NEOMETALS LTD — Investor Presentation 2010

Oct 26, 2010

Mining 2010 Presentation

October 2010

Company Snapshot

Overview Reed Resources (ASX: RDR) is a diversified mining and exploration company with 5 primary projects currently all based in WA.

Current project portfolio includes:

• 1.Mount Marion – Lithium
• 2.Barrambie – Vanadium
• 3.Comet Vale – Gold
• 4.Mt Finnerty – Iron Ore and Nickel
• 5.Bell Rock Range – Nickel and Copper

Company Strategy

Lithium Market Overview

• • Lithium prices have tripled over past 10 years and demand is forecast to triple in the next ten years driven by the size and number of Lithium-Ion batteries – the move from portable devices to transport
• • Lithium is sourced primarily from salt brines ("brines") or hard rock deposits ("spodumene") and are sourced in the following forms from the following countries:

Brines

• Argentina
• USA

Spodumenes

• Chile Western Australia
• Petalite
• China Zimbabwe

• 1.Flythrough
• 2.Project Overview
• 3.Mt Marion JV Partners
• 4.Resource Estimates & Potential
• 5.Geology Characteristics & Comparisons
• 6.Project Layout &Infrastructure
• 7.Development Timetable and Future Plans
• 8.Marketing Concepts

Flythrough

Mt Marion Lithium Project Overview

• •100% Reed Resources Ltd (ASX:RDR)
• • Production JV with Mineral Resources Ltd (ASX:MIN)(ASX Top 200)
• • Initial Output - 200,000 tpa of +6.5% Li 2O. World's 2nd largest Spodumene producer
• • JV Terms - Mineral Resources will :
• Operate project
• Fund Evaluation and Development Costs
• Build-Own-Operate Processing Plant
• Decision to Mine 16 July 2010
• Commercial Production by 31 Mar 2011
• Earn 40% of EBIT.
• RDR retain 60% EBIT and right to offtake

Mineral Resources – Company Snapshot

Crushing Services Australia's largest specialist crushing, screening and materials movement contractor

Process MineralsMinerals and base metals processing, logistics, ship loading & marketing

PIHAPipeline, services, site infrastructure, contractor and polyethylene fittings manufacturer

S h I a r e s o n s s u e	1 6 7 M i l l i o n ~
C M k t a r e a p	\$ A 1. 6 B i l l i + o n
F Y 1 0 N P A T	\$ A 9 7 M i l l i o n

Resource Estimates

Re so ur ce f C la i ica io t ss n	To nn es ( ) M t	h L i iu t m de G ra % i2 L O	Iro n de G ra % Fe O 2 3
d M e a s u r e	2. 1	1. 5	1. 1
d i d I t n c a e	3. 9	1. 4	1. 2
f d I n e r r e	4. 5	3 1.	9 1.
T O T A L	1 0. 5	1. 4	1. 4

Exploration Potential

Potential for significant addition to the current resource base.

Currently all 5 Deposits are open along strike and at depth

Explored 1 of 3 Pegmatite Groups.

Additional Exploration Target 10-15 MT of 1.1 – 1.4% Li 2O

Orebody Characteristics

• •Thick
• •Shallow
• •Gently dipping
• •Ore virtually fresh from surface
• • Ore visually distinguished (white)
• = Simple Open Pit Mining

Site Layout

Crushing Circuit Layout

Nominal Capacity

400 tph – 3.2 Mtpa

•

Beneficiation Plant

Nominal Capacity

• •150 tph – 1.2 Mtpa
• •Dense Media/Floatation

Fines Floatation Circuit Plant Control Room

Sister DMS Plant

Infrastructure and Logistics

• •Local skilled workforce, mining services
• • Secured 4MW Allocation on Open Access HV Powerline to site
• •Abundant process water within 10km
• •Adjacent to National Highway 1 (8km)
• •Open Access Rail to Fremantle (670km)
• •Sealed Highway/Road to Port (360km)

