Fortune Minerals Notes Alaska-Canada Rail Link Study Recommends Route Past Mount Klappan to Prince Rupert



    Connection Would Sharply Enhance Economics of Anthracite Coal Project

    Issued Capital: 38,996,407

    LONDON, ON, June 27 /CNW/ - Fortune Minerals Limited (TSX-FT) is pleased
to report that the Alaska - Canada Rail Link (ACRL) Phase 1 Feasibility Study
has been released jointly by Yukon Premier Dennis Fentie and Alaska Governor
Sara Palin (The contents of this study are available online at:
www.alaskacanadarail.org). This study, which was jointly funded by the State
of Alaska and Yukon Territory, recommends a railway connection from Alaska
through the Yukon and northern British Columbia, to the continental United
States that would include a segment running past Fortune's Mount Klappan
anthracite coal project in northwest B.C. Notably, the study also recommends a
short-cut to the Port of Prince Rupert that would dramatically reduce the rail
haulage distance of coal products from Mount Klappan to Prince Rupert from
1,400 kilometres to just over 600 kilometres and very materially reduce
transportation costs.
    The ACRL study recommends a connection between the Alaska Railroad at
Delta Junction, extending southeast through the Yukon (via Carmacks and Watson
Lake) and then continuing south through B.C. (along the BC Rail right-of-way
through Dease Lake) and continuing along the Little Klappan River near Mount
Klappan to connect with the Canadian National Railway at New Hazelton for
access to Pacific ports at Kitimat and Prince Rupert or south to the
continental U.S. Notably, the study also recognizes the merits of a staged
build from B.C. and/or Alaska.
    "The railway route that has been proposed in the ACRL study would sharply
enhance our Mount Klappan project as it offers the potential to significantly
reduce our transportation costs to an internationally accessible deep-water
port," said Robin Goad, Fortune's President. "It would make us increasingly
accessible to expanding markets in Asia as well as to markets in the U.S. and
enable the mine to be expanded from the 1.5 million tonnes of clean coal per
annum we are currently contemplating."
    The idea of linking Alaska to "the Lower 48 U.S." states has been
discussed since before the Alaska Railroad was completed in 1923. More
recently, increased interest in mineral resources in Alaska, Yukon and
northern B.C., as well as changing world markets and supply chains, have
rekindled that discussion. On July 1, 2005, the governments of Alaska, B.C.
and Yukon launched an initiative to determine the feasibility of a rail link
connecting Alaska and Yukon with the North American railroad system. The
report, which evaluated market, and technical issues, as well as assessing
engineering, economic and environmental factors, contemplates a partnership
involving both public and private sources for financial support.
    Noted the report's authors, "Drastic changes in global demand - driven by
Asian markets - have sharply raised the value of mineral resources in north
western Canada and Alaska and rail infrastructure investment would
dramatically increase economic productivity, development and sustainability in
this region."
    Phase 1, jointly chaired by Yukon and Alaska, was governed by a
bi-lateral Advisory Committee comprised of government and industry leaders.
This committee oversaw a multi-lateral Management Working Group that assisted
in the coordination of the Study, including participation by Fortune Minerals.
The Yukon government will be presenting the study's findings to the federal
government and the Governor of Alaska will be taking the study back for public
review. Meanwhile, extensive engineering studies would also be required before
the plan could be moved forward.
    Fortune's Mount Klappan anthracite coal project covers more than 15,000
hectares of contiguous coal licenses straddling the BC Rail right-of-way and
roadbed, 150 kilometres northeast of the Port of Stewart and 330 kilometres
northeast of the Port of Prince Rupert. The railway right-of-way currently
provides road access to the site from Highway 37. Fortune is currently
proposing to construct a short-cut truck haulage route in order to transport
coal to the Port of Stewart. Currently, the Company is proceeding with the
permitting of a 1.5 million tonnes of clean coal per year export metallurgical
coal mine producing pulverized coal injection (PCI) coal for the overseas
steel industry that was assessed in a positive full feasibility study in 2005
by Marston Canada Ltd. (see News Release, dated October 17, 2005).
    The Mount Klappan project contains very large resources of high quality
anthracite rank coal. Anthracite is a hard coal with the highest rank, carbon
and energy content and lowest moisture and volatile content of all coals.
Unique properties make anthracite suitable for use in a broad range of
metallurgical and thermal applications, including carbon filters, reductants
for metallurgical processing, blend coals for blast furnace coke replacement,
and charge carbon, sinter and PCI coal used in the manufacture of steel. Mount
Klappan anthracite resources are identified in four distinct deposit areas
referred to as Lost Fox, Hobbit-Broatch, Summit and Nass. Collectively, these
contain Measured resources of 107.9 million tonnes, Indicated resources of
123 million tonnes, plus 2.572 billion tonnes in the Inferred and Speculative
classes (see News Release, dated June 22, 2004). The Measured and Indicated
Mineral resources stated are inclusive of those Mineral resources modified to
produce Mineral reserves. The Run of Mine (ROM) and product reserves contained
in the initial open pit mine at the Lost Fox deposit as part of the Marston
feasibility study are shown in the following table.

