CORPORATE PROFILE

First Metals Inc. (FMA-T) was formed in 2006 to capitalize on record high metals prices. The First Metals management team brings a combination of mining expertise and entrepreneurial and professional experience designed to effectively and efficiently advance the development to production of two identified copper-zinc deposits.

The location of the Fabie Bay/ Magusi River Deposits and their advanced stage of development are key components in making the project successful.

The properties are located in Quebec, a mining friendly jurisdiction, in the heart of the Abitibi Region, which boasts a long history of mining and possibly the best mining workforce in the world. Hydro, water and equipment are readily available. Permitting is well understood, which has allowed for a systematic, 'normal course' roll-out of a mine plan.

The Fabie Bay/ Magusi River Deposits were discovered 35 years ago. Since then, extensive prospecting, drilling and feasibility studies (non-NI 43-101 compliant) have been carried out. Juniors and seniors have worked and advanced the project over the years. Included in the work are the important phases of bulk sampling and test milling, with favourable results on both grades and recoveries. Most of the requisite elements were in place to advance to production. With the recent increases in copper and zinc demand and the corresponding price increases, the following elements have been addressed in 2007:

• The access road has been upgraded to 40 tonne truck haulage standards;
• 35km of hydro lines and 500KW substations have been installed;
• refurbishment of the access ramp to the 150m level has been completed;
• Roscoe Postle Associates completed NI 43-101 Reports on the deposits;
• Golder and Associates provided assistance in successfully completing the permitting process;
• All required mining equipment has been purchased;
• Staffing is in place;
• The open pit has been drilled off and blasted and mucking is in progress;
• Underground development is ongoing, with ore being trucked to the mill's storage building;
• A 1500 tonne per day mill rehabilitation program is nearing completion; A smelting agreement has been signed  with Xstrata Copper Canada;

Conclusion: The project is about to transition from being an advanced exploration project.  The history of expenditures and the results, the degree of advancement, including the test mining and milling, have greatly reduced the risk from a geological perspective. The participation of Golder and Micon, and the previous development by Noranda and Mining Corporation. have also served to mitigate the engineering challenges.  Xstrata' s milling and smelting expertise minimise metallurgical risks. The access to local infrastructure- be it people, drills, equipment or utilities, is as good as it gets. With funding and management in place, First Metals is well positioned to meet its goal of capitalizing on the current copper and zinc prices and becoming a profitable mining company within a relatively short time.

ANNUAL REPORT
(highlights and Chairman's Message)