May 21, 2010 10:45 ET

Ignite Energy Resources Enters Into Heads of Agreement With Solid Energy New Zealand Ltd

TORONTO, ONTARIO--(Marketwire - May 21, 2010) -


Karmin Exploration Inc. ("Karmin") (TSX VENTURE:KAR) announced today that it has been advised by Ignite Energy Resources Pty Ltd ("Ignite") that Ignite has entered into a binding heads of agreement (the "Agreement") with Solid Energy New Zealand Ltd ("Solid Energy") that Ignite expects to lead to a licensing agreement between the two parties. The licensing agreement would secure for Solid Energy the exclusive New Zealand rights to Ignite's Cat-HTR technology, which converts low energy feedstocks, such as lignite and biomass, into high-grade coal and synthetic crude oils which have the potential to be upgraded to transport fuel.

Under the agreement, which provides for payments by Solid Energy to Ignite of up to A$15 million upon reaching specified milestones plus royalty payments, Solid Energy and Ignite will work together to further develop and commercialize Ignite's Cat-HTR technology and intend to construct and commission a pilot plant able to process lignite and biomass in New Zealand. It is anticipated that the pilot commercial plant, at a yet to be determined location, would be capable of expansion to a one million tonnes per annum facility. Ignite is currently converting lignite to synthetic crude oil and high-grade coal at a pilot plant in Somersby, New South Wales, Australia. The high-grade coal produced at the Somersby pilot plant has the potential to be used in the steel making process.

Ignite's proprietary Cat-HTR technology converts low-value feedstocks into high-value oil and coal products using both ancient biomass, such as lignite, and modern biomass, such as plant waste.

On March 19, 2010, Karmin announced that it entered into a share exchange agreement with Ignite pursuant to which Karmin will acquire all of the outstanding ordinary shares of Ignite in exchange for the issuance by Karmin of its common shares (the "Transaction"). Each Ignite ordinary share will be exchanged for one common share of Karmin. In connection with, and immediately prior to the completion of the Transaction, Karmin will consolidate its current issued and outstanding common shares on a 6:1 basis.

Also, as previously announced, the board of directors of Karmin has fixed May 12, 2010 as the record date for the determination of shareholders entitled to receive notice of and to vote at the special meeting to be held on June 14, 2010. The closing date of the Transaction is expected to occur on or about June 15, 2010, provided that the Transaction is approved by shareholders at the special meeting and all other conditions of the Transaction are satisfied or waived.

About Karmin

The common shares of Karmin are listed on the TSXV and trade under the symbol "KAR". The principal business of Karmin is to acquire and explore resource properties. Karmin's main project is located at Aripuanã, Brazil. Karmin owns 30% of the Aripuanã zinc project, one of the largest undeveloped zinc projects in Brazil. Aripuanã covers a complete mineralized massive sulphide district, with five areas of mineralization (Arex, Ambrex, Babacu, Massaranduba and Mocoto) over a 25 kilometre strike length.

This news release contains forward-looking statements relating to the Agreement and the Transaction. Forward-looking statements include, but are not limited to, possible events and statements. The words "plans," "expects," "is expected," "scheduled," "estimates," "forecasts," "projects," "intends," "anticipates," or "believes," or variations of such words and phrases or statements that certain actions, events or results "may," "could," "would," "might," or "will be taken," "occur," and similar expressions identify forward-looking statements.

Such statements are not historical facts. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections in the forward-looking statements will not occur, and that actual performance and results in future periods may differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These assumptions, risks and uncertainties include, among other things: Ignite and Solid Energy will not enter into a licensing agreement; a pilot plant may never be built in New Zealand; lignite and biomass from New Zealand may not produce coal of similar or better quality than Australian coal produced at the Somersby pilot plant; the failure to realize the synergies and other perceived advantages resulting from the Transaction; the inability to obtain or meet conditions imposed by applicable regulatory requirements relating to the Agreement or the Transaction; the failure of either Karmin or Ignite to satisfy the closing conditions set forth in the share exchange agreement; the failure of the combined company to retain key personnel; costs and potential litigation associated with the Transaction; the failure of each of Karmin and Ignite to successfully execute its business strategies, including the development and successful commercialization of the Cat-HTR technology platform and EL 4416; competitive conditions in the industry; business cycles affecting the markets in which Karmin and Ignite conduct their business; fluctuations in applicable currency rates, including the exchange rate for Australian dollars to Canadian dollars; and economic conditions generally.

The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, Karmin disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, Karmin undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

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