Formation Metals Drills to Optimize Mine Design and Assess Rare Earth Elements on Cobalt Project

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 07/28/10 -- Formation Metals Inc. (TSX: FCO) ('Formation') is pleased to announce that its 100% owned subsidiary, Formation Capital Corporation, U.S., (the 'Company') has reported the commencement of a 5,000 foot diamond drill program in a previously untested area on the Idaho Cobalt Project. Pursuant to the approved Plan of Operations (mine permit), this verification drilling program will provide information needed to optimize mine design and production plans with the primary goal of maximizing ore production as early in mine life as possible.

The program will also provide material for initial metallurgical test work to assist in determining the economic viability of extracting the heavy Rare Earth Elements ('REE's') that are known to occur on the property. Additional material for follow-up metallurgical testing can also be obtained once underground operations commence. REE's, as well as gold, were not included in the Company's bankable feasibility study.

'The (diamond drill) program is exciting for us as we can now obtain the data needed to optimize the mine design,' commented Bill Scales, President of Formation Capital Corporation, U.S. He continued, 'Mine design optimization, along with new information on the REE's, could have a positive impact on the overall economics of the project.'

The 100% owned Idaho Cobalt Project is a unique, fully permitted primary cobalt deposit that will be capable of producing high purity cobalt metal. Cobalt is used in a wide variety of environmental and high-tech applications that include the re-chargeable battery and aero-space sectors.

Formation Metals Inc. 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.

Contacts:

Formation Metals Inc.

E.R. (Rick) Honsinger, P.Geo.

V.P. Corporate Communications

604-682-6229
inform@formationmetals.com
www.formationmetals.com