DPM Dundee Precious Metals Inc

Dundee Precious Metals Inc. (TSX:DPM)(TSX:DPM.WT)(TSX:DPM.WT.A) ("DPM" or "the
Company") is pleased to announce it has entered into a binding letter of intent
(the "LOI") with Weatherly International plc ("WTI") for the purchase of WTI's
Tsumeb smelter assets and related business. The acquisition includes all land,
plant and other assets used by or in connection with or which benefit or pertain
to WTI's smelter business (the "Transaction").


The consideration to be provided to WTI by DPM upon completion of the
Transaction will be:




i.  US$33 million, consisting of: 
    a.  US$18 million in cash (less any amounts drawn under a US$2 million
        working capital loan to be provided to WTI, as outlined below); and 
    b.  the issuance of approximately 4,446,420 fully paid common shares of
        DPM; and 
ii. the assumption by DPM of all third party obligations of Namibia Custom
    Smelters (Pty) Limited ("NCS"), a subsidiary of WTI. 



Under the LOI, DPM will (subject to any necessary exchange control consents
being obtained) provide: (i) a working capital loan facility to WTI of up to
US$2 million, and (ii) a working capital loan facility to NCS of up to US$4
million. The loans shall be made on the same terms as the current loan agreement
between Chelopech Mining EAD ("CME") and NCS.


"DPM's purchase of the Tsumeb smelter will secure value-added, downstream
processing capacity for the Company" said Jonathan Goodman, President and CEO of
DPM. "This is a very important consideration as we work to double concentrate
production at our Chelopech Mine. We see great opportunity as a custom smelter
for complex concentrates and look forward to developing this asset and its
related business opportunities."


The LOI is conditional inter alia upon:



i.   the parties entering into a detailed sale and purchase agreement
     containing the warranties, indemnities and other terms provided for in
     the LOI; 
ii.  WTI shareholder approval; 
iii. WTI's agreement not to exercise its remaining rights under its
     subscription agreement with DPM dated July 31, 2009 and DPM release of
     all such obligations; 
iv.  there having been no material adverse change in the physical assets,
     licences, permits, waivers, consents or approvals that benefit the
     smelter operations; 
v.   WTI's convertible noteholders consent and agreement to the full
     settlement of their notes (and discharge of security for such notes);
     and 
vi.  Toronto Stock Exchange approvals. 



As of today, DPM has received irrevocable undertakings from approximately 44% of
WTI shareholders to support the Transaction. The outstanding conditions of the
LOI are to be satisfied by February 28, 2010 or such other date as the parties
may agree. In the event the Transaction is not completed by June 30, 2010, any
amounts drawn down under the loan to NCS would become due to DPM on demand.


CONFERENCE CALL

DPM will hold a conference call to discuss the Transaction with analysts on
Thursday, January 14, 2010 at 11:00 a.m. (EST). The call will be hosted by
Jonathan Goodman, President and Chief Executive Officer, and will be webcast
live (audio only) at:
http://events.digitalmedia.telus.com/dundee/011410/index.php. The audio webcast
of this call will be archived and available on the Company's website at
www.dundeeprecious.com.


Dundee Precious Metals Inc. is a Canadian based, international mining company
engaged in the acquisition, exploration, development and mining of precious
metals. DPM owns the Chelopech Mine, a producing gold/copper mine, and the
Krumovgrad Gold Project, a mining development project, both located in Bulgaria,
as well as a 95% interest in the Kapan Mine in Armenia. In addition, it is
engaged in mineral exploration activities in Serbia.


FORWARD-LOOKING STATEMENTS

This news release may contain certain information that constitutes
forward-looking statements. Forward-looking statements are frequently
characterized by words such as "plan," "expect," "project," "intend," "believe,"
"anticipate" and other similar words, or statements that certain events or
conditions "may" or "will" occur. Forward-looking statements are based on the
opinions and estimates of management at the date the statements are made, and
are subject to a variety of risks and uncertainties and other factors that could
cause actual events or results to differ materially from those projected in the
forward-looking statements. These factors include the inherent risks involved in
the exploration and development of mineral properties, the uncertainties
involved in interpreting drilling results and other geological data, fluctuating
metal prices and other factors described above and in the Company's most recent
annual information form under the heading "Risk Factors" which has been filed
electronically by means of the Canadian Securities Administrators' website
located at www.sedar.com. The Company disclaims any obligation to update or
revise any forward-looking statements if circumstances or management's estimates
or opinions should change. The reader is cautioned not to place undue reliance
on forward-looking statements.

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