IODM LIMITED — Capital/Financing Update 2011

Jan 12, 2011

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Suite 202, 122 Walker St W www.paradigmmetals.com.au North Sydney 2060 E info@paradigmmetals.com.au New South Wales T +61 2 9955 7130 AUSTRALIA F +61 2 8920 3576

ABN 28 102 747 133

ASX / Media Announcement 13 January 2011

Extensive shallow gold mineralisation discovered at Yellow Mountain

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• Paradigm is pleased to report full results from its December 2010 air core drill program at the Quarry Hill prospect, Yellow Mountain project, Condobolin NSW.

• An extensive, near-surface, oxide gold horizon has been discovered at Quarry Hill covering 500m by 100m, open along strike and down-dip. Several other parallel gold horizons have also been identified.

• Higher grade drill intercepts include:

• 36.5m @ 0.50g/t from 0m, including 4m @ 2.4g/t from 20m in PQH029;

• 40m @ 0.50g/t from 0m, including 4m @ 2.0g/t from 4m in PQH044;

• 8m @ 1.0g/t from 10m in PQH028; and

• 10m @ 0.64g/t from 26m in PQH030.

• Many of the holes were stopped at shallow depths due to the limits of the air core technique, still within +0.1g/t gold mineralisation at base-of-hole.

• Gold mineralisation occurs within a heavily weathered metamorphosed siltstonesandstone sequence, interpreted to be located in the hinge of a geological fold structure (‘syncline’). The syncline is a priority gold target in particular down-dip of sub-outcropping mineralisation in the hinge of the fold.

• The Directors are very encouraged by the results of the recent program which, although low-grade, indicate a large and extensive shallow gold system that may contain one or more leachable oxide gold deposits with further exploration.

• A 2000-metre, 15 to 20-hole, RC percussion drill program will commence at Quarry Hill later this week targeting mineralisation down-dip of the tested sub-cropping zone to a vertical depth of up to 150m. Results are expected by mid-February.

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December 2010 drill program

Paradigm Metals Limited (Paradigm) is pleased to report the results of its second phase of shallow air core drilling at the Yellow Mountain gold project, 70km north of Condobolin, New South Wales. Paradigm has now exercised its option to earn up to a 51% joint venture interest in the Yellow Mountain tenement, EL 6325.

In total, 53 air core holes for 1,754m advance, and 1 RC percussion hole for 120m advance, were completed at the Quarry Hill prospect during December 2010.

The air core holes were drilled on northwest-southeast orientated drill lines along pre-existing trenches which had been sampled for gold by a past explorer.

Air core drill results

The full results of the recent drilling are appended in Table 1. Previously released drill results from earlier Paradigm and Triako drilling are appended in Table 2. The drill results are summarized in a drill map showing gold intensity in an interpretation of the geology at the Quarry Hill prospect in Figure 1.

An extensive, near-surface, oxide gold horizon covering an area of about 500m by 100m has been found. The main mineralised horizon, which could be up to 50m thick, strikes west-northwest and dips at a shallow angle to the north. Gold mineralisation remains open both along strike to the west and down-dip.

Highlights of the drill intercepts include:

• 36.5m @ 0.50g/t from 0m, including 4m @ 2.4g/t from 20m in PQH029;

• 40m @ 0.50g/t from 0m, including 4m @ 2.0g/t from 4m in PQH044;

• 8m @ 1.0g/t from 10m in PQH028; and

• 10m @ 0.64g/t from 26m in PQH030.

More than thirty of the recent holes (i.e. 60% of the total) intercepted +10m thick gold intercepts grading 0.1 to 0.5g/t from near surface. Many of the holes were stopped at shallow depths due to the limits of the air core drilling technique still within +0.1g/t gold mineralization at base of hole.

Gold mineralisation is hosted within a deeply weathered metasiltstone-sandstone sequence with accompanying iron oxides (after pyrite) and weak silicification. Quartz veinlets occur, but do not appear to be generally associated with gold mineralisation.

Interpretation of the gold potential

Gold mineralisation at the Quarry Hill prospect is located within the limbs of a geological fold structure, known as a ‘syncline’. The limbs of the syncline dip at a low angle (25 to 35 degrees) to the north and north-northwest. Mineralisation remains open down-dip in both directions, and down-plunge in the hinge of the fold, where it is possible that mineralisation may be concentrated. A cross-section through part of the syncline is shown in Figure 2.

