GeoMegA Resources Inc. (GMA-TSXV)

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April 29, 2011 Issue

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With China Reducing Exportations of REE, Which is Used in Much of Today’s Clean Technologies and Only Two Other Mines in Line for Production Next Year, GeoMegA Resources Inc. is in The Right Space at The Right Time Exploring for Light Rare Earth Elements in Quebec Canada

Company Profile:

GeoMegA Resources Inc. is a Quebec based mineral exploration company focused on the identification and development of economic REE deposits. GeoMegA's current mineral portfolio is located in the Abitibi and Upper Laurentians regions of Quebec.

Simon Britt
President and CEO

Mr. Britt, a chartered accountant, is implicated in GéoMégA Resources Inc. since 2009. His implication in the successful completion of the initial public offering of the company earned him the respect of shareholders and board members. From May 2005 to June 2010, Mr. Britt was an accounting and securities consultant for listed junior mining companies.

He was, from January 2007 to August 2009, chief financial officer for Kinbauri Gold Corp, taken over by Orvana Minerals in August 2009. From January 2000 to May 2005, Mr. Britt practiced auditing and corporate finance mainly with public companies for Deloitte. He is a member of the Ordre des Comptables Agréés du Québec.

Mineral Exploration

GeoMegA Resources Inc.
475 Victoria avenue
St-Lambert, QC CA J4P 2J1
Phone: 450-465-0099


Interview conducted by: Lynn Fosse, Senior Editor,, Published – April 29, 2011

Mr. Britt, what is the overall vision for GeoMegA?

Mr. Britt: The overall vision for GeoMegA is the exploration of rare earth elements (“REE”) in Quebec, and hopefully the discovery and development of an economic deposit.


CEOCFO: What are some of the details of your current projects?

Mr. Britt: The current projects are located in the Abitibi region of Quebec, and also the Upper Laurentians. Our current flagship is the Montviel property, which we optioned from NioGold (NOX-TSXV) back in April of 2010.


CEOCFO: What is happening on that property today?

Mr. Britt: At our flagship Montviel property, we just sent out the second hole news release. We got the first results of first hole last Tuesday and the results are very encouraging. We went at it with deep five hundred meter holes and so far we have intersected mineralized carbonatite throughout the core length of the holes. Future looks very promising.


CEOCFO: Tell us about the rare earth elements; what are you looking for and what are you finding?

Mr. Britt: Montviel is a carbonatite, so you are looking at the light category of rare earth; mainly cerium, lanthanum, neodymium and praseodymium. What we are looking for mainly is for the neodymium content of the carbonatite. We are focused on the clean technologies, which are the two mass markets developing in the 21st century; the hybrid and electric vehicles and the wind turbines, both of them need the strongest magnets which are mainly built out of neodymium.

CEOCFO: Is there a history of neodymium in the area that you are looking, or what led you to the belief that was the place to look for it?

Mr. Britt: We knew it was a carbonatite, historical drilling performance in 1977 and 1979 and 2002 revealed traces of rare earth elements. The 2002 drilling was angled for a niobium discovery, but in the same assay package, they tested for lanthanum, which is one of the rare earth elements. A couple of assays topped the limits of the lanthanum detection, so they re-assayed for the whole rare earth family and we discovered then that it looked to be economical. Therefore, we optioned the property and financed a significant drilling campaign, a 10,000 meter drilling campaign.


CEOCFO: What is the availability in general for neodymium?

Mr. Britt: Currently, China controls pretty much 95% of the market. There will be two other producers of light rare earths, such as cerium, lanthanum and neodymium mainly, one of which is Molycorp with the Mountain Pass property in California and the other one is Mt. Weld in Australia. Both of these projects are former mines and are going back into production sometime in 2012, early 2013. China who provides the global demand is trying is cutting down on exports since the second semester of 2009 and have trimmed down the exports ever since. Therefore, once China retracts from the market you will be looking at just two other producers.


CEOCFO: So it is a good thing to find!

Mr. Britt: It is a good thing to find. Obviously, it has been reflected in the prices of every element which has soared significantly. We are definitely looking forward to identifying a neodymium deposit at Montviel.


CEOCFO: What happens next?

