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 April 23, 2012
Nautilus Minerals signs landmark offtake agreement for Solwara 1

 Toronto, Ontario, 23 April, 2012 -- Nautilus Minerals Inc. ("Nautilus" or the "Company") today announced it has signed a binding heads of agreement with Tongling Nonferrous Metals Group Co. Ltd ("Tongling") for the sale of the product extracted from the Company's Solwara 1 deposit located in the Bismarck Sea, Papua New Guinea ("PNG").

The agreement provides for the purchase by Tongling of 1.1 million tonnes per annum (subject to +/- 20% variation) of Solwara 1 material for a period of three years on a take or pay basis, commencing upon the first delivery of product from Solwara 1, targeted in Q4 2013 in accordance with a notification mechanism and includes an option to agree an extension of the arrangement.

"The quality of this relationship with China's largest importer of copper concentrates provides further evidence that there is considerable interest in the high grade massive sulphides being found by the emerging seafloor resource production industry," said Nautilus CEO Stephen Rogers.

The material will be imported into China by Tongling and then processed through its facilities in the city of Tongling alongside the Yangtze River. After production of a copper concentrate it will be smelted in Tongling's industrial complex. The purchase price to be paid by Tongling will be based on the quality of the copper concentrate produced.

The agreement includes a mechanism for an early payment of 90% of the price upon loading of the export vessel in PNG. Final payment is based on the recovery of copper, gold and silver reporting to the copper concentrate with deductions for capped logistics and processing costs, smelter treatment and refining charges (TC/RCs), allowances for plant fixed capital recoveries and Tongling's tolling fee on concentrator plant processing costs. TC/RCs are based on Asian International benchmarks with a premium payable for the achievement of target metal recoveries.

The price payable for all metals will be set by the London Metal Exchange (LME) for copper and London Bullion Market Association (LBMA) for silver and gold with the initial payment for all metals based on the average of the month preceding the shipment and final payment on a four month Quotational Period.

Further value may be realised through a 50%/50% profit sharing scheme based on incremental by-product revenue realised in China, including gold bearing pyrite. Material from the process can be roasted in China to produce gold and sulphuric acid and the remaining calcine may be sold to cement manufacturers or as iron ore fines. With minimal waste Tongling's process brings significant benefits consistent with Nautilus' commitment to minimise environmental impacts.

The Company will issue a bank guarantee to Tongling in three stages over nine months, which will not exceed approximately US$11.5 million, as a security for 50% of Tongling's concentrator investment costs commencing at the first order of major equipment.

Nautilus CEO Stephen Rogers said the Company was looking forward to working with Tongling to realise the full potential of the high grade material extracted from Solwara 1. "We have now closed the value chain on the project, established our first customer for seafloor massive sulphides and look forward to building a long term relationship with Tongling," he said.

Nautilus is currently progressing the build of equipment, including the Seafloor Production Tools and Production Support Vessel (as those terms are used in the Company's Annual Information Form), for the Solwara 1 Project.

About Tongling Nonferrous Metals Group Co. Ltd

Tongling Nonferrous Metals Group Co., Ltd., together with its subsidiaries, engages in the copper smelting, copper ore mining, processing of copper products and other related businesses primarily in the People's Republic of China and has a revenue in excess of US$11.2 billion. They are one of the world's leading copper and zinc smelting groups. The company produces gold concentrates containing silver, copper, sulfur, and other elements; iron concentrates; sulfur fine sand products; single-sulphide, iron ore, and iron pellets; copper cathodes; copper flat wires; oxygen-free copper rods; phosphor copper anodes; precision brass sheets and strips; copper sheets and strip classes; lead frame strip classes; phosphor bronze tins; brass rods; self-adhesive and lubricating cables; and resistant wires. It also offers sulfuric acid, copper sulfate, and nickel sulphate. The company was formerly known as Anhui Tongdu Copper Co., Ltd. and changed its name to Tongling Nonferrous Metals Group Co., Ltd. in September 2007. Tongling Nonferrous Metals Group Co., Ltd. was founded in 1992 and was listed on Shenzhen Stock Exchange in 1996. It is headquartered in Tongling City, China. Tongling Nonferrous Metals Group Co., Ltd. is one of the companies with the most complete industry chain in China. In 2011, the copper contained in the self-produced copper concentrate is 48,500 tons, the copper cathodes produced is 854,400 tons, the sulfuric acid produced is 2,067,000 tons, and the gold produced is 11.15 tons. The core business of Tongling is copper smelting. As of the end of 2011, Tongling has total assets of US$5,117 million, net assets of US$1,814 million, sales revenue of US$11.218 billion and total profits of US$296 million.

For more information please refer to www.nautilusminerals.com or contact:

Investor Relations
Nautilus Minerals Inc. (Toronto)
Email: investor@nautilusminerals.com
Tel: +1 (416) 551 1100

Numis Securities Limited
Nominated adviser: Alastair Stratton
Corporate broking: James Black
Tel: + 44(0) 20 7260 1000

Neither the TSX nor the London Stock Exchange accepts responsibility for the adequacy or accuracy of this press release.

Certain of the statements made in this news release may contain forward-looking statements within the meaning of the United States Securities Exchange Act of 1934 and forward-looking information within the meaning of applicable Canadian securities law. Forward-looking statements and forward-looking information include, but are not limited to statements or information with respect to the the future price of copper, gold and other metals, the estimation of mineral resources, the realization of mineral resource estimates, the timing and amount of estimated future production, the fulfilment of the obligations under the Tongling sales agreement and the timing and suitability of such arrangements, the Company's financial position, business strategy, plans and objectives of management for future operations. We have made numerous assumptions about the material forward-looking statements and information contained herein including the Company's present and future business strategies, the charter rate for ore-transport barges, the proposed mine plan and the good faith performance of the obligations of counterparties pursuant to contracts with the Company. The Company has also assumed that market fundamentals will result in sustained copper and gold demand and prices; that the proposed development of its mineral projects will be viable operationally and economically and proceed as expected; and that any additional financing needed will be available on reasonable terms. Risks relating to these assumptions include the over-arching risk that the Company will not commence production of mineralised material, that future prices of copper, gold and other metals will be lower than expected; and possible variations in resources, grade or recovery rates. Please refer to the company's most recently filed Annual Information Form in respect of other material assumptions and risks relevant to forward looking information. Even though our management believes the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that the forward-looking statement or information will prove to be accurate. Forward-looking statements and information by their nature involve known and unknown risks, uncertainties and other factors which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking statements or information. Such risks, uncertainties and other factors include, among others, the risk that the amount of metals contained in the company's deposits may differ from estimates of resources. Should one or more of these risks, uncertainties or other factors materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements and information. Although we have attempted to identify factors that would cause actual results to differ materially from those described in forward-looking statements and information, there may be other factors that cause actual results, performances, achievements or events to not be as anticipated, estimated or intended. Also, many of the factors are beyond our control. There can be no assurance that forward-looking statements or information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly you should not place undue reliance on forward-looking statements or information. Except as required by law, we do not expect to update forward-looking statements and information as conditions change and you are referred to the full discussion of the Company's business contained in the Company's reports filed with the securities regulatory authorities in Canada.
 
 

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