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Canada Carbon Reports Exceptional Results from Tests on Miller Lump/Vein Graphite Property

Canada Carbon Inc. (the “Company”) is pleased to announce exceptional results from its first series of beneficiation tests conducted at SGS Canada Inc. (Lakefield) on its 100% owned Miller lump/vein graphite property.

1) Initial Flotation Test - A 2 kilogram (kg) surface sample taken from an exposed vein with a grade of 61.2% Cg (65.1% C) was concentrated by grinding and flotation to 79.2% Cg (84.1% C). The +48 mesh size (jumbo size) fraction represented 34.3% of the flotation concentrate and was assayed at 93.5% Cg (94.4% C). This represents 40.5% of the graphitic carbon in the concentrate. The result was obtained in a single flotation test without process optimization. A full process development study including grinding and flotation optimization is expected to yield noticeably higher flotation concentrate yields and grades, thus reducing the operating cost of a downstream purification process.

2) Leach Test - The +48 mesh fraction of the concentrate was subjected to two (2) different hydrometallurgical purification processes. A traditional leach process yielded a concentrate that assayed 99.2% Cg (100 % C). An alternative hydrometallurgical process was completed to further upgrade this concentrate and results are pending. Although preliminary in nature, these results are very encouraging, especially when considering that they were obtained in a single set of tests without any process optimization. The data further suggest that Canada Carbon will be able to target the growing market of high-value ultra-pure graphite applications as well as those customers preferring lump/vein graphite because of its exceptional properties. Prices for thermally purified graphite (99.5% Cg) are sold for $6,500-$9,200 per tonne. Ultra-pure (99.9% Cg) currently has a value exceeding $25,000 per tonne. (Pricing Source: Industrial Minerals Data March/April 2013)

The 100% owned Miller Graphite property covers 15.3 kilometres (km)2 and is located 70 km west of Montreal. Main roads connect up to 800 metres (m) away from the deposit and travel all around the property. A power line also crosses the property 500 m south of the deposit, and a bush road goes directly to the deposit, which allows for very easy access.

R. Bruce Duncan, Interim CEO & Director of Canada Carbon stated, “These preliminary results are outstanding and confirms the exceptional quality of the Miller Graphite Mine’s product. We are now speaking with a number of North American based graphite consumers about these results and sharing the process information with them.” Mr. Duncan further stated, “The Morgan Crucible Company of London and also J.H. Gauthier and Company, Jersey City, historically used some of this graphite in their crucibles and pronounced it equal to the best graphite known to come from Ceylon (now Sri Lanka). Having a true shallow hydrothermal lump/vein ore in Canada similar to the Sri Lanka vein graphite deposits is rare and exciting.”

All carbon analyses were performed by SGS Canada Inc. (Lakefield) and are reported as total carbon C by LECO or graphitic carbon Cg employing a roast, followed by a leach and LECO assay of the leach residue.

Rémi Charbonneau, Ph.D., P. Geo #290 (an Associate of Inlandsis Consultants s.e.n.c.) is an Independent Qualified Person under National Instrument 43-101, and has performed a comprehensive reading of the metallurgical balance sheet and assay results produced by SGS Canada Inc. (Lakefield) approved the technical information provided in this news release.

About Miller Graphite Mine

The Miller Graphite Mine, located in Grenville Township in Quebec is a past graphite and mica producer with unknown graphite reserves remaining. This mine was worked around 1845 and was probably the first graphite operation in Canada. The quantity of produced graphite is unknown but it is reported that 25 rail cars of lump graphite were shipped from this deposit in the year 1900 and sent to the Globe Refining Company of Jersey City, N.J. This yielded thirty-two tons of clean crucible graphite. The Morgan Crucible Company of London and also J.H. Gauthier and Company, Jersey City, used some of this graphite in their crucibles and pronounced it equal to the best graphite known to come from Ceylon (now Sri Lanka). The property covers 15.3 km2 of land and is located 80 km west of Montreal. A main road, located approximately 800 m from the deposit, is connected by a gravel road to the deposit allowing very easy access. A power line also crosses the property 500 m south of the deposit. There is no certainty that further exploration will result in the development of similar deposits.

On Behalf of the Board of Directors

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