Canarc Resource Corp.
OTC Bulletin Board : CRCUF

Canarc Resource Corp.

July 05, 2005 14:46 ET

First Gold Pour at Bellavista Mine, Independent Valuation of Canarc's Interest

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - July 5, 2005) - Canarc Resource Corp. (TSX:CCM)(OTCBB:CRCUF) announces that Operator Glencairn Gold Corp. has poured its first gold bars at the new Bellavista mine in Costa Rica. Canarc holds a 5.6% net profit interest before payback in Bellavista that increases to 20.2% after payback of Glencairn's exploration, development and capital costs.

Since mining began in April, 2005, approximately 200,000 tonnes of ore have been stacked on the leach pads. Gold contained in ore on the pads and in leach solution currently stands at approximately 10,000 ounces. Production at Bellavista is expected to ramp up to its design rate of 60,000 ounces annually before year-end.

Canarc also announces the results of an independent valuation of Canarc's net profit interest prepared by Pincock, Allen and Holt ("PAH"). PAH updated a June 2004 cash-flow model of Glencairn and carried out sensitivity analysis of how project value could be affected by changes in metal prices, capital costs, operating costs and gold reserves.

Using a US $425 gold price and Glencairn's base case production model of 11.2 million tonnes grading 1.54 gpt gold to produce 60,000 oz per year over a 7.2 year mine-life, Canarc's net profit interest generates an undiscounted total cash-flow of US $4.6 million. At a 5% discount rate, the discounted net present value ("NPV") is US $3.3 million and discounted at 10%, the NPV is US $2.3 million.

The value of Canarc's interest is highly leveraged to gold price. A 20% increase or decrease in gold price causes the NPV to rise or fall by 40-45%. However, the NPV is not sensitive to changes in capital costs and is only slightly affected by changes in operating costs and mine-able reserves.

Now that gold production is underway at Bellavista and the mine commissioning is advancing smoothly, Canarc intends to seek a buyer for its interest so it can put the capital to work on its principal assets, the New Polaris gold project in British Columbia and the Benzdorp project in Suriname.

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 in 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, President 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 has neither approved nor disapproved the contents of this news release.

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