Essential Power…Infinite Possibilities

November 5, 2010

Continued Positive Results from Formation Metals' Cobalt Mine Optimization Drilling

Vancouver, B.C., November 05, 2010, Formation Metals Inc. (FCO-TSX) (“Formation”) is pleased to announce that its 100% owned subsidiary, Formation Capital Corporation, U.S., (the “Company”) has reported additional positive results from its recently concluded diamond drill program on its 100% owned Idaho Cobalt Project, located in Lemhi County, Idaho. Data from the program is being used to further assist in mine plan optimization studies. In addition, split drill core samples collected will be used to conduct initial metallurgical test work to assess the economic viability of the extraction and separation of Rare Earth Elements (“REE’s”) from the cobalt, copper and gold mineralized ore horizons. A total of 5,727 feet were drilled in six holes across 400 feet of strike in a previously untested area along the southern extension of the Ram deposit (see Formation News Release dated October 21, 2010).

The primary goal of the optimization study is to maximize ore production as early in mine life as possible with a resulting positive impact on the overall economics of the project. The drill program, to date, has also confirmed economic ore grade mineralization for an additional 230 feet along strike to the south and 200 feet down dip. This data is expected to increase the reserve / resource base and mine life of the Idaho Cobalt Project. Results from the first four drill holes are tabulated below:

click to enlarge

*Previously released

The occurrence of REE’s is closely associated with the cobalt, copper and gold mineralized horizons. Metallurgical test work will be utilized to determine the economic viability of extracting and separating the rare earths elements from the mineralized horizons to be mined from the deposit. Any potential future REE production would be considered by-product production with provisions for mining, milling and concentrating already included in the existing approved mine plan.

Mr. George King, B.Sc., P.Geo., is the Qualified Person working directly on the project and has reviewed the contents of this release. Cut drill core samples were sent to ALS Chemex Labs Ltd in North Vancouver, B.C. for assaying. The Company will announce further results of the program when available.

The 100% owned Idaho Cobalt Project is a unique, fully environmentally permitted primary cobalt deposit and hydrometallurgical refinery that will be capable of producing high purity cobalt metal. Cobalt is used in a wide variety of environmental and high-tech applications that include the re-chargeable battery and aerospace sectors.

Formation Metals Inc. is dedicated to the principles of environmentally sound mining and refining practices, and believes that environmental stewardship and mining can co-exist. Formation trades on the Toronto Stock Exchange under the symbol FCO.

FORMATION METALS INC.
“Mari-Ann Green”
Mari-Ann Green,
C.E.O.


For further information please contact:
E.R. (Rick) Honsinger, P.Geo., V.P. Corporate Communications
Formation Metals Inc., 1730 — 999 West Hastings Street, Vancouver, BC, V6C 2W2
Tel: 604-682-6229 - Email: inform@formationmetals.com — Web: formationmetals.com

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This press release contains “forward-looking statements” within the meaning of applicable Canadian securities legislation. Generally, forward-looking statements can be identified by the use of forward- looking terminology. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws. Further information on the Company is available at www.sedar.com.

The statements contained in this news release in regard to Formation Metals Inc. that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including Formation Metals Inc.’s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to the parties as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.

View the Previous News Release:
October 21st, 2010, Formation Drills Cobalt Project to Optimize Mine Design
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November 30th, 2010, Formation Metals Mandates BNP Paribas to Arrange Idaho Cobalt Project Debt