IODM LIMITED — Capital/Financing Update 2008

May 5, 2008

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Suite 202, 122 Walker St, North Sydney NSW 2060 Australia

Ph: 02 9955-7130 Fax: 02 8920-3576

Email: info@paradigmmetals.com.au www.paradigmmetals.com.au

6 May 2008

ASX Announcement: Code PDM

SEMPRA METALS TAKES A$800,000 PLACEMENT FOR 11% STAKE IN ASX-LISTED PARADIGM METALS LTD

• US-based global commodities group Sempra Metals & Concentrates LLC is taking an A$800,000 placement at a premium in Paradigm Metals Ltd at 10c per share

• Sempra Metals and Paradigm are negotiating an off-take agreement for Sempra Metals to purchase the full base metal production from Paradigm’s 100%-owned Frogmore Copper Project, New South Wales

• Funds to be used for an aggressive drill program at Frogmore

Paradigm Metals Ltd (PDM) is pleased to announce that leading US-based global metal commodities trading company, Sempra Metals & Concentrates LLC (“Sempra Metals”), is taking an 11% stake in the Company via a placement.

Paradigm will issue 8,000,000 PDM shares priced at 10c to Sempra Metals, together with options to purchase 2,000,000 PDM shares with a strike price of 20c per share (Options) for an aggregate subscription price of $800,000. The Options will expire 5 years from the date of issue and will be unlisted. Placement of the shares and 800,000 Options will be made under Paradigm’s 15% placement capacity pursuant to the ASX Listing Rules. Shareholder approval for allotment of the balance of 1,200,000 Options will be sought at a meeting of PDM shareholders within 4 months.

The funds will be used to advance the Frogmore Copper Project in New South Wales through an aggressive drill program during 2008.

PDM and Sempra Metals are negotiating a life of mine offtake agreement for Sempra Metals to purchase all base metal production from Frogmore on prevailing international benchmark terms.

Sempra Metals is a pre-eminent metals trading group based in the US. The Royal Bank of Scotland plc (“RBS”) has recently acquired a controlling interest in Sempra Metals. RBS is active in project development from preliminary feasibility through the development of the most appropriate financial structures to the arranging, underwriting and syndication of transactions within the international banking market.

The Managing Director of Paradigm, Dr Graham Carman, said: “The Board of Paradigm is very pleased that a company of the stature of Sempra Metals has agreed to join our share register having recognised the copper potential of the Frogmore project at this early stage. Sempra Metals’ and RBS’ involvement is a strong endorsement of the Frogmore project and of the team at Paradigm. If the drilling campaign delivers positive results, financing opportunities may also become available in the development stage of the project through Sempra’s ties with RBS. We look forward to reporting our drilling results over coming weeks.”

For further information please contact: Graham Carman, Managing Director: Ph: 61-2-9955-7130 About Paradigm: Paradigm Metals Ltd (PDM) is a copper, uranium and tungsten explorer with projects in the Lachlan Fold Belt of NSW and the Mt Isa region of Queensland.

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