Adanac Molybdenum Corporation

Adanac Molybdenum Corporation

March 19, 2008 16:45 ET

Adanac Molybdenum Corporation: Ruby Creek Project Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 19, 2008) - Adanac Molybdenum Corporation (TSX:AUA)(PINK SHEETS:AUAYF)(FRANKFURT:A9N) -


On January 28, 2008 Michael MacLeod, Chief Executive Officer of the Company, announced that the Company has temporarily suspended its field construction activities at its Ruby Creek Project (the "Project") near Atlin, British Columbia, pending the putting into place of a bridge financing (the "financing") which is being negotiated by its financial agents. The Company's US financial agents have been working diligently on securing up to $80 million in bridge financing which forms part of the $650 million capital expenditures to fund the 23,000 TPD mine and mill construction at Ruby Creek. The US agents have received a term sheet from an interested major institution but the terms are not in line with Adanac's ability to move the project forward on its existing obligations. The US agent is attempting to restructure the terms on a more positive basis while continuing discussions with other interested parties. Adanac has positioned itself to be one of the few mining projects capable of proceeding to production over the next eighteen months. The Company has received notice that four of its suppliers have filed builders' liens on the Project totaling approximately $3,000,000. These claims are not in dispute and will be paid by the Company in the ordinary course of business from its expected financing.

Adanac's salient features are:

- Long lead items have been ordered and are scheduled to be delivered throughout 2008 and early 2009 (If ordered today, lead times for several of the items have increased to between 36 and 48 months).

- Updated technical report has been completed (see news release dated December 6, 2007) and confirms positive economics of the Ruby Creek Project. The Ruby Creek Project is projected at 23,000 TPD for a 21 year mine life with pay back from the 5 year high grade starter pit in 3.2 years.

- Detailed engineering by Amec PLC is about 60% complete.

- Adanac received its permit approving its pre-construction work program at Ruby Creek on December 24, 2007. The permit to construct is imminent and requires a $3 million bond.

- Adanac is currently working with the responsible agencies to complete the Federal comprehensive review by the 4th quarter 2008.

- Adanac received its Environmental Assessment Certificate from the British Columbia Government on September 10, 2007. A major milestone for the Company.

- Exploration diamond drilling outside the pit area to the north, south and west has identified significant molybdenum mineralization up to 256 meters grading .08% Mo in the north wall of the pit. Once resources are established on these mineralized areas years could be added to the life of the mine.

- The Company continues to negotiate an Impact Benefits Agreement with the Taku-River Tlingit whom have been very supportive of the Ruby Creek Project.

- Supply and demand factors continue to influence the price of molybdenum positively as the price per pound of molybdenum remains in the $33 to $34 per pound range.

The capital markets have been undergoing significant turbulence and uncertainty. The resulting instability in the financial markets has made it much more difficult to obtain financing for major projects. Although the backlash has been disruptive, projects like Ruby Creek are gaining significant attention as a result of the advanced state of the project.

On Behalf of Management


Michael MacLeod, President & Chief Executive Officer

Visit our website to watch Larry Reaugh, Executive Chairman of Adanac Molybdenum Corporation interview with SmartStox Online TV Talk Show.

This news release may contain certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents filed from time to time with the Toronto Stock Exchange, the British Columbia Securities Commission and the US Securities and Exchange Commission.

The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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