Uru Metals Regulatory News (URU)

7 June 2012

URU METALS LIMITED

("URU Metals" or "URU" or "the Company")

 URU receives positive NI 43-101-compliant Preliminary Economic Assessment of

the Zebediela Project, South African Nickel Joint Venture

Highlights

·; The Preliminary Economic Assessment (PEA) of the Zebediela Project projects a pre-tax and pre-royalty net present value of $1,018 million, an internal rate of return of 25.7% and a 3.8 year payback period at an 8% discount rate.

·; Indicated resources stand at 485.4 million tonnes at a grade of 0.245% Ni with additional inferred resources of 1,115.1 million tonnes at a grade of 0.248% Ni.

·; Using indicated resources only, a proposed open-pit mine is envisioned with a 25 year mine life producing 56,600,000 lbs of recoverable nickel per annum.

·; The project is projected to a lowest-quartile cost nickel producer.

·; Substantial opportunities are available to the South African Nickel Joint Venture (SAN JV) to increase the project value through resource accretion and the addition of a magnetite concentrate revenue stream.

Commenting on the nickel joint venture PEA, Paul Loudon, Non-Executive Chairman of URU Metals, said: "The PEA indicates significant value accretion from URU's investment in the SAN JV. With expenditures of approximately $4.2 million to date, the Joint Venture has defined a large low-cost open pit disseminated sulphide nickel resource at Zebediela that has excellent economic and growth potential."

Background

URU Metals, the exploration and development company with uranium interests in Niger and South America, and nickel interests in southern Africa, announces the receipt from of the Preliminary Economic Analysis of the Zebediela Project, one of two sulphide nickel projects currently part of the South African Nickel Joint Venture. The PEA indicates that the Zebediela Project could be economically viable by conventional open pit mining techniques and proven milling technologies.

The effective interest of each party in the SAN JV will be URU Metals 45 per cent., South African Nickel 40 per cent. and Umnex 15 per cent.

Zebediela Nickel Project

The Zebediela Nickel Project is located in the Limpopo Province of South Africa close to the platinum mining town of Mokopane, very close to existing rail, highway, and electrical power infrastructure.

The PEA validates the Zebediela Nickel Project as a large disseminated sulphide resource with mining engineering aspects similar to typical porphyry copper deposits in terms of size and grade. The NI 43-101-compliant PEA outlined indicated resources of 485.4 million tonnes averaging 0.245% nickel, and additional inferred resources of 1,115.1 million tonnes of 0.248% nickel. The Zebediela Project also contains significant iron minerals in the form of magnetite that is also being investigated as a potential by-product.

Details of the Preliminary Economic Assessment Study ("PEA")

The MSA Group was commissioned by the Joint Venture to conduct a PEA, which was based on work performed by the following experts:

·; TWP Engineering, responsible for the comminution circuit design;

·; Bateman Engineering N.V., responsible for the concentrator design;

·; Mintek SA, responsible for the comminution test work;

·; SGS South Africa Pty Ltd., responsible for mineralogy work and magnetite recovery test work;

·; Maelgwyn Mineral Services Africa Pty Limited, responsible for nickel flotation test work;

·; Professional Cost Consultants Pty Ltd., responsible for the process facility costing;

·; The MSA Group, responsible for the NI 43-101 compliant mineral resource statement and accompanying NI 43-101 technical report, mine plan, mine and infrastructure costing, environmental studies, financial model and collation of the overall PEA report

The PEA considered the mining and milling of only 500 million tonnes of mineralized material in an open pit mine approximately 1700 m long by 880 m wide by 250 m deep. The proposed mining rate is 20 million tonnes per annum using a contractor mining fleet. The strip ratio was calculated to be 0.36:1. Consideration of the development of inferred resources was not contemplated in the PEA at this time, but will be considered in future studies.

Extensive work was conducted on the Zebediela deposit metallurgy. Testing indicates that 50% of the total contained nickel could be recovered into a high quality saleable nickel concentrate averaging 16% Ni. Start-up capital expenditures including contingencies and working capital are estimated to be $650 million and sustaining capital is estimated at $58 million over the life of the mine. Operating expenditures are estimated to be $3.35 per pound of recoverable nickel.

The PEA projects a pre-tax and pre-royalty net present value of $1,018 million, an internal rate of return of 25.7% and a 3.8 year payback period at an 8% discount rate using a nickel price of $8.50/lb and a ZAR/USD ratio of 8.1. Annual cash flow is project to be $203 million.