Bonnie Vale Siding

Logistics – Container - Fremantle

Logistics – Bulk – Esperance Berth 2

Stage 1 - Development Timetable

Lithium Strategy – Integrated Producer

Lithium Carbonate Pre-Feasibility Study 2010

Robust Economics and highly leveraged to the growth in electric vehicles

I t n p u :	f 5 L i2 O 1 2 0, 0 0 0 6. % t o
O t t p u u :	1 7, 0 0 0 f 9 9. 5 % t o p r e u L i h i C b t t u m a r o n a e
C t o s :	\$ S C U 6 3 i P R h i m n n a \$ U S i M l i 7 0 m n a a y s a
N P V : I R R :	\$ U S 4 0 4 i 1 2 % m u s n g 6 8 %
P b k a y a c :	~2 y e a r s

Implies additional value in conversion = US\$270/t of spodumene concentrate

Comparison – Australian Lithium Mineral Producers

	ha S re ice Pr \$ A	ke M t ar Ca p \$ A m	ise En te rp r lu Va e \$ A m	du io Pr t o c n K L C E tp a	/ du io E V Pr t o c n \$ / A L C E t
l Ta iso n i L Co tr te nc en a du Pr o ce r	5. 1 8	4 8 5	( 1) 4 8 5	( 2) 4 1. 8	1 1, 6 0 0
io M M t ar n ha 6 0 % R D R s re	5 0. 6	5 1 0	9 0	1 9. 3	?
la Ga xy d i C In L te te g ra lo De ve p er	6 1. 5	3 0 0	( 3) 3 8 0	( 4) 2 0. 3	8, 0 0 1 7

A\$220m A\$360m

Using Hatch Study + A\$400m

Assumptions

(1) Talison : Converted using 1 A\$ = 1 C\$ (2) Production 2010: 260,000t @ 6.5% Li2O

(3) Galaxy : Enterprise Value = Mkt Cap – Cash at Commencement of Production + Project Loan Facility + New Conv Note

(4) Production CY 2011 : 137,000t @ 6.5% Li2O Source ASX Announcement 2 June 2010.

LITHIUM PRODUCTION CAPACITY

Ca 2 0 1 0 i ty p ac
K L C E * t
Ta l iso n	4 2
M t M ion ar	3 2 *
Ga lax y	2 0
C h ina	8
Z im ba bw e	8

S Q M	6 0
C he l l ta m e	4 1
F M C	1 8
C h ina	2 1

(*) Planned Production Rate, LCE : Lithium Carbonate Equivalent

Brine Producers

Mineral Producers - New World Order

Marketing Concepts

China now largest producer of Li batteries China sources < 25% from BrineChina committed to Mineral ConversionNo Mt Marion lithium, tanatalum or mica production forward sold

Downstream

• •Strong Balance Sheets
• •Diversity of Supply
• • In discussions with 5 Domestic and International Companies.
• • Proposals for toll-conversions and/or Lithium Carbonate JV due 30 September

Source: TRU Group –Demand, Industrial minerals - Price

Barrambie Vanadium Project Overview

• •100% Reed
• • Highest grade vanadium reserves in Australia.
• • Attractive project economics from DFS and highly leveraged to a recovering vanadium price.
• • Barrambie project is located 125 km north-east of the Windimurra project in Murchison region of Western Australia
• • Barrambie is serviced by major regional roads.
• • Safe water supply from Barrambie borefield
• • Barrambie Native Title Agreement in place

	M t	( ) V O % 2 5
R E S O U R C E
I d i d t n c a e	4 9. 2	0. 8 2
I f d n e r r e	1 6. 0	0. 8 1
T l t o a	6 5. 2	0. 8 2
R E S E R V E
P b b l r o a e	3 9. 7	0. 8 2

27

Flythrough

Barrambie Project Economics & Strategy

	1 0 Y e a r A v e r a g e \$ U S / k 3 0 g	5 Y e a r A v e r a g e \$ U S 5 / k 0 g	/ F Y 0 0 8 7 \$ S / U 7 7 k g
\$ \$ U S A E h t : x c a n g e r a e	0 6 0	0 9 7	0 8 9
C i l C ( A U D M ) t t a p a o s s	\$ 6 3 0	\$ 6 3 0	\$ 6 3 0
( ) E B I T D A A U D M	\$ 1 0 5	\$ 1 8 6	\$ 3 2 7

