TALON METALS ANNOUNCES EXTENSION ON LOAN TO SABER ENERGY ON POSITIVE CORPORATE DEVELOPMENTS

Road Town, Tortola, British Virgin Islands – Talon Metals Corp., (“Talon” or the “Company”) (TSX: TLO) today announces a further six month extension on the maturity date of Talon’s $6 million loan to Saber Energy Corp (“Saber”). The revised maturity date of the loan is October 31, 2009. This loan is part of the binding Heads of Agreement entered into by Saber and Talon on September 25, 2008 (the “Heads of Agreement”) regarding a potential merger of the two companies.

This second extension of the loan maturity date is based on today’s news that Saber has signed a Heads of Agreement with Tlou Energy (“Tlou”) to conduct further exploration on Saber’s Coal Bed Methane (“CBM”) properties in Botswana. Tlou is a 50-50 joint venture between Mitchell Energy Group (“Mitchell”) and Walcot Capital (“Walcot”). Mitchell and Walcot are leaders in exploration and development of CBM projects in Australia. These exploration programs will be funded to the “proof of concept” stage solely by Tlou. In return, Tlou will earn an ownership position in various companies that hold the Botswana land licences.  

“We are pleased that Saber has a strategic joint venture partner that will fund exploration of its CBM properties in Botswana to proof of concept and believe that, with Tlou’s expertise, Saber’s exploration program will be enhanced,” said Mr. Stuart Comline, President and CEO of Talon.”

Also under the loan extension agreement, Saber is required to make principal repayments should it raise funds through the sale of assets or financing activities prior to the loan maturity date. Interest on the loan will be payable at a rate of 18% per annum  for the first three months of the loan extension period, and at 25% per annum on the second  three months of the loan extension period. The loan is secured against Saber’s assets; namely its land licenses in Botswana and equipment.

In addition, Talon will receive three million common share purchase warrants of Saber under the loan extension agreement. These warrants are in addition to the three million warrants Talon received under the 2008 Heads of Agreement. 

Talon’s exclusive right to enter into a merger with Saber has also been extended until April 30, 2010. Talon’s due diligence review of Saber regarding a potential merger of the two companies remains ongoing.

Saber is a private CBM exploration company focused on developing a CBM and shale gas field in the Karoo Basin in Botswana, Africa.

In addition, Talon is continuing to investigate other acquisition opportunities in the resources sector. Several due diligence reviews are currently underway on significant strategic resource opportunities.

About Talon

Talon is a TSX-listed company focused on the acquisition, exploration and advancement of high quality resource projects.  The Company has a well-qualified exploration and management team with extensive experience in exploration and project management.

Talon has a treasury of approximately CDN$7 million and holds 2,450,000 common shares in Beadell Resources Limited (ASX:BDR). Talon has 27,054,222 common shares outstanding.

For additional information on Talon please visit the Company’s website at www.talonmetals.com or contact:

Erica Belling
VP Investor Relations
Tau Capital Corp.
Tel: (416) 361-9636 x 243
Email: ebelling@taucapital.com

About Tlou Energy

Tlou Energy is a 50-50 joint venture between Mitchell Energy Group and Walcot Capital. Together the two companies provide a wealth of technical, drilling, operating and commercial experience in CBM projects globally.

Mitchell Energy Group was formed from Mitchell Drilling, a specialized drilling company whose surface to in-seam drilling technology helped revolutionize the Australian CBM industry. Today Mitchell Energy Group is an integrated contractor offering a full range of drilling services on a global basis. www.mitchellenergygroup.com

Walcot Capital is a Brisbane based private venture capital business specializing in energy investment. Walcot Capital’s capabilities extend across technical, commercial and legal fields of the energy sector with its principals having founded and developed successful CBM companies in both Australia and New Zealand.

Forward-Looking Statements

This press release contains certain “forward-looking statements”.  All statements, other than statements of historical fact, that address activities, events or developments that Talon believes, expects or anticipates will or may occur in the future are forward-looking statements, including, without limitation, statements regarding Talon’s plans and objectives, the $6 million interim loan to Saber and the extension of the maturity date thereof, the potential merger of Talon and Saber (the “Merger”, with the company resulting from such Merger being hereinafter referred to as “MergeCo”), the continuation of Talon’s due diligence review of Saber, the entry by Saber and Tlou into a heads of agreement, the proposed conduct and funding by Tlou of further exploration on Saber’s CBM properties in Botswana to the “proof of concept” stage, and the proposed earn-in by Tlou of an ownership position in various companies that hold the Botswana land licences.  These forward-looking statements reflect the current expectations or beliefs of Talon based on information currently available to Talon.  Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of Talon to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on Talon.  Factors that could cause actual results or events to differ materially from current expectations include, among other things: the failure of such further exploration by Tlou to yield positive results; the failure of Talon and Saber (together, the “Companies”) to reach agreement and to execute a pre-Merger agreement; the failure of the Companies to complete the Merger; Saber failing to repay the interim loan from Talon and interest thereon; volatility of and sensitivity to market prices for gas and prices (market or otherwise) for electricity; changes in the anticipated demand for electricity in southern Africa; changes in equity and debt markets; inflation; changes in exchange rates; uncertainties relating to the availability and costs of financing needed to complete exploration activities, demonstrate the feasibility of the gas reserve and to develop Saber’s proposed 1,000 megawatt power plant (the “Power Project”); the ability of Saber and/or MergeCo (as well as any joint venture with Tlou) to conclude power purchase agreements with the intended offtakers of the Power Project; exploration costs varying significantly from estimates; delays in the exploration and development of, and/or commercial production from, the Power Project and the properties Saber has an interest in; inability to commercially exploit the resources of the Power Project or the areas covered by Saber’s prospecting licences, including the production of downstream products such as petrochemicals; inability to secure and produce sufficient water to support gas production; actual gas usage varying from assumptions; inability to, or delays in, procuring the engineering, procurement and construction contract, labour, capital equipment and/or operating parts and supplies required for the Power Project; equipment failure; unexpected geological or hydrological conditions; political risks arising from operating in Africa; imprecision in preliminary resource estimates, including estimates of the life and recovery thereof; success of future exploration and development initiatives; inability to establish the minimum amount and quality of reserves required to support the proposed Power Project; competition; operating performance of facilities; environmental and safety risks, including increased regulatory burdens, seismic activity, weather and other natural phenomena; inability to, or delays in, obtaining necessary permits and approvals from government authorities, including approval of environmental impact assessment applications; the existence of undetected or unregistered interests or claims, whether in contract or in tort, over the property of Saber and/or MergeCo, respectively; failure to acquire interests in prospecting licences that Saber currently has an interest in; changes in government regulations and policies, including tax and trade laws and policies; risks relating to labour; and other exploration, development and operating risks.

Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable laws, Talon disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise.  Although Talon believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.  Information pertaining to Saber has been furnished by Saber.  Although Talon does not have any knowledge that would indicate that any such information is untrue or incomplete, Talon assumes no responsibility for the accuracy or completeness of such information.