VANCOUVER, BRITISH COLUMBIA, Tambangnews.com.-  Southern Arc Minerals Inc. ("Southern Arc" or the "Company") (TSX VENTURE:SA) is very pleased to announce that, subject to TSX Venture Exchange acceptance, it has entered into an option and joint venture agreement (the "Agreement") with Vale S.A. ("Vale"), through its wholly-owned subsidiary Vale International S.A., regarding its East Elang and Sabalong properties.

To exercise its option, Vale must fully fund the advancement of either property, through to and including the completion of a Bankable Feasibility study, at no cost to the Company.

Vale is the second largest metals and mining company in the world and the largest private sector company in Latin America by market capitalization. Vale is the world's largest producer of iron ore, a key raw material for steelmaking, and the world's second largest producer of nickel. Vale also produces manganese, ferroalloys, thermal and coking coal, bauxite, alumina, aluminum, copper, cobalt, gold, platinum group metals, and fertilizer nutrients, important raw materials for the global industrial and food production industries. Vale shares are traded on the New York Stock Exchange - NYSE (VALE and VALE.P), on the Sao Paulo Stock Exchange - BM&F BOVESPA (Vale3 and Vale5) and on the Euronext Paris (Vale3 and Vale5).

John Proust, CEO of Southern Arc says, "This agreement is a significant milestone for the Company in advancing these two key properties. It reflects and confirms the Company's strategy to acquire, evaluate, and advance mineral properties in Indonesia. The Agreement provides Southern Arc with the opportunity to develop East Elang and Sabalong from early exploration through to and including bankable feasibility studies, while retaining a 25% interest in a joint venture with one of the largest mining companies in the world. We look forward to working with Vale on both of these projects as we seek to add value for both companies, for the local communities, and of course, for our shareholders."

East Elang

The East Elang property, covering 9,670 hectares, adjoins immediately to the east of Newmont Mining Corporation's Elang-Dodo property, host to a porphyry copper-gold discovery of size greater than one billion tonnes (with yet undisclosed grades). Newmont acquired the East Elang property (currently held by Southern Arc) in 1986, explored it up to 1993, and then relinquished it to the government in 1999 under the requirements of its license.

Mineralization on the adjacent Newmont property comprises a complex of polyphased felsic to intermediate intrusives which generated multiple mineralized porphyry centres (Elang, Gergang, Kuning, and Sepekat) along a NNE trending structural corridor. Rock geochemistry of surface and drill hole samples demonstrate a NE-SW elongate copper zone more than 1.5 km long by 0.8 km wide (Maryono, 2005).

Remote sensing studies together with modeling of airborne magnetic data indicate that the controlling NNE trending mineralized structural corridor (present on the Newmont property) extends on to Southern Arc's property. Limited surface evaluation work and airborne studies by the Company support this finding.

Previous exploration by Newmont on the East Elang property identified a series of epithermal gold-silver-bearing quartz veins within a large argillic alteration system. Such alteration systems are often surface expressions ("lithocaps") of upper or distal portions of mineralized porphyry Cu-Au systems. **

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