Canadian Royalties Inc.

Canadian Royalties Inc.

January 11, 2007 09:55 ET

Canadian Royalties Inc./2006 Exploration Results: Expo Deposit Indicated Resources Increase by 93% to 8.6 Million Tonnes

MONTREAL, QUEBEC--(CCNMatthews - Jan. 11, 2007) - Canadian Royalties Inc. (TSX:CZZ) reports a significant increase of the mineral resources for its Expo deposit as a result of 11,317 metres of infill drilling completed during the 2005 and 2006 exploration seasons. The indicated resources have increased 93% to 8,562,000 tonnes grading 0.76% nickel (Ni), 0.76% copper (Cu) and 1.76 g/t combined platinum (Pt) + palladium (Pd) + gold (Au) (PGE) with additional inferred resources of 478,000 tonnes grading 0.81% Ni, 0.83% Cu and 1.72 g/t PGE. This represents a significant increase in the resources available to support a long-term plan of operations.

The updated undiluted resource estimate completed by P&E Mining Consultants Inc., based on exploration conducted to December 31, 2006 and ongoing metallurgical test work, is summarized in the table below:

Ni Cu Co Au Pt Pd PGE
Category tonnes (%) (%) (%) (g/t) (g/t) (g/t) (g/t)

Resources 8,562,000 0.76 0.76 0.04 0.08 0.32 1.36 1.76

Resources 478,000 0.81 0.83 0.04 0.07 0.32 1.33 1.72


- Mineral resources which are not mineral reserves do not have
demonstrated economic viability. The estimate of mineral resources
may be materially affected by environmental, permitting, legal,
title, taxation, sociopolitical, marketing, or other relevant

- The quantity and grade of reported inferred resources in this
estimation are conceptual in nature and there has been insufficient
exploration to define these inferred resources as an indicated or
measured mineral resource and it is uncertain if further
exploration will result in upgrading them to an indicated or
measured mineral resource category.

The mineral resources in this press release were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council December 11, 2005.

The mineral resources are reported at a CDN$40/tonne NSR cut-off value, at the following metal prices in US$: Ni: $5.50; Cu: $1.50; Co: $15; Au: $425; Pt: $900; and Pd: $300, with a CDN/US exchange rate of $0.80.

Additional exploration results from the 2006 program, including assays from drilling at Mequillon and Mesamax, new resource estimates for the Ivakkak, Mequillon and Mesamax deposits, and a final compilation of the new resources update will be reported over the next two months.

Eugene. Puritch, P.Eng. and Tracy Armstrong, P.Geo of P&E Mining Consultants Inc. will be the authors of an NI 43-101 compliant Resource Estimate Technical Report on the Expo deposit to be filed within 45 days of this press release. . They are Qualified Persons in accordance with National Instrument (NI) 43-101, and are responsible for the information presented in this press release. All assaying was completed by ALS Chemex with sample preparation completed in Val-d'Or, QC and analyses completed at ALS Chemex in Vancouver, BC. Base metal values were determined by sodium peroxide fusion with ICP-AES analysis. Platinum, palladium and gold values were determined by 30 gram fire assay with ICP-AES finish. Additional information regarding the deposit including assays of the new drill holes will be available in an updated technical report, which is to be filed on SEDAR by February 28, 2007.

About Canadian Royalties and the Raglan South Nickel Project

Canadian Royalties is evaluating the potential of establishing an independent, stand-alone Ni-Cu-PGE mining and milling operation in the general vicinity of Xstrata Nickel's Raglan Mine in Nunavik, Quebec. Canadian Royalties is currently proceeding with permitting applications, a bankable feasibility study (1) ("BFS"), and an environmental and social impact analysis ("ESIA").

(1) A bankable (full) feasibility study is a comprehensive analysis of a projects economics (+/- 15% precision) and is used by the banking industry for financing purposes.

The statements contained in this press release may contain statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections.

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