Mr. Raj Chowdhry reports

ASIABASEMETALS ENTERS INTO DEFINITIVE AGREEMENT TO ACQUIRE MAJORITY INTEREST IN LAOS POTASH PROJECT

AsiaBaseMetals Inc. has entered into a definitive purchase and sale agreement with AXN Group LLC (AXNG) for the acquisition by the company of a 90-per-cent interest in a Laos limited company that will hold exclusive rights to explore and mine the Vientiane potash property, a 16.5-square-kilometre potash exploration property located in the Huaxieng-Xaithany area of Vientiane province, Laos. The definitive agreement was entered into pursuant to a letter of intent announced by the company on Sept. 1, 2011, and amended on Dec. 12, 2011.

Under the definitive agreement, the company has agreed to issue to AXNG one million common shares at the closing of the transaction. A further one million common shares will be issued and $500,000 paid by the company to AXNG if and when the company has completed financings for proceeds of at least $2-million.

The company also agreed to pay to AXNG additional milestone payments of up to a total of $3.3-million in cash and 20 million common shares, payable in stages, if specific financing, resource, and feasibility study and mine construction milestones are achieved. The definitive agreement provides for an alternate milestone payment structure payable only upon feasibility study and mine construction milestones if AXNG has not, within one year of the closing of the transaction and at no additional cost to the company, expanded the property to include exclusive exploration and mining rights covering approximately 38.5 square kilometres of additional contiguous ground.

The closing of the transaction remains subject to various conditions, including approval of the TSX Venture Exchange, the company being satisfied with the results of its due diligence, the company obtaining an independent National Instrument 43-101-compliant technical report on the property, required consents being obtained and certain authorizations being issued by the Lao PDR government.

Raj Chowdhry, president and chief executive officer of AsiaBaseMetals, stated: "We are pleased to have entered into a definitive agreement for the acquisition by the company of an indirect 90-per-cent interest in the Vientiane potash property in Laos. Since potash is one of the key components of fertilizer, and with China, India and Indonesia representing three of the largest markets for agricultural products in the world and located on the doorstep of Laos, management believes that the Vientiane potash project represents a world-class opportunity."

A World Bank report dated November, 2006, stated the following with respect to Laos: "Potash rock salt: As with gypsum, potash rock salt occurs in the evaporite of the Upper Cretaceous, and its distribution is confirmed to be large in Vientiane and Savannakhet provinces. Potash salt deposits in Vientiane and Savannakhet sedimentary basins are large in Laos. Thickness of the deposit in Savannakhet province was confirmed to be 70 to 85 metres at drill holes (DGM-INTERGEO, 2005). The resource of potash salt may be as high as 50 billion tonnes."

We seek Safe Harbor.