Mr. Harvey Keats reports

DONNER METALS LTD.: DEVELOPMENT TO REACH THE MCLEOD ZONE A YEAR AHEAD OF SCHEDULE

Donner Metals Ltd. has provided an update on positive changes to the development plan for the Bracemac-McLeod mine as reported to the company by partner and project operator Xstrata Canada Corporation-Xstrata Zinc Canada division. Following on Xstrata Zinc's objective to continuously improve the development plan at Bracemac-McLeod, the mine design has been revised to access the McLeod zone with two ramps by early 2013 as opposed to late 2013 under the original plan. This change will be accommodated within the existing development budget and reschedules production from McLeod to commence in late 2013 as opposed to mid-2014 under the original schedule. The new development plan improves the overlap and timing of production from both the Bracemac and McLeod zones.

With underground drilling scheduled to start at Bracemac by mid-2012, this important change to the mine plan will also provide access a year earlier for both delineation and exploration drilling on both the McLeod zone and the McLeod Deep deposit. The objective of the underground drill program at both areas is to expand resources and to bring the McLeod Deep deposit into the mine plan as soon as possible.

Once access is available at McLeod, delineation drilling will be focused on the West McLeod zone (160,000 tonnes grading 2.17 per cent zinc, 2.63 per cent copper, 23.76 grams per tonne silver, 0.19 g/t gold) and the McLeod Deep zone (2.47 million tonnes grading 9.21 per cent zinc, 1.22 per cent copper, 39.81 g/t silver, 1.12 g/t gold). Both zones are currently in the inferred mineral resource category with favourable potential for additional mineralization. Underground exploration drilling will also be focused on the potential for expansion of mineralization beyond known mineral resources and mining reserves, for example DDH MC-08-45 located 250 up dip from the McLeod mining reserves returned 8.09 per cent zinc, 2.35 per cent copper, 5.64 g/t silver, 0.26 g/t gold over 6.35 metres (from 268.9 m to 275.3 m) which is not currently in any resource category.

            STATUS OF MINE DEVELOPMENT AT BRACEMAC-MCLEOD
Surface
Haulage road to Matagami mill                              complete         
Ramp portal at BAS pit, and stockpile and waste rock                        
pads                                                       complete         
Access road to BAS pit                                     complete         
Power, water service, surface pumps and mine water line                     
to treatment facilities                                    complete         
Power and access to vent/fill raise sites                  complete         
Surface garage and support buildings (will be augmented                     
by Perseverance buildings)                                 complete         
Matagami mill (2,950-tonne-per-day capacity -- upgraded                      
in 2007-2008)                                              existing         
Tailings facility                                          existing         
Railway and highway (zinc and copper concentrate                           
shipping)                                                  existing         
Underground
Ramp to Bracemac area and underground power supply                          
(Bracemac)                                                 complete         
Temporary ventilation                                      complete         
Multiface development to Bracemac ore lenses               in progress      
Ramps to Macleod zone                                      in progress      
Vent and fill raise construction                           in progress      
Underground pumping system                                 in progress      
Equipment purchase and transfer from the Perseverance                       
mine                                                       continuing as needed

The construction of the Bracemac-McLeod mine has consistently exceeded development rate targets and the project remains within budget.

Speaking from years of development experience in the Matagami camp, Ron Tessier, Donner's vice-president of engineering, said: "I am pleased that all construction activities are advancing as planned to have the mine ready for production by early 2013. I am also pleased with the revised mine plan that not only gets us to McLeod a year early, but provides earlier access to McLeod Deep."

Additional information is available at the company's website.

Project overview

The company is a fully vested partner with Xstrata Canada Corporation in the extensive Matagami base metal camp located in the Abitibi region of central Quebec. This joint venture partnership covers six joint venture areas governing 4,737 square kilometres of prime stratigraphy, which has yielded high-grade base metal production since 1963. The joint venture areas currently contain 2,895 mineral claims covering 667 square kilometres. Each joint venture area is defined by an area of interest which expires on June 1, 2013. Following this term, the joint ventures will apply only to the surviving mineral claims and other mineral interests.

   SPECIFIC JOINT VENTURE AREAS AND THEIR RELATIVE INTERESTS

South Flank JVA       Donner 35 per cent/Xstrata 65 per cent                            
Bracemac-McLeod JVA   Donner 35 per cent/Xstrata 65 per cent
                      (includes the Bracemac-McLeod mine -- under development)               
North flank JVA       Donner 50 per cent/Xstrata 50 per cent
Central camp JVA      Donner 50 per cent/Xstrata 50 per cent
West camp JVA         Donner 50 per cent/Xstrata 50 per cent
                      (includes the PD1 deposit under feasibility study)   
East JVA              Donner 50 per cent/Xstrata 50 per cent

Xstrata Canada Corporation holds a separate right to increase its interest to 65 per cent in each of the North flank, Central camp, West camp and East JVAs by completing a bankable feasibility study. Both parties will be responsible for their share of costs on the basis of the relative joint venture interests.

The Matagami project covers the Matagami mining camp, a world-class mining district, with 18 known volcanogenic massive sulphide deposits including 10 past producers of varying sizes, including the giant Matagami Lake deposit (25.64 million tonnes of 8.2 per cent zinc, 0.56 per cent copper, 20.91 g/t silver and 0.41 g/t gold) discovered in 1957 and mined from 1963 to 1988. The area is host to historical production of 8,600 million pounds of zinc and 853 million pounds of copper. The Matagami area is well serviced by established infrastructure including the town of Matagami, power, a permitted tailings facility, railway, airport, and well-developed road and highway networks. Xstrata Zinc is currently producing from its low-cost and wholly owned Perseverance deposit which feeds its refurbished 2,950-tonne-per-day Matagami mill complex. Any future development under the Donner-Xstrata agreement will support the established infrastructure and facilities. Zinc concentrates produced at Matagami are refined at the Noranda Income Fund zinc refinery in Valleyfield, Que. Copper concentrates are smelted at Xstrata's Horne smelter in Rouyn-Noranda and refined at Xstrata's Canadian copper refinery in Montreal, Que.

The company's strategy is to explore for and develop zinc-copper deposits in the Matagami camp and to leverage the general infrastructure and existing processing facilities within a known and well-established cost structure for developing VMS deposits. Donner's exploration objective is to investigate multiple stratigraphic horizons with potential for VMS mineralization including the prolific Key Tuffite horizon throughout the Matagami camp. To date, the joint venture partners have discovered new mineralization at Bracemac-McLeod, Daniel1, Garon Lake, Bell Channel, McLeod Deep and down dip from Radiore. Within the extensive project area there are numerous exploration targets with excellent potential for additional discoveries.

Xstrata Zinc is the project operator for the Matagami project and all of the respective joint ventures. As operator, Xstrata Zinc is responsible for the execution of all development, production and exploration programs on the property. This includes resource evaluation, sampling, submittal of samples for assay, assay verification, metallurgical evaluation and quality assurance/quality control. Sample preparation and assaying are conducted by ALS Chemex-Chimitec, of Val d'Or, Que. (zinc, copper and silver by atomic absorption, and gold by standard fire assay procedures).

Robin Adair, vice-president of exploration, is the qualified person for Donner Metals and is responsible for the technical information related to resources and drill hole assay results reported in this news release.

We seek Safe Harbor.