Prophecy Resource Corp.
TSX VENTURE : PCY
FRANKFURT : 1P2
OTCQX : PRPCF

Prophecy Resource Corp.

December 02, 2010 11:34 ET

Prophecy Announces Filing of Preliminary Prospectus for Proposed Equity Offering

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 2, 2010) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN

Prophecy Resource Corp. ("Prophecy" or the "Company") (TSX VENTURE:PCY)(OTCQX:PRPCF)(FRANKFURT:1P2) announced today that it has filed a preliminary short form prospectus in the provinces of British Columbia, Alberta and Ontario, Canada for a new issue of common shares. The net proceeds of the offering are intended to be used by the Company to fund work on its existing properties in Mongolia, repayment of an outstanding credit facility, and for working capital and general purposes. The issue price of the shares and the number of shares to be issued will be determined in the context of the market.

Jacob Securities Ltd. and Renaissance Capital (Hong Kong) Ltd. will act as joint lead managers for the offering. The offering will be conducted in the Canadian provinces referred to above through Jacob Securities Ltd. Renaissance Capital (Hong Kong) Ltd. and affiliates will act as special selling agent for the purpose of procuring subscribers in certain jurisdictions outside of Canada.

The offering is subject to all customary conditions and regulatory approvals, including that of the TSX Venture Exchange.

This press release does not constitute an offer to sell or a solicitation to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended ("the U.S. Securities Act") or any state securities law and may not be offered or sold in the United States unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About Prophecy Resource

Prophecy is an internationally diversified company engaged in developing energy, nickel and platinum group metals projects. The Company controls over 1.4 billion tons of open-pittable thermal coal in Mongolia (839 Mt Measured, 579 Mt Indicated). Prophecy's Ulaan Ovoo coal deposit in Mongolia is in production. In Canada, Prophecy owns Wellgreen PGM Project in Yukon, Lynn Lake Nickel Sulphide Project in Manitoba, and a 10% equity stake in Victory Nickel. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

ON BEHALF OF THE BOARD OF DIRECTORS of Prophecy Resource Corp.

John Lee, Chairman

Forward Looking Statements: This news release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, including, without limitation, statements regarding future plans and objectives of the companies are forward-looking statements that involve various risks and uncertainties. Although Prophecy believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Forward-looking statements are based on a number of material factors and assumptions. Factors that could cause actual results to differ materially from those in forward-looking statements include general economic, market or business conditions, and other risks detailed herein and from time to time in the filings made by the companies with securities regulators. Mineral exploration and development of mines is an inherently risky business. Accordingly the actual events may differ materially from those projected in the forward-looking statements. For more information on Prophecy and the risks and challenges of its businesses, investors should review its annual filings that are available at www.sedar.com.

"Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."

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