Creso Announces Proposed Amalgamation With Nichromet

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR RELEASE
PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR
IN PART, IN OR INTO THE UNITED STATES.


Creso Exploration Inc. ("Creso" or the "Corporation") (TSX
VENTURE:CXT)(OTCQX:CRXEF)(FRANKFURT:C3X) is pleased to announce that it has
agreed to enter into a merger agreement with Nichromet Extraction Inc.
("Nichromet") and a wholly-owned subsidiary of Nichromet ("Subco") pursuant to
which Creso and Subco will amalgamate (the "Amalgamation") and the amalgamated
company will become a wholly-owned subsidiary of Nichromet. Prior to the
Amalgamation, Nichromet will be renamed "Dundee Sustainable Technologies Inc."


The Amalgamation

Pursuant to the Amalgamation, Nichromet would, indirectly, acquire all of the
issued and outstanding common shares of Creso, which it does not already own,
and the shareholders of Creso would receive one subordinate voting share of
Nichromet in exchange for two common shares of Creso. Holders of options and
warrants of Creso will receive options and warrants, as applicable, of Nichromet
based upon the same exchange ratio.


The Amalgamation must be approved by a special majority (66 2/3%) of the votes
cast at the Creso shareholders' meeting to be held to consider the Amalgamation.
In addition, since Dundee Sustainable Technologies Inc. will have multiple
voting shares outstanding (held by Dundee Corporation), the Amalgamation must be
approved by a majority of the minority of the shareholders of Creso. In this
regard, Creso is preparing a management information circular which will be
mailed to each shareholder of Creso. The multiple voting shares of Dundee
Sustainable Technologies Inc. will not be listed on any stock exchange and are
convertible, at the option of the holder, into subordinate voting shares for no
additional consideration.


Assuming completion of the proposed Amalgamation, but excluding any securities
issuable pursuant to a future financing in connection with the Amalgamation,
Dundee Sustainable Technologies Inc. will have (i) 227,445,202 subordinate
voting shares issued and outstanding, of which 27.5% will be held by the current
shareholders of Creso (excluding Nichromet) and 72.5% will be held by the
current shareholders of Nichromet (including Dundee Corporation), and (ii)
50,000,000 multiple voting shares issued and outstanding, all of which will be
held by Dundee Corporation. Accordingly, Dundee Corporation will exercise voting
rights in respect of an aggregate of 86.3% of the issued and outstanding voting
securities of Dundee Sustainable Technologies Inc.


The parties expect to sign the merger agreement shortly. Completion of the
Amalgamation is subject to requisite shareholder and regulatory approvals and
standard closing conditions for transactions of this nature. 


About Nichromet

Nichromet is a private Canadian company controlled by Dundee Corporation that
has developed patented precious and base metal extraction processes that are
environmentally friendly in that the residues of mining operations are totally
void of contaminants such as sulfur and arsenic. These new processes are based
on chlorination and are particularly efficient for the treatment of polymetallic
ores either in the form of sulfides, oxides or arsenides. These chloride based
patented processes are a substitute to cyanidation, which is commonly used in
the mining industry.


Nichromet was awarded a $5 million grant by the Government of Canada through
Sustainable Development Technology Canada (SDTC) for the development of an
innovative patented technology that will increase efficiency in processing gold
while reducing the environmental impact and the construction of a demonstration
plant of $27 million. The $5 million grant was part of a $61.8 million
investment by the Government of Canada to support 23 clean technology projects
across Canada.


Nichromet received a grant of $700,000 from the Quebec Ministere du
Developpement economique, de l'Innovation et de l'Exportation.


Insiders, Officers and Board of Directors of Nichromet

Upon completion of the Amalgamation, it is anticipated that the executive
management and board of directors of Dundee Sustainable Technologies Inc. will
consist primarily of the current executive management and board of directors of
Nichromet. It is expected that the only person that will exercise control or
direction over more than 10% of the issued and outstanding shares of Dundee
Sustainable Technologies Inc. will be Dundee Corporation.