Attractive economics and highly leveraged to the recovering world economy

• 12yr mine life; Operating cost of < US\$20/kg
• A\$456m direct construction costs, A\$172m EPCM, owners costs and contingencies;
• A\$186m EBITDA at 5 year average vanadium price

China Nonferrous Metal Industry's Foreign Engineering and Construction Co., Ltd

•EPC and Financing proposal

PER Lodged - Environmental Approval expected Q4 2010

Vanadium Market Overview

Vanadium Price Outlook

Steel Industry Restructuring and Revitalising Plan Existing 335 series rebar (~100Mt) must be replaced by 400 and 500 series

Total World Capacity ~ 85,000 t of V Current Chinese Consumption ~ 23,000 t of V, ROW ~ 40,000 t

Additional SIRRP Rebar Consumption ~ 34,000 to 56,000 t of V

NB: All Quantities RDR Internal Estimates

Electric Vehicle and Energy Storage Batteries

Cathode	Voltage $(V)$	Capacity (mAh/g)	Energy (kWh/kg)
LiCoO 2	3.7	140	0.518
LiMn, O 4	4.0	100	0.400
LiFePO 4	3.3	150	0.495
Li 2 FePO 4 F	3.6	115	0.414
$Li3V2(PO4)3$	4.8	130	0.624
LiVPO a F	4.1	120	0.492

Lithium Vanadium EV Batteries

• Highest Voltage →POWER
• Highest Energy Density →RANGE
• Contains 4kg Li, 20kg of V

Vanadium Redox (Liquid) Batteries

• • Renewable Energy Storage, Peak Shaving, Load Levelling, Backup
• •High Efficiency, Long Life >20yrs
• •Deep discharge, low self discharge
• •Variable Input/Fixed Output
• • Power (cell) and Capacity (concentration and volume) varied to suit application.

Flythrough

Comet Vale - Gold Business Overview

• • High grade underground mine
• High grade resource 186,000oz @ 10.8g/t
• FY09 production of ~3,800 oz (RDR share), FY09 cash costs ~A\$588/oz
• FY10 production of ~ 4,300 oz (RDR share) Estimated FY10 cash costs ~ A\$750/oz
• •Placed on care and maintenance 1 June 2010 – unable to secure milling agreement for FY11
• • Strategy - Establish Nimbus as a standalone toll-milling facility and resume gold production
• 250,000 tpa, A\$15M replacement cost, acquisition cost A\$2.4m
• MIN funding connection to grid power

Comet Vale

• •Resource Extension Drilling -
• • New Resource/Reserve to justify Decline due Christmas 2010
• High grade resource 186,000oz @ 10.8g/t
• Proposed open pit/boxcut for decline access – probable reserve 9,200oz @ 2.6g/t
• 10,000m RC/Diamond drilling underway
• Detailed Design for refurbishment to 300ktpa underway

•

Mt Finnerty - Iron Ore

• 20:80 JV with Cleveland Cliffs (Australia's fourth largest iron ore exporter)

• •Strategy : Satellite for Koolyanobbing
• •Target 5-10Mt of DSO.
• •Maiden Resource Estimate 4.6Mt @ 54% Fe
• •> 50 New Targets identified in Dec Q 09
• •Ground Geophysics March Q 10.
• • Priority DSO Targets FIN9, Mt Watt and Maitland drilling to commence Nov 10.

Board of Directors and Senior Management

David Reed OAM FCPAExecutive Chairman

Chris ReedManaging Director/ Chief Executive Officer

Jason Carone CACompany Secretary/ Financial Controller

Dr Peter CollinsNon-executive DirectorGeologist

Ian JunkNon-executive DirectorMining Engineer

Bill Crossley Project Manager/ Mining Engineer

Craig Fawcett Chief Geologist

Disclaimer

This document has been prepared by Reed Resources Ltd ("Reed" or "the Company") to provide an update of the Company to investors and potential new shareholders.

