Formation Metals' Idaho Cobalt Project Construction Update

Formation Metals Inc. (TSX:FCO) (the "Company") is providing an update on the
progress of construction on its 100% owned Idaho Cobalt Project ("ICP"), which
is managed by JDS Energy & Mining ("JDS"). The ICP is comprised of the
development of a mine and construction of a concentrator at a primary cobalt
deposit in Lemhi County near the town of Salmon, Idaho, and the construction of
an electrowinning cobalt production facility in Shoshone County, near Kellogg,
Idaho, U.S.A. 


The updates are based on progress reports submitted to the Company by JDS since
January, 2012, and are broken out into two separate sections; one highlighting
construction progress at the Mine & Concentrator Site, and the other on
construction progress at the Cobalt Production Facility. 


Mine & Concentrator Site Construction Progress Executive Summary

Significant progress was made since the beginning of the year on concluding
engineering studies and releasing Issued for Construction ("IFC") drawings and
specifications. Detailed engineering at the mine and concentrator site is now
95% complete. In January, JDS conducted a year-end executive review and a
strategy for success meeting was held later that month. Procurement activities
included the release of the contract for rock bolting and the creation of
additional trade contract Request for Proposal ("RFP") packages. Working with
the agencies to receive approval on design packages in order to resume
construction activities was, and continues to be, a primary focus of the team
moving forward. Construction activities during February included safety
improvements that included brush and timber clearing for vision enhancements
along the transportation route. 


Specific activities relating to the mine and concentrator site included:



- Samuel Engineering, Inc. ("SE") completed final interdisciplinary checks
and released all IFC drawings and specifications in the steel, piping,
and electrical disciplines.
- Langston & Associates released IFC drawings and specifications for the
portal bench high-wall stabilization (rock bolting) activities. The contract
terms and conditions have been finalized and the contract was executed in
February.
- JDS and the Company compiled and released information to Micon Engineering
to support due diligence activities by various mine finance lending groups.
- SE released all IFC drawings and specifications for items within the
crusher and concentrator buildings.
- Mine Development Associates completed the underground mine block model
for review.
- Two RFP packages were released for bid (building erection and tram
foundation design-build) and additional RFP packages are expected to be
issued in March.



Cobalt Production Facility Construction Progress Executive Summary

Significant progress on beneficiation engineering analysis was completed. These
studies have shown that the installation of a new autoclave in the Cobalt
Production Facility in lieu of modifying the existing autoclaves will benefit
project economics by allowing the existing autoclaves to be utilized for other
precious and base metals' leaching by the Company's 100% owned Sunshine Precious
Metals Refinery. SE completed a review of the autoclave design and
specifications and is preparing bids. 


Process Operating Procedures have been finalized. These engineering
specifications were locked and flow sheets were finalized and provided to Micon
Engineering to support mine finance due diligence activities. Meetings were held
at the end of February between JDS, SE and the Company which provided SE with
direction to prioritize purchasing and vendor data acquisition to best suit
construction sequencing. SE was also provided a directive to begin detailed
engineering of the gold-leach circuit.


Specific activities relating to the Cobalt Production Facility included:



- The cobalt resolution process operating plan was signed off, resulting in
five of the six operating plans being completed. The concentrate leaching
plan was updated to reflect the new autoclave.
- Mechanical equipment package purchase orders were issued and quotations
were received for five equipment packages. 
- Refurbishment work of existing copper SX-EW circuits and other equipment
continued.
- Cobalt electro winning cells for the Cobalt Production Facility arrived
at the port of Seattle and will be delivered to site after customs
processing.
- Existing autoclave re-certification process nearing completion.



Additional progress at the Cobalt Production facility included the re-location
of gas lines, pad preparation for additional concrete pouring, running of power
line, phones and Internet to various new construction offices, installation of
the parking lot, the refurbishment of the ball mill including motor rebuild, the
installation and repair of new and existing gates, fences, ditches and sumps,
the relining of the copper electrolyte circulating tanks and electrowinning
cells and the development of an improved cobalt cathode handling and treatment
process.


The Company continues to work with Union Bank as its Mandated Lead Arranger to
secure a credit facility (in the form of a letter of credit and debt) for the
ICP, while JDS continues to provide up-to-date, optimized engineering plans to
assist the lenders in their due diligence. Additional updates will be made
available as construction progresses on the ICP.


Formation Metals Inc. is a well-established, mineral exploration, development
and refining company that 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, C.E.O.

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.