NEOMETALS LTD — M&A Activity 2011

May 19, 2011

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ASX Code: MRP

ASX ANNOUNCEMENT

20 May 2011

Contact Details

PO Box 778 119 Maritana Street Kalgoorlie WA 6430

T +61 (0) 8 9021 5866 F +61 (0) 8 9021 5348 E info@macphersonsreward.com.au ABN 98 139 357 967

MacPhersons to Acquire Nimbus Silver Mine and Mill Assets

Highlights

• MacPhersons have entered into a binding MOU to acquire the assets of the Nimbus Silver Project, located at Kalgoorlie, including mine, mill and polymetallic deposits from Reed Resources Ltd.

• Granted mining tenements with recent silver production of 3.616 million ounces of silver from 318,992 tonnes at a grade of 353 g/t silver, and various polymetallic deposits in the advanced stages of exploration.

• Permitted processing facility with works underway for mill expansion and design of a gold processing circuit, which will allow for direct processing of gold-bearing production material from the MacPhersons operations located at Coolgardie 55km away.

• Exploration results indicate a zinc – polymetallic exploration target with a range of 200,000 – 400,000 tonnes grading 5 – 6% Zinc, 100 – 200 g/t silver, 0.8 - 1.0% lead. There are anomalous gold and copper zones.

• MacPhersons Reward Gold Limited (“MRP”) has continued to expand its in-pit drilling at the MacPhersons Reward mine operations at Coolgardie with a view of looking at near-term production opportunities.

• To fast track the opportunity to process MacPhersons ore within the MRP business, the Company has been proactive in acquiring mill processing and mine assets at the Nimbus Silver Mine, located 10 Km from Kalgoorlie (Figure 1).

• The assets come with an approved site for metallic and non-metallic ore processing and an approved tailings storage facility.

• The assets have advanced exploration targets on the silver deposits below two existing open cuts (recently produced 3.6 million ounces of silver) and with polymetallic deposits carrying zinc – silver – lead mineralisation with zones of anomalous gold and copper values.

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The Nimbus Project comprises two granted mining leases (M26/490, M26/598). Mining in early 2004 and produced approximately 3.6 million ounces of silver from two open pits before ceasing operations in 2007. The processing plant (Figures 2 and 3) was placed on care and maintenance in late 2007. There is base metal exploration upside and in-situ high-grade silver mineralization beneath the current pit floors.

Figure 1: - Location of Nimbus Silver mine and processing facility 10 km east of Kalgoorlie’s Superpit.

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The Nimbus Project and assets were conditionally acquired from Reed Resources Ltd (RDR) for a consideration of:

• $3,000,000 in cash (includes $100,000 deposit);

• $1,500,00 value in MRP ordinary shares;

• RDR will retain a 1% NSR royalty on zinc production from the two mining leases;

• Reimbursement of up to $500,000 for ongoing infrastructure and mill refurbishment costs currently underway; and

• Toll milling agreement option provided to RDR to process ore mined from the Sand Queen mine located north of Kalgoorlie;

The agreement is subject to conditions precedent including due diligence and formal documentation.

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Figure 2: - The Nimbus processing plant looking west, the plant capacity was 250,000 tpa in 2007.

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Figure 3: - The Nimbus processing plant looking east.

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• MacPhersons Reward Gold Limited (“MRP”) is currently drilling in-pit in the MacPhersons – Powell open pit mines and the Tycho greenfields discovery area. MRP has completed its first drilling programmes at Bakers Find, Franks Find and the Tycho deposits. Assessments of the deposits are underway and MRP are examining options to near-term production.

• MacPhersons has undertaken the acquisition of the Nimbus project with a view that production from its Coolgardie and Kalgoorlie tenements will be processed through the Nimbus processing plant. Figure 4 shows the location of the projects.

Figure 4: - Location of Projects.

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For more information on MacPhersons Reward and to subscribe for regular updates, please visit our website at: www.macphersonsreward.com.au or contact our Kalgoorlie office care of Morrie Goodz.

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Morrie Goodz Managing Director

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About MacPhersons

MacPhersons Reward is a Kalgoorlie-based gold resource company with a number of advanced exploration projects located 37 km southwest of Kalgoorlie. Following two years of tenement acquisition MacPhersons Reward has for the first time put together 7 km of strike extension along the MacPherson open pit.

The tenement package has 8 open pits and 2 recent discoveries over a strikelength of 3 Km, that provide potential for both strike and depth extensions to the known mineralised zones, with >95% of historical drilling being shallower than 70 metres. There are no records of diamond drilling beyond the MacPherson open pit and no geological models, yet a substantial history of surface discoveries and workings.

The Company believes that its aggressive diamond drilling programme will unlock the geological mysteries and deliver value to the shareholders.

Competent Person’s Statement

The information in this report that relates to mineral resources and exploration results is based on information compiled by Mr Morrie Goodz who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Morrie Goodz is a full time officer of MacPhersons Reward 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”. Mr Goodz has given his consent to the inclusion in this report of the matters based on the information in the form and context in which it appears.

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