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Wednesday 11 July, 2007

Union Resources LTD

Mehdiabad Project Update


Union Resources Limited

Re: Mehdiabad Project Update

Union Resources Limited ("Union") is focused on the Mehdiabad Zinc-Silver-Lead
Project ("the Project") in Iran. The Project is carried on by Union, the
Iranian government body Iranian Mines and Mining Industries Development and
Renovation Organisation ("IMIDRO") and Iranian company Itok GmbH through an
incorporated Iranian joint venture company, Mehdiabad Zinc Company ("MZC").

In its quarterly release to ASX dated 28 July 2006 Union advised that the
"Bankable Feasibility Development Project Phase III Report" completed by Aker
Kvaerner Australia (the "Feasibility Study Report") had been received by Union
on 2 May 2006 and, following review, presented to the Company's Iranian
partners in MZC on 26 June 2006.

On 13 June 2007 Union advised ASX that:

 1. Aker Kvaerner had completed a technical and economic study of the Project
    and had advised Union that the Project meets Aker Kvaerner's standard for a
    feasibility study, subject only to receipt of necessary water rights and
    environmental clearances, the grant of an Exploitation Licence, and an
    indication of commitment to the Project from the Iranian Government; and
   
 2. at the request of the MZC Board Union had commissioned Iranian engineering
    company, Aseh Sanat to provide confirmation of the standard of the
    Feasibility Study Report and to provide a confirmatory market study for
    zinc.
   
Aseh Sanat has now has now provided a report to the Board of MZC that, subject
to some minor considerations, the Feasibility Study Report meets the standard
for a bankable feasibility study. The MZC Board, in turn, has accepted the
Feasibility Study Report and noted that, based on the report received from Aseh
Sanat, the Feasibility Study report can be updated to a bankable feasibility
study upon the granting of requisite licences, support from the government
sector, and commitment of foreign financing.

Union considers MZC's acceptance of the Feasibility Study Report to be a
significant development as Union has now completed its commitments under the
various Project agreements, and the remaining outstanding matters are largely
under the control of its Iranian partners. As previously advised, IMIDRO has
purported to terminate several agreements governing the Project, and Union is
firmly of the opinion that the agreements were invalidly terminated. As also
previously advised, Union has been in negotiation with IMIDRO in an effort to
establish a basis upon which the Project can proceed to the development phase.
Union believes acceptance by MZC of the Feasibility Study Report will assist
this.

For further information contact:

Australia: Union Resources Limited

Dr. Frank Reid

Phone: +61 07 3833 3833

London: Hanson Westhouse Limited

Bill Staple or Martin Davison

0207 7601 6100