The main zone of mineralisation intersected by the drilling is believed to be hosted by a favourable stratigraphic horizon. The reason for preferential gold enrichment within this horizon is unclear as yet, although it is likely the horizon was more reactive to gold-bearing solutions. Other parallel stratigraphic horizons intersected in the drilling and in trenches represent secondary targets.

The main target for further drilling at Quarry Hill is high-lighted in the cross section and longitudinal section - see Figures 2 and 3. There is good correlation between the mineralisation in drill holes and the past trench results, as shown in Figure 3.

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The potential region of mineralisation is therefore considerably greater than has been outlined by the current drilling. If mineralisation continues down-dip within the limbs and hinge of the gently plunging syncline, we believe that Quarry Hill will be a very attractive exploration target for bulk mineable gold. The gentle plunge to the mineralisation means that it could be additionally attractive as an open pit target.

The gold is likely to be easily leachable, especially if the zone of oxidation persists to depth. The Company will immediately commence a simple cyanide leach test to confirm this, using available drill cuttings.

Outside of the Quarry Hill prospect, there are a large number of other gold prospects within the package of tenements being explored by the Company around Yellow Mountain. These other prospective areas are high-lighted in Figure 4. Of particular interest is a large gold-in-soil anomaly to the northwest of Quarry Hill covering several square kilometres, which has received very limited past drilling.

Percussion drilling to commence immediately

The Managing Director, Dr Graham Carman, said “The air core drilling program at Quarry Hill was designed to enable more accurate targeting for the deeper holes to follow. This objective has been achieved, and we now understand the geological controls better. “

“It now remains to test this exciting gold opportunity with deeper percussion drilling, which will begin immediately. A 15 to 20-hole RC percussion drill program will commence later this week, targeting gold mineralisation down-dip of sub-outcropping mineralisation to a vertical depth of up to 150m.”

“The Directors are very encouraged by the results of the recent air core program at Quarry Hill which, although lowgrade indicate an extensive, shallow, gold system that may contain an economic oxide gold deposit with further successful exploration.”

“There is a number of gold targets being developed by the Company at Yellow Mountain (EL 6325) and the adjacent tenement application at Marranoonbah (ELA 4001). Apart from the Quarry Hill work we are also looking forward to exploring some of these other targets, particularly on ELA 4001, which should soon be granted.”

For further information contact Dr Graham Carman, Managing Director: Ph: 61-2-9955-7130

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Dr Graham Carman who is a Member of the Australasian Institute of Mining and Metallurgy. Dr Carman is a full-time employee of the Company, and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Dr Carman consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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Figure 1. (top) Interpretation of parallel sub-cropping mineralised horizons in the syncline at Quarry Hill. Gold intensity in drill holes (gram-metres) is plotted using a 0.1g/t Au cut-off. (bottom) Map of past trench results and planned RC holes at the same scale.

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Figure 2. Cross section through Quarry Hill gold prospect showing key drill results and interpretation of main exploration targets.

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Figure 3. Longitudinal section along the axis of the syncline at the Quarry Hill gold prospect showing multiple target zones.

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Figure 4. (top) Gold prospects at the Yellow Mountain project on magnetic image with interpretation of geology.

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(bottom) Tenement position of major mining companies in the region around Yellow Mountain.
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Table 1. Summary of gold results from the December air core drilling program (at 0.1g/t Au cut-off)

