Mr. Bruce Hodgman reports

KWG ANNOUNCES PROPOSED INVESTMENT ACQUISITION

KWG Resources Inc., which carries on business as The Canadian Chrome Company, has proposed to acquire, in two stages, to assure conformity with terms of a shareholder agreement, up to 50 per cent of the equity of Newcon International Ltd., which carries on business as Newcon Optik, in exchange for Canadian Chrome Company multiple voting shares to be issued from treasury at a 15-per-cent premium to Canadian Chrome Company's current volume-weighted average trading price. A letter of intent was signed today to acquire an initial 25-per-cent indirect interest assuming certain underlying options are exercised, and is proposed to be completed following execution of a definitive agreement, satisfying all conditions and receiving all necessary approvals. The estimated value of this first 25-per-cent tranche at present market prices, based on a formula agreed upon and to be supported by a fairness opinion to be obtained prior to closing, would be approximately $14-million.

The proposed transaction is not intended to constitute or result in a change of business for Canadian Chrome Company as Canadian Chrome Company intends to continue to focus on its business of mineral exploration involving the acquisition of interests in, and the exploration, evaluation and development of, large-scale mineral deposits of chromite and other base metals and minerals, including the large chromite deposits it controls in Ontario's Ring of Fire. It is the objective of the proposed transaction to provide a source of cash flow to be derived from dividends to be paid by Newcon and, in the longer term, should the opportunity present itself, a liquidation of the investment in Newcon. Newcon Optik is a night optical equipment manufacturer and a world leader in laser-based rangefinders which are sold to military and police organizations in many countries. With annual net income ranging between $2.9-million and $6.1-million over the past five years, and excellent growth prospects, including in 2025, it has shown itself to be a profitable business and is expected to provide a steady flow of dividend income to its shareholders. This income will assist Canadian Chrome Company with its cash needs rather than relying totally on periodic private placements in these challenging capital markets. The business is also believed to have excellent growth prospects with interesting possibilities for strategic development.

The company also announces a proposed private placement of units, each unit being composed of four Canadian Chrome Company multiple voting shares and two warrants (each warrant exercisable for the purchase of one further such share at any time within 12 months after closing of the first tranche of the private placement or a change of control, whichever first occurs, upon payment of $4). Up to three million units priced at $10 each will be offered to accredited investors and other investors qualified to purchase such securities on a prospectus-exempt basis.

About KWG Resources Inc. (The Canadian Chrome Company)

KWG, which carries on business as The Canadian Chrome Company, is an exploration-stage company that is focused on identification, acquisition, consolidation, exploration, development and evaluation of large-scale deposits of minerals, including chromite, base metals and strategic minerals and, where applicable, on the development of transportation and electrification links to access remote areas where these deposits may be located. Canadian Chrome Company is a registered business style of KWG Resources.

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