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Trading Symbol  TSE:CCM
NEWS ANNOUNCEMENT ---------- FOR IMMEDIATE RELEASE


Canarc Approves Optimization Report on Proposed DP Gold Mine, Sara Kreek Property, Republic of Suriname;

Capital Costs Reduced to US$650,000, Operating Costs Estimated at US$90 per oz.; Project Financing Proposed to Private Investors

Vancouver, British Columbia, Canada,
February 7, 1999

Bradford J. Cooke, President and C.E.O of Canarc Resource Corp. (CCM-TSE) is pleased to announce that the Company has approved an optimization report on the DP Gold Mine, Sara Kreek Property, Republic of Suriname, subject to financing.

The proposed DP mine will be a small, high grade, open pit operation projected to produce approximately 13,000 oz. (420 kg) gold over a 9 month period. Additional production is possible as the gold deposit is still open at both ends as well as to depth.

A recent optimization report on the project economics was able to reduce the estimated capital cost by 50% to US$650,000 through the use of contract mining. Operating costs are estimated to be US$90 per oz., which would make the DP mine one of the lowest cost gold mines in the world.

The DP deposit is one of several gold prospects found by Canarc on the Sara Kreek property over the past 6 years. The DP mineable reserves total 16,000 oz. (490 kg) gold contained in 65,000 tonnes soft saprolite ore grading (7.5 gpt) gold.

Proposed mine method is a truck and shovel operation with no drilling or blasting and an 8:1 waste to ore strip ratio. The processing plant is projected to recover 85% of the gold using simple, modern gravity equipment, and a furnace to produce dor´┐Ż gold bars from concentrate.

Canarc has proposed a project financing to private investors that will provide them with preferred payback of their capital, a high fixed return of 33 1/3%, a bonus profit on any additional gold production from the DP mine, and the right to participate in any additional offerings Canarc may propose to expand lode gold production at Sara Kreek.

Subject to closing the financing in March, the construction will commence in April and trial mining would begin in August. Full operations are projected to run from September 2000 through March 2001, followed by additional gold production if merited and a reclamation program once the mine has closed. Canarc's focus will then shift to finding similar high grade, near surface ore reserves in other prospect areas on the property.

Shareholders and investors are encouraged to visit Canarc's new website, www.canarc-ccm.com, for more detailed information (old address, new content, with lots of photos).

Canarc Resource Corp. is a growth-oriented, international gold exploration and mining company. Production increased 10% last year at the Company's Sara Kreek (80%) mine. Reserves and resources now total 2 million oz. at the New Polaris (100%) and Bellavista (18% after payback) projects. Our large exploration portfolio includes joint ventures with Homestake and Noranda. Major shareholders include Barrick Gold and Echo Bay Mines. The Company's common shares trade under the symbol "CCM" on the Toronto Stock Exchange and "CRCUF" on the OTC Bulletin Board.

For further information contact Robert Carriere, Investor Relations at (604) 685-9700 or visit our website: http://www.canarc.net.

Sincerely,
CANARC RESOURCE CORP.

Bradford J. Cooke
President and CEO
www.canarc.net

For further information contact:
Robert Carriere
Investor Relations
Tel: (604) 685-9700


NOTE: If you have an E-Mail address and would prefer to receive Canarc's
News through this format, please E-Mail us at [email protected].

 

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