Strategic Metals Ltd.

TSX.V:SMD $0.305

Strategic Metals to Sell Royalty Interests for US$30 Million with Provisional Increase to US$36 Million


August 3, 2012 - Strategic Metals Ltd. (TSX-V: SMD) ("Strategic") announces that pursuant to the terms of an August 1, 2012 royalty purchase agreement, Strategic will sell its royalty interests in three advanced mineral projects to 8248567 Canada Limited, an arm's length purchaser, for up to US$36 million. The three royalty interests being sold are:

  1. a 5% net profits royalty interest in the Casino copper-molybdenum-gold deposit, located in the Whitehorse Mining District of the Yukon Territory and owned by Western Copper and Gold Corporation;
  2. a 1% net smelter return royalty interest in the Logtung tungsten project, located on the Yukon-British Columbia border and owned by Largo Resources Ltd.; and
  3. a 1% net smelter return royalty interest in all mineral production from the Kink 3 mineral claim that covers a substantial portion of the Wolverine zinc-silver-lead-copper-gold deposit, located in the Watson Lake Mining District of the Yukon Territory and owned by Yukon Zinc Corporation. The 1% royalty interest will be reduced to a 0.5% net smelter return royalty interest after a total of $500,000 in royalty payments have been made to the royalty holder.
The sale proceeds to be received by Strategic will consist of:
  1. an initial cash payment of US$30 million on the closing of the royalty sale; and
  2. an additional cash payment of US$6 million if the operator of the Casino project has obtained all necessary permits and authorizations prior to December 31 2016 to construct and operate the project as a producing mine as contemplated in a feasibility study prepared for and upon which the operator makes a positive construction decision. The required permits and authorizations required as part of the operator's construction decision will include: (i) a positive decision from the Yukon Environmental and Socio-Economic Assessment Board; (ii) a positive decision from the Canadian Environmental Assessment Agency; (iii) a Quartz Mining License, including the requirement for a reclamation and closure plan, from the Yukon Government Energy, Mines and Resources/Minerals Resources Branch; (iv) a Type A Water Use License from the Yukon Water Board; and (v) a Metal Mining Effluent Regulation Schedule 2 Amendment from the Government of Canada.
This transaction is subject to TSX Venture Exchange acceptance and is expected to close on or about August 9, 2012.



For additional information concerning Strategic Metals Ltd. please visit Strategic's website at www.strategicmetalsltd.com or contact:




Corporate Information
Strategic Metals Ltd.
W. Douglas Eaton
President and C.E.O.
Tel: (604) 688-2568



Strategic Metals Ltd.
Bruce A. Youngman
Chairman
Tel: (604) 687-2522



Investor Inquiries
Richard Drechsler
Corporate Communications
Tel: (604) 687-2522
NA Toll-Free: (888) 688-2522
rdrechsler@strategicmetalsltd.com
http://www.strategicmetalsltd.com



Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.



About Strategic Metals Ltd.



Strategic is a pre-eminent explorer and claimholder in the Yukon, with an exceptional portfolio of more than 160 property and royalty interests. Strategic also owns marketable shares of other resource companies, including 9.6% of ATAC Resources Ltd., 18.8% of Silver Range Resources Ltd., 28.0% of Rockhaven Resources Ltd, 19.9% of Precipitate Gold Corp., and 19.9% of Wolverine Minerals Corp.



CAUTIONARY NOTE: This news release includes certain "forward-looking statements" including completion of the royalty sale and payment of the additional US$6 million. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Factors that could cause actual results to differ materially from those expected by Strategic are those risks described herein and from time to time, in the filings made by Strategic with Canadian securities regulators. Those filings can be found on the Internet athttp://www.sedar.com.