Prophecy Reports M&I resource of 22.9 million Tons at 0.57% Ni (263 Million
pounds of nickel) at Lynn Lake deposit in Manitoba

TSX-V: PCY

OTC: PCYRF

Frankfurt:3P1

VANCOUVER, Feb. 3 /CNW/ - Prophecy Resource Corp. (TSX.V: PCY; OTC: PCYRF; Frankfurt: 3P1) (the "Company" or "Prophecy") is pleased to announce the results of an updated independent mineral resource estimate on the Lynn Lake Nickel-Copper property (the "Property") located in the historic Lynn Lake Nickel Camp in Manitoba.

The property is estimated to contain a Measured and Indicated resource of 22.9 million tons at 0.57% nickel and 0.3% copper, together with an Inferred resource of 8.1 million tons at 0.51% nickel and 0.28% copper. The estimate uses a 0.4% Nickel equivalent (NiEQ %) cutoff. The results are summarized in the following Table:

    
    -------------------------------------------------------------------------
     Mineral Resource Estimate for Lynn Lake (at a cut-off of 0.4% NiEQ%)
    -------------------------------------------------------------------------
    Resource Category  Tons    Ni Grade  Cu Grade  Ni Contained  Cu Contained
    -------------------------------------------------------------------------
                    (millions)   (%)        (%)        lbs            lbs
    -------------------------------------------------------------------------
    Measured &
     Indicated         22.9      0.57      0.30    263,028,299   136,133,440
    -------------------------------------------------------------------------
    Inferred            8.1      0.51      0.28     81,559,227    45,614,959
    -------------------------------------------------------------------------
    

The updated estimate was completed by Wardrop Engineering Inc ("Wardrop") on January 28, 2010 and prepared in accordance with National Instrument 43-101 ("NI 43-101") Standards of Disclosure for Mineral Projects.

The current estimate updates previous estimates produced by Wardrop in October 2005 and 2007, using ordinary kriging methodology, and includes mineralisation from the N, O and G zones. It has been calculated from an extensive database of 3,709 drill holes with an aggregate length of 399,088 meters (1,309,345 feet). NiEQ% was calculated using a Nickel price of $7.22/lb and a Copper price of $2/lb. Metal recoveries were assumed to be 100% for both Nickel and Copper, as metal recovery options such as bio-leach are being investigated with results pending.

The current estimate does not include mineralisation from the Disco zone discovery made in 2008 which includes intercepts of 47 meters of 0.7% nickel and 18 meters of 1.5% nickel, located 1.5km away from the outlined resource. Wardrop determined that there is not enough drill information to generate an inferred resource for the Disco Zone at this time.

The mineral resource estimate model was completed by Todd McCracken, P. Geo, Principal Geologist with Wardrop Engineering Inc. The material in this news release has been reviewed and approved by Mr. McCracken, a Qualified Person as defined by NI 43-101 and J.W. Morton P. Geo, a director of Prophecy and also a Qualified Person as defined by NI 43-101.

About Prophecy Resource Corp.

Prophecy is a Canadian company focused on the acquisition of advanced mineral assets. On January 21 2009, Prophecy signed a letter of agreement (LOA) to combine with Red Hill Energy (TSX-V: RH), which controls over 1 billion tons of thermal coal resource in Mongolia.

In October 2009, Prophecy entered into an agreement to acquire 100% of Lynn Lake from Victory Nickel Inc. The project is located in the Lynn Lake Nickel Camp, northern, Manitoba approximately 320 km by road northwest of the Thompson mining camp. Historically, Lynn Lake is the third largest nickel producing region in Canada offering excellent mining infrastructure. In October 2009, Prophecy entered into an option agreement to acquire 100% of the Lynn Lake Project from Victory Nickel Inc. (see our news release of October 21, 2009).

Prophecy in January 2010 acquired 80% of a Titan-Vanadium project in Ontario. The project has access to excellent infrastructure with past drill intercepts of 142 meters of 0.27% Vanadium (0.48% Vanadium Pentoxide) from hole RA-5-21 and 174 meters of 0.26% Vanadium (0.46% Vanadium Pentoxide) from hole RA-5-10. The mineralization started from surface to an open vertical depth of 500 meters. The complete horizontal and vertical extent of the deposit is still to be determined.

Prophecy also holds a 60% interest in the Okeover Copper-Molybdenum property in B.C. where, in 2006, Dr. N.C. Carter, PhD, P.Eng, completed a technical report on the Okeover Property pursuant to NI 43-101 that estimated an inferred mineral resource of 86.8 million tons grading 0.31% copper and 0.014% MoS2 at a 0.20% copper cut-off grade. This report is available at www.sedar.com.

ON BEHALF OF THE BOARD OF DIRECTORS of

Prophecy Resource Corp.

"JOHN LEE"

John Lee

Chairman

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.

SOURCE PROPHECY RESOURCE CORP.

For further information: For further information: about Prophecy, please contact us toll-free at 1-800-459-5583 or visit our web site at www.prophecyresource.com

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