Industrial Minerals receives LOI from graphite customer

    TORONTO, Jan. 23 /CNW/ - Industrial Minerals Inc. (OTCBB: IDSM - or "the
Company") today announced that it has received a letter of intent (LOI) from
ACC Resources Corp LP (ACC), one of the world's largest refined graphite
suppliers, to initially purchase between 5,000 and 10,000 metric tonnes of
flake graphite concentrates annually.
    The purchase price for the graphite will be determined at the time of
sale and based on prevailing global prices.
    "This is an extremely important development for the Company as it
represents potential revenues coming from 20 to 40 percent of the annual
projected plant capacity," said David Wodar, President and CEO of Industrial
Minerals, "ACC has also indicated to us that annual volumes are likely to grow
given the expansion in the markets served. We expect to have a lasting
relationship with ACC when our graphite property begins production."
    ACC expects to market this product in Latin America, Africa, Asia, and in
national markets where strong and consistent industrial growth is taking
place. ACC has also informed Industrial Minerals that it may market in other
regions, depending upon prevailing economic conditions.
    Initial sales contemplated under this LOI are expected to begin in 2010.
    Also the Company would like to announce that as of Dec. 27th 2007 the
finalized Preliminary Assessment NI 43-101 report was filed with the Ontario
Securities Commission (OSC). The report is available for viewing at the OSC
office or please contact the Company to receive an electronic copy.

    About Industrial Minerals, Inc.

    Industrial Minerals Inc. through its wholly owned subsidiary Industrial
Minerals Canada Inc., headquartered in Oakville, Ontario, Canada, owns 100% of
an undivided interest in the Bissett Creek Graphite patented mineral lease,
containing a resource of 640,000 tons of flake graphite on approximately 10%
of the patented mineral lease that has been drilled to date. The property is
comprised of 28 claims covering an area of approximately 1,315 hectares
(3,250 acres). It has been the subject of substantial earlier exploration
drilling, trenching and metallurgical test work by KHD Canada, Kilborn
Engineering, Pincock Alan and Holt and Cominco Engineering Services. The
property is located in Maria Township in the Province of Ontario, Canada. The
property is one of the largest and purest natural flake graphite deposits in
the world. The Company plans to become the leading producer of large flake
crystalline graphite in North America and a prominent market participant

    Safe Harbor Statement
    All statements contained herein, as well as oral statements that may be
made by the Company or by officers, directors or employees of the Company
acting on the Company's behalf that are not statements of historical fact,
constitute "forward-looking statements" and are made pursuant to the
Safe-Harbor provisions of the Private Securities Litigation Reform Act of
1995. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause the actual results of the
company to be materially different from the historical results or from any
future results expressed or implied by such forward-looking statements. Such
risks and uncertainties are outlined in the Company's Annual Report on Form
10-K for 2006 as filed with the Securities and Exchange Commission. The
Company is not obligated to revise or update any forward-looking statements in
order to reflect events or circumstances that may arise after the date of this

    Cautionary Note to U.S. Investors: The United States Securities and
Exchange Commission limits disclosure for U.S. reporting purposes to mineral
deposits that a company can economically and legally extract or produce. Our
reference to a "resource" above may not be consistent with established SEC
guidelines for the disclosure of mineralized material. U.S. investors are
urged to consider closely our disclosure on Forms 10-QSB and 10-KSB (File
No. 0-30651) which are available at the SEC's website at

For further information:

For further information: David Wodar, President, Industrial Minerals
Inc, at, Tel: (905) 829-0220, Fax: (905)
829-5220, Toll free: 1-888-829-0220; or Martti Kangas, The Equicom Group,, Tel: (416) 815-0700 x 243

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