Essential Power…Infinite Possibilities

July 8, 2010

Formation Metals' Uranium Project 2010 Winter Drilling Discovers Potential New Mineralized Structure

Vancouver, B.C. July 8, 2010 - Formation Metals Inc. (the “Company”, FCO-TSX,) is pleased to provide its shareholders with an update on the Virgin River Uranium Project 2010 Winter Drill Program, as provided to the Company by project operator, Cameco Corporation. Located within the south-central portion of the Athabasca Basin in northern Saskatchewan, the project is a joint venture formed in 1998 between Formation Metals’ wholly owned Canadian subsidiary, Coronation Mines Limited (2%), Cameco Corporation (49%) and by AREVA Resources Canada Inc. (49%). Coronation Mines Limited has the first right of offer to increase its ownership of the project up to 10%.

To date in 2010, a total of 2,780 metres have been drilled in three pilot holes; DDH VR-041, 042 and 043. Pilot drill hole DDH VR-042 was collared on L8+00N approximately 200 metres southeast of the Centennial Deposit and was designed to target an interpreted resistivity low and moderate intensity conductor running parallel to the Centennial Deposit.

DDH VR-042 intersected favourable alteration, scattered structural disruption and local uranium mineralization within the basal Athabasca Group with split sample assay results yielding a 0.1% grade cut-off assay of 0.38% U3O8 over 18.8 m from 790.4 — 809.2 m = 7.1 GT, that includes an interval with a 1.0% grade cut-off assay of 1.98% U3O8 over 1.9 m from 797.8 — 799.7 m = 3.8 GT. GT is defined as % Grade U3O8 multiplied by Thickness in metres.

The intersection is interpreted to represent a separate zone of mineralization paralleling the Centennial Deposit. Alternately, it can also be interpreted as the eastern extent of a mineralized NNW trending structure crosscutting the Centennial Deposit in the vicinity of L10+50N where DDH VR-031W3 intersected 8.78% U3O8 over 33.9 m (see Company news release dated January 06, 2010). Additional follow-up drill holes are planned to further define this newly discovered mineralized zone during the summer of 2010.

The Centennial Deposit has been traced over a known 650 m of strike length and has a minimum across strike width ranging from 10.0 m to 52.5 m. The deposit remains open to the east and west on most sections and appears to remain open to both the north and the south. High grade U3O8 intersections of up to 298 GT have been intersected within the deposit.

Drill hole DDH VR-041, collared on L14N, was drilled to test for mineralization along the northern strike extent of the Centennial Deposit while DDH VR-043, also collared on L14 N, was designed to test the up-dip projection of the weakly radioactive faulted quartzite intersected in DDH VR-041.

Drill hole DDH VR-041 intersected favourable alteration but significantly less structural disruption within the basal sandstone than that observed on the Centennial Deposit. It also intersected a zone of elevated radioactivity within a faulted quartzite unit similar in appearance to the controlling structure of the Centennial Deposit suggesting that the optimal target remains to the grid east. DDH VR-043 appears to have overshot the up-dip projection of the weakly mineralized and faulted quartzite intersected in VR-041 and further drill holes are planned for the summer of 2010 to continue testing the northern strike extension of the Centennial Deposit.

In addition to testing the newly discovered mineralized zone and the northern strike extension of the Centennial Deposit, the summer drill program, utilizing two drill rigs, will also concentrate on extending the southern strike length of the Centennial Deposit and continue testing the across-strike width and the potential for high-grade mineralization (ie. >100 GT) on select fences.

A budget of $5 million has been approved for the 2010 exploration program. Over $23.2 million has been spent on the project to date exploring for a large unconformity-type deposit that has resulted in the discovery of the Centennial Deposit. The 2010 winter (complete) and summer programs consist of diamond drilling, grid establishment and both Fixed-Loop and step-wise Moving-Loop TEM (Time—Domain Electromagnetic) geophysical surveying.

Project representatives are pleased with the ongoing success of the program and are looking forward to the results of the summer 2010 drill program.

All uranium geochemical assays were carried out utilizing Inductively Coupled Plasma - Optical Emission Spectroscopy analysis by the Saskatchewan Research Council of Saskatoon, Saskatchewan. Mr. Eric (Rick) Honsinger, P.Geo., of Formation Metals Inc., is the Qualified Person who has reviewed and approved the content of this news release based on an examination of the data submitted to the Company by the project operator Cameco Corporation. A location map of the project and drill hole location plan map will be made available on the Company’s website at http://www.formationmetals.com.

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



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:
June 22nd, 2010, Formation Metals Strengthens Board
View the main News Releases page.
View the Next News Release:
July 28th, 2010, Formation Metals Drills to Optimize Mine Design and Assess Rare Earth Elements on Cobalt Project