First American Railways Reports Third Quarter 1997 Net Profit; Durango & Silverton Scenic Rail Revenues Increase; Florida Fun-Train Launches Service Early in Fourth Quarter.

HOLLYWOOD, Fla.--(BUSINESS WIRE)--November 17, 1997--First American Railways, Inc. (Nasdaq: FTRN), the entertainment and scenic rail company which initiated service on October 15 between South and Central Florida on its Florida Fun-Train, today announced revenues of $6,177,291 for the third quarter ended September 30, 1997. These revenues were generated by The Durango and Silverton Narrow Gauge Railroad ("D&SNG"), which the Company acquired earlier this year. The Company generated operating income of $1,505,785 for the quarter and net income of $604,810, or $.05 per share, for the quarter. This compares with an operating loss of $745,078 and a net loss of $778,650, or ($0.09) per share, in the 1996-quarter. Revenues for the first nine months ended September 30 were $8,810,876, which were solely from D&SNG. The net loss for the nine months of 1997 was $1,091,149, or ($0.11) per share, versus a net loss of $1,537,857, or ($0.22) per share, in 1996.

Developmental expenses in connection with the Company's Florida Fun-Train increased $1.1 million compared to the same period last year as it prepared to launch service early in the fourth quarter. This increase is related primarily to the hiring of train operations personnel and additional general and administrative expenses such as rent, insurance, promotion and advertising relating to the commencement of operations.

The Company does not anticipate reporting profits for the fourth quarter due to the seasonality of the operations of the D&SNG and start-up cost of the Florida Fun-Train in excess of ticket revenues. The Company also does not anticipate being profitable for fiscal 1997.

First American Railways, Inc. provides innovative, quality entertainment passenger rail service through the development of "Fun-Trains" and the acquisition of "Scenic Destination Railroads." The Company currently operates the Florida Fun-Train between Central and South Florida. The Company also owns and operates the Colorado-based Durango & Silverton Narrow Gauge Railroad, a registered National Historic Landmark, which accommodates approximately 200,000 passengers annually.

First American Railways' mission is:

To be the recognized leader in providing innovative, quality

entertainment-based passenger rail service, offering our customers,

communities, employees and shareholders an experience which

exceeds their expectations.

Certain statements in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In particular, statements contained herein regarding the expectations with respect to future revenues and business expansion, and recently acquired businesses are subject to known and unknown risks, uncertainties and contingencies, many of which are beyond the control of First American Railways, Inc., which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. Factors that might affect such forward-looking statements include, among others, overall economic and business conditions, the prompt institution of Florida Fun-Train services (which require the prompt delivery of railcars and the completion of terminal sites), the demand for the company's services, competitive factors, regulatory approvals and the uncertainty of consummation of pending or proposed third party agreements, unscheduled rail equipment repairs or commitments. Additional factors which may affect the company's business and performance are set forth in the company's filings with the Securities and Exchange Commission. -0-

                 First American Railways, Inc.
             Consolidated Statements of Operations

                           Three Months Ended       Nine Months Ended
                              September 30,           September 30,
                            1997         1996       1997         1996

Revenue                 $ 6,177,291        -     $ 8,810,876       -
Cost of revenue           1,684,498        -       2,870,502       -

Gross profit              4,492,793        -       5,940,374       -

Selling, general
 and administrative       1,127,747        -       1,652,900       -

Development of
 Florida Fun-Train        1,859,261     745,078    3,742,539   1,136,972

Operating income (loss)   1,505,785    (745,078)     544,935  (1,136,972)
Interest expense,
 (income) net               740,702     (16,090)   1,333,721     171,995
Amortization of
 loan costs                 160,273      49,662      302,363     171,061
Expenses from offerings
 not completed                 -           -            -         57,829

Net income (loss)        $  604,810   $(778,650) $(1,091,149)$(1,537,857)

Weighted average number
 of common shares
 outstanding             11,129,617   9,061,078    9,986,770   7,149,329


Net income (loss)
 per common share            $ 0.05      $(0.09)      $(0.11)     $(0.22)

CONTACT: First American Railways, Inc.

Michael Acierno [phone]

Tara Monteleone McGinn [phone]

or

The MWW Group

Investor and Media Relations - [phone]

Investor Contact: Rob Swadosh ([e-mail])

Leon Berman ([e-mail])

Media Contact: Laurie Terry ([e-mail])