Channel Resources Ltd.

Channel Resources Ltd.

December 11, 2008 14:56 ET

Channel Appoints IBK Capital Corp. to Lead Private Placement Financing; Corporate Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 11, 2008) - Channel Resources Ltd. ("Channel" or the "Company") (TSX VENTURE:CHU) announces that it has entered into an agreement with IBK Capital Corp. ("IBK Capital") for the arrangement of a private placement equity financing, on a best-efforts basis, for up to C$1,000,000.

The Company intends to use the proceeds of this financing to advance the Fox Creek lithium project in Alberta and the Tanlouka gold project in Burkina Faso, and for corporate development and general working capital purposes.

The specific terms of the proposed financing have not yet been finalized; however, any such financing would be subject to a cash commission and the issuance of broker warrants. A non-refundable work-fee, deductible from the cash commission payable upon closing of the financing, is being paid to IBK Capital.

The final terms of the proposed financing will be subject to the approval of the TSX Venture Exchange.

Fox Creek Lithium Brine Project, Alberta

A due diligence program for the Fox Creek lithium project has commenced pursuant to a Letter of Intent agreement with Polaris Capital Ltd. announced on November 12, 2008. This work includes a review of data from previous oil and gas drilling conducted on the property, the formation of a project team and the preparation of conceptual production scenarios for battery-grade lithium carbonate from aquifers identified in Government of Alberta studies on formation water geochemistry. Based on positive results from these activities, Channel expects to enter into a formal option agreement in early 2009 to earn a 100% interest on the Fox Creek project, as described in the November 12 news release.

Tanlouka Gold Project, Burkina Faso

Channel and Generale de Mines et de Carrieres have agreed to extend the term of Channel's option agreement on the Tanlouka Gold Project, to March 4, 2011. Channel has the right to earn a 90% interest in Tanlouka by funding aggregate exploration expenditures of $350,000 on the property.

During 2008, Channel completed gradient IP and ground magnetic surveys that have identified zones characterized by high chargeability and high resistivity consistent with what the Company believes to be the presence of a siliceous zone of potentially gold-bearing sulphide mineralization. The surveys have provided a structural framework for previously found gold mineralization in the southern part of the property and have defined discrete drill targets for follow-up exploration programs.

El Mozo Gold Project, Ecuador

The government of Ecuador has recently introduced a new mining law that follows a six-month suspension of all exploration activities announced in April of 2008. Channel has determined that in light of the marked recent deterioration in economic conditions and increased market aversion to political risk, which has been heightened due to recent events in Ecuador, it is not in the best interests of the Company to continue investing in El Mozo project. The Company is therefore terminating the option agreement on the property, in which it had the right to earn up to a 70% interest upon expending a minimum $1 million dollars per year on exploration activities, the production of a bankable feasibility study and the arrangement of project financing. Ecuador still boasts significant exploration potential, and Channel hopes that conditions will improve to the point that it can consider a resumption of activities there at some time in the future.

Equity Ownership in Orezone Resources

As a result of a sale of its interests in the Bombore gold project announced on August 20, 2008, Channel owns 550,000 shares in Orezone Resources Inc. ("Orezone"). Today, a joint news release by Orezone and IAMGOLD Corporation ("IAMGOLD") announced that they have entered into a definitive arrangement agreement whereby IAMGOLD would acquire, via a plan of arrangement, all of the outstanding common shares of Orezone in a supported, all-share transaction. Total consideration is valued at approximately US$139 million. For further information on this transaction, please refer to the websites of Orezone ( and IAMGOLD (

The above information has been prepared under the supervision of Colin H. McAleenan, P.Geo, who is the Company's "Qualified Person" under the definition of NI 43-101.

Some of the statements contained herein may be forward-looking statements which involve known and unknown risks and uncertainties. Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, whether as a result of new information or future events or otherwise.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this Release.

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