MSV Completes $40 Million Financing.

MONTREAL--(BUSINESS WIRE)--May 11, 1998--MSV Resources Inc. (ME:MSV.UN.) (TSE:MSV.UN.) today announced that it has secured a $40 million financing for the development of its Copper Rand 5000 project, enabling the company to continue its mining activities for a foreseeable period of at least ten years in the Chibougamau region.

Andre Fortier, Chairman and Chief Executive Officer of MSV, said he was delighted with the outcome, which caps several months of collective effort. He underlined the support of Gerald Metals, which expressed its confidence in the project early in the process, greatly facilitating contacts with some financial institutions, as well as the support of the Quebec ministries of Natural Resources and Regional Development and of Investissements Quebec.

The Steelworkers' Union and MSV employees in Chibougamau displayed understanding and patience, while supporting the Company's contacts with various parties. In that regard, Raymond Bachand, President and Chief Executive Officer of the Solidarity Fund (QFL) stated that the city of Chibougamau's survival is directly linked to the region's mining development. "The Fund's investment will allow MSV to start up its project," he said. "Moreover, sustaining activities at the mill leads us to hope that other base metals deposits will be developed in Chibougamau."

The support of regional organizations, notably the Fonds d'aide a l'entreprise (Conseil regional de la Radissonie), and of the Member of National Assembly for Ungava, Michel Letourneau, was greatly appreciated and shows the willingness of local stakeholders to support a project which represents an appreciable economic value for the region.

In addition to Messrs Bachand and Letoureau, Fortier was also accompanied during the announcement of the financing in Chibougamau by Arnold Dugas, Quebec Director, Steelworkers' Union; Donald Murphy, President of the James Bay Development Corp.; and Michel Bouchard, Vice-President, Exploration and Development, of SOQUEM (Societe quebecoise d'exploration miniere).

The financing essentially is comprised of a $30 million loan from a major banking institution and $10 million of convertible debentures issued to Quebec financial institutions.

The proposed loan has a seven-year term at a competitive interest rate. Bernard Landry, Quebec Deputy Prime Minister and Finance Minister approved a loan loss guarantee equivalent to 70 percent of the balance of the loan to MSV with an option to purchase 3,500,000 common shares of MSV at $0.35 per share through Investissements Quebec.

The convertible debentures bear an annual interest of 8 percent and an additional interest of 1 percent of operating profit per million dollars. These unsecured debentures totaling $10 million are convertible into common shares at a minimum of $0.35 per share. The following financial institutions have agreed to purchase the debentures:

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- Solidarity Fund (QFL):                        $5,000,000
- James Bay Development Corporation             $2,200,000
- SOQUEM                                        $2,000,000
- Regional Solidarity Fund of Northern Quebec     $500,000
- Caisse populaire Desjardins of Chibougamau      $200,000
- Societe d'aide au developpement des
  collectivites (SADC) Chibougamau-Chapais inc.:  $125,000
- Chibougamau SOLIDE (Societe locale d'investissement
   dans le developpement de l'emploi:              $25,000

The Copper Rand 5000 project involves deepening the no 4 shaft from the 4000 to 5000 level, as well as the excavation of a hauling drift at this level. This underground infrastructure will help cut materials handling, significantly reduce production costs compared to current costs and take advantage of MSV's Chibougamau processing plant which has a capacity of 2,700 tons per day.

The project's profitability was established in an August 1997 feasibility study. Based on copper prices of US$1.05 per pound, gold prices of US$340 per ounce, silver prices of US$5.00 per ounce, and a US dollar exchange rate of $1.39, the Copper Rand 5000 project would generate a 17.5 percent return. The study was based on reserves of 2.2 million tonnes at 1.72 percent copper and 3.70 g/t gold. The deposit has an estimated minimum life span of 4.75 years which could be extended over several additional years, given the fact that the deposit remains open on its eastern side and the possibility of extension towards the Cedar Bay mine, located approximately one kilometer west of the Copper Rand mine. Approximately 175 jobs will be created in the Chibougamau area during production.

The financing announced today is subject to approval by shareholders of MSV Resources at the Company's Annual Meeting on June 3, 1998 and is subject to certain conditions set by the investors. In the days that will follow the Meeting, management expects to secure approvals necessary to complete the financing and proceed with the initial phase of development work.

CONTACT: MSV Resources Inc.

Andre Fortier, 514/875-9037

or

Lucie Brun, 514/875-9036