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Canadian Royalties Inc./Nunavik Nickel Project: Drilling Confirms Further Mineral Potential of Allammaq-Mesamax Dyke System

Posted on: Thursday, 7 February 2008, 12:00 CST

Canadian Royalties Inc. (TSX: CZZ) reports composite assay results from twelve (12) exploration drillholes along the ultramafic dyke system which hosts the Mesamax and Allammaq deposits. The majority of these drillholes returned significant results including several high-grade intercepts (see drillholes MX-07-60 & 62). These results demonstrate further exploration potential along this highly prospective geological trend. Upcoming exploration campaigns will be designed to unlock additional mineral potential in this area that could become a key mining centre of the Nunavik operation.

 Table 1 -Composite Assays  Hole             From        To     Width     Ni      Cu      Pt     Pd  Number             (m)       (m)       (m)    (%)     (%)   (g/t)   g/t) ------------------------------------------------------------------------  MX-07-25        10.75     16.70      5.95   0.35    0.88    0.17   0.87 ------------------------------------------------------------------------  MX-07-26        24.00     26.00      2.00   0.39    0.64    0.32   1.47 ------------------------------------------------------------------------  MX-07-27        82.00     93.00     11.00   0.49    0.53    0.24   0.98 ------------------------------------------------------------------------  MX-07-28        81.00     86.40      5.40   0.60    1.43    0.24   1.40                  83.75     86.40      2.65   0.90    2.07    0.36   2.28 ------------------------------------------------------------------------  MX-07-29                                       No significant results ------------------------------------------------------------------------  MX-07-53                                       No significant results ------------------------------------------------------------------------  MX-07-54                 End of season blizzard; core unexamined ------------------------------------------------------------------------  MX-07-60       107.00    109.70      2.70   0.48    0.79    0.19   1.05  and            144.55    146.25      1.70   2.82    1.89    0.65   1.48 ------------------------------------------------------------------------  MX-07-61       139.40    139.70      0.30   1.50    2.00    0.28   0.92 ------------------------------------------------------------------------  MX-07-62       117.95    119.90      1.95   1.04    0.54    0.78   2.48  and            134.65    145.75     11.10   0.76    0.54    0.26   1.05  incl.          137.70    139.70      2.00   1.72    1.30    0.40   1.19 ------------------------------------------------------------------------  MX-07-63             Drill capacity reached; target not attained ------------------------------------------------------------------------  MX-07-64                        Frozen hole; target not attained ------------------------------------------------------------------------ Table 2 - Drillhole  Locations  Hole         Easting      Northing   Azimuth       Dip   Final Depth  Number        (UTM NAD83,  Zone 18) (degrees) (degrees)           (m) ---------------------------------------------------------------------  MX-07-25     595064E      6827367N       178       -45         66.00  MX-07-26     595064E      6827367N       178       -85         78.00  MX-07-27     595059E      6827450N       178       -88        119.60  MX-07-28     595059E      6827450N       178       -60        138.00  MX-07-29     595562E      6827343N       178       -45        135.00  MX-07-53     595358E      6827566N       178       -89        225.00  MX-07-54     595358E      6827566N       178       -62        300.00  MX-07-60     595057E      6827546N       178       -71        212.55  MX-07-61     595057E      6827546N       178       -83        240.00  MX-07-62     595057E      6827546N       178       -57        252.45  MX-07-63     595631E      6827697N       160       -70        301.20  MX-07-64     595631E      6827697N       164       -65        195.00 --------------------------------------------------------------------- 

Section 1900E: Holes MX-07-25 to 28 were drilled early in the season from two set-ups targeting the favourable Mesamax Main ultramafic where historical drilling on-strike gave indications of further potential. All four (4) holes returned highly anomalous mineralization with composite assays up to 11.00 metres of 0.49% Nickel and 0.53% Copper. The best grades were intersected in hole MX-07-28 which returned 5.40 metres grading 0.60% Nickel and 1.43% Copper, including a higher-grade 2.65 metre interval that ran 0.90% Nickel and 2.07% Copper.

