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General Metals Update: Historical Independence Mine Gold and Silver Production Figures and Future Exploration and Development Plan

Posted on: Wednesday, 22 March 2006, 06:00 CST

General Metals Corporation (OTCBB:GNLM) takes this opportunity to update the historical gold and silver production figures from its Independence Mine in the Battle Mountain Mining District in Lander County, Nevada. The Independence claims are completely surrounded by Newmont Mining's Phoenix Mine (www.newmont.com) and is a 240-acre island with legal access.

The Independence mine is predominately a silver mine that produced intermittently from 1938 through 1987 in seven separate operations. Production came from 8 miles of underground workings developed along a 1,500 ft. strike length of the Independence fault zone. Reported historic production by the various operators totaled 750,200 ounces silver and 11,029 ounces gold. The average recovered grade of all recorded production was 0.17 and 11.53 ounces of gold and silver per ton, respectively. (See Executive Summary). Poor silver prices in 1987 led to the shutdown of the mine. With today's silver at over $10 per ounce and gold at over $500 per ounce, development is timely.

From 1995 - 1997 there were several exploration campaigns conducted by Noranda, Teck Exploration, Northern Dynasty and Great Basin Minerals which resulted in about 80 reverse circulation and core drill holes being drilled and reported. The 1997 Carrington Report, the 1997 Akright Report, the 2006 Carew Report and the 2005 Frost and Larsen findings have been cited below. These reports are available for review in their entirety at the Company's office in Reno, Nevada. An Executive Summary has been prepared containing a thorough discussion of production and exploration activities and will be available soon on the Company's website, www.generalmetalscorporation.com.

According to Akright in his 1997 report, "the gold resource potential of the Independence property occurs in two distinct categories: a shallow open pit mineable target, suitable for heap leach and a deep underground target. Insufficient drilling has been done to calculate a proven or probable reserve for the shallow target. However, mineralized material containing 235,000 ounces of gold and 2,500,000 ounces of silver have been estimated by Carrington (1997)." Our 2006 exploration drilling campaign is designed to bring the shallow target into a resource category according to SEC Industry Guide 7.

Based on this previous work (Carrington, 1997 and Akright, 1997), "this gold mineralization is directly analogous to the famous Fortitude deposits in terms of structure and igneous association, ore and gangue mineralogy, paragenesis, age and host rock type. The Fortitude produced 2.8 million ounces of gold from 11 million tons of ore. It is believed that the Independence surface and shallow mineralization is directly connected to the deep mineralization. Making volume and grade assumptions based on the Fortitude analogy, and using the limited deep drilling by Noranda, the deep target in the southern area of the property could contain mineralized material with 1.4 million ounces of gold at an average grade of 0.17 ounces gold per ton, or 818,000 ounces of gold at a grade of 0.27 ounces gold per ton." The deep target will be further explored once the shallow target is brought to a level of confidence to start open pit mining and subject to available future financing.

According to a review report prepared by Carew, P. Geo (Feb 2006), "a large body of mineralized material is, however, clearly indicated by previous drilling, as illustrated by the grade-thickness plot in Figure 2 (see Executive Summary). A program of re-logging some 25,000 feet of Noranda drill core, stored on the property, was completed in August 2005 by Karl Frost (2005), in addition to petrographic (thin section) studies by Dr. L.T. Larsen (2005). Frost noted gold values in all the deep holes, and Larsen identified gold as separate grains, apparently as a late stage event, both indications that gold recovery should be straightforward."

As part of our pre-feasibility study for the shallow target heap leach operation, leach testing is being conducted and leach pad engineering, design and building costs are being put out for bid. Refurbishing of the existing cyanide decantation mill on the property could enable processing of high-grade ore not suitable for heap leach. Operating permitting is a process that requires extensive engineering, testing and time to be finalized and management has commenced that process to enable early cash flow.

An initial budget of $600,000 will be expended for geology, geophysics, phase 1 drilling and early permitting, with an additional $2.5 million budgeted to complete the drilling, permitting, heap leach and mine development for the shallow mining operation. Targeted recovery: 235,000 oz. of gold and 2.5 million oz. of silver.

Notice Regarding Forward-Looking Statements

This news release contains "forward-looking statements", as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, the development, costs and results of our exploration program at our Independence Mine project, the existence of any economically recoverable mineralized material, any similarities to the Fortitude deposit and any anticipated future production.

Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with mineral exploration. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that the beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-KSB for the 2004 fiscal year, our quarterly reports on Form 10-QSB and other periodic reports filed from time to time with the Securities and Exchange Commission.

Source: Business Wire

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