CCGC Not Proceeding With Proposed Agreement to Combine With MTI's Rubber Division.

SIMCOE, ONTARIO--(BUSINESS WIRE)--July 3, 1997--Custom Cryogenic Grinding Corporation (CCGC) (Alberta Stock Exchange:CR.) today announced that it and Mining Technologies International Inc. (MTI) have permitted to expire a letter of intent regarding the proposed combination of CCGC with the rubber division of MTI (MTI Rubber). MTI is a privately held company.

"While it is unfortunate that we could not reach a definitive agreement, the process should still prove beneficial to both organizations," said Joseph Kosalle, CCGC's President and Chief Financial Officer. "We believe at CCGC that it is possible to realize some of the expected benefits of the planned combination by doing business together. We are hopeful that MTI Rubber will become a significant customer of CCGC for our reprocessed rubber products."

"CCGC is presently in discussions with its lenders and other parties to secure additional working capital financing," Mr. Kosalle stated. "Pending these discussions, which should be resolved in two weeks, CCGC has requested that the Alberta Stock Exchange continue the halt in trading of CCGC's shares. At that time, we also expect to set a date for CCGC's annual meeting which was delayed pending the outcome of our discussions with MTI."

CCGC previously obtained bridge financing for its short-term working capital requirements in the form of a four-month guaranteed loan from a private investor in the amount of $300,000, effective April 30, 1997. The loan, which bears interest at the rate of 12 percent per annum, includes as a portion of the consideration payable for the loan issuance of 70,000 common shares to the investor.

"We remain generally positive about the outlook for CCGC's business, although it is necessary that we obtain additional working capital and/or a strategic partner," Mr. Kosalle said.

"For example, we have made good progress with a major customer for our plastics reprocessing operations, working with Royal Ecoproducts (80 percent owned by Royal Group Technologies Limited) on developing compounds that will meet its requirements. Pending the successful conclusion of the final testing now underway, volume shipments should begin shortly. We also are working with Royal Ecoproducts on a rubber material blend for its slate-like roofing tile business and are hopeful that the samples provided to them will result in significant volume business for CCGC by this Fall.

"Our business with a major carpet manufacturer for which CCGC is separating and reprocessing the plastic backing also is increasing under a blanket purchase order that is resulting in a growing volume of shipments. We are continuing to pursue customers for our De-Vulc devulcanized rubber product, such as MTI Rubber, but this area remains disappointingly slow to develop," he said.

Custom Cryogenic Grinding Corporation (CCGC) is a fully integrated and diversified Canadian reprocessing company which produces and sells a variety of compounds to processing and manufacturing industries around the world. CCGC also provides its customers with R&D and engineering services. The company is the leading North American manufacturer of cryogenically ground rubber and plastic powders produced by its unique proprietary system, which uses approximately 50 percent less nitrogen than conventional methods. CCGC provides a cost-effective, environmentally friendly alternative of waste handling versus the high transportation and landfill costs currently incurred by many industries. -0- (The Alberta Stock Exchange has neither approved nor disapproved this news release.)

CONTACT: Custom Cryogenic Grinding Corporation

Joseph Kosalle, 519/426-5544, Ext. 225