Royalco Resources, Royalco Philippines, Vale International SA and Vale Exploration Philippines, both wholly owned subsidiaries of Vale, have executed an Option Agreement concerning Royalco's Gambang tenement in the Philippines.

Royalco Philippines, Royalco's operating subsidiary in the Philippines, will retain administrative responsibility for the tenement until the exercise of the option.

To realize the full potential of substantial porphyry targets, such as those contained at Gambang, requires the technical and financial expertise of a quality mining house such as Vale. Hence Royalco's desire to deal with this project on appropriate terms which also match the Company's ambitions in regards to royalty interests.

Royalco itself will continue to concentrate its current exploration efforts in the Philippines on targets with a gold emphasis. Vale Exploration, a wholly owned subsidiary of Vale SA, the world’s second largest Mining Company.