    
                   LOST FOX DEPOSIT ROM & PRODUCT RESERVES
    -------------------------------------------------------------------------
         ROM COAL RESERVES (Mt)                    10% ASH PCI PRODUCT (Mt)
    -------------------------------------------------------------------------
    MEASURED    INDICATED    TOTAL               PROVEN    PROBABLE    TOTAL
    -------------------------------------------------------------------------
     89.56        16.8       106.3                51.6       9.2        60.8
    -------------------------------------------------------------------------
    

    The Lost Fox feasibility study resources and reserve estimates were
    prepared by Marston in accordance with the CIM Definition Standards on
    Mineral Resources and Reserves prepared by the CIM Standing Committee on
    Reserve Definitions and adopted by CIM Council, November 14, 2004. In
    estimating Measured, Indicated and Inferred resources, Marston referred
    to the guidelines in Paper 88-21 of the Geological Survey of Canada.
    Richard Marston, P.E., is the Qualified Person responsible for the
    resource and reserve estimates in accordance with National Instrument
    43-101.

    About Fortune Minerals

    Fortune Minerals is a diversified natural resource company with seven
mineral deposits and a number of exploration projects, all located in Canada.
They include the Mount Klappan anthracite coal deposits in British Columbia,
and the NICO cobalt-gold-bismuth deposit, the Sue-Dianne copper-silver deposit
and other base and precious metals exploration projects in the Northwest
Territories. Fortune Minerals is focussed on outstanding performance and
growth of shareholder value through assembly and development of high quality
mineral resource projects.

    This press release contains forward-looking information. This
forward-looking information includes, or may be based upon, estimates,
forecasts, and statements as to management's expectations with respect to,
among other things, the size and quality of the Company's mineral resources,
progress in development of mineral properties, demand and market outlook for
metals and future metal prices. Forward-looking information is based on the
opinions and estimates of management at the date the information is given, and
is subject to a variety of risks and uncertainties and other factors that
could cause actual events or results to differ materially from those projected
in the forward-looking information These factors include the inherent risks
involved in the exploration and development of mineral properties, the
uncertainties involved in interpreting drilling results and other geological
data, fluctuating metal prices, the possibility of project cost overruns or
unanticipated costs and expenses, uncertainties relating to the availability
and costs of financing needed in the future and other factors. Mineral
resources that are not mineral reserves do not have demonstrated economic
viability. Inferred mineral resources are considered too speculative
geologically to have economic considerations applied to them that would enable
them to be categorized as mineral reserves. There is no certainty that mineral
resources will be converted into mineral reserves. The forward-looking
information contained herein is given as of the date hereof and the Company
assumes no responsibility to update or revise such information to reflect new
events or circumstances, except as required by law.





For further information:

For further information: Fortune Minerals Limited, Robin Goad,
President, Tel.: (519) 858-8188, Fax: (519) 858-8155,
info@fortuneminerals.com, www.fortuneminerals.com; Greg Taylor, Investor &
Public Relations, Tel: (416) 605-5120, Fax: (905) 844-6532,
gtaylor@fortuneminerals.com


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