Nautilus Annual Results

Nautilus Minerals Inc. has ended fiscal 2010 in a strong financial position with $165-million (U.S.) in cash and cash equivalents, and after making significant progress in the development of its pioneering sea floor resource project in the Bismarck Sea of Papua New Guinea.

The company has today released its 2010 full-year financial results, annual information form and updated National Instrument 43-101 technical report.

The highlights of the year were as follows:

Commencement of a major exploration drilling campaign in the Bismarck

Sea, which has delivered an enhanced understanding of the Solwara 1

deposit;

Advanced development of the Solwara 1 project, with the key contract for

construction of sea floor production tools (SPT) reinstated during the

year;

Release of a comprehensive study outlining expected capital and

operating costs associated with production of ore from the Solwara 1

deposit, which confirms the robust commercial aspects of the project.

• Commencement of a major exploration drilling campaign in the Bismarck

Sea, which has delivered an enhanced understanding of the Solwara 1

deposit;

• Advanced development of the Solwara 1 project, with the key contract for

construction of sea floor production tools (SPT) reinstated during the

year;

• Release of a comprehensive study outlining expected capital and

operating costs associated with production of ore from the Solwara 1

deposit, which confirms the robust commercial aspects of the project.

Since the year-end, the company has announced further major progress in the development of the Solwara 1 project, and in other exploration initiatives, as follows:

In January, the PNG government granted Nautilus the first mining lease

in the Pacific region to allow deep-sea resource development in the

Bismarck Sea. The lease provides Nautilus with a 20-year licence to mine

an area of approximately 59 square kilometres surrounding Solwara 1, 50 km north of

Rabaul, where Nautilus intends to mine high-grade copper and gold

deposits on the sea floor, at depths of approximately 1,600 metres.In March, the PNG government confirmed its intention to take a 30-per-cent stake

in the Solwara 1 project as a joint venture partner. The government will

contribute funds to the project in proportion to its interest, including

its share of the exploration and development costs incurred to date.

Also in January, Nautilus moved to a 100-per-cent interest in United Nickel Inc.

(since renamed), which has applied to the International Seabed Authority

for a licence to explore for polymetallic nodules in a 75,000-square-kilometre area of the sea floor in the Clarion Clipperton zone (CCZ) of

the eastern Pacific. The CCZ contains significant accumulations of

polymetallic nodules, which may become an important source of copper,

nickel and cobalt in the future.

• In January, the PNG government granted Nautilus the first mining lease

in the Pacific region to allow deep-sea resource development in the

Bismarck Sea. The lease provides Nautilus with a 20-year licence to mine

an area of approximately 59 square kilometres surrounding Solwara 1, 50 km north of

Rabaul, where Nautilus intends to mine high-grade copper and gold

deposits on the sea floor, at depths of approximately 1,600 metres.

• In March, the PNG government confirmed its intention to take a 30-per-cent stake

in the Solwara 1 project as a joint venture partner. The government will

contribute funds to the project in proportion to its interest, including

its share of the exploration and development costs incurred to date.

• Also in January, Nautilus moved to a 100-per-cent interest in United Nickel Inc.

(since renamed), which has applied to the International Seabed Authority

for a licence to explore for polymetallic nodules in a 75,000-square-kilometre area of the sea floor in the Clarion Clipperton zone (CCZ) of

the eastern Pacific. The CCZ contains significant accumulations of

polymetallic nodules, which may become an important source of copper,

nickel and cobalt in the future.

The company reported a loss of $45-million (U.S.) for the year, with total expenses of $46.5-million (U.S.), including $26-million (U.S.) in exploration costs, and wages and salaries of $7.7-million (U.S.). Total assets were $207-million (U.S.), including $165-million (U.S.) in cash and cash equivalents, leaving the company well positioned for the continuing development of the Solwara 1 project in 2011.

“Nautilus made excellent progress in 2010, the most significant milestone being the grant of the mining lease early in the new year,” said Nautilus president and chief executive officer Stephen Rogers.

“We are now finalizing an agreement with a potential joint venture partner, and our exploration drilling campaign has produced encouraging results. We look forward to further significant advancements in the project during the remainder of 2011,” he said.

The following documents have been filed on SEDAR and are available from the SEDAR and the company’s websites:

Audited consolidated financial statements, and management’s discussion

and analysis for the year ended Dec. 31, 2010;

Annual information form;

National Instrument 43-101 technical report as at Dec. 31, 2010.

• Audited consolidated financial statements, and management’s discussion

and analysis for the year ended Dec. 31, 2010;

• Annual information form;
• National Instrument 43-101 technical report as at Dec. 31, 2010.