TALON SIGNS LETTER OF INTENT WITH RIO VERDE MINERALS ON THE SERGIPE POTASH
PROJECT

ROAD TOWN, Tortola, British Virgin Islands, Oct. 14 /CNW/ - Talon Metals Corp., ("Talon" or the "Company") (TSX: TLO) is pleased to announce that it has entered into a Letter of Intent (the "LOI") with Rio Verde Minerals Corp. ("Rio Verde") regarding Talon's Sergipe Potash Project in Brazil. The intention of the parties is to complete a transaction whereby Talon will transfer to Rio Verde all of Talon's rights in the Sergipe Potash Project licences in return for approximately 27 million shares or about 66% of Rio Verde*.

Rio Verde's strategic plan is to be a leading Brazilian focused fertilizer company. It is currently an unlisted company. Complementing Talon's potash properties as part of Rio Verde's build-out of its fertilizer business, Rio Verde is expected to acquire certain phosphate properties in Brazil from Sercor Ltd. ("Sercor"), which is also a party to this LOI. Under the terms of this LOI, Sercor would hold about 22% of Rio Verde*.

"This transaction is aligned with our strategy to secure a partner to develop the Sergipe Potash Project," said Stuart Comline, President and CEO of Talon. "We believe the synergy in combining these phosphate and potash assets in one company creates a compelling competitive advantage and enhances shareholder value for all parties. Also importantly, it allows Talon to focus its management team and financial resources on the development of its iron ore projects."

Upon completion of the transactions contemplated by the LOI (the "Proposed Transactions"), Talon will have the right to nominate a majority of the directors of Rio Verde until Rio Verde completes a "going public" transaction, if at all. It is anticipated that Mr. Warren Newfield, Chairman of Talon and Mr. Luis M. F. De Azevedo, COO of Talon will be appointed as directors of Rio Verde. It is also expected that Mr. David Beatty, CEO of Rio Novo Gold Inc. (TSX:RN), will be appointed Chairman of Rio Verde.

The Proposed Transactions are expected to close in December 2010. The closing is conditional upon, among other things, the board of directors of Talon having received a fairness opinion from a financial advisor, satisfactory due diligence by all of the parties, the execution by the parties of binding definitive agreements and Rio Verde raising aggregate gross proceeds of at least US$3 million.

Upon completion of the Proposed Transactions, Talon will acquire pre-emptive rights to a proportionate participation in any future offering of equity securities of Rio Verde, exercisable for so long as Talon holds 10% or more of the issued and outstanding common shares of Rio Verde, subject to termination in the event that Rio Verde completes a "going public" transaction.

Following closing of the Proposed Transactions, Rio Verde intends to continue the exploration program for the Sergipe Potash Project and to prepare a technical report for this project in compliance with Canadian National Instrument 43-101.

Pending the successful conclusion of this transaction and Talon's previously announced transaction with Tlou Energy Limited, Talon's primary focus will be its 100% owned iron ore projects in Brazil. Talon is undertaking an aggressive exploration program at its Trairão Iron Ore Project.  As a substantial shareholder of Tlou Energy and Rio Verde following the completion of these transactions, Talon's shareholders would stand to benefit from any significant exploration success on these gas and fertilizer projects.

* as of the closing date of the Proposed Transactions, excluding a planned Rio Verde financing of at least US$3 million prior to closing.

Potash Drilling Program Update

Talon's drilling program at the Sergipe Potash Project is now anticipated to begin immediately following the delivery of all the drilling equipment to site by November.  The delivery of all of this imported equipment unfortunately has been delayed since Talon's last update to shareholders in July.

About Talon

Talon is a TSX-listed company focused on the acquisition, exploration and development of iron ore and other mineral 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$5 million and currently has 63,877,950 common shares issued and outstanding and 69,706,950 shares fully diluted.

About Rio Verde

Rio Verde Minerals Corp. is a private company focused on the exploration and development of fertilizer projects in Brazil.

Following the closing of the proposed transactions with Talon Metals Corp. and Sercor Ltd., Rio Verde expects to have one potash project and four phosphate projects in Brazil. Potash and phosphate fertilizers have favourable supply and demand dynamics and Rio Verde expects to have a significant cost advantage by being based in Brazil. Rio Verde intends to fast track exploration to establish a Canadian National Instrument 43-101 resource estimate.

Rio Verde intends to complete a "going public" transaction through the listing of its shares on a recognized exchange in Canada, although there can be no assurance that this transaction will be completed or that Rio Verde's shares will ever be listed on a stock exchange.

Forward Looking Statements

This news release contains certain "forward-looking information". All information, other than information pertaining to historical fact, which addresses activities, events or developments that Talon believes, expects or anticipates will or may occur in the future constitutes forward-looking information. Such forward-looking information includes, among other things, statements relating to: the proposed terms for, and anticipated timing and completion of, the Proposed Transactions; the expected benefits of the Proposed Transactions to Talon and its shareholders; the Company's proposed business plans, investments and priorities following the completion of the Proposed Transactions; Rio Verde's future strategic and exploration plans, including the completion of, and timing for, a National Instrument 43-101 compliant technical report on the Sergipe Potash Project; the completion of the Company's transaction with Tlou Energy Limited; future drilling activities by the Company at the Sergipe Potash Project; and the possible completion of a "going public" transaction by Rio Verde in the future.

Forward-looking information is subject to significant risks and uncertainties and other factors that could cause the actual results to differ materially from those discussed in the forward-looking information, 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, the Company. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to: the inability of the Company, Rio Verde and/or Sercor to satisfy, or obtain a waiver of, the conditions precedent to the completion of the Proposed Transactions for which they are each responsible; a delay or failure by Talon, Rio Verde and/or Sercor to comply in all material respects with the terms and conditions of the LOI; a delay in the receipt of, or a failure to obtain, any required regulatory approvals for the Proposed Transactions; adverse market conditions; changes to regulations affecting the Company's activities, including tax and trade laws and policies; changes in the price of, or demand for, iron ore and/or potash and/or phosphate; adverse political developments in Brazil, Botswana or any of the other countries in which the Company's operations are located; the success of future exploration and development initiatives; uncertainties relating to the availability and costs to the Company of financing for exploration and development; Rio Verde's failure to complete a "going public" transaction; and other risks involved in the mineral exploration and development industry.

The forward-looking information in this news release reflects the current expectations, assumptions or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made certain assumptions about the Company's business, the economy and the mineral exploration industry in general, the regulatory framework in Brazil, Botswana and/or the other countries in which the Company's operations are located, including that the Company, Sercor and/or Rio Verde will be able to satisfy or obtain a waiver of any conditions imposed by applicable regulatory authorities necessary in order to complete the Proposed Transactions, the execution of a definitive agreements relating to the Proposed Transactions, the satisfaction or waiver, as applicable, of the conditions precedent to the completion of the Proposed Transactions, Rio Verde proceeding with its intention to complete a "going public" transaction in the near future, and has also assumed that no significant events occur outside of the Company's normal course of business. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.

Forward looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update forward-looking information, whether as a result of new information, future events or results or otherwise.

For further information:

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

Erica Belling, CFA
VP Investor Relations
Tau Capital Corp.
Tel: [phone] x 243
Email: [email protected]

For additional information on Rio Verde Minerals Corp., please visit www.rvminerals.com or contact:

Stephen Keith
President & CEO
Rio Verde Minerals Corp.
Tel: [phone]
Email: [email protected]