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Discovery Metals Limited (DME)

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Friday 24 December, 2010

Discovery Metals Limited

Drilling Report






AIM RELEASE

24 December 2010


                            Discovery Metals Limited
                       ('Discovery Metals' or 'Company')

   HIGH GRADES PERSIST IN SECOND SET OF RESULTS FROM ZETA UNDERGROUND INFILL
                                    DRILLING



Highlights

  * New Zeta Underground Infill drill intercepts (240 to 330m depth) confirm
    significant widths of copper and silver grades better than the average
    assumed in the Boseto Development Plan (1.4% Cu and 23.1g/t Ag)


  * The best intercepts include:

11.7m @ 2.0 % Cu & 42.4 g/t Ag from 274 metres

10.0m @ 2.0 % Cu & 35.9 g/t Ag from 223 metres

7.9m   @ 2.0 % Cu & 40.2 g/t Ag from 267 metres

7.0m   @ 2.2 % Cu & 48.1 g/t Ag from 322 metres

6.0m   @ 2.2 % Cu & 45.4 g/t Ag from 276 metres

4.8m   @ 2.2 % Cu & 45.5 g/t Ag from 240 metres


  * Results will update the Zeta Mineral Resource for the Zeta Underground
    Definitive Feasibility Study which is on target for completion in H2/2011.

Details

Discovery  Metals Limited  announces results  for the  second set of drill holes
from  the infill drilling program at  Zeta Underground, beneath the area planned
for open pit mining.  The Zeta deposit is a part of the 100% owned Boseto copper
project (Figures 1 and 2) which is being developed to commence copper production
in  early  2012. Planned  production  is  36,000 tonnes  of copper and 1 million
ounces of silver per annum over a minimum 15 year mine life.

Discovery  Metals' Managing Director, Brad Sampson, commented "These drill holes
continue  to impress,  with intersections  being thicker  and with higher grades
than  previously  allowed  for.   Further  drilling  is required before the Zeta
Mineral Resource can be updated, but these results provide further encouragement
for our planned underground development at Zeta."

The  13 holes are  the second  set of  drill results  reported to  date from the
planned  50 hole in-fill  programme (approximately  13,000 metres of drilling).
Results  from the  set of  holes above  the current reported data (approximately
200m depth) were reported on 28 October 2010.

The  current  reported  holes  intersected  the  target mineralised horizon at a
vertical   depth  of  between  250 and  300 metres  at  approximately  100 metre
intervals along a strike length in excess of 1,000 metres.

The  remainder of the current drill programme, which is scheduled for completion
in  Q1, 2011, will concentrate on gathering  further data from below the current
set of reported data, where previous deep drilling has shown that mineralisation
at  the Zeta prospect remains open to at least a vertical depth 600 metres below
surface.   The drilling of the  next set of holes  designed to intersect the ore
horizon  at  a  further  50 metres  down-dip  is  almost completed and should be
reported in January 2011.

A second high grade zone, along strike to the southwest, has still to be tested,
and  some data from this zone is expected  to be obtained in the current Q1/2011
program.



Implications for the Boseto Project

The  successful Scoping Study for the  proposed Zeta underground mine (announced
in  March 2010) was based  on a preliminary  resource of 25Mt at 1.4% copper and
23.1g/t silver.   All results from the current drilling program confirm that the
grade  and  thickness  of  the  Zeta  mineralisation extends to depth, with good
continuity  and indications that the grade of ore which will eventually be mined
at Zeta Underground may exceed the currently allowed parameters.

The  current drill  results will  be used  to update  the Zeta Mineral Resource,
which  will be  the basis  of the  Zeta Underground Definitive Feasibility Study
(DFS).  The DFS remains on target for completion in second half of 2011.

The  results reinforce  the potential  value of  underground mining  at Boseto.
Increased grades at Zeta Underground will have a particularly high impact on the
value  of the overall Boseto Project,  with economic analysis indicating that an
additional  0.1% copper grade will add US$46m to the NPV of the project assuming
a  copper  price  of  $3/lb.   Further  explanation  of  the  role  and value of
underground mining at Boseto was given in the announcement of 28 October 2010.



Boseto Project Background

Discovery  Metals is  an ASX/AIM/BSE  listed copper  exploration and development
company  focused on the emerging Kalahari Copperbelt in northwest Botswana.  The
Company  is currently  developing its  100% owned Boseto  copper project towards
production in the first half of 2012.

The  Kalahari  Copperbelt  sediment-hosted  mineralisation  of the Boseto copper
project  is similar in style to the well-known and large deposits of the Central
African Copperbelt of Zambia and the Democratic Republic of the Congo.

Discovery  Metals  has  prospecting  licences  covering  9,656 km(2)  along  the
Kalahari Copperbelt.



Further information on the Company including Mineral Resources and Ore Reserves
is available on its website:
www.discoverymetals.com.au



Competent Persons Statement

The  information in this report that relates  to Exploration Results is based on
information  compiled by Mr Fred  Nhiwatiwa who is a  Member of the Australasian
Institute  of  Mining  and  Metallurgy  (MAusIMM).   Mr Nhiwatiwa is a full-time
employee  of Discovery Metals  Limited.  Mr Nhiwatiwa  has sufficient experience
which  is relevant  to the  style of  mineralisation and  type of  deposit under
consideration  and  to  the  activity  which  he  is undertaking to qualify as a
Competent  Person as defined  in the 2004 Edition  of the "Australasian Code for
Reporting  of  Exploration  Results,  Mineral  Resources  and Ore Reserves".  Mr
Nhiwatiwa  consents to  the inclusion  in this  report of  the matters  based on
information provided by him and in the form and context in which it appears.

Forward Looking Statements

This  release includes  certain statements  that may  be deemed "forward-looking
statements".   All  statements  in  this  discussion,  other  than statements of
historical facts, that address future activities and events or developments that
Discovery  Metals expects,  are forward-looking  statements.  Although Discovery
Metals  believes the  expectations expressed  in such forward-looking statements
are  based  on  reasonable  assumptions,  such  statements are not guarantees of
future performance and actual results or developments may differ materially from
those  in  the  forward-looking  statements.   Factors  that  could cause actual
results  to differ materially  from those in  forward-looking statements include
market  prices,  continued  availability  of  capital and financing, and general
economic,  market or business conditions.  Investors are cautioned that any such
statements  are not guarantees of future  performance and that actual results or
developments  may  differ  materially  from  those  projected in forward-looking
statements.


For further information contact:


Discovery Metals Limited
Brad Sampson
Managing Director
Tel: +617 3218 0200


Fairfax I.S. PLC
Ewan Leggat / Laura Littley
Tel: +44 (0)20 7598 5368

Conduit PR
Jos Simson/Emily Fenton
Tel: +44 (0) 20 7429 6603
Mobile: +44 (0)7899 870 450

Further information on the Company is available on its website:
www.discoverymetals.com.au




Zeta High Grades Figures: 


http://hugin.info/137928/R/1475548/411593.pdf




This announcement is distributed by Thomson Reuters on behalf of 
Thomson Reuters clients. The owner of this announcement warrants that: 
(i) the releases contained herein are protected by copyright and 
    other applicable laws; and 
(ii) they are solely responsible for the content, accuracy and 
     originality of the information contained therein. 
    
Source: Discovery Metals Limited via Thomson Reuters ONE

[HUG#1475548]