TORONTO, ONTARIO--(Marketwire - March 11, 2011) -

NOT FOR ISSUE IN THE UNITED STATES OR TO U.S. NEWSWIRE SERVICES

Largo Resources Ltd. ("Largo" or the "Company") (News - Market indicators) is pleased to announce that it has entered into a letter of intent (the "Letter of Intent") with Eton Park Capital Management, L.P. on behalf of one or more funds managed by it ("Eton Park"), Arias Resource Capital Management LP on behalf of one or more funds managed by it ("ARCM") and Mackenzie Investments on behalf of one or more funds managed by it ("Mackenzie") (collectively, the "Lead Investors"), two of Largo's current investors. The Lead Investors have agreed in principle, subject to certain conditions, to participate as the lead orders in a proposed private placement financing (the "Private Placement"), for a significant proportion of the placement, to be completed by the concurrent issuance of Units and Subscription Receipts (each as defined below) for aggregate gross proceeds to Largo of not less than CDN $110 million. 

The first portion of the Private Placement will consist of the issuance of units (each a "Unit") at a price of $0.35 per Unit for aggregate proceeds to Largo of $30,000,000 with each Unit consisting of one common share and one-third of one common share purchase warrant (a "Warrant") where each whole Warrant will entitle the holder to acquire one further common share at a price of $0.50 for a period of 48 months from the date of issue. Concurrently, Largo will issue subscription receipts (each a "Subscription Receipt") at a price of $0.35 per Subscription Receipt for aggregate proceeds to Largo of approximately $80,000,000. Each Subscription Receipt will convert, at no additional cost to the holders thereof, into one Unit upon the achievement of certain milestones.

Mark Brennan, the President and Chief Executive Officer of Largo, commented, "We are extremely encouraged that the Lead Investors, including Largo's two largest investors, have agreed to lead this financing in order to secure the necessary equity funding for our construction of the Maracas Vanadium Mine. The Private Placement represents a financing alternative that allows Largo to maintain control over the development of the Maracas Mine, our near term tungsten production from the Currais Novos property and a 100% interest in the Campo Alegre property that we believe has potential to host a significant iron ore deposit."

In connection with the entering into of the Letter of Intent, Largo's previously announced proposed financing for its Maracás Vanadium project (see press release dated October 27, 2010) has been terminated.

Banco Itaú BBA of Brazil has been engaged to act on behalf of Largo in the Private Placement.

Largo intends to use gross proceeds of the Private Placement to fund the development of Largo's mining project for the exploitation of vanadium and other ores located mainly in the City of Maracás, State of Bahia, Brazil, through its subsidiary entity, Vanádio de Maracás S.A.

The Private Placement is subject to, without limitation, the successful negotiation of definitive agreements with the Lead Investors and other investors who will participate in the Private Placement and receipt of all necessary regulatory approvals, including TSX Venture Exchange approval, and shareholder approval as may be required by the TSX Venture Exchange in respect of the Private Placement. The Units and the Subscription Receipts, and underlying securities, will be subject to a hold period ending four months and one day following the date of issue of the Units and Subscription Receipts, respectively.

This press release is not an offer of securities for sale in the United States or in any other jurisdiction. The securities being offered have not been and will not be registered under the United States Securities Act of 1933 and accordingly are not being offered for sale and may not be offered, sold or delivered, directly or indirectly within the United States, its possessions and other areas subject to its jurisdiction or to, or for the account or for the benefit of a U.S. person, except pursuant to an exemption from the registration requirements of that Act.

About Largo

Largo is a Canadian-based mineral resource exploration and development company focused on creating a world leading strategic metals company. The Company currently holds an 80% interest in the Maracás Vanadium Project, a 100% interest in the Currais Novos Tungsten Tailing Project, a 100% interest in the Campo Alegre de Lourdes Iron-Vanadium Project, all in Brazil, and a 70% interest in the Northern Dancer Tungsten-Molybdenum property located in the Yukon Territory, Canada. The immediate goal of the Company is to develop the Maracás Vanadium Project by Q1 2013 and begin production of WO₃ concentrate from the reprocessing of tungsten tailings from Currais Novos by June, 2011. Largo has a very skilled management team both in Canada and Brazil with the ability to advance these projects.

Largo is listed on the TSX Venture Exchange under the symbol "LGO".

For more information please refer to Largo's website: www.largoresources.com

Cautionary Statement on Forward Looking Information

This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, without limitation, statements regarding the execution of definitive agreements, expected size of the Total Placement, proposed use of proceeds; receipt of necessary approvals; and the requirements for additional capital. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including risks inherent in the mining industry and risks described in the public disclosure of the Company which is available under the profile of the Company on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.