Non-Arm's Length Party to the Amalgamation

Nichromet currently owns or exercises control or direction over more than 10% of
the issued and outstanding shares of Creso. As such, Nichromet may be considered
a Non-Arm's Length Party to the proposed Amalgamation. In addition, the proposed
Amalgamation may be considered as a "business combination" under Multilateral
Instrument 61-101 Protection of Minority Security Holders in Special
Transactions ("MI 61-101") and, accordingly, requires approval by the holders of
a majority of the shares of Creso, excluding shares held by interested parties
at the shareholder meeting to be held by Creso to seek approval for the
Amalgamation, in addition to the requirements under the Canada Business
Corporations Act which require that the Amalgamation be approved by at least
two-thirds (66 2/3%) of all votes cast at the Meeting. Finally, Creso is exempt
from the formal valuation requirement of MI 61-101 in connection with the
proposed Amalgamation in reliance on Section 4.4(1)(a) of MI 61-101, as no
securities of the Corporation are listed or quoted for trading on the Toronto
Stock Exchange, the New York Stock Exchange, the American Stock Exchange, the
NASDAQ stock market or any other stock exchange outside of Canada and the United
States.


Trading Halt

Trading in the common shares of Creso on the TSX Venture Exchange will be halted
pending a review, if any, of the proposed Amalgamation by the TSX Venture
Exchange and the filing of certain documents by Creso and Nichromet.


Completion of the transaction is subject to a number of conditions, including
TSX Venture Exchange acceptance and disinterested shareholder approval. The
transaction cannot close until the required shareholder approval is obtained.
There can be no assurance that the transaction will be completed as proposed or
at all.


Investors are cautioned that, except as disclosed in the Management Information
Circular to be prepared in connection with the transaction, any information
released or received with respect to the transaction may not be accurate or
complete and should not be relied upon. Trading in the securities of Creso
should be considered highly speculative.


The TSX Venture Exchange has in no way passed upon the merits of the proposed
transaction and has neither approved nor disapproved the contents of this press
release.


Information for U.S. Creso Shareholders

Due to U.S. securities law considerations, Nichromet will not distribute its
subordinate voting shares into the United States or to U.S. Creso shareholders.
Accordingly, no U.S. Creso shareholder will be entitled to receive Nichromet
subordinate voting shares. All Nichromet subordinate voting shares that a U.S.
Creso shareholder would have been entitled to receive under the Amalgamation
will instead be issued and delivered to a depositary, and the depositary shall
use its best efforts to sell such shares through the facilities of the exchange
upon which the subordinate voting shares may be listed as soon as practicable
after the Amalgamation, on such dates and at such prices as the depositary
determines in its sole discretion, through one or more brokers with whom the
depositary transacts business.


About Creso 

The Corporation's principal mining exploration holdings are located in the
Shining Tree mining camp of Northern Ontario within 100 km of the Timmins and
Kirkland Lake mining camps.


Forward-looking Statements

This press release contains forward-looking statements that address future
events and conditions, which are subject to various risks and uncertainties.
Forward-looking statements include, but are not limited to, statements with
respect to: the terms and conditions of the proposed Amalgamation; the
completion of any future financing; use of funds; and the business and
operations of the resulting issuer, Nichromet, after the proposed Amalgamation.
Actual results could differ materially from those anticipated in such forward-
looking statements as a result of numerous factors, some of which may be beyond
the Corporation's control. These factors include: general market and industry
conditions and other risks disclosed in the Corporation's filings with Canadian
Securities Regulators, including those that will be contained in the Management
Information Circular that will be prepared and filed in connection with the
proposed Amalgamation.


Forward-looking statements are based on the expectations and opinions of the
Corporation's management on the date the statements are made. The assumptions
used in the preparation of such statements, although considered reasonable at
the time of preparation, may prove to be imprecise and, as such, undue reliance
should not be placed on forward-looking statements. The Corporation expressly
disclaims any intention or obligation to update or revise any forward-looking
statements whether as a result of new information, future events or otherwise,
except as required by applicable law.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Pierre Gauthier
Chairman, President and CEO
[phone] # 239
[phone] (FAX)
[e-mail]
www.creso.ca