Canadian Royalties: New Drill Core Assays Extend Mequillon Ni-Cu-PGE Deposit 400m beyond Conceptual Pit.

MONTREAL -- Canadian Royalties (TSX symbol: CZZ) reports significant assay results over broad drill core intervals at locations from 200 meters to 400 meters northeast of the existing northeast limit of the Mequillon conceptual pit designed by Strathcona Mineral Services Limited ("Strathcona"). The latest set of diamond drill core assay results include a 21.0 meter (68.9 foot) interval in MQN-04-35, collared 400 meters northeast of the conceptual pit limit, commencing at 197 meters that assayed 1.15% nickel (Ni), 1.27% copper (Cu), 0.05% cobalt (Co), 0.15 g/t gold (Au), 0.84 g/t platinum (Pt) and 2.67 g/t palladium (Pd), 3.66 g/t Platinum + Palladium + Gold (PGE). This interval is contained within a broader 51.0 meter (167.3 foot) interval that assayed 0.77% Ni, 1.07% Cu, 0.04% Co, 0.92 g/t Au, 0.65 g/t Pt, 2.18 g/t Pd (3.75 g/t PGE).

Highlights

- A recent independent study completed by Strathcona and reported by
  Canadian Royalties on September 22, 2004 provided an initial
  estimate of the mineral resources constrained by a conceptual pit
  as 1.4 million tonnes at grades of 0.7% Ni, 0.9% Cu, 0.6g/t Pt, 2.1
  g/t Pd, and 0.03% Co in the inferred category along approximately
  300 meters of the mineralized zone;

- The mineralized interval in diamond drill hole MQN-04-35 reported
  above is located 400 meters to the northeast of the limit of this
  conceptual pit limit. Diamond drill hole assay data received to
  date show that the zone of Ni-Cu-PGE mineralization extends for an
  800 meter strike length in total;

- Drilling information for which assays have not yet been received
  indicates that the mineralized zone continues along the same
  general trend for an additional minimum 200 meters where drilling
  intersected similar sulphide rich mineralization. The zone remains
  open along strike to the northeast. Canadian Royalties has
  completed a total of 97 holes in the Mequillon area, 79 of which
  were drilled in 2004. The zone of mineralization has been traced
  continuously for 1000 meters (3280 feet) as of the termination of
  drilling operations this season;

- Significant diamond drilling was completed in the Mequillon deposit
  area in 2004 to provide additional assay and geological data for
  the purpose of updating the recent resource estimate study on the
  near surface part of the mineralized zone, and also to provide
  information about the geometry, grade and limits of the mineralized
  zone to the northeast where it remains open to expansion along the
  15 degree mineralized plunge line;

- The Mequillon Ni-Cu-PGE mineralized zone occurs as a crescent
  shaped sulphide mineralized body along the base of a "U" shaped,
  shallow northeast plunging ultramafic body that is mostly comprised
  of a core of peridotite surrounded by a more pyroxenitic contact
  zone;

- The Company has now received assay data for approximately 18 holes
  to the northeast of the conceptual pit area that confirm the
  extension of the rather uniform, predictable mineralized zone for
  at least 800 meters. Composite length weighted assay data for six
  diamond drill holes are reported below:

Mqn      From     To    Width    Ni   Cu   Co    Au    Pt    Pd   PGE
DDH       (m)     (m)    (m)      %    %    %   g/t   g/t   g/t   g/t
---------------------------------------------------------------------
04-28    28.00  189.70 161.70  0.25 0.31 0.01  0.06  0.20  0.83  1.09
incl.   147.00  189.70  42.70  0.72 0.90 0.03  0.16  0.56  2.45  3.17
incl.   156.00  189.70  33.70  0.84 0.92 0.04  0.17  0.61  2.63  3.41
incl.   169.00  189.00  20.00  1.02 0.98 0.04  0.18  0.69  3.22  4.09
incl.   178.95  189.00  10.05  1.33 1.13 0.05  0.25  0.76  4.00  5.01
04-32   154.00  200.50  46.50  0.92 1.11 0.04  0.30  0.96  3.34  4.60
incl.   163.00  192.00  29.00  1.00 1.17 0.05  0.30  1.06  3.53  4.89
04-33   125.00  148.00  23.00  0.45 0.73 0.03  0.06  0.27  1.28  1.61
04-34    93.00   97.25   4.25  0.47 0.70 0.03  0.19  0.33  1.35  1.87
04-35   167.00  218.00  51.00  0.77 1.07 0.04  0.92  0.65  2.18  3.75
incl.   177.00  197.00  20.00  0.53 1.10 0.02  2.09  0.57  2.08  4.74
incl.   197.00  218.00  21.00  1.15 1.27 0.05  0.15  0.84  2.67  3.66
04-36   163.00  182.00  19.00  0.38 0.53 0.02  0.05  0.26  1.24  1.55
04-37     4.50   13.00   8.50  0.39 0.47 0.02  0.06  0.36  1.15  1.57

Notes:

1.  More detailed information on these intervals, including hole
    collar locations, dip angles, and a plan map showing holes, can
    be found at
    www.canadianroyalties.com/en/ourbusiness/royalties/mequillon.asp;
2.  PGE equals Pt + Pd + Au;
3.  Holes MQN-04-28, 32 and 35 are 200, 300 and 400 meters
    respectively east of the east limit of the mineralized zone
    within the Strathcona conceptual pit;
4.  All assay intervals are interpreted to reflect at least 80% of
    the true width of the mineralized zone; and
5.  Hole MQN-04-32 was previously reported October 14, 2004.

Diamond drilling is now complete for the 2004 season. Field operations, including diamond drilling, are nearly complete and a large final shipment of samples is expected to arrive at the laboratory by mid-November. Canadian Royalties does not anticipate receiving final assay data from the entire diamond drill program until near year-end.

Metallurgical test work on mineralized material from Mesamax, Expo and Mequillon deposits is progressing and a significant portion of the results of this phase of test work are expected during the fourth quarter of 2004.

Bruce Durham, P.Geo. and President of Canadian Royalties Inc. is the designated Qualified Person responsible for the exploration program on the property and the person responsible for the preparation of this release.

Canadian Royalties maintains a diligent protocol for its analytical work. The assay technique and protocol were designed with the assistance of Strathcona All assaying was completed by ALS Chemex with sample preparation completed in Val d'Or, QC and analyses completed at ALS Chemex in Vancouver, BC. Base metal determined by sodium peroxide fusion with ICP-AES analysis. Platinum, palladium and gold values are determined by 30 gram fire assay with ICP-AES finish.

Canadian Royalties has been actively and successfully exploring for magmatic sulphide related nickel-copper-cobalt-platinum-palladium-gold (Ni-Cu-PGE) mineralization in the Raglan area since the summer of 2001. Canadian Royalties holds various property interests in the area covering over 1400 square km. All holes reported in this release were drilled on the Expo-Ungava Option/Joint Venture Property, in which Canadian Royalties holds a 70% interest (an additional 10% may be earned upon completion of a bankable feasibility study). Canadian Royalties maintains a strong cash position and a portfolio of more than 200 property interests. For additional information please visit our website at www.canadianroyalties.com.

The Statements contained in this press release may contain statements that may involve a number of risks and uncertainties. Actual events or results could defer materially from the Company's expectations and projections.

CANADIAN ROYALTIES INC. (TSX:CZZ)