Cusac Gold Mines: Private Placement Arranged, New Board Member Appointed, New Strategy Outlined, High Grade Drill Results.

VANCOUVER, British Columbia--(BUSINESS WIRE)--July 10, 1997-- CUSAC GOLD MINES (TSE CQC., NASDAQ CUSIF.) Mr. David H. Brett, Vice President and Director, is pleased to announce the Company has arranged, subject to regulatory approval, a private placement to be brokered by Canaccord Capital Corp. of 2,500,000 special warrant units at $0.60 per unit consisting of one common share and one warrant to purchase one common share for one year at $0.60 and two years at $0.70.

The gross proceeds of $1.5 million will be applied primarily to exploration of the Company's Table Mountain Property with the goal of significantly increasing gold reserves. In conjunction with this financing, Mr. P. Leslie Hammond, CA has been appointed to the Board of Directors in order to assist the Company in implementing a new strategy of rapid growth through mergers, acquisitions and optimisation of current assets. A second new director is to be appointed shortly.

Underground diamond drilling of new targets in the Michelle Highgrade Zone is set to commence July 15, as a 250 foot decline development designed to provide an optimum drill position is nearing completion. Cusac believes that this area has the geologic potential to host over 370,000 ounces of gold. A series of 200-500 foot holes will test the extension of the highly productive Lilly Vein prior to the commencement of longer (1000-3000 foot) drilling.

Surface diamond drilling is already underway, with significant intersections as follows:

STRUCTURE        INTERSECTION (metres)      GOLD OZ/T

Vollaug Vein            0.50                  0.701
    "                   1.10                  1.714
    "                   1.65                  1.080
Sara Vein               1.60                  0.995
                        ____                  _____
    "                   1.00                  0.409
                        ____                  _____
    "                   1.10                  0.363

NOTE: Underlined results above were drilled in 1988 but have not been previously released.

Results from the Sara vein are considered by management to be highly significant as this intersection represents the possible eastern extension of veins in what is known as the "Main Mine" area. The Main Mine provided some ten years of production to Cusac's predecessors on the property, all from veins west of the major Erikson Creek fault structure. The new intersection, east of the fault, opens up a significant new area of exploration potential.

Cusac is pleased to welcome Mr. P. Leslie Hammond, CA to its board of directors. Mr. Hammond, President and CEO of Quadrant Financial Corporation, brings to the Company nearly 30 years of international business and financial experience.

Cusac believes that the above addition to its Board, together with other planned strategic changes, represents a significant first step in providing the specific and specialised strengths required to fulfil its objective of emerging as a significant Western Canadian mining company with proven technical and financial expertise geared to providing continuous enhancements in shareholder value. Given the current market environment, Cusac believes that it is well positioned to pursue advantageous potential mergers, acquisitions and strategic alliances capable of building the Company into a significant gold producer with greatly expanded reserves.

Cusac Gold Mines Ltd. Per/ David H. Brett, Vice President and Director -0-

Note To Editors: The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

CONTACT: Cusac Gold Mines Ltd.

David H. Brett, 604/682-2421

E-mail: [e-mail]

Web site: http://www.cusac.com