The PEA also recommends the commencement of a phased pre-feasibility study with a total combined cost of $8.3 million with the objectives of upgrading and expanding mineral resources, securing long-term water and electrical supplies, conducting geotechnical work to confirm pit design, continued metallurgical work and a bulk sampling program, detailed investigations into toll smelting and refining, optimizing tailings disposal options, the initiation of base-line environmental studies, and confirming the viability of recovering magnetite as an economically viable by-product. Phase I of the recommended study is estimated to cost $4.23 million and Phase II is estimated to cost $4.03 million.

The Joint Venture has been aware of the potential value of a magnetite as an iron concentrate by-product at Zebediela since the inception of the project. Metallurgical work investigating by-product magnetite was included in the scope of the PEA investigations, but due to analytical delays, any potential economic impact from iron by-product was not included in the report. If by-product magnetite is proven to be economically viable, an amendment to the PEA will be issued.

For further information:

URU Metals Limited

Roger Lemaitre, Chief Executive Officer

Tel: +1 (416) 892-2870

Fairfax I.S. PLC (Nominated Adviser and Joint Broker)

Ewan Leggat/Laura Littley

Tel: +44 207 598 5368

Daniel Stewart & Company (Joint Broker)

Tel: +44 (0)20 7776 5651

Brand: Mining IR

Andre Morral / Dr Iestyn Adams

Tel: +44 (0)151 531 7908

Forward-Looking Statements:

This press release contains statements that are 'forward-looking'. Generally, the words 'expect,' 'intend,' 'estimate,' 'will' and similar expressions identify forward-looking statements. By their very nature, forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, or that of our industry, to differ materially from those expressed or implied in any of our forward-looking statements. Statements in this press release regarding the Company's business or proposed business, which are not historical facts, are 'forward looking' statements that involve risks and uncertainties, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

These forward-looking statements speak only as of the date they are made.

The technical information contained in this announcement has been reviewed and approved by Dr Brendan Clarke Pr.Sci.Nat., Geology Operation Manager at The MSA Group and Mr Rob Croll, Head of Consulting at The MSA Group. Dr Clarke is a member of the Geological Society of South Africa and a Professional Natural Scientist (Pr. Sci. Nat) registered with the South African Council for Natural Scientific Professions. Mr Croll is a Fellow of the Southern African Institute of Mining and Metallurgy. Dr Clarke has sufficient experience relevant to the style of mineralisation under consideration to qualify as a Qualified Person (QP) and verifies that exploration data has been acquired by URU Metals using best practice quality assurance and quality control protocols. Mr Croll has sufficient experience to qualify as a Qualified Valuator (QV). Dr Clarke and Mr Croll are consultants to URU Metals with no interest in the Company. Both Dr Clarke and Mr Croll have consented to the inclusion in this announcement of their names in the form and context in which they appear.

GLOSSARY

Disseminated

A verb meaning spread or disperse (something, esp. information) widely, or spread throughout an organ or the body. 

Nickel or Ni

Nickel belongs to the transition group of metals, is hard and ductile and a silvery-white metal with a slight golden tinge that takes a high polish.

Peridotite

A peridotite is a dense, coarse-grained igneous rock, consisting mostly of the minerals olivine and pyroxene. Peridotite is ultramafic, as the rock contains less than 45% silica. It is high in magnesium, reflecting the high proportions of magnesium-rich olivine, with appreciable iron

Preliminary Economic Assessment

A comprehensive study of a deposit in which all geological, engineering, operating, economic and other relevant factors are considered in sufficient detail for it to reasonably serve as the basis for a final decision by a financial institution to finance the development of the deposit for mineral production. and is the equivalent to a JORC scoping study but allows inferences and costings to be drawn on the back of inferred resources.

Qualified Person (QP)

Means an individual who:

(a) is an engineer or geoscientist with a university degree, or equivalent accreditation, in an area of geoscience, or engineering, relating to mineral exploration or mining;

(b) has at least five years of experience in mineral exploration, mine development or operation, or mineral project assessment, or any combination of these, that is relevant to his or her professional degree or area of practice;

(c) has experience relevant to the subject matter of the mineral project and the technical report;

(d) is in good standing with a professional association; and

(e) in the case of a professional association in a foreign jurisdiction, has a membership designation that:

(i) requires attainment of a position of responsibility in their profession that requires the exercise of independent judgment; and

(ii) requires a favourable confidential peer evaluation of the individual's character, professional judgement, experience, and ethical fitness; or a recommendation for membership by at least two peers, and demonstrated prominence or expertise in the field of mineral exploration or mining.

Qualified Valuator (QV)

Is an individual who (a) is a professional with demonstrated extensive experience in the Valuation of Mineral Properties, (b) has experience relevant to the subject Mineral Property or has relied on a Current Technical Report on the subject Mineral Property by a Qualified Person, and (c) is regulated by or is a member in good standing of a Professional Association or a Self-Regulatory Professional Organization.