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MMW: Mineral Resource Estimate Update

Magma Metals Limited (ASX  TSX MMW) (Magma or the Company) is pleased to advise that AMEC Americas Limited (AMEC) has completed an independent update of the Mineral Resource Estimates for the Thunder Bay North PtPdCuNi project in Ontario. On a platinum equivalent (PtEq) basis the Mineral Resources have been estimated as Open Pit (0.61g/t PtEq cutoff) Indicated Mineral Resource 8.02 Mt  2.29g/t PtEq for 591,000 PtEq ounces Inferred Mineral Resource 0.05 Mt  2.06g/t PtEq for 4,000 PtEq ounces Underground (1.94g/t PtEq cutoff) Indicated Mineral Resource 1.05 Mt  3.47g/t PtEq for 117,000 PtEq ounces Inferred Mineral Resource 0.21 Mt  3.00g/t PtEq for 20,000 PtEq ounces Total Mineral Resources Indicated Mineral Resource 9.06 Mt  2.43g/t PtEq for 708,000 PtEq ounces Inferred Mineral Resource 0.27 Mt  2.81g/t PtEq for 24,000 PtEq ounces. The open pit and underground cutoff grades are the cashcost breakeven figures for open pit and underground mining using the cost input and metal price assumptions applied in the resource estimate. This is a robust resource estimate update, based on nearly twice as much drilling as previously, with 97% now in the Indicated Resource category said Keith Watkins, Magmas Executive Chairman. The objective of converting most of the previously defined Inferred Resources into the Indicated Resources category has been achieved. This conversion will facilitate detailed modelling of the interface between the proposed open pit and underground mines, and the design of the proposed underground mine, in the current Scoping Study, which is scheduled for completion in the December quarter, 2010. The resource estimate is based on 528 diamond drill holes for approximately 97,000m and over 28,600 assayed samples. The estimate includes all assays received from drilling up to 31 May 2010. Approximately 81% of the resources (by contained metal) are within the open pit, with the remainder being in the underground area. A direct comparison with the previous resource estimate is not possible given that different metal prices and other cost input parameters were used in the updated estimate. In addition, the updated estimate is based on nearly twice as much drilling, which resulted in significantly different geological models of the mineralized envelopes. The previous resource estimate contained Indicated Resources of 4.6 Mt  2.88g/t PtEq for 425,000 ounces PtEq and Inferred Resources 3.6 Mt  2.29g/t PtEq for 265,000 ounces PtEq (see Magma announcement dated 7 September 2009, which is available on the Companys website at www.magmametals.com.au). A full NI 43101 compliant technical report on the resource estimates will be filed under the Companys profile on the SEDAR website (sedar.com) within 45 days of the date of this announcement