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Great Western Minerals Group Signs Groundbreaking Heads of Terms to Build Rare Earth Separation Plant in South Africa

SASKATOON, SASKATCHEWAN--(Marketwire - 07/25/11) - Great Western Minerals Group ("GWMG") (TSX-V:GWG - News)(OTCQX: GWMGF) is pleased to announce that it has negotiated a Heads of Terms with Ganzhou Qiandong Rare Earth Group Ltd. ("GQD") of China to build a Rare Earth separation plant in South Africa, located in proximity to GWMG's Steenkampskraal operation.The Heads of Terms agreement between the two companies will form the basis of the project. Signing the Heads of Terms agreement in July 2011 positions GWMG to work toward the final agreement by the end of August 2011.A new joint venture company, Great Western GQD Rare Earth Materials Co. Ltd., will be created in which GWMG will hold 75% ownership while GQD will hold the remaining 25%.Great Western GQD Rare Earth Materials Co. Ltd. will be responsible for the design, manufacture, construction, commissioning and operation of the planned separation facility. It is anticipated that the separation plant will be fed with Rare Earth chloride that GWMG produces at its Steenkampskraal monazite mine and/or with feedstock from sources in the region.GQD is a highly respected Chinese processor of Rare Earth oxides and metals with over twenty years of operational experience. GQD has been a supplier of metals and oxides to GWMG's wholly-owned subsidiary, Less Common Metals Limited ("LCM") for over fifteen years.GWMG President and Chief Executive Officer Jim Engdahl said, "Our agreement with GQD marks one of the most significant developments so far in the delivery of our fully integrated Rare Earth business model. GQD's experience in the rare earth industry will ensure our new facility will be at the cutting edge of solvent extraction processing. GWMG's team of metallurgists will be working closely with those from GQD to finalize process and plant design in order to commence construction of this plant early in 2012. This agreement is a major step in our plans to deliver separated Rare Earth oxides and metals to the world market by the beginning of 2013."Mr. Gong Bin, Chairman of the Board and President of GQD stated, "The world of Rare Earths has gone through significant changes in the past two years. We at GQD welcome this opportunity to work with GWMG and our old friends at LCM in establishing a new integrated Rare Earths producer that is able to supply ever increasing world demand."Great Western Minerals Group Ltd. is an integrated Rare Earths processor. Its specialty alloys are used in the battery, magnet and aerospace industries. Produced at the Company's wholly owned subsidiaries Less Common Metals Limited in Birkenhead, U.K. and Great Western Technologies Inc. in Troy, Michigan, these alloys contain aluminium, nickel, cobalt and Rare Earth Elements. As part of the Company's vertical integration strategy, GWMG holds 100% equity ownership in Rare Earth Extraction Co. Limited, which owns a 74% equity interest in the Steenkampskraal Mine. In addition to a planned exploration program at Steenkampskraal, GWMG also holds interests in six Rare Earth exploration and development properties in North America.Email inquiries should be made to info@gwmg.ca and the company website is located at www.gwmg.ca. Inquiries by direct mail should be addressed to Great Western Minerals Group Ltd., 219 Robin Crescent, Saskatoon, SK S7L 6M8.Certain information set out in this News Release constitutes forward-looking information. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "could", "anticipate" or "will" and similar expressions) may describe expectations, opinions or guidance that are not statements of fact and which may be based upon information provided by third parties. Forward-looking statements are based upon the opinions, expectations and estimates of management of GWMG as at the date the statements are made and are subject to a variety of known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. Those factors include, but are not limited to, the execution and delivery of a definitive agreement encompassing the Heads of Terms and the proposed joint venture, the results of the exploration program, a resource estimate and commencement of production at Steenkampskraal, satisfaction of the conditions precedent with respect to GWMG's offtake agreement, receipt of all required approvals (including those relating to the commencement of production at the Steenkampskraal mine) and risks, uncertainties and other factors that are beyond the control of GWMG, risks associated with the industry in general, commodity prices and exchange rate changes, operational risks associated with exploration, development and production operations, delays or changes in plans, risks associated with the uncertainty of reserve or resource estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. In light of the risks and uncertainties associated with forward-looking statements, readers are cautioned not to place undue reliance upon forward-looking information. Although GWMG believes that the expectations reflected in the forward-looking statements set out in this press release or incorporated herein by reference are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward-looking statements of GWMG contained in this News Release, or incorporated herein by reference, are expressly qualified, in their entirety, by this cautionary statement and the risk factors contained in GWMG's current annual information form available at www.sedar.com.CUSIP: 39141Y 10 3Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.