson Iron Mines Limited’s Bloom Lake Deposit (637.7 million tonnes @ 29.8% iron) that is currently being developed and is expected to produce 7 million tonnes of iron concentrate per year at a grade 66.5% iron (source: Consolidated Thompson Iron Mines Limited SEDAR filings available at www.sedar.com).

The O’Keefe-Purdy-Audrea Lakes, Harvey-Tuttle Lakes, Bellechasse-Midway, Midway SE, Oil Can Lake, Don Lake, Fire Lake North, Hope Lake, Hope Lake SW and Casse Lake mineral concessions tie onto the Quinto Mining Corporation (“Quinto”) Claim Group, which owns the Peppler Lake Iron Project containing an estimated 250 million tonnes @ 28.2% iron based on a NI 43-101 Technical Report issued by Quinto in 2006 (source: Quinto Mining Corporation SEDAR filings available at www.sedar.com).

All of the iron mineralization on the Property is linked to magnetite and/or specularite (hematite) iron formations in various proportions. The Property has received limited historical exploration work; however, the iron formations tend to have positive relief, the iron mineralization and ores are easily recognized visually, and they can be explored using airborne and ground magnetic geophysical surveys. Magnetic highs outline magnetite-rich iron formations, whereas magnetic lows tend to be hematite-rich iron formations and zones of secondary iron enrichment due to near surface oxidation. The historical sizes and iron grades were determined with minimal drilling, as outlined in the above table of historical Mineral Resources, and are not compliant with current NI43-101 standards; accordingly, they cannot and should not be relied upon.

The Fermont Property Agreement

Under the terms of the Agreement, Champion can earn an initial 65% interest in the Property at the Company’s option by expending C$ 6 million in staged exploration and development work expenditures on the Property, making cash payments to the Vendors totalling C$ 1 million, and issuing 2.5 million shares to the Vendors – all over a 4-year period. The Vendors will retain a 3% Net Smelter Returns (“NSR”) royalty, one third of which may be purchased by Champion for C$ 3 million.

Pursuant to the Agreement, and after earning the initial 65% interest, Champion will have the option to acquire a further 5% interest in any of the retained mineral concessions in the Property by completing a positive bankable feasibility study on the applicable retained mineral concessions. Champion will be required to make a one-time issuance of 500,000 shares to the Vendors on completion of the first feasibility study.

After Champion completes its earn-in, the Vendors and Champion will form a joint venture (“JV”) reflective of their proportionate ownership interests in the Property in order to explore and develop the retained mineral concessions. Champion will retain a right-of-first-refusal on any part or all of the Vendors’ proportionate interest in each of the mineral concessions comprising the Property. If the Vendors elect not to fund their proportionate interest in the JV, their interest would be diluted and, when the Vendors’ interest is reduced below a 10% remaining interest, the Vendors would be left with a 3% NSR royalty subject to a buyback clause at Champion’s option to reduce the NSR royalty to 2% by paying C$ 3 million. Champion would also retain a first-right-of-refusal on the royalty.. There is a 10 km area of influence around each mineral concession. The Agreement is subject to the completion of due diligence, the approval of Champion’s Board of Directors, and all required regulatory approvals, including that of the TSX Venture Exchange Inc. Subject to regulatory approval, Champion will issue 100,000 common shares to an arm’s length party as a finder’s fee.

Mr. Tom Larsen, President and CEO of Champion stated “For the third time in the past year Champion is proceeding with a major acquisition of strategic iron holdings, with this most recent acquisition adding more than 600 million tonnes of historic mineral resources in the Fermont Mining Camp of northeastern Quebec. The new Fermont holdings are in proximity to Quebec Cartier Mining’s Fire Lake Mine and Consolidated Thompson’s Bloom Lake and Quinto’s Peppler Lake deposits.”

“Champion is now strategically poised to become one of the major players in this region’s iron sector. Champion plans to aggressively explore and develop the 261.5 km2 Fermont Property in addition to the 139.7 km2 Attikamagen Property located in western Labrador and northeastern Quebec. Both iron properties have excellent potential to host significant iron resources.”

“Champion’s near-term aim is to rapidly determine the quality and size of the iron mineralization at both Attikamagen and Fermont, and their highest recoverable grades. I would like to take this opportunity to thank the management team for their efforts and also, Mr. Jean Lafleur, P. Geo., Director and Technical Advisor to the Company, for his role in enabling Champion to build an extensive and highly prospective iron property portfolio.”

About Champion Minerals

Champion is a junior exploration Company focused on discovering and developing significant metal resources in eastern Canada, particularly in Labrador and Newfoundland, and northeastern Quebec. The Company’s projects include the Powderhorn and Gullbridge Base Metal Projects located in central Newfoundland, the Attikamagen Iron Property, located in western Labrador and northeastern Quebec, and the Fermont Iron Property in northeastern Quebec.

The technical content of this press release has been reviewed by Mr. Jeff Hussey, P. Geo., Vice President, Exploration for Champion, and a Qualified Person under the guidelines of National Instrument 43-101.

Statements in this release that are not historical facts are “forward-looking statements” and readers are cautioned that any such statements are not guarantees of future performance, and that actual developments or results, may vary materially from those in these “forward-looking statements.


Table 1 - Detailing the 15 mineral concessions of the Fermont Property

---------------------------------------------------------------
                                  SIZE
MINERAL CONCESSION                (km2)           NTS MAP-SHEET
---------------------------------------------------------------
MOISE LAKE                        13.3                    23B14
---------------------------------------------------------------
O'KEEFE-PURDY-AUDREA LAKES        37.6             23B11, 23B12
---------------------------------------------------------------
HARVEY-TUTTLE LAKES               49.8             23B05, 23B12
---------------------------------------------------------------
BELLECHASSE-MIDWAY                 6.9                    23B11
---------------------------------------------------------------
MIDWAY SE                          8.0                    23B11
---------------------------------------------------------------
OIL CAN LAKE                       9.0                    23B11
---------------------------------------------------------------
DON LAKE                           2.7                    23B06
---------------------------------------------------------------
FIRE LAKE NORTH                   21.2                    23B06
---------------------------------------------------------------
HOPE LAKE                          6.9                    23B06
---------------------------------------------------------------
HOPE LAKE SW                       3.2                    23B06
---------------------------------------------------------------
CASSE LAKE                        13.5                    23B05
---------------------------------------------------------------
AUDREY-ERNIE LAKES                28.1             23C01, 23B04
---------------------------------------------------------------
BIG THREE LAKES                    4.8                    23C01
---------------------------------------------------------------
AUBERTIN-TOUGARD LAKES            28.1             23B04, 22O13
---------------------------------------------------------------
SILICATE-BRUTUS LAKES             28.6                    22O13
---------------------------------------------------------------
TOTALS                           261.5
---------------------------------------------------------------
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