Hole No.	Int(m) Au (g/t) From (m) To (m) Stopped in lowgrade?	Hole No.	Int (m) Au (g/t) From (m) To (m) Stopped in lowgrade?
PQH020 PQH021 PQH022 PQH023 incl PQH024 PQH025 PQH026 PQH026 PQH027A PQH027B PQH028 incl PQH029 incl PQH030 PQH031 PQH032 PQH033A PQH033B PQH034 PQH035 PQH036 PQH037 PQH038 PQH039 PQH040 PQH041 PQH042 PQH042 PQH043 PQH044 incl	2 0.30 0 2 y 10 0.26 0 10 y 6.5 0.55 0 6.5 y 35 0.37 0 35 y 4 1.08 2 6 15 0.32 20 35 y 12 0.19 24 36 y 8 0.31 0 8 4 0.18 34 38 y 15.5 0.20 0 15.5 y 14 0.24 0 14 22 0.64 0 28 8 1.04 10 18 36.5 0.50 0 36.5 y 4 2.40 20 24 18.5 0.39 26 44.5 y 27.5 0.11 12 39.5 y 4 0.24 36 40 y 4 0.31 0 4 y 18.5 0.15 0 18.5 y 8 0.50 24 32 10 0.23 28 38 12 0.19 16 28 10 0.23 32 42 NSR 2 0.21 0 2 y 8 0.25 4 12 10.1 0.19 0 10.1 y 16 0.48 0 16 22 0.14 28 50 y 28 0.20 0 28 41 0.50 0 41 y 4 1.96 4 8	PQH045 PQH046 PQH047 PQH047 PQH048 PQH048 PQH049 PQH049 PQH050 PQH051 PQH051 PQH052 PQH053 PQH054 PQH055 PQH056 PQH057 PQH058 PQH059 PQH060 PQH061 PQH062 PQH063 PQH064 PQH065 PQH066 PQH067 PQH068 PQH069 PQH070 PQH071 PQH072 PRC001 PRC001	2 0.50 6 8 y 12 0.29 16 28 y 2 0.33 6 8 2 0.30 20 22 2 0.19 0 2 16.5 0.24 18 34.5 y 10 0.12 0 10 19 0.23 28 47 y 40 0.25 0 40 y 24 0.16 4 28 2 0.62 44 46 23 0.24 20 43 y 11 0.19 22 33 y 4 0.14 6 10 2 0.11 6 8 NSR 10 0.11 0 10 4 0.14 26 30 6 0.10 0 6 10 0.14 6 16 10 0.18 40 50 y 10 0.13 18 28 y 8 0.13 6 14 4 0.10 6 10 10 0.20 12 22 NSR 2 0.14 0 2 8 0.29 14 22 y NSR NSR NSR NSR 16 0.49 6 22 14 0.18 48 62 2 0.71 96 98
		PRC001

NSR = no significant result Y = yes Assays are based on 2m composite samples which were analysed at ALS-Chemex in Orange. All gold assays are based on the AuAA26 method which is a 50g fire assay with AAS finish.

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Table 2. Summary of previous drill hole results from the Quarry Hill prospect (at a 0.1g/t Au cut-off).

Hole No.	Int(m) Au (g/t) From (m) To (m) Drilled by	Hole No.	Int (m) Au (g/t) From (m) To (m) Drilled by
PQH001 PQH002 PQH003 PQH004 PQH005 PQH006 PQH007 PQH008 PQH009 PQH010 PQH011 PQH012 PQH013 PQH014 PQH015 PQH016 PQH017 PQH018 PQH019	12 0.69 10 22 Paradigm NSR Paradigm 8 0.30 4 12 Paradigm NSR Paradigm 4 0.10 32 36 Paradigm 12 0.18 31 43 Paradigm NSR Paradigm 8 0.19 46 54 Paradigm NSR Paradigm NSR Paradigm 8 0.13 36 44 Paradigm NSR Paradigm NSR Paradigm 4 0.29 4 8 Paradigm 20 0.26 8 28 Paradigm NSR Paradigm 12 0.19 32 44 Paradigm NSR Paradigm NSR Paradigm	TYM005 TYM006 TYM007 TYM008 TYM009 TYM010 TYM011 TYM012 TYM013 TYM014 TYM015 TYM016 incl TYM017 incl TYM018 TYM020 TYM021 TYM023 TYM024 TYM025 TYM026 TYM027 TYM028 TYM041 TYM042 TYM043 TYM044 TYM045 TYM053 TYM067	36 0.17 0 36 Triako 19 0.32 4 23 Triako 4 0.45 4 8 Triako 16 0.31 0 16 Triako 16 0.26 8 24 Triako 28 0.27 4 32 Triako 36 0.19 0 36 Triako 24 0.22 0 24 Triako 20 0.28 0 20 Triako 36 0.29 0 36 Triako 28 0.28 0 28 Triako 32 0.72 3 35 Triako 14 1.07 5 19 Triako 40 0.34 8 48 Triako 1 5.35 16 17 Triako 6 0.53 0 6 Triako 8 0.72 0 8 Triako 20 0.24 0 20 Triako 16 0.10 8 24 Triako 8 0.17 8 16 Triako 28 0.17 0 28 Triako 9 0.28 8 17 Triako 36 0.21 0 36 Triako 16 0.24 0 16 Triako 4 0.25 0 4 Triako 20 0.13 28 48 Triako 68 0.33 0 68 Triako 14 0.54 8 22 Triako 22 0.20 128 150 Triako 24 0.13 16 40 Triako 4 0.14 16 20 Triako 15 0.48 32 47 Triako
		TYM068

