LRL Leyshon Res

RNS Number:7198B
Leyshon Resources Limited
20 April 2006


For Immediate Release                                              20 April 2006



 New Joint Venture Agreement Facilitates Financing and Development of the Zheng
                               Guang Gold Project


Leyshon Resources Limited ("Leyshon") (ASX and AIM : LRL) today reports that it
has executed a new Incorporated Joint Venture Agreement with the Qiqihar Brigade
of the Heilongjiang Bureau of Geology and Mineral Resources ("HLJ BGMR"). The
new agreement is an important milestone for Leyshon in China as it sets out the
terms under which the Joint Venture Company Black Dragon Mining Limited ("Black
Dragon") will explore, finance and develop the recently discovered Zheng Guang
gold project ("the Project").


Black Dragon was established by Leyshon in January 2004 as the first Sino
Foreign Joint Venture mining company in the mineral rich province of
Heilongjiang. Over the past two years Black Dragon has successfully explored the
Project located in the north west of the Province.


As a result of the rapid progress made on the Project to date, the original
exploration focused joint venture agreement has now been updated to incorporate
agreed terms associated for the finance, development and mining of the Project.


The significant terms of the new agreement are that Leyshon will complete its
earn in obligations for a 70% interest in Black Dragon by spending on
exploration, development and by making payments of US$5.0 million to the HLJ
BGMR over a 2 year period. The Qiqihar Brigade will hold a 30% participating
interest.


Leyshon will provide financing for the Project's development on normal
commercial terms with a repayment schedule ranking ahead of any profit
distribution to the parties.


Black Dragon will complete the application for additional Exploration Licences
surrounding the Project which will increase the company's land holding to over
200 km2. The transfer of these licences to Black Dragon, some of which are held
by Qiqihar brigade will not change the respective equity holdings in the
company.


All other terms of the agreement are standard to an incorporated mining joint
venture company.



The HLJ BGMR has assigned its interest in Black Dragon to its largest and most
important brigade located in the western city of Qiqihar 360 km south of the
Project. The Qiqihar Brigade has been managing the HLJ BGMR's interest in the
Project since the original agreement was signed and as such Leyshon has a good
working relationship with the key members of the 4,000 strong geological and
technical team.


The HLJ BGMR appointed Mr Chai Desai last year as the Director General of the
Qiqihar Brigade with a key responsibility being the success of the Black Dragon
Joint Venture. Black Dragon's success is important to the HLJ BGMR as Zheng
Guang is the province's first new gold mining project for 15 years and the first
ever with a foreign company. The HLJ BGMR is of the view that Black Dragon's
success will attract additional international mining investment to the province.


Director General Mr Chai commented: "We have co-operated very well with Leyshon
over the past two years in our joint efforts in exploring the Project and we
appreciate not only the capital investment by Leyshon, but more importantly, the
technical expertise shown by Leyshon personnel and their professional work which
has greatly advanced the joint venture project. Both my staff and I are
confident that we will continue working closely towards building the first Sino
Foreign operated modern gold mine in our minerals rich province."


Qiqihar Brigade holds a large number of Exploration Licences in the highly
mineralised and underexplored north western Heilongjiang. As one of the main
sources of the 20 million ounces of surface gold recovered, the area has
contributed significantly to Heilongjiang becoming one of China's largest
historic gold producers. Black Dragon will be reviewing the work to date on
these licences with Mr Chai's team with a view to identifying new mesothermal
and epithermal gold and copper project opportunities.


Managing Director Paul Atherley commented: "We are delighted with the progress
of Zheng Guang which is rapidly emerging as China's most exciting new gold
projects. This agreement provides the framework for financing, developing and
expanding the project. We very much look forward to working with Mr Chai and the
Qiqihar Brigade on this important development for the Province of Heilongjiang."

Leyshon has firmly established its presence in China over the past two years and
is pioneering the opening up of the mineral rich province of Heilongjiang to
modern exploration techniques and foreign investment. It is one of the very few
foreign resource companies with its Managing Director and senior staff located
in Beijing.


For further information contact:


Paul Atherley - Managing Director       Tim Thompson

Tel: +86 10 8528 9256                   Buchanan Communications

Mob: +61 417 475 038                    Tel: +44 207 466 5000



                      This information is provided by RNS
            The company news service from the London Stock Exchange

END
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