Largo Resources Ltd.

Largo Resources Ltd.

May 14, 2008 09:17 ET

Largo Resources and Glencore International Enter Into Off-Take Agreement for the Maracas Vanadium Project (Brazil)

- Glencore is one of the worlds largest participants in the vanadium market - Off-take agreement for all vanadium products produced at Maracas for the first 6 years of commercial production with a renewable option for a further 6 years - Partnership represents significant milestone and validation of the exciting potential of the Maracas Vanadium project

TORONTO, ONTARIO--(Marketwire - May 14, 2008) - Largo Resources Ltd. (TSX VENTURE:LGO) is pleased to announce that it has entered into an off-take agreement with Glencore International AG ("Glencore") for all vanadium products produced at the Maracas vanadium project (the "Project") in Bahia, Brazil.

The agreement shall remain in effect for a six year evergreen period commencing from commercial production, and shall be renewable for a further six years.

Mark Brennan, Largo President and CEO commented: "We are happy to have been able to enter into this off-take with Glencore as they are a significant player in the global vanadium market. This marks the beginning of what we hope will be a mutually beneficial and increasingly collaborative long-term relationship with Glencore."

Based on a scoping study by Micon International in December 2007, the Measured and Indicated Mineral Resource at Maracas (Gulcari "A" Deposit) at $5.00/lb vanadium pentoxide consistent with a cut-off grade of 0.46 g/t was estimated to be 22.5 million tonnes grading 1.27% vanadium pentoxide, including a high-grade zone of 8.7 million tonnes grading 2.0% vanadium pentoxide - expected to support the first 10 years of production. Largo anticipates the production of 5,000 tonnes of Ferro Vanadium per year. The open pit mine design was based on a pit shell reflecting a $5.00/lb long-term price forecast for vanadium pentoxide that was commissioned from CRU of London, England. The base case view of the CRU forecast at the time of commissioning was that the long-term price of vanadium pentoxide would stabilise at approximately $5.00 per lb (and $23.08/kg for ferro vanadium) through 2017. Current prices for vanadium pentoxide and ferro vanadium are approximately $14.00/lb and $62/kg respectively. Largo's expected costs are anticipated to be less than $10/kg for Ferro Vanadium.

Based on the aforementioned resource estimate, Gulcari "A" has 624 million pounds of contained vanadium pentoxide and 406 million pounds of potentially recoverable ferro vanadium. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Projected revenues from the Maracas vanadium deposit are expected to be comprised of the sale of ferrovanadium alloy as the primary product and by-product revenue from the sale of leached concentrate pellets as feedstock for iron and steel production.

As announced on December 12, 2007, the feasibility study for the project is being undertaken by a team led by Aker Kvaerner of Toronto, Ontario. Largo would like to report at this time that the feasibility study is progressing well and that the targeted completion date continues to be June 30, 2008.

This press release was reviewed by Andy Campbell, P.Geo, Largo's VP of Exploration, who is a Qualified Person under NI 43-101.

About Glencore

Glencore International AG is one of the world's largest suppliers of a wide range of commodities and raw materials to industrial consumers.

Headquartered in Baar, Switzerland, Glencore International AG employs over 2,000 people worldwide in some 50 offices in over 40 countries whilst our industrial operations employs over 50,000 people in 19 plants spread over 12 countries.

About Largo

Largo Resources is a Canadian natural resource development and exploration company with two advanced stage projects: the Maracas Vanadium-PGM deposit in Brazil and the Northern Dancer Tungsten-Molybdenum deposit in the Yukon. The company is listed on the TSX Venture Exchange under the symbol LGO.

For more information please refer to Largo's website:


Certain statements contained in this news release may contain forward-looking information within the meaning of Canadian securities laws. Such forward-looking information is identified by words such as "estimates", "intends", "expects", "believes", "may", "will" and include, without limitation, statements regarding the company's plan of business operations, production levels and costs, estimates regarding mineral resources, projections regarding mineral prices, anticipated revenues and projected expenditures. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others, metal prices, risks inherent in the mining industry, financing risks, labour risks, uncertainty of mineral resource estimates, equipment and supply risks, title disputes, regulatory risks and environmental concerns. Most of these factors are outside the control of the company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.


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