Primary Metals Inc.
TSX VENTURE : PMI

Primary Metals Inc.

November 27, 2006 19:00 ET

Primary Metals Reports Six-Month Earnings

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 27, 2006) - Primary Metals Inc. ("Primary" or the "Company") (TSX VENTURE:PMI) has announced consolidated financial results, reported in Euros, for the six months and second quarter ended September 30, 2006. For the six-month period, the Company reported net earnings before non-cash income taxes of EUR 1,451,000 (CDN$2,059,000) or EUR 0.12 (CDN$0.17) per share. Six-month earnings after non-cash income taxes were EUR 1,108,000 (CDN$1,573,000) or EUR 0.09 (CDN$0.13) per share. Results for the second quarter were affected by an extended scheduled renovation programme. For the second quarter, the Company reported three-month net earnings before non-cash income taxes of EUR 264,000 (CDN$377,000) or EUR 0.02 (CDN$0.03) per share and earnings after non-cash income taxes of EUR 211,000 (CDN$301,000) or EUR 0.02 (CDN$0.02) per share.

Highlights for the period include:

- Tungsten sales of EUR 7,284,000 (CDN$10,336,000) for the six-month period and EUR 2,522,000 (CDN$3,579,000) for the second quarter

- Net earnings for the six-month period, before non-cash income taxes, of EUR 1,451,000 (CDN$2,059,000) or EUR 0.12 (CDN$0.17) per share

- Net earnings for the six-month period, after non-cash income taxes, of EUR 1,108,000 (CDN$1,573,000) or EUR 0.09 (CDN$0.13) per share

- Net earnings for the second quarter, before non-cash income taxes, of EUR 264,000 (CDN$377,000) or EUR 0.02 (CDN$0.03) per share and EUR 211,000 (CDN$301,000) or EUR 0.02 (CDN$0.02) per share after non-cash taxes

- Completion of a major renovation programme in the processing plant

- Receipt of an independent Technical Report presenting new independent reserve estimates totalling 4,649,000 tonnes at an average grade of 0.25% WO3 and containing 1,180,408 MTU's of tungsten trioxide (sufficient for eight years operation when developed and assuming current operating rates) as well as identifying significant additional exploration potential (see news release dated June 23, 2006, and the 43-101 Technical Report filed in August 2006 and available for viewing on the company's website and at www.sedar.com)

- Continuing strength in tungsten prices, currently around US$250 per MTU (MTU - metric tonne unit or 10 kilograms of contained WO3 - tungsten trioxide)

- Graduation of the Company's listing to Tier 1 on the TSX Venture Exchange

"While the tungsten market and the Company's gross revenues remained strong over this period, Primary's net earnings were affected by a number of factors," said Lewis Black, Chairman of the Board. "The annual summer vacation shutdown and a major scheduled renovation programme resulted in the mine being inactive for almost five weeks during the second quarter. The grade of mined ore was also lower than anticipated during the second quarter - a situation that is expected to show improvement during the third quarter," he said.

"The renovation and refurbishment programmes contributed to low net earnings in the second quarter; however, the long-term effects of this work will be very positive," said Mr. Black. "A return to normal operations is expected and we will continue introducing new low-profile mining equipment in the coming months to improve efficiency. Primary remains committed to the long-term operation of the Panasqueira mine. Tungsten prices remain firm and we expect to see continuing strength in the tungsten market through 2007."

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 second quarter together with the Management Discussion and Analysis of Results and other information are available at www.sedar.com and on the company's website at www.primarymetals.ca.

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 www.sedar.com.


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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