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International Reef Resources Ltd; Update on Alpheus Coal Recovery Project.

CALGARY, Alberta--(BUSINESS WIRE)--Nov. 26, 1996--International Reef R(Alberta Stock Exchange:IRF.) International Reef Resources Ltd. (ASE - IRF) is pleased to advise that the first stage of the US$26 million Alpheus coal recovery project, with estimated reserves of 7.7 million tonnes of waste coal in place, has been fully funded. Reef and its joint venture partner, Mineral Development Corporation, have each contributed US$5.85 million in equity to the joint venture vehicle, Resource Recovery II LLC. These contributions provide more than sufficient capital to complete the gravity and oil agglomeration stages of the project which will enable coal production and sales to commence.

This first phase funding will enable coal production and sales to commence from the gravity and oil agglomeration sections of the plant. Negotiations are currently underway to contract for completion of the pyrolysis stage of the project which will enable output to qualify for the US Internal Revenue Service Section 29 tax credits. This equates to over US$30 per tonne. Output at the plant is expected to be 600,000 tonnes per year, with approximately 10 years of reserves in place.

Resource Recovery II, on behalf of the joint venture, is negotiating with contractors for the completion of the pyrolysis plant and a contract for the construction and commissioning of this section of the plant is expected to be awarded in the near future.

The project's New York financial advisor, Ormes Capital Markets Inc., is currently negotiating with major financial institutions who have expressed interest in completing the funding for the pyrolysis section of the project.

CONTACT: International Reef Resources Ltd.

Dr. Malcolm T. Jacques, 416/350-3528

Mr. John P. Ogden, 416/350-3677
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Publication:Business Wire
Date:Nov 26, 1996
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