Combined annual report EL 24453, EL 24463 and EL 24533 Ngalia Regional Project period ending 6 February 2010

Abstract

EL 24453, 24463 and 24533 are part of the Ngalia Regional Project which immediately surrounds the Bigrlyi project (ERL's 46 to 55 inclusive) located 390 kilometres (by road) northwest of Alice Springs. The Ngalia Regional Project is 100% owned by Energy Metals Limited and the Bigrlyi Project is a Joint Venture between Energy Metals Limited with 53.3% (operator), Valhalla Uranium (a subsidiary of Paladin Resources Ltd) with 41.7% and Southern Cross Exploration NL with 5%. In May 2005 Energy Metals acquired a 53.3% interest in, and assumed management of, the Bigrlyi project through the purchase of the interests of CPM and Yuendumu Mining Company NL. In September 2005 Energy Metals listed on ASX after raising $3m, primarily to fund exploration at the Bigrlyi and Ngalia Regional Projects. Exploration undertaken on these licences in the period 06 February 2009 to 06 February 2010 included: Interpretation of 2007 airborne geophysical survey including radiometrics, magnetics and topography, continuing compilation of historical data and conversion of this data to digital format, clearing access to sites, tracks and drill pads, regional prospecting and mapping, aircore drilling of prospects in EL 24453 and EL 24533. During this period China Guangdong Nuclear Power (CGNPC) subsidiary China Uranium Development Company Ltd (CUD) completed a proportional takeover bid for Energy Metals on 18 December 2009 with CUD holding approximately 66% of the Company's issued capital (subject to final confirmation). CGNPC is a Chinese incorporated company with total assets of approximately USD 16 billion and net assets of over USD 5 billion. Established in September 1994, CGNPC now has 4 operating nuclear power stations with existing generation capacity of 4,000 MWe. Further nuclear projects currently under construction will add in excess of 20,000 MWe of capacity across various locations around China. CGNPC is to underwrite a $12M rights issue, allowing accelerated development of the Bigrlyi resource as well as exploration/development of potential resources in the surrounding Ngalia tenements.