Canarc Options Two Properties in Mexico to Noranda.

VANCOUVER, British Columbia--(BUSINESS WIRE)--Sept. 30, 1998-- Canarc Resource Corp. (TSE:CCM.) is pleased to announce that the Company has optioned two properties in Mexico to Noranda Minerals Inc.

Minera Aztec S.A. de C.V., a subsidiary of Canarc, has entered into separate agreements on the Lobo 6 and Lobo 8 properties in Zacatecas State, Mexico with Minerales Noranda S.A. de C.V., a subsidiary of Noranda, whereby Noranda can earn up to a 70 percent interest in each property over a six-year period by making a schedule of cash payments, stock investments, and work commitments.

On Lobo 6, Noranda can earn an initial 51 percent interest by making $45,000 in cash payments, $490,000 in share purchases at a minimum of $1.00 to $3.00 per share, and spending $1,100,000 on exploration within the next three years. Once Noranda has earned a 51 percent interest, they have a second option to earn up to a 70 percent interest in Lobo 6 by investing $2,000,000 in additional share purchases at a minimum of $4.00 to $6.00 per share, and delivering a bankable feasibility study within an additional three years.

Noranda can also earn a 51 percent interest in Lobo 8 under an agreement similar to Lobo 6. However, the requirements are slightly higher, including $65,000 in cash payments, $700,000 in share purchases, and a $1,500,000 work commitment. The terms of the second option for Noranda to earn a 70 percent interest in Lobo 8 are identical to Lobo 6.

The Lobo 6 concession (27,760 hectares) lies approximately 50 km northwest of Western Copper's huge San Nicolas polymetallic massive sulfide discovery which contains a mineable reserve of 72 plus million tonnes grading 1.4 percent Cu, 2.3 percent Zn, 0.5 g/t Au, 30 g/t Ag in Zacatecas State. The Cretaceous volcanic rocks that host San Nicolas continue to the northwest and are believed to underlie the Lobo 6 and Lobo 8 concessions. Regional aeromagnetic data show two major lineaments crossing the property in northeast and northwest directions. Aeromagnetic highs related to these lineaments could indicate buried intrusions and associated silver- rich mineral deposits.

Lobo 8 (48,640 hectares) is located immediately east of the Fresnillo mine, which has past production and mineable reserves of more than 440 million oz. of silver from silver-rich veins, mantos and chimneys hosted in the Cretaceous marine sedimentary and island arc volcanic assemblages, similar to those which host the San Nicolas deposit. Many of the veins at Fresnillo trend either east- west or northeast and strike directly onto the Lobo 8 block. The regional aeromagnetic data indicates a strong lineament trending northeast from the Fresnillo mine on to the northwest portion of Lobo 8. This lineament is intersected by northwest trending lineaments.

A mercury showing is documented by the Consejo de Recursos Minerales (CRM) at the intersection of these lineaments. Recent pediment covers the block, which may explain why there has been no previous exploration on Lobo 8. Noranda plans a phased exploration program, commencing in early 1999 on both properties, consisting of aeromagnetic surveys, ground geophysical surveys and diamond drilling.

Stated Godfrey Walton, Vice President Exploration of Canarc, "The completion of these Agreements is a testament to the technical merits of the properties that Minera Aztec has staked. Minera Aztec will continue to seek out new joint venture partners for its other Mexican projects which are also located in this prolific mineral belt."

Canarc Resource Corp. is a growth-oriented, international gold exploration and mining company. Production increased over 300 percent last year to 7000 oz. at the Company's Sara Kreek (80 percent) mine. Reserves and resources now total 2 million oz. at the New Polaris (100 percent) and Bellavista (18 percent) projects. Our large exploration portfolio includes a joint venture with Homestake/Prime. Major shareholders include Barrick Gold and Echo Bay Mines. The Company's common shares trade under the symbol "CCM" on the Toronto Stock Exchange.

ON BEHALF OF THE BOARD OF DIRECTORS Bradford J. Cooke, President

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