Primary Metals Inc.

Primary Metals Inc.

February 27, 2007 20:17 ET

Primary Metals Reports Nine-Month Earnings

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 27, 2007) - Primary Metals Inc. ("Primary" or the "Company") (TSX VENTURE:PMI) has announced consolidated financial results, reported in Euros, for the nine months and third quarter ended December 31, 2006. For the nine-month period, the Company reported net earnings before non-cash income taxes of EUR 1,625,000 (CDN$2,333,000) or EUR 0.13 (CDN$0.19) per share. Nine-month earnings after non-cash income taxes were EUR 1,159,000 (CDN$1,664,000) or EUR 0.09 (CDN$0.14) per share. For the third quarter, the Company reported three-month net earnings before non-cash income taxes of EUR 174,000 (CDN$256,000) or EUR 0.01 (CDN$0.02) per share and earnings after non-cash income taxes of EUR 50,000 (CDN$74.000) or EUR 0.004 (CDN$0.01) per share.

Highlights for the period include:

- Tungsten sales of EUR 11,432,000 (CDN$16,420,000) for the nine-month period and EUR 4,148,000 (CDN$6,100,000) for the third quarter - an increase of EUR 1,626,000 (CDN$2,521,000) over the previous quarter

- Net earnings for the nine-month period, before non-cash income taxes, of EUR 1,625,000 (CDN$2,333,000) or EUR 0.13 (CDN$0.19) per share

- Net earnings for the nine-month period, after non-cash income taxes, of EUR 1,159,000 (CDN$1,664,000) or EUR 0.09 (CDN$0.14) per share

- Net earnings for the third quarter, before non-cash income taxes, of EUR 174,000 (CDN$256,000) or EUR 0.01 (CDN$0.02) per share and EUR 50,000 (CDN$74,000) or EUR 0.004 (CDN$0.01) per share after non-cash taxes

- Delivery of two new low profile LHD mining vehicles and two jumbo drill rigs, all of which were in mine operation immediately subsequent to the third quarter

- Improved mine output with record daily production of 3,523 tonnes on November 7

- Completion of D9 underground mine ramp to access new zones of tungsten resources

- Initiation of a new NI 43-101 tungsten resource estimate subsequent to the period

- Continuing strength in tungsten prices, currently around US$260 per MTU (MTU - metric tonne unit or 10 kilograms of contained WO3 - tungsten trioxide)

"Earnings during the quarter continued to be affected by mined ore grade, but mine plans are underway that are expected to improve the grade over the next few months," said Lewis Black, Chairman of the Board. "Mined ore grade remained at 0.17% WO3, which was consistent with the previous quarter. With the completion of our new D9 mine ramp, access to new tungsten resources is now available and mining of these new areas should be underway this summer. We are also preparing a new independent tungsten resource estimate, which will be completed and announced in March. Tungsten prices continue to show strength and we expect our investment in the mine to pay off as we move forward."

Primary Metals Inc. owns a 100 percent interest in the Panasqueira tungsten mine in Portugal and is currently producing wolframite concentrates containing some 100,000 MTU's of tungsten trioxide per annum with further improvements underway. The Panasqueira mine has a long history of production of high-quality wolframite concentrates and is the dominant producer of high-grade tungsten concentrates outside China. Results from the third quarter together with the Management Discussion and Analysis of Results and other information are available at and on the company's website at

On Behalf of the Board of Directors,

James Robertson, P. Eng., Director

James Robertson, P. Eng., is a Qualified Person for Primary and has reviewed and approved the information contained in this News Release.

Certain of the statements made and information contained herein is "forward-looking information" within the meaning of the Ontario Securities Act or "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 of the United States. Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation the company's expectations as to the results of planned work programs, potential mineralization, resources, reserves, mine production levels and future tungsten prices. Such statements are based on certain assumptions, including continued demand for tungsten, availability of capital, equipment and personnel to carry out and complete the planned work programs and accuracy within a reasonable range of reported exploration and development results, and involve various risks and uncertainties, including global economic factors, future commodity prices, lack of availability of equipment or personnel, and results of exploration and development. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Other important factors that could cause actual results to differ materially from the Company's expectations are disclosed under the heading "Risk Factors" and elsewhere in the Company's documents filed from time-to-time with regulatory authorities and on

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.

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