Strategic Metals Ltd.

Strategic Metals Ltd.

February 27, 2007 11:33 ET

Strategic Metals Ltd. Options NiMo Project to Southampton

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 27, 2007) - Strategic Metals Ltd. (TSX VENTURE:SMD) ("Strategic") and Southampton Ventures Inc. (TSX VENTURE:SV) ("Southampton") are pleased to announce that they have entered into an agreement in principle whereby Southampton will have the option to earn up to a 100% interest in Strategic's Devonian shale hosted nickel-molybdenum-zinc-platinum group elements project (the "NiMo Project").

The key terms of the agreement are as follows:

- Southampton has an option to earn 75% of Strategic's 100% interest in the NiMo Project by spending $6 million in exploration by December 31, 2007 and by reimbursing Strategic's costs to date to a maximum of $400,000 in cash and by issuing to Strategic 2,000,000 common shares of Southampton and 1,000,000 common share purchase warrants (the "Purchase Warrants"). The Purchase Warrants entitle Strategic to acquire one common share of Southampton at an exercise price of $1.25 for a period of 24 months from the date of issuance;

- Southampton can earn the additional 25%, for an aggregate 100% ownership of the NiMo Project subject to a 1% net smelter royalty (NSR) in favour of Strategic, by issuing to Strategic an additional 2,000,000 common shares and 1,000,000 common share purchase warrants, at any time before December 31, 2008.

The option agreement and related transactions remain subject to the execution of a definitive agreement and the approval of the TSX Venture Exchange.

The NiMo Project consists of seven claim blocks totaling 28,905 hectares in north-central Yukon Territory. The properties were recently staked to cover occurrences of Middle Devonian-aged stratiform sedimentary exhalative (sedex) massive sulphide deposits that are enriched in an unusual suite of elements that can include nickel, molybdenum, vanadium, zinc, platinum and palladium.

- The Nick property hosts the original North American discovery of this type of mineralization. Exploration from 1988 to 1992 outlined a bedded deposit around the entire extent of an 80 square kilometre sedimentary basin. Results of 13 diamond drill holes that intersected the sulphide horizon at one end of the basin returned average assays of 3.01% nickel (Ni), 0.20% molybdenum (Mo), 0.82% vanadium (V), 0.82% zinc (Zn), 310 parts per billion (ppb) platinum (Pt) and 150 ppb palladium (Pd) over widths ranging from 2 cm to 10 cm. Exploration by a major mining company identified other areas on the property where significantly thicker accumulations of mineralization were indicated but no follow-up work was ever carried out.

- A 1997 drill hole on the Deer property intersected 25.5 metres of 0.51% Ni and 0.39% Zn, including a 5.3 metre intersection grading 1.37% Ni and 0.70% Zn.

- The Pe and El claims cover two nearby occurrences sampled in 1994 by the Geological Survey of Canada (GSC) but never explored. A 25 cm chip sample across the Pe occurrence assayed 3.96% Ni, 0.27% Mo and 0.81% Zn. A grab sample of a 4 cm massive sulphide horizon on the El claims assayed 3.70% Ni, 0.20% Mo, 210 ppb Pt and 184 ppb Pd.

- The Rich property covers scattered NiMo occurrences reported by the GSC and the Yukon Geological Survey about 80 km along strike of the Pe and El showings. A grab sample of one of these occurrences assayed 4.68% Ni, 0.20% Mo, 290 ppb Pt and 192 ppb Pd.

- The Fox claims were staked to cover strong multi-element stream sediment anomalies from drainages underlain by the host Devonian shales a further 60 km north of the Fox property.

- A sample of NiMo mineralization taken by the GSC in 1994 from the Mon showing assayed 3.30% Ni.

Research by the GSC indicates that the Yukon NiMo mineralization was deposited from warm saline fluids that vented along fault zones on the Devonian seafloor. Modern analogies occur in the Red Sea where thickest accumulations of metaliferous sediment are confined to depressions on the seafloor. Using this model, an aggressive 2007 exploration program of prospecting and geological mapping will accompany stratigraphic diamond drilling to establish the presence of sub-basins where thickest NiMo mineralization may be present on the project properties.

Strategic Metals Ltd. is a junior mining company with an attractive exploration portfolio comprising more than 50 properties. It currently has 17 properties optioned out and holds royalty interest in five other projects. The Company has a strong balance sheet with approximately $3 million in working capital plus approximately $18 million worth of marketable securities in other companies at current prices.


Robert C. Carne, President

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

Contact Information