Pele Mountain Resources Completes NI 43-101 Resource Estimate for Eco Ridge Mine Project, Ontario

Pele Mountain Resources Inc. (TSX Venture: GEM) today announced the completion of a NI 43-101 Resource Estimate which for the first time includes both uranium oxide and rare earth oxides at its Eco Ridge Mine Uranium and Rare Earths Project in Elliot Lake, Ontario. 

Eco Ridge is owned 100-percent by First Canadian Uranium, a wholly owned subsidiary of Pele. The Resource Estimate was prepared by Roscoe Postle Associates ("RPA").

The Resource Estimate includes 51.9-million pounds of "Indicated" total rare earth oxides ("TREO") plus an additional 96.3-million pounds of "Inferred" TREO.  These resources are in addition to 15.2-million pounds of Indicated uranium oxide ("U₃O₈") plus an additional 31.4-million pounds of Inferred U₃O₈, which was announced in Pele's press release dated January 24, 2011.

Pele President and CEO Al Shefsky stated, "Our new REO resource is exciting because it provides a potentially significant source of by-product revenue at Eco Ridge and it places Pele on a short list of emerging North American rare earth developers. Our next priority at Eco Ridge is the completion of an updated NI 43-101 Preliminary Assessment ("PA"), which is expected in the second quarter of 2011.  The PA will feature a detailed economic model based on combined revenues from U₃O₈ and REO and will include significant mining, processing, and waste management design enhancements achieved since our initial 2007 Scoping Study. We believe Eco Ridge contains an important future source of U₃O₈ and REO and we are determined to rapidly advance its development."

Recent extraordinary REO market developments, sparked by China's reduction of export quotas, have resulted in sharply higher prices, inciting a rush to find and bring to production new sources outside of China.  Eco Ridge has inherent competitive advantages that may assist its development ahead of other projects, such as:

• It is located within a proven mining camp with historic production exceeding 300 million pounds of U₃O₈.  Elliot Lake is the only mining camp in Canada to achieve commercial production of REO.
• It contains the full range of naturally occurring REO, including the highly valued "heavy" REO.  The Elliot Lake camp was one of the most important sources of heavy REO in North America.
• The project has the potential to be a primary uranium mine that would produce REO as by-products, and would not be wholly dependent on the volatile REO market.
• The mining and processing method to recover uranium at Eco Ridge will also recover REO into the leach solutions, at no extra cost.
• It has well-understood geology and lies within a mining-friendly jurisdiction.  The project enjoys strong local support and is an ideal location for a safe, secure, reliable long-term supply of uranium and REO.

The resource wireframe at Eco Ridge contains 14.3-million tonnes of Indicated resources plus 33.1-million tonnes of Inferred resources. The deposit extends to the north and east, beyond the resource wireframe boundaries. Based on historical wide-spaced drilling and extrapolation of the resource area, RPA estimates that these extensions could contain an additional 30 to 50 million tonnes grading from 0.03 to 0.05-percent U₃O₈ and 0.12 to 0.18-percent TREO as a "potential mineral deposit". Although there is no historical REO data in this area, RPA expects that REO grades would be similar to other portions of the deposit. The deposit also remains open beyond the drilled areas with potential for significant expansion. The potential quantity and grade of the potential mineral deposit are conceptual in nature and there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the targets being delineated as a mineral resource.

The technical information relating to the NI 43-101 resource estimate in this press release has been reviewed and approved by Roscoe Postle Associates.  The balance of this press release has been reviewed and approved by Fergus Kerr, P.Eng., Vice President of Uranium Operations for Pele and a qualified person under NI 43-101.

Source: Pele Mountain Resources Inc.