Discovery Zone

The Discovery Zone VMS deposit at Reed Lake, Manitoba was discovered in volcanic rocks under approximately 20 meters of flat-lying dolomite and sandstone using the new VTEM helicopter-borne EM system. The deposit occurs within a sequence of altered felsic and mafic volcanic rocks intruded by a quartz-feldspar porphyry dyke. The high grade near solid to solid sulphide copper mineralization occurs at or near the contact between massive aphyric to porphyritic and fragmental basalt and an altered felsic volcaniclastic unit. The basalt is crosscut by an anastomozing system of chlorite-silica-chalcopyrite veins and pervasive fronts of silicification interpreted to represent a classic footwall alteration plumbing system.

On March 4, 2010 VMS Ventures entered into a non-binding Letter of Intent with a subsidiary of HudBay Minerals respecting VMS' Reed Lake Discovery Zone, the copper-rich Reed Lake property claims optioned from HudBay, the two southern claims adjoining the Reed Lake property and certain exploration properties adjacent to the Reed Lake property, that are 100% held by VMS. The Letter of Intent contemplates that the parties will enter into a definitive Joint Venture Agreement respecting the two Reed Lake property claims and the two claims immediately south of the Reed Lake property. HudBay will have a 70% interest in the Joint Venture and VMS will have a 30% interest. Upon execution of the definitive Joint Venture Agreement, HudBay will make certain cash payments to VMS in satisfaction of its obligation to earn back in to the property and as consideration for VMS transferring the southern claims to the Joint Venture. Under the Joint Venture, HudBay will act as operator with primary authority and discretion as to the exploration and potential development of the Reed Lake property and will have exclusive rights to purchase and market the ore produced from the new Joint Venture. HudBay will provide full financing for VMS's proportionate share of the costs to develop the property, which will be repayable solely from VMS' share of cash flow generated by the project.

The Letter of Intent also provides that, concurrently with the entering into of the Joint Venture Agreement, VMS and HudBay will enter into an Option Agreement that grants HudBay the option to earn a 70% interest in four adjacent properties held by VMS, including the Tower Zone and Super Zone properties. Upon making certain cash payments and meeting work commitments over two to three years with respect to each property, HudBay will earn a 70% interest in the applicable property resulting in a new Joint Venture between VMS and HudBay on substantially the same terms as the Reed Lake Joint Venture. Any failure to make the required cash payments and work commitments with respect to a particular property will result in such property reverting to 100% ownership by VMS, but will not affect HudBay's option over the other properties.

VMS will update all information within 24 hours of the dissemination of any news release regarding deposit developments.

Reed Lake Picture Page

Deep-EM and Magnetic Survey Results Map

3D Gravity and Magnetic Map - View to 146

3D Ore Lense Map - Bearing 320 Degrees

3D DHPEM and VTEM EM Map - Bearing 30 Degrees

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