Crescent Resources Signs Letter Agreement to Acquire Major Potash Exploration Project in Western Australia: Financial News

Crescent Resources Signs Letter Agreement to Acquire Major Potash Exploration Project in Western Australia
Wednesday July 30, 2008 8:00 am ET

VANCOUVER, BRITISH COLUMBIA--(MARKET WIRE)--Jul 30, 2008 -- Crescent Resources Corp. (CDNX:CRC.V - News) ("Crescent") has signed a letter agreement with Australian Potash Company Pty Ltd. ("APC") and its shareholders to acquire up to a 100% direct and indirect interest in 12 licenses known as the Carnarvon Basin Project, an exploration property covering approximately 4,280 square kilometres of prospective potash horizons in an extensive evaporite basin known as the Southern Carnarvon Basin in Western Australia. Previous drilling, consisting of three widely spaced oil and gas wells over a distance of 25 kilometres, has indicated the potential for significant potash and other sodium and magnesium salts.

CARNARVON BASIN POTASH PROJECT HIGHLIGHTS:

- Three widely spaced drill wells drilled in the late 1960's intercepted significant intervals of salt layers some of which hosted potash beds:

-- Yaringa No. 1 - combined 38 metres thick from 1,198 m. to 1,268 m.

-- Hamelin Pool No. 1 - combined 17.7 metres thick from 1,234 m. to 1,295 m.

-- Hamelin Pool No. 2 - combined 5.2 metres thick from 1,140 m to 1,177 m.

- The three wells span a distance of 25 kilometres. Due to the indicated lateral continuity and the enclosing beds intercepted within these wells, the potential for a significant potash deposit exists. Regional gravity data indicates that the evaporitic horizons may have developed in a sub-basin exceeding fifty kilometres in length and suggest that the sub-basin is nested within the much larger, but locally complex Southern Carnarvon Basin.

- In 1968, based on the results from the first of these wells, Yaringa No. 1, Continental Oil commissioned Hazen Research to undertake a series of potash recovery feasibility tests using solar evaporation of a brine estimated to contain 5.3% potassium chloride (KCL), which is a substantially higher grade than that at some profitable mines operating in other parts of the world.

- The project is ideally situated on the coast of Western Australia, adjacent to the major North West Coastal Highway which can be used to access several port facilities in the region.

- Australia currently imports 100% of their potash requirements resulting in a strong demand and need for a domestic potash supply. In addition, the project's location on the west coast is ideal for export to the Asian markets.

Michael Hopley, President and CEO of Crescent states, "This is a very significant project for Crescent with many positive features including historical work verifying the presence of potash and an excellent environment for potash exploration as well as world-class location and infrastructure. In addition, the potash market remains extremely strong."

Terms of the Agreement

Under the terms of the letter agreement, and an underlying option agreement which APC has with property owner West Coast Potash ("WCP") and its shareholder, Crescent has the right to acquire a 100% direct and indirect interest in the Carnarvon Basin Project, subject to a 2% gross overriding royalty. Subject to regulatory approval, Crescent must make the following payments and issue an aggregate of 30,000,000 common shares to APC (collectively, the "Option Payments") to maintain its rights, provided Crescent is satisfied with its 45 day due diligence review:

(a) issue to APC 7,500,000 common shares of Crescent within five business days of the date of approval (the "Approval Date") by the TSXV of the transaction

(b) issue to APC an additional 7,500,000 common shares of Crescent on or before the first anniversary of the Approval Date

(c) issue to APC an additional 15,000,000 common shares of Crescent on or before the date which is two and one-half years after the Approval Date

(d) reimburse $275,000 of payments made by APC prior to the Approval Date pursuant to the underlying option agreement between APC and WCP within 30 days of the Approval Date and make all further payments, carry out all further work expenditures and fulfill all further obligations of APC under the agreement between APC and WCP. These underlying payments in Canadian dollars are summarized as follows:

- APC can earn an 80% interest in the WCP licenses by spending a cumulative $7,000,000 on exploration and development over a three year period commencing July 15, 2008;

- APC can acquire an additional 20% interest (total of 100%) by completing a bankable feasibility study and paying WPC's shareholder the fair value of the additional 20% as determined by an independent engineering evaluation;

- Additional option payments by APC to WCP are as follows:

-- $500,000 by August 31, 2008

-- Six semi-annual payments of $400,000 beginning on January 15, 2009 until a total of $2,400,000 has been paid by July 15, 2011

(e) At the election of Crescent 50% of the $2,400,000 payments may be made in common shares of Crescent

(f) Nominees of APC will have the right but not the obligation to purchase up to 40% of any equity financings by Crescent

(g) On closing, APC may appoint up to two board members to Crescent's board of directors

About Crescent

Crescent is a mineral exploration and development company with a defined growth strategy of adding value through discovery and rapid project advancement through exploration. The Company has 30.7 million common shares outstanding.

CRESCENT RESOURCES CORP.

Michael Hopley, President and Chief Executive Officer

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this News Release.