Canuc Announces Ecuadorian Producing Gold Property Update, Successful Rights Issue and Consolidation of Shares.

TORONTO--(BUSINESS WIRE)--June 17, 1996--CANUC RESOURCES INC. (CANADIAN DEALING NETWORK:CNUC)

PRODUCING GOLD PROPERTY

On June 5, 1996, Canuc Resources Inc. reached agreement with Minera Andes Dorado S.A. ("Andos") whereby Canuc would acquire a 30 percent interest in Andos for US $2.5 million. Canuc also has a firm option to acquire a further 40 percent interest in Andos one year from the date of the last payment as described below.

Andos owns and operates a producing gold mine in the Nambija region which is located in the province of Zamora-Chinchipe in southern Ecuador. Current annual gold production of this mine is approximately 9,000 ounces operating at a rate of 40 tons a day. Because of the primitive mining and extraction process presently employed, only ore containing 0.50 ounces or more per ton is being mined.

An independent engineering report prepared for Canuc by Strathcona Mineral Services Limited shows that sampling in one section of the mine indicated values of 0.28 ounces per ton over a distance of 40 metres or 132 feet. Within that section, 7.0 metres or 22 feet assayed 16.0 grams or approximately 0.50 ounces of gold to the ton. Moreover, the ore zone appears to continue well past the section sampled. Within the area accessible by present workings, it is estimated that there are probable reserves of at least 5.0 million tons carrying a minimum grade of 0.20 ounces to the ton. The area presently being mined comprises less than 10 percent of the total. The remaining unworked part of the property has been sampled by digging numerous pits all of which were found to carry economic gold values.

In addition to the operating mine, Andos owns a 150 ton per day carbon-in-pulp gold extraction plant. This mill, which is located about 3 kilometres from the mine site, was constructed in 1991 by another company and was only used for a short time. An inspection of the mill showed that it was in excellent condition and could be put back into operation in a few months at modest cost.

It would be Canuc's intention to close down the present working operation and to truck the ore to the bigger plant, and at the same time to carry out extensive exploration over the entire property.

To acquire its 30 percent ownership of Andos, Canuc has made a non-refundable payment of US$350,000 for a three month option during which time it will carry out engineering and geological due diligence. The legal due diligence already has been completed and the results were satisfactory. At the end of the three month period, a further payment of US$1,150,000 will be made for a 17.23 percent interest in Andos. On completion of this payment, Canuc will assume operatorship of the mine and mill. Following a further three months, a payment of US$500,000 is to be made. Six months thereafter a final payment of US$500,000 will increase Canuc's interest in Andos to 30 percent.

The option on a further 40 percent of Andos is to be exercised by Canuc within one year of the final payment and the amount is to be determined by an independent engineering evaluation carried out by a firm accountable to both parties. The other 30 percent of Andos will be acquired by Nova Beaucage Mines Limited ("Nova") under the same terms and conditions as those agreed by Canuc. Nova also will be granted the opportunity to purchase 10 percent of Canuc's option to purchase the additional 40 percent of Andos. Nova and Canuc are both managed by H.J. Mockler, Professional Geologist.

A personal visit to the property in Ecuador by Mr. Mockler provided firsthand observation of both the surface and underground geology, which led to the conclusion that this property has the potential to be a very large mine with a grade in excess of 0.20 ounces of gold per ton.

The acquisition of the Andos producing gold property in Ecuador plus the right to earn a 51 percent interest in the highly prospective Plumas Gold property in northern California could see Canuc operating two producing gold properties in a relatively short time.

Subsequent to the signing of the agreement, a detailed underground sampling program was initiated. Samples will be taken from the previously unsampled extensive drifts, cross cuts and stopes which are estimated to total in excess of 5 kilometres in length and criss-cross the property. This sampling will be of considerably greater value than diamond drilling because of the greater size of the areas available for visual observation. In addition, it will also afford the opportunity to carry out a more detailed geological evaluation than could be provided by drill holes.

The first samples will be taken under seal to the Bondar-Clegg Laboratory in Quito, Ecuador for sample preparation prior to being assayed at Bondar-Clegg's Laboratory in either Santiago, Chile or Vancouver, Canada. The first sample results should be available in two to three weeks.

RIGHTS ISSUE AND SHARE CONSOLIDATION

The recent issue by Canuc of new shares through preemptive rights to shareholders on the basis of one new share at $0.11 plus four rights was fully subscribed, by June 4, 1996, resulting in gross proceeds to the Company of $1,250,700 and the issue of 11,370,278 additional Canuc common shares.

At the Annual and Special General Meeting of Shareholders on June 5, 1996, shareholders voted to consolidate the common share capitalization of Canuc on the basis of one new share for every five shares previously held and to change the name of the company to Canuc Resources Corporation. Trading on the Canadian Dealing Network in the new shares is expected to commence in July.

CONTACT: Canuc Resources Inc.

H.J. Mockler, 416/214-1134

416/363-1902 (Fax)