Matamec Explorations Inc.

Matamec Explorations Inc.

August 07, 2012 10:31 ET

Matamec Grants Stock Options Following the Excellent Results of 2011 and 2012

MONTREAL, QUEBEC--(Marketwire - Aug. 7, 2012) - Matamec Explorations Inc. ("Matamec" or the "Company") (TSX VENTURE:MAT)(OTCQX:MHREF) is pleased to announce that the Board decided to grant stock options to two of the Company's directors and officers, to the Zeus property exploration team and to a company employee currently working on the feasibility study .

Agreement with TRECan and conclusions of the preliminary economic assessment ("PEA") study

1.2 million options were equally granted between the two directors and officers who, since January 2010, negotiated the agreement with Toyotsu Rare Earth Canada Inc. ("TRECan"), a subsidiary of Toyota Tsusho Corp., and conducted the PEA study. The decision of the Board is based on the signature of the agreement with a world-class company, as pertains to the Kipawa deposit. Once the feasibility study is concluded in the second quarter of 2013, TRECan will become the main buyer of the production of the Kipawa deposit. TRECan has made a commitment to fund the feasibility study, which already began last April (see July 12 and 23, 2012 press releases).

Following the positive conclusion of the PEA study filed on SEDAR in March 2012 and the hiring of a V-P Project development and Construction, Matamec and TRECan decided to move directly to the feasibility study. The March 2012 press release highlighted that the project has robust economics such as: $606 million before-tax value (NPV8%), a 36.9% before-tax IRR, a potential $2.8 billion revenue, $1.67 billion EBITDA, a before-tax payback period of 2.4 years, etc. (see press release dated January 30, 2012).

Promising Results from Many Rare Earth-Niobium-Tantalum Showings on Other Areas of the Zeus Property

720,000 options were granted to the Zeus property exploration team as a reward for the various discoveries made during the 2011 drilling campaign and to foster the same successes for 2012. The Zeus property team consists of 2 geologists and 6 technicians.

The exploration programs were aimed at expanding the Kipawa deposit (which remains open laterally and at depth), better define existing showings (Surprise, Falaises and PB/PS). For example, a new showing was discovered 1.5 kilometres to the west of Surprise and named the Certitude REE-Y-Nb-Ta showing. In samples with > 0.5% TREO, the new Certitude showing averages 13 samples of 5.1% TREO @ 36% HREO+Y2O3. Up to 3.6% Nb2O5 and 360 ppm Ta2O5 is found in some of the samples (see March 1 and 5, 2012 press releases).

Conditions of Exercise

All stock options, totalling 2,020,000, were granted at an exercise price of $0.20 per share, for a period of five years. These options, as well as the terms and conditions of their exercise, are governed by the Company's Stock Option Plan.

Andre Gauthier, President of Matamec, says, "that the Board wishes to stress the vital contribution of several people in the results obtained in 2011 and 2012. The discovery of several new mineral occurrences in the large Kipawa alkalic complex where the Zeus property is located, the positive conclusions of the PEA study, the startup of the feasibility study and the agreement between Matamec and TRECan positions the Company as the most probable contender to become the first producer of heavy rare earths outside of China."

About Matamec

Matamec Explorations Inc is a junior mining exploration company whose main focus is in developing the Kipawa deposit with TRECan and exploring more than 35km of strike length in the Kipawa Alkalic Complex for rare earths-yttrium-zirconium-niobium-tantalum mineralization on its Zeus property.

The company is also exploring for gold, base metals and platinum group metals. Its gold portfolio includes the Matheson JV property located along strike and in close proximity to the Hoyle Pond Mine in the prolific mining camp of Timmins, Ontario.

In Quebec, the Company is exploring for lithium and tantalum on its Tansim property and for precious and base metals on its Sakami, Valmont and Vulcain properties. As well, it is exploring for gold together with Northern Superior Resources Inc. on the Lesperance/Wachigabau property.

"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."

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