http://finance.yahoo.com/news/Avalon-Provides-Progress-iw-1746401735.html?x=0&.v=1

Avalon Provides Progress Report on Metallurgical Testwork, Nechalacho Rare Earth Elements Deposit, Thor Lake, Northwest Territories, Canada

The 2011 winter drilling program commenced in January and 34 holes totaling 8291 metres have now been completed with 17 of these holes recovering the larger PQ core. An additional 10 short holes were drilled for purely geotechnical purposes. The smaller drill, equipped to recover HQ core, has been drilling holes to define additional Indicated Mineral Resources in the West Long Lake area, where previous drilling has identified a high grade sub-zone within the Basal Zone. Initial assay results from this drilling should be available in early May.

Simultaneously, the larger rig (equipped for PQ core) has been completing 50 metre spaced holes in areas of thicker Basal Zone intercepts in order to generate a bulk sample for metallurgical testwork, as well as upgrading Inferred resources to the Indicated level of confidence. Results from this drilling will be slower to arrive due to a lengthy sample preparation procedure designed to maximize the amount of sample available for future metallurgical testing.

A program of geotechnical drilling is commencing using the smaller drill, to test ground conditions in the proposed tailings area where berms would be required. This drilling is proceeding ahead of schedule and will finish within a few days when the drill will return to resource drilling. The larger drill will continue acquiring metallurgical sample until Spring break-up in May.

Avalon continues to hold discussions with potential customers for its rare earth products. Many industrial consumers in the US, Japan and Korea are very concerned about the future availability of heavy rare earths and neodymium. Some of these consumers have expressed interest in partnering with the Company in the development of the project and discussions in this regard are on-going.

On the permitting process, the Company received the final Terms of Reference ("TOR") for the environmental impact assessment from the Mackenzie Valley Environmental Impact Review Board ("MVEIRB") on February 15, 2011. Since then Avalon, along with EBA Engineering Consultants Ltd, have been working diligently on the Developers Assessment Report ("DAR"), commonly known as an Environmental Impact Statement utilizing the TOR as its foundation. Avalon anticipates the completion of the DAR by the end of April, 2011. Upon submittal of the DAR to MVEIRB, a work schedule will be developed by MVEIRB outlining the expected timeline for completion of the Environmental Assessment process.

Community engagement efforts continue with all of the Company's aboriginal partners in the Northwest Territories. Avalon has entered into Negotiation Agreements with the Yellowknives Dene First Nation and the Deninu K'ue First Nation and is presently working toward concluding a similar agreement with the Lutsel K'e Dene First Nation.