Canadian Royalties Inc.

Canadian Royalties Inc.

June 17, 2008 09:52 ET

Canadian Royalties/Nunavik Nickel Project Exploration Update: Extension of High-Grade Mesamax Deep Zone; Anomalous Rhodium Detected at Allammaq

MONTREAL, QUEBEC--(Marketwire - June 17, 2008) - Canadian Royalties Inc. (TSX:CZZ) ("Canadian Royalties" or the "Corporation") is pleased to report the down-plunge extension of a zone (the "Deep Zone") of high-grade nickel, copper, platinum, and palladium mineralization, which commences approximately 100 metres below the bottom of the proposed Mesamax open pit. The extension of the Deep Zone includes a 6.85 metre interval of predominantly net-textured mineralization in diamond drill hole MXNW-07-156 that assayed 1.15% Nickel, 1.01% Copper, 0.55 g/t Platinum and 2.42 g/t Palladium.

Mesamax Deep Zone

During 2006 Canadian Royalties tested for the existence of additional mineralization at depth along a northeast dipping fault. Several holes were drilled near the centre of the Mesamax deposit, intersecting the interpreted fault at depths ranging from 100 metres to 250 metres below surface (approximately 20 to 170 metres immediately below the bottom of the proposed Mesamax open pit). Follow-up testing during 2007 consisted of four (4) holes of which only one attained its target (MXNW-07-156). The drilling focused on section 1000W, located 50 metres east of section 1050W where several 2006 drillholes intersected mineralization over substantial widths (i.e.: 3.22% Ni and 2.68% Cu over 4.50 metres, and in a second lower zone: 1.04% Ni and 0.52% Cu over 7.95 metres in hole MXNW-06-145).

Composite assay values and drill locations from the 2007 drillholes at the Mesamax Deep Zone are summarized in the tables below:

Table 1 - Mesamax Deep Zone Composite Assays

Hole From To Width Ni Cu Pt Pd
Number (m) (m) (m) (%) (%) (g/t) (g/t)
MXNW-07-154 Frozen hole; target not attained
MXNW-07-155 198.50 200.10 1.60 1.53 1.99 0.85 2.20
Vein assay; Frozen hole & target not attained
MXNW-07-156 244.80 251.65 6.85 1.15 1.01 0.55 2.42
MXNW-07-157 Incomplete hole; to be deepened in 2008

Table 2 - Mesamax Deep Zone Drillhole Locations

Hole Easting Northing Azimuth Dip Final Depth
Number (UTM NAD83, Zone 18) (degree) (degree) (m)
MXNW-07-154 592683E 6828160N 208.7 -62 117.00
MXNW-07-155 592683E 6828159N 208.7 -62 320.45
MXNW-07-156 592637E 6828082N 208.7 -70 309.00
MXNW-07-157 592674E 6828050N 208.7 -81 132.00

Inadequate drill data exists to fully complete the evaluation of the Mesamax Deep Zone. Further delineation of the zone is proposed as a component of the 2008 exploration program.

Allammaq Rhodium

Canadian Royalties recently re-analyzed four (4) Allammaq drillholes for rhodium content. Anomalous rhodium values were returned from all four (4) holes including MX-07-58, which intersected 18.35 metres of mineralization that graded 0.254 g/t rhodium; of particular note: individual samples from hole MX-07-32 ran up to 0.848 g/t.

Rhodium consumption is dominated by catalytic applications where it is used with platinum and palladium to control exhaust emissions in gasoline and diesel-powered vehicles. As of June 16th the price of rhodium was $9,730 US/oz, or more than $312 per gram (source:

Table 3 - Allammaq Composite Assays (Ni, Cu, Pt and Pd previously reported)

Hole From To Width Ni Cu Pt Pd Rh
Number (m) (m) (m) (%) (%) (g/t) (g/t) (g/t)
MX-07-32 145.15 170.90 25.75 2.10 2.29 0.61 2.97 0.232
MX-07-35 125.00 149.85 24.85 1.45 1.02 1.06 3.65 0.093
incl. 135.00 149.85 14.85 1.85 1.29 1.44 4.53 0.080
MX-07-42 107.00 144.15 37.15 1.67 2.20 1.11 4.20 0.165
MX-07-58 119.55 137.90 18.35 2.52 2.41 1.06 3.35 0.254

Table 4 - Allammaq Drillhole Locations (previously reported)

Hole Easting Northing Azimuth Dip Final Depth
Number (UTM NAD83, Zone 18) (degree) (degree) (m)
MX-07-32 595559E 6827515N 358 -62 244.10
MX-07-35 595509E 6827513N 358 -75 240.00
MX-07-42 595457E 6827590N 178 -70 237.00
MX-07-58 595407E 6827592N 178 -79 201.00

The economic significance of elevated rhodium content at Allammaq has yet to be ascertained, but suggests that further analytical and metallurgical work is warranted. The Corporation intends to continue its rhodium re-sampling program and anticipates expanding it to other deposits forming part of the Nunavik Nickel project.

Sampling and Assays

Core samples are either split or sawn on-site, individually sealed in bags and shipped off-site on a regular basis to the ALS Chemex laboratory in Val-d'Or, Quebec for sample preparation. Analyses are performed at the ALS Chemex laboratory in Vancouver, British Columbia. Base metal analyses including nickel and copper are determined by sodium peroxide fusion with ICP-AES analysis. Platinum, palladium and gold analyses are determined by fire assay and ICP-AES finish. Where requested, rhodium analyses were obtained using ALS Chemex's Rh-MS25 fire assay with gold collection and ICPMS finish analytical method. The Corporation's quality control (QA/QC) program includes regular insertions of blanks and standards. Reported values are uncut and composite intervals are reported as length along the core axis.

Qualified Person

W. Grant Arnold (P.Geo.), Vice-President, Exploration for Canadian Royalties, is a Qualified Person (as such term is defined in National Instrument 43-101-Standards of Disclosure for Mineral Projects), and is responsible for the geological information presented herein.

About Canadian Royalties and the Nunavik Nickel Project

Canadian Royalties has initiated the development of an independent, stand-alone nickel-copper mine on its Nunavik Nickel project, located 20 kilometres south of Xstrata Nickel's Raglan Mine in Nunavik, Quebec. Canadian Royalties has now received its Environmental Certificate of Authorization and Mine Lease for the Expo site and is proceeding to construction.

Forward-looking Statement

This news release contains certain forward-looking statements or forward looking-information. These forward looking statements are subject to a variety of risks and uncertainties beyond the Corporation's ability to control or predict which could cause actual events or results to differ materially from those anticipated in such forward looking statements. Such risks and uncertainties are disclosed under the heading "Risk Factors" in the Corporation's Annual Information Form for the year ended December 31, 2007 and dated March 31, 2008. Further, forward-looking information is in addition based on various assumptions, including, without limitation, the expectation and beliefs of management, the assumed long term price of nickel, that the Nunavik Nickel project is a technical viable and economic operation, that it can be successfully completed by the Corporation, that the Corporation will receive the required permits and access to surface rights, and that the Corporation can access financing, appropriate equipment, and sufficient labour. Should one or more of these risks and uncertainties materialize, or should the underlying assumption prove incorrect or different, actual results may vary materially from those described in the forward-looking statements. All forward looking statements speak only as of the date of this news release, accordingly, readers should not place undue reliance on forward-looking statements.

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