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Table 3. Detail of drill collars for all holes completed at the Quarry Hill prospect

Hole number E_GDA94 N_GDA94 Hole depth m Azi- muth degs Dip Company Drill type

Hole number E_GDA94 N_GDA94 Hole depth m Azi- muth degs Dip Company Drill type

QHRC001 481663 6399967 100 89 -60 GCR RC TYM005 481708 6400111 59.5 90.5 -60 Triako RC TYM006 481678 6400111 60 90.5 -60 Triako RC TYM007 481648 6400113 60 90.5 -60 Triako RC TYM008 481618 6400113 60 90.5 -60 Triako RC TYM009 481588 6400114 54 90.5 -60 Triako RC TYM010 481558 6400114 55 90.5 -60 Triako RC TYM011 481528 6400114 60 90.5 -60 Triako RC TYM012 481498 6400115 52 90.5 -60 Triako RC TYM013 481578 6400174 52 90.5 -60 Triako RC TYM014 481548 6400174 55 90.5 -60 Triako RC TYM015 481428 6400149 57 90.5 -60 Triako RC TYM016 481398 6400149 58 90.5 -60 Triako RC TYM017 481368 6400149 52 90.5 -60 Triako RC TYM018 481630 6399974 56 90.5 -60 Triako RC TYM019 481598 6399839 45 90.5 -60 Triako RC TYM020 481568 6399839 46 90.5 -60 Triako RC TYM021 479213 6401484 40 90.5 -60 Triako RC TYM022 479183 6401484 40 90.5 -60 Triako RC TYM023 479033 6401984 40 90.5 -60 Triako RC TYM024 479013 6401984 40 90.5 -60 Triako RC TYM025 478993 6401984 40 90.5 -60 Triako RC TYM026 478973 6401984 40 90.5 -60 Triako RC TYM027 478953 6401984 40 90.5 -60 Triako RC TYM028 478933 6401984 40 90.5 -60 Triako RC TYM041 476955 6402984 36 90.5 -60 Triako RC TYM042 477003 6403169 50 90.5 -60 Triako RC TYM043 481338 6400199 150 90.5 -60 Triako RC TYM044 481338 6400149 150 90.5 -60 Triako RC TYM045 481338 6400099 150 90.5 -60 Triako RC TYM046 480243 6399644 124 180.5 -60 Triako RC TYM047 480788 6398984 100 270.5 -60 Triako RC TYM048 481343 6399274 96 135.5 -60 Triako RC TYM049 481080 6399184 96 90.5 -60 Triako RC TYM050 481058 6399064 96 225.5 -60 Triako RC TYM051 481778 6398999 96 135.5 -60 Triako RC TYM052 481877 6399159 100 135.5 -60 Triako RC TYM053 482023 6399214 100 135.5 -60 Triako RC TYM054 481320 6398855 96 135.5 -60 Triako RC TYM055 481150 6398707 96 135.5 -60 Triako RC TYM056 481425 6399142 96 135.5 -60 Triako RC TYM060 480838 6398634 100 270.5 -60 Triako RC TYM061 481138 6397609 100 270.5 -60 Triako RC TYM067 481713 6400334 214 181 -60 Triako RC TYM068 481718 6400084 246 1 -60 Triako RC PQH001 481633 6400319 22 130 -60 Paradigm AC PQH002 481589 6400357 10.5 130 -60 Paradigm AC PQH003 481541 6400398 77 130 -60 Paradigm AC PQH004 481496 6400434 84 130 -60 Paradigm AC PQH005 481450 6400471 75 130 -60 Paradigm AC PQH006 481405 6400509 67 130 -60 Paradigm AC PQH007 481359 6400548 47.75 130 -60 Paradigm AC PQH008 481312 6400586 62 130 -60 Paradigm AC PQH009 481794 6400446 6.5 130 -60 Paradigm AC PQH010 481748 6400482 23.5 130 -60 Paradigm AC PQH011 481702 6400520 52.5 130 -60 Paradigm AC PQH012 481658 6400558 73.5 130 -60 Paradigm AC PQH013 481611 6400597 75 130 -60 Paradigm AC PQH014 481677 6400283 24 130 -60 Paradigm AC