Any statements, opinions, projections, forecasts or other material contained in this document do not constitute any commitments, representations or warranties by Reed and associated entities or its directors, agents and employees. Except as required by law, and only to the extent so required, directors, agents and employees of Reed shall in no way be liable to any person or body for any loss, claim, demand, damages, costs or expenses of whatsoever nature arising in any way out of, or in connection with, the information contained in the document.

This document includes certain statements, opinions, projections, forecasts and other material, which reflect various assumptions. The assumptions may or may not prove to be correct. Recipients of the document must make their own independent investigations, consideration and evaluation of the opportunity to invest in the Company. By accepting this document the recipient agrees that if it proceeds further with its investigations, consideration or evaluation of the opportunity to invest in the Company it shall make and rely solely upon its own investigations and inquiries and will not in any way rely upon the document.

Artists Acknowledgement

Some elements of this presentation were used under the Creative Commons Attribution-Share Alike 2.0 Generic Licence and we would like to acknowledge the creators of some of the photos that were used and which were sourced from Flikr: gregory, mrhayata, decafinata, openDemocracy, mahalie, Andrew Turner, Thomas Roche, EverySpoon, apdk, Internet Dairy

JORC Statement

Competent Persons/ Exploration Results in General

The information in this report that relates to exploration results is based on information compiled by Craig Fawcett (MAUSIMM), an employee of Reed Resources Ltd. Craig Fawcett has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which is being reported on to qualify as a Competent Person as defined in the Code for Reporting of Mineral Resources and Ore Reserves. Craig Fawcett consents to the inclusion in the report of the matters in the form and context in which it appears.

References to Exploration/Production targets and Potential

While the company remains optimistic it will report increases in resources and reserves in the future, any discussion in relation to exploration targets, resource potential, reserves or 'ore' is only conceptual in nature, there has been insufficient exploration to define a Mineral Reserves and resources and it is uncertain if further exploration will result in the determination of a Mineral reserves and resources.

Mt Marion Lithium Project – Mineral Resource Estimate

Reed reported on the 12 August 2010 a resource of 10.5Mt @ 1.4% Li2O for the Mt Marion Deposits. While the Company intends to do further exploration on the Mt Marion Project tenements and remains optimistic it will report additional resources in the future, any discussion in relation to targets, resources, reserves or 'ore' over and above the resource of 10.5Mt @ 1.4% Li2O is only conceptual in nature. There has been insufficient explorations to define a Mineral Resources over and above the resource of 10.5Mt @ 1.4% Li2O, and it is uncertain if further exploration will result in the determination of a Mineral Resource over and above the resource of 10.5Mt @ 1.4% Li2O.

The information in this report that relates to Mineral Resources (at Mt Marion) is based on information compiled by Mr. Robert Spiers who is a full time employee of Hellman & Schofield Pty Ltd and who is a Member of the Australian Institute of Geoscientists. Mr. Spiers has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity 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'. Mr. Spiers consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

JORC Statement

Barrambie Vanadium Project – Mineral Resource Estimate

Reed reported on the 13 February 2009 a resource of 65.2 million tonnes at 0.82% V2O5. While the Company intends to do further exploration on the Barrambie Project tenements and remains optimistic it will report additional resources in the future, any discussion in relation to targets, resources, reserves or 'ore' over and above the resource of 65.2 million tonnes at 0.82% V2O5 is only conceptual in nature. There has been insufficient explorations to define a Mineral Resources over and above the resource of 65.2 million tonnes at 0.82% V2O5, and it is uncertain if further exploration will result in the determination of a Mineral Resource over and above the resource of 65.2 million tonnes at 0.82% V2O5.Information in the report (released 13/02/2009) that relates to Mineral Resources is based on information compiled by Ms Stephanie Gotley and Mr Michael Andrew both Members of the Australasian Institute of Mining and Metallurgy (AusIMM), and Dr Bryan Smith a Member of the Australian Institute of Geoscientists (AIG). Ms Stephanie Gotley, Consultant Resource Geologist, and Mr Michael Andrew, Divisional Manager Resource Evaluation, are employed as consultants at Snowden and produced the resource estimate based on assay data and geological interpretations provided by Reed Resources Ltd. Ms Gotley and Mr Andrew have sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results Mineral Resources and Ore Reserves". Ms Gotley and Mr Andrew consent to the inclusion in this report of the matters based on their information in the form and context in which it appears.

