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Paladin Notes "Summit Resources" Announcement; Provides Response

Paladin Resources Ltd ("Paladin" or "the Company") (TSX: PDN)(ASX: PDN) notes that Summit Resources Limited, the 50% joint venture partner in the Valhalla Uranium Project, today made the following release to the Australian Stock Exchange.

Summit seeks orders in Supreme Court of Western Australia

Potential Breach of the ISA Uranium Joint Venture Agreement

In an announcement to the Australian and New Zealand Stock Exchanges on 11 July 2006, Summit Resources Limited noted that its wholly owned subsidiary, Summit Resources (Aust) Pty Ltd ("Summit"), was seeking confirmatory legal advice on whether the structure of the proposed takeover offer by Paladin Resources Ltd ("Paladin") for Valhalla Uranium Limited ("Valhalla") triggered Summit's pre-emptive rights under the Isa Uranium Joint Venture Agreement (the "Joint Venture Agreement").

A summary of those pre-emptive rights was disclosed to the market by Valhalla without Summit's approval on 15 December 2005.

Summit is currently seeking to determine whether Resolute Limited and/or Mt Isa Uranium Pty Ltd (a wholly owned subsidiary of Valhalla) as Participants in the joint venture are or were in material breach of the Joint Venture Agreement. Should such breach have occurred, Summit will be entitled to exercise an option to purchase Mt Isa Uranium Pty Ltd's 50% interest in the joint venture at a price to be agreed or, failing agreement, at 85% of the market price determined by an independent expert.

On 24 July 2006, Summit wrote to Resolute Limited and Mt Isa Uranium Pty Ltd outlining its concerns about the disclosure by Resolute and/or Mt Isa Uranium of confidential information and seeking details about any information which had been disclosed to Valhalla, Paladin and any other third parties in relation to the joint venture.

On 26 July 2006, Mt Isa Uranium Pty Ltd responded in writing, denying that it was in breach and refusing to provide any of the information Summit had requested. As a consequence, Summit has today commenced proceedings in the Supreme Court of Western Australia seeking orders that Resolute Limited and Mt Isa Uranium Pty Ltd provide discovery of all information that either of them has disclosed to any third party in relation to the joint venture.

Summit will not be making any further comments in relation to these proceedings or the merits of its legal position pending consideration of these matters by the Supreme Court.

Alan J Eggers
Summit Resources Limited
Perth 28 July 2006

Paladin Resources Ltd has issued the following response:

Paladin notes today's announcement made to ASX by Summit Resources Limited (Summit) advising that Summit's wholly owned subsidiary, Summit Resources (Aust) Pty Ltd (Summit Resources), is seeking to determine whether Resolute Limited (Resolute) and/or Mt Isa Uranium Pty Ltd (a wholly owned subsidiary of Valhalla Uranium Limited (Valhalla)) are in material breach of the Isa Uranium Joint Venture Agreement between Summit Resources and Resolute.

Paladin remains confident that none of the mentioned companies have been party to any material breach of its obligations under the Isa Uranium Joint Venture Agreement. Paladin notes that its off-market takeover bid for all the ordinary shares in Valhalla announced in respect of which its bidder's statement was lodged with ASIC on 24 July 2006 is conditional on, amongst other things, there being no breach by any party to the Isa Uranium Joint Venture Agreement of the terms of that agreement.

Paladin will continue to closely monitor developments in the allegations made by Summit and will keep shareholders updated if and when Paladin becomes aware of further material information in relation to this matter.

Paladin Resources Ltd is an Australian uranium exploration and development company listed on the Australian Stock Exchange ("PDN") and the Toronto Stock Exchange ("PDN"). Paladin is involved in the mineral resource sector with projects both in Australia and Africa. With the Langer Heinrich Uranium Project in Namibia nearing construction completion and the Kayelekera Project in Malawi undergoing a Bankable Feasibility Study, Paladin is well placed to become a major supplier of primary uranium to world markets.

A.C.N. 061 681 098