Canarc Resource Corp.
OTC Bulletin Board : CRCUF

Canarc Resource Corp.

March 20, 2006 13:15 ET

Canarc Closes CA$3.5 Million Flow-Through Financing for New Polaris Gold Project, BC

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 20, 2006) -

Canarc Affiliate, Aztec Metals Completes Name Change, Share Consolidation, Debt Settlement, Rights Offering and CA$1.1 Million Private Placement for Working Capital

Canarc Resource Corp. (TSX:CCM)(OTCBB:CRCUF) announces it has closed on CA $3,525,599 in flow-through financing for the New Polaris gold project in northwestern British Columbia.

The planned CA$2.7 million financing was well oversubscribed so the Company agreed to increase the offering total to CA$3.5 million. The Company issued 4,299,511 flow-through common shares at CA$0.82 per share in two private placements to 47 investors.

Dundee Securities Corp. acted as agent for the brokered placement of 3,850,000 shares totalling CA$3,157,000. Canarc paid Dundee a 6% fee, consisting of CA$123,123 and 80,850 common shares. Dundee also received broker's warrants exercisable to purchase 231,000 common shares at CA$0.82 until March 17, 2007. The non-brokered placement of 449,511 shares totaling CA$368,599 was placed privately and CA$20,316 in finders fees were paid.

The CA$3.5 million proceeds of the private placements will be used by Canarc to carry out an expanded Phase 3 in-fill drilling program of approximately 65 holes totaling 20,000 m of core on the New Polaris gold project in northwestern B.C. that will bring 600,000 ounces of the historic resource to a N.I. 43-101 compliant status. The 2006 work program will also include a conceptual mine plan, initial economic assessment, and additional environmental studies needed to enter into the provincial mine permitting process.

Diamond drilling, environmental studies and related site work are expected to get underway in May 2006 and wrap up in October 2006. In connection with the 2006 work program, Canarc will incur Canadian Exploration Expenses in 2006 and then renounce them to the private placees no later than December 31, 2006.

In addition to the CA$3.5 million in flow-through funds, Canarc currently holds approximately CA$3.6 million in cash and marketable securities. The Company is now fully funded for 2006, including work planned for the New Polaris and Benzdorp properties and working capital for the evaluation of new acquisitions.

Canarc also announces that an affiliated company, Aztec Metals Corp. has completed a name change, share consolidation, rights offering, shares for debt settlement and CA$1.1 million private placement financing for working capital.

Previously known as Minera Aztec Silver Corporation, Aztec Metals now has 13.9 million shares issued, 18.8 million shares fully diluted and holds over CA$1.5 million in cash. Canarc previously held approximately 65% of Minera Aztec and currently owns 2.7 million shares (19.5%) and 0.5 million warrants (17% fully diluted) of Aztec Metals.

Aztec Metals is actively evaluating base metal projects with precious metal credits for acquisition, principally in Mexico and Peru. Using a similar business model to Endeavour Silver Corp., Aztec intends to acquire more advanced or past-producing mine projects where it can add value quickly by expanding resources and production.

Canarc Resource Corp. is a growth-oriented, gold exploration and mining company listed on the TSX (symbol CCM) and the OTC-BB (symbol CRCUF). The Company's principal assets are its 100% interest in the New Polaris gold deposit, British Columbia and its 80% option on the Benzdorp gold property in Suriname. Major shareholders include Barrick Gold Corp. and Kinross Gold Corp.

On Behalf of the Board of Directors


Bradford J. Cooke, Chairman and C.E.O.


Certain statements contained herein regarding the Company and its operations constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plans, objectives, assumptions or expectations of future performance, are "forward-looking statements". We caution you that such "forward-looking statements" involve known and unknown risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such statements. Such risks and uncertainties include fluctuations in precious metal prices, unpredictable results of exploration activities, uncertainties inherent in the estimation of mineral reserves and resources, fluctuations in the costs of goods and services, problems associated with exploration and mining operations, changes in legal, social or political conditions in the jurisdictions where the Company operates, lack of appropriate funding and other risk factors, as discussed in the Company's filings with Canadian and American Securities regulatory agencies. The Company expressly disclaims any obligation to update any forward-looking statements.

The TSX Exchange has neither approved nor disapproved the contents of this news release.

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