Mr. Britt: We are currently in about a third of the ten thousand meter drilling campaign completed. We have the first two holes, which are very encouraging. Right now we are proceeding to mineralogical and metallurgical testing; grade recovery is the second component when you have identified an economic deposit. Afterwards it will be the resource calculation, which will be a compilation of our drilling results and then there is the scoping study, which takes into account the deposit size, the metallurgy and the logistics of production. Montviel has a very good access by road, which I think will position the deposit in the front runners to go into production if everything is conclusive to be economic.


CEOCFO: What is the financial picture of the company today?

Mr. Britt: We completed our IPO on September 30th, $2.9 million IPO with $0.35 units. We have concluded a private placement on January 28th of another million with $0.90 units. The balance sheet currently stands at about $2.6 million in liquidity. We have a very light share structure, 15.5 million shares outstanding, 22 million fully diluted. We are looking very good. We are at the beginning of the story.


CEOCFO: How far will the funds take you?

Mr. Britt: With the current drilling program, we can finish it very easily. Also of note is that the Quebec exploration expenses are applicable to 40% tax credit, which we expect to be coming in the summer of 2011; our year end as of May 31st. We are very comfortable for I would say twenty-four months looking ahead, but the nature of the beast is that we are in a market that moves fast and we are very aggressive in terms of exploration. We have about twelve other distinct properties and Montviel will not be finished in terms of exploration until we have completed our current Phase I drilling program. So we are definitely looking to finance sometime in 2011 with something much more substantial that the million we did in January.


CEOCFO: Do you own the property 100%?

Mr. Britt: The option is a stage option, which gets us to 100% with NioGold, is over a four-year period. We need to incur $3.35 million of exploration expenses and issue 1.5 million shares. We have currently issued 1.1 million shares to NioGold and in the years two and three we will issue the additional 200,000 shares for the 1.5 million shares and afterwards this gets us into joint venture, 75% Geomega and 25% NioGold. We have a third option with which we can purchase the remaining 25% of NioGold for $9 million, 50% of which is decided by each party, either a cash payment or shares of GeoMegA.


CEOCFO: Are you still looking at additional properties; I know you have a bunch now?

Mr. Britt: Yes, we have a bunch. We claimed aggressively in December after we noticed that some things were left opened in Quebec. We pretty much claimed anything that was of interest to us. Are we looking for additional properties? Currently I would say no, but if we find that something is offered to us that looks intriguing we will definitely look at it.


CEOCFO: Will you be working any of the other properties?

Mr. Britt: Four of them we are looking to work over the next six months. Most of them are grassroots properties, so we will go out during the summer and the autumn of 2011; all four have an attributed exploration budget.


CEOCFO: You did mention that the investment community is paying attention; do you expect continued attention?

Mr. Britt: I think so. Right now, as long as China does not back off from cutting the exportation to secure internal needs and reduce environmental damages, you will see an increased interest. We are still looking at a gap until 2015, because Lynas and Molycorp will not fill the rest of the world’s demand. So we are definitely going to see additional attention. The only thing I think would put a damper on everything is if technology moves away, which could happen if the supply constraints are held too long. Producers will want to secure long-term plans and if they feel they can’t have continued access to the rare earths, they will develop something else.


CEOCFO: Are there any special challenges when you are looking for the rare earth elements that may be different than when you are looking at other minerals?

Mr. Britt: The metallurgy is different, that is the main challenge to the rare earth elements. There is an historical track record for the carbonatites (light REE), with Mountain Pass and Mt. Weld both being carbonatites. There is also the Bayan Obo deposit in China, the biggest REE deposit in the world, which is also a carbonatite. So you have an historical track record for the metallurgical process and the refining, which is already existent. The heavies are harder to find and so far even harder to extract. That is the main challenge of the rare earth family.


CEOCFO: In closing, why should potential investors pick GeoMegA out of the crowd?

Mr. Britt: There is significant upside, as we are a new company. There is not too much float at 15.5 million outstanding and 22 million fully diluted, but there is even less when you consider that we have approached every investor at the beginning one by one. As we demonstrate the potential of Montviel, market capitalization will increase, which will translate into higher share price that we are currently seeing. That is the main aspect. We have an experienced team, very good properties located at the best jurisdiction in the world in Quebec. We are a very good exploration company.


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At our flagship Montviel property, we just sent out the second hole news release. We got the first results of first hole last Tuesday and the results are very encouraging. We went at it with deep five hundred meter holes and so far we have intersected mineralized carbonatite throughout the core length of the holes. Future looks very promising. - Simon Britt does not purchase or make
recommendation on stocks based on the interviews published.