PQH015 481655 6400302 28 130 -60 Paradigm AC PQH016 481611 6400341 13 130 -60 Paradigm AC PQH017 481563 6400379 60 130 -60 Paradigm AC PQH018 481816 6400427 1.1 130 -60 Paradigm AC PQH019 481772 6400465 10.5 130 -60 Paradigm AC PQH020 481687 6399962 2 145 -60 Paradigm AC PQH021 481674 6399986 10 145 -60 Paradigm AC PQH022 481662 6399999 6.5 140 -60 Paradigm AC PQH023 481651 6400013 35 144 -60 Paradigm AC PQH024 481633 6400043 35 144 -60 Paradigm AC PQH025 481616 6400069 36 144 -60 Paradigm AC PQH026 481599 6400090 38 145 -60 Paradigm AC PQH027A 481583 6400116 15.5 145 -60 Paradigm AC PQH027B 481583 6400113 16 145 -60 Paradigm AC PQH028 481572 6400128 25.1 145 -60 Paradigm AC PQH029 481565 6400144 36.5 146 -60 Paradigm AC PQH030 481556 6400155 44.5 145 -60 Paradigm AC PQH031 481540 6400183 39.5 145 -60 Paradigm AC PQH032 481521 6400206 40 146 -60 Paradigm AC PQH033A 481502 6400226 4 145 -60 Paradigm AC PQH033B 481499 6400230 18.5 145 -60 Paradigm AC PQH034 481484 6400255 45.2 145 -60 Paradigm AC PQH035 481472 6400275 41 145 -60 Paradigm AC PQH036 481453 6400300 53.2 145 -60 Paradigm AC PQH037 481435 6400324 61 145 -60 Paradigm AC PQH038 481575 6399964 23 135 -60 Paradigm AC PQH039 481542 6400026 2 143 -60 Paradigm AC PQH040 481514 6400064 44 145 -60 Paradigm AC PQH041 481494 6400116 10.1 150 -60 Paradigm AC PQH042 481443 6400159 53 145 -60 Paradigm AC PQH043 481422 6400181 37 145 -60 Paradigm AC PQH044 481408 6400205 41 146 -60 Paradigm AC PQH045 481391 6400231 11.5 145 -60 Paradigm AC PQH046 481358 6400278 30.1 140 -60 Paradigm AC PQH047 481323 6400323 47 143 -60 Paradigm AC PQH048 481634 6400224 34.5 145 -60 Paradigm AC PQH049 481617 6400243 47 144 -60 Paradigm AC PQH050 481600 6400268 40 145 -60 Paradigm AC PQH051 481582 6400291 53 145 -60 Paradigm AC PQH052 481564 6400316 43 145 -60 Paradigm AC PQH053 481550 6400341 33 144 -60 Paradigm AC PQH054 481450 6399964 35 145 -60 Paradigm AC PQH055 481416 6400016 40 146 -60 Paradigm AC PQH056 481385 6400074 35 150 -60 Paradigm AC PQH057 481347 6400116 35 146 -60 Paradigm AC PQH058 481313 6400164 59 146 -60 Paradigm AC PQH059 481280 6400215 9 145 -60 Paradigm AC PQH060 481262 6400237 53 145 -60 Paradigm AC PQH061 481246 6400261 50 146 -60 Paradigm AC PQH062 481210 6400309 31 145 -60 Paradigm AC PQH063 481331 6400139 47 144 -60 Paradigm AC PQH064 481299 6400186 52 144 -60 Paradigm AC PQH065 481269 6400055 29 145 -60 Paradigm AC PQH066 481235 6400105 37 147 -60 Paradigm AC PQH067 481199 6400152 44 147 -60 Paradigm AC PQH068 481159 6400208 33 145 -60 Paradigm AC PQH069 481693 6400356 6.5 145 -60 Paradigm AC PQH070 481700 6400347 3.5 145 -60 Paradigm AC PQH071 481686 6400370 1.4 145 -60 Paradigm AC PQH072 481677 6400381 2 145 -60 Paradigm AC PRC001 481625 6400329 120 145 -60 Paradigm AC

GCR = Golden Cross Resources Ltd AC = air core

RC = reverse circulation percussion drilling

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