Barrambie Vanadium Project – Reserve Estimate

Reed reported on the 5 May 2009 a probable reserve of 39.7 million tonnes at 0.82% V2O5. While the Company intends to do further exploration on the Barrambie Project tenements and remains optimistic it will report additional reserves in the future, any discussion in relation to targets, resources, reserves or 'ore' over and above the probable reserve of 39.7 million tonnes a 0.82% V2O5 is only conceptual in nature. There has been insufficient explorations to define a Mineral Resources over and above the resource of 65.2 million tonnes at 0.82% V2O5, and it is uncertain if further exploration will result in the determination of a Mineral Resource over and above the resource of 65.2 million tonnes at 0.82% V2O5 nor the development of a reserve over and above the probable reserve of 39.7 million at 0.82% V2O5.

Information in this report that relates to the Ore Reserve is based on information compiled by Mr Frank Blanchfield who is a member of the Australasian Institute of Mining and Metallurgy (AusIMM), and Dr Bryan Smith who is a member of The AusIMM and a member of the Australian Institute of Geoscientists (AIG). Mr Frank Blanchfield is Principal Consultant at Snowden and produced the Ore Reserve estimate based on data and geological interpretations provided by Reed Resources Ltd. and developed by Snowden. Mr Blanchfield has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Person for the Ore Reserve sign-off as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results Mineral Resources and Ore Reserves". All modifying Factors have been considered in the preparation of the Probable Mineral Reserve. Mr Blanchfield consents to the inclusion in this report of the matters based on their information in the form and context in which it appears.

JORC Statement

Comet Vale Gold Project – Mineral Resource Estimate

Reed reported on the 8 April 2010 a resource of 534,000t @ 10.8 g/t Au for the Sand Queen Gold Mine. While the Company intends to do further exploration on the Comet Vale Project tenements and remains optimistic it will report additional resources in the future, any discussion in relation to targets, resources, reserves or 'ore' over and above the resource of 534,000t at 10.8 g/t Au is only conceptual in nature. There has been insufficient explorations to define a Mineral Resources over and above the resource of 534,000t @ 10.8 g/t Au, and it is uncertain if further exploration will result in the determination of a Mineral Resource over and above the resource of 534,000t @ 10.8 g/t Au.

The information in this report that relates to that relates to geological interpretations and Mineral Resources (at Comet Vale)is based on information compiled by Mark Zammit of Cube Consulting Pty Ltd, who is a Member of The Australian Institute of Geoscientists (AIG) and Australasian Institute of Mining and Metallurgy (AusIMM). Mark Zammit 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 Mineral Resources and Ore Reserves". Mark Zammit consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Mt Finnerty Iron Ore Project – Mineral Resource Estimate

Reed reported on the 14 April 2010 a resource of 4.66Mt @ 53.5% Fe for the Mt Finnerty Iron Ore Project, currently in Joint Venture with Cliffs Asia Pacific Iron Ore Pty Ltd. While the Company intends to do further exploration on the Mt Finnerty Project tenements and remains optimistic it will report additional resources in the future, any discussion in relation to targets, resources, reserves or 'ore' over and above the resource of 4.66Mt @ 53.5% Fe is only conceptual in nature. There has been insufficient explorations to define a Mineral Resources over and above the resource of 4.66Mt @ 53.5% Fe, and it is uncertain if further exploration will result in the determination of a Mineral Resource over and above the resource of 84.66Mt @ 53.5% Fe.

Mineral Resource estimation has been compiled in accordance with the guidelines outlined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2004) by Leonora Hackman and Duncan Hackman of Hackman and Associates Pty Ltd. Leonora Hackman is a member of the Australasian Institute of Mining and Metallurgy and Duncan Hackman is a member of the Australian Institute of Geoscientists. Both have sufficient experience relevant to the style of mineralization and type of deposit under consideration and to the activity undertaken to qualify as Competent Persons as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Leonora Hackman and Duncan Hackman consent to the inclusion of the Mineral Resource estimations in the form and context in which it appears.