Mega Uranium Updates on Development of Lake Maitland Uranium Project in Australia

Mega Uranium Ltd. (TSX:MGA) has provided an update on the development of its Lake Maitland Uranium Project in Western Australia.

Mega recently completed a Test Pit Program ("Program") at Lake Maitland, concluding a key component in the preparation of the Definitive Feasibility Study ("DFS") and Environmental Review and Management Program ("ERMP") currently underway for the Project.

The Program involved the excavation of two test pits, approximately 34 m long by 19 m wide and 5 m deep.

The objectives of the Program, achieved over an eight week duration, provided Mega with fundamental information for the DFS and ERMP.

The highlights of the Program include:

• Completion of a close spaced grade control drilling program over the test pit areas prior to excavation commencing;
• Validation of the geological model interpreted from drilling data;
• Demonstration that a truck and excavator mining method is viable and that the ore and overburden can be excavated without blasting;
• Demonstration that selective mining is achievable using high precision GPS equipment on the excavator;
• Natural groundwater flow into the test pits was less than expected and the barrier system trialled around the test pits was successful in reducing groundwater inflows;
• Dewatering of the test pits during the Program, together with monitoring undertaken, has provided invaluable data required to evaluate the aquifer characteristics; and
• Data collected from monitoring of groundwater drawdown and quality, as well as other environmental parameters, including air quality, will provide information to assist with the environmental impact assessment studies for the Project.

Mega's environmental approach, aiming to have as low an impact as possible, was achieved throughout the Program. Since the excavation work has been completed, the test pits have been backfilled and rehabilitation has commenced in accordance with Mega's Mining Proposal approved by the Western Australian Department of Mines and Petroleum.

EXPLORATION DRILLING ADJACENT TO MEGA'S LAKE MAITLAND PROJECT

Near Resource and Extensional Drilling

Further to Mega's announcement on September 29, 2010 regarding its intention to undertake an exploration drilling program, Mega has revised the program's scope and drilling will commence this month.

Mega will be investigating extensions to its uranium deposit at Lake Maitland, targeting near surface calcrete uranium mineralisation within the same drainage system that hosts the deposit in ground that is largely unexplored.

This exploration drilling will now be conducted as a single phase rather than a multi-phase program and will occur in the two main areas previously advised, which are:

• Southern Area within E53/1210 - 99 holes covering an 800m by 800m grid pattern will be drilled to an average depth of 15m, for a total of 1,500 metres.
• North Western Area within E53/1211 - 39 holes to be drilled to an average depth of 15m, for a total of 500 metres.

Deeper Palaeochannel Drilling for Roll Front Uranium Mineralisation

Mega is also currently investigating the potential for deeper roll front uranium mineralisation within the Tertiary Carey Palaeochannel. Recent drilling targeting palaeochannels for production water bores has also encountered highly anomalous uranium intervals associated with redox boundaries. Although exploration for these deeper channel deposits has been very successful elsewhere in Australia, and in particular South Australia, their potential has not yet been explored at Lake Maitland. Deeper drilling down to 120m is being planned to target these redox channels later this year.

EXPLORATION DRILLING AT MEGA'S 100% OWNED KINTRYE ROCKS PROJECT

Further to Mega's announcement on 23 November 2010, further diamond core drilling is planned to commence in the first half of 2011 at Mega's wholly owned Kintyre Rocks Project in Western Australia on the Area 1, Southern Cross, Wyoming Valley and other prospects. These prospects, located 3 to 6 kilometers from the Cameco-Mitsubishi Kintyre resource (79 million pounds U₃O₈), contain uranium targets which have geophysical/geological similarities to Kintyre.

EXPLORATION DRILLING AT MEGA'S 100% OWNED BEN LOMOND PROJECT

At Mega's wholly owned Ben Lomond uranium-molybdenum resource in Queensland, Australia, diamond core and reverse circulation drilling programs are being planned this year to pursue further extensions to the west of the deposit and potential repetitions to the north of the East/West trending mineralisation. Sophisticated fluid flow and structural modelling techniques are being applied to refine drill targets in a highly prospective East/West sediment filled graben immediately north of the deposit.

Ben Lomond, located some 50 kilometers west-southwest of the city and port of Townsville, contains a NI 43-101 compliant resource comprising:

• an Indicated Resource of 7.9 million pounds U₃O₈ at an average grade of 0.27% U₃O₈; and
• an Inferred Resource of 2.8 million pounds at a grade of 0.21% U₃O₈.

In a 1982 internal feasibility study by Minatome Australia Pty Ltd ("Minatome Study") the resource was also reported to contain a substantial molybdenum credit of 0.15% Mo.

The Ben Lomond resource occurs at low elevation in remote, sparsely populated hill country at an easily accessible site, and is favourably located with respect to mine development, as it is close to power, water and essential services. The Minatome Study concluded that 70% of the delineated resource was mineable by open pit at a 5:1 stripping ratio and that the remainder of the resource was conducive to extraction by underground workings from the pit. In 1984, an Environmental Impact Study was accepted by the relevant Federal and State authorities, but in 1985 the planned mine development was halted by the imposition of the "Three Uranium Mines Policy" by the then Australian Federal Labor Government. Mine development at Ben Lomond is currently prevented by the Queensland State Labor Government's policy banning new uranium mines in the State.

Stewart Taylor, Mega's President and Qualified person under NI43-101, is responsible for this release and has verified the contents disclosed.