Cobalt Coal Corp Commences Production at Westchester Mine

CALGARY, May 27 /CNW/ - Cobalt Coal Corp. ('Cobalt' or the 'Corporation') announced today that it has begun coal production at its Westchester Metallurgical Coal Mine (the 'Westchester Mine' or 'Westchester') in McDowell County, West Virginia USA.

The Westchester Mine produces high quality, low volatile metallurgical coal (also known as 'coking' coal) that is used in the production of steel. The Westchester Mine was operational from Q4 2008 until Q2 2009, when the global recession caused demand for metallurgical coal to drop dramatically. Steel production is now nearing the highs of 2008, and the demand for metallurgical coal has risen rapidly as a result. Cobalt received a new purchase order for coal in Q1, 2010 and has since been working to put the Westchester Mine back into production.

Cobalt President and CEO David M. Lewis stated: 'The commencement of production at the Westchester Mine is a very significant step for our company as we are now an active producer of metallurgical coal. Having demonstrated our ability to bring coal projects into production, there are now additional opportunities for expansion at Westchester and elsewhere. The market for metallurgical coal remains very robust, and with coal production at Westchester managed by our first class operations team, we are very excited about the future of Cobalt.'

In addition, the Company filed its audited Annual Financial Statements and related Management's Discussion and Analysis required under National Instrument 51-101 for the year ended December 31, 2010. All of these filings can be accessed on SEDAR at www.sedar.com.

NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION/SERVICE PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

About Cobalt:

Cobalt is a publicly traded coal exploration and production company headquartered in Calgary, Alberta, Canada with a regional office in Welch, West Virginia USA. Cobalt was created in August 2007 to capitalize on the growth opportunities that exist in the modern metallurgical coal mining industry. Cobalt owns a 60% after payout interest in the Westchester Mine, and operates this mine through its wholly owned subsidiary Westchester Coal GP Inc.

Initially, Cobalt is concentrating its efforts on developing an asset base in the Appalachian coal producing region of the United States, and intends to expand internationally as opportunities allow. The Appalachian area includes parts of West Virginia, Virginia, Kentucky, Ohio, Pennsylvania, the Carolinas, and Tennessee. Appalachia's history of producing large volumes of metallurgical coal, along with the under-utilized coal infrastructure already in place, make the area ideal for the implementation of Cobalt's business model. Coal assets in the area can be acquired and brought into production relatively quickly. The resulting cash flows are generated in the short term without the need to invest large amounts of time and capital.

All of these factors align with Cobalt's strategy to provide near term cash flow and high growth to shareholders.

READER ADVISORY

Statements in this news release may contain forward-looking information including expectations of future production and cash flows from the Westchester Mine, as well as the expansion plans of Cobalt. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Corporation. These risks include, but are not limited to, the risks associated with the coal mining industry, commodity prices and exchange rate changes. Industry related risks could include, but are not limited to, operational risks in exploration, development and production, delays or changes in plans, risks associated to the uncertainty of reserve estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. The reader is cautioned not to place undue reliance on this forward-looking information.

%SEDAR: 00029033E

SOURCE COBALT COAL CORP.

For further information: For further information: David M. Lewis, President and CEO, Cobalt Coal Corp, Office: (403) 262-5510, dlewis@cbtcoal.com; Rick Couronne, Consultant, Cobalt Coal Corp, Office: (403) 262-5510, rcouronne@cbtcoal.com; The Howard Group Inc., Investor Relations, Dave Burwell, Office: (403) 410-7907, dave@howardgroupinc.com

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COBALT COAL CORP.

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