Given the success of the earlier drilling, three additional holes were planned and executed from a location 94 metres north of the MX-07-27 & 28 set-ups. Hole MX-07-60 returned a 1.70 metre interval of high-grade massive sulphides within sediments below the ultramafic that ran 2.82% Nickel and 1.89% Copper. At the base of the ultramafic hole MX-07-62 intersected 11.10 metres of predominantly net-textured mineralization that graded

0.76% Nickel and 0.54% Copper, of which 2.00 metres ran 1.72% Nickel and 1.30% Copper.

The high-grade intercepts from section 1900E provide much impetus for further exploration in the area. Additional drilling is planned for 2008.

Section 2200E: Holes MX-07-53 and 54 were collared as part of a new drill fan that targeted the western strike extension of Allammaq mineralization. Hole MX-07-53 intersected a favourable ultramafic unit between 174.45 metres and 189.65 metres but did not yield significant results. Hole MX-07-54 was drilled at the close of the exploration season as a follow-up to hole 53. Blizzard conditions prevented access to the drill and transportation of the core for geological examination. The core will be examined when crews return to the site to execute the 2008 exploration campaign. Regardless of results, the drill fan remains incomplete and further drilling is planned for this section.

Section 2400E: Hole MX-07-29 was drilled to test a shallow magnetic and HLEM anomaly approximately 200 metres south of the Allammaq discovery hole. The conductor was explained by the presence of graphite while the magnetic anomaly appears to have been explained by the veneer of peridotite overlying conductive sediments.

Section 2500E: Holes MX-07-63 and 64 were drilled as part of a new drill fan of off-section drilling targeting the eastern strike extension of Allammaq mineralization, and direct follow-up of mineralization intersected in hole MX-07-38 (22.30 metres grading 2.62% Ni, 1.81% Cu, 0.64 g/t Pt and 2.12 g/t Pd). Hole MX-07-63 was drilled to the maximum depth capacity of the diamond drill and was abandoned in the favourable ultramafic at 301.20 metres. Subsequent borehole EM surveys indicate the presence of an off-hole anomaly at hole bottom. MX-07-64 was targeted somewhat up dip from hole 63 but unfortunately froze prior to attaining the target. Sections east of and adjacent to 2450E remain prime exploration targets; holes 63 and 64 will be re-drilled as part of a complete drill fan that will be executed during 2008 upon the arrival of higher-capacity, heli-portable drills.

Sampling and Assays

Core samples are either split or sawn on-site, individually sealed in bags and shipped off-site on a regular basis to the ALS Chemex laboratory in Val d'Or, Quebec for sample preparation. Analyses are performed at the ALS Chemex laboratory in Vancouver, British Columbia. Base metal analyses including Nickel and Copper are determined by sodium peroxide fusion with ICP-AES analysis. Platinum, Palladium and Gold analyses are determined by fire assay and ICP-AES finish. The company quality control (QA/QC) program includes regular insertions of blanks and standards. Reported values are uncut and composite intervals are reported as length along the core axis.

Qualified Persons

W. Grant Arnold (P.Geo.), Vice-president Exploration for Canadian Royalties Inc., is a Qualified Person in accordance with National Instrument (NI) 43-101, and is responsible for the geological information presented in this news release.

About Canadian Royalties and the Nunavik Nickel Project

Canadian Royalties has initiated the development of an independent, stand-alone nickel-copper mine on its Nunavik Nickel Project, located 20 kilometres south of Xstrata Nickel's Raglan Mine in northern Quebec. Canadian Royalties is proceeding with permitting applications, as well as exploration for additional resources.

Canadian Royalties currently holds a 100% interest in the Ivakkak deposit, subject to a net smelter royalty ("NSR", refer to news release dated September 21, 2005). Additionally, Canadian Royalties has vested in a 70% interest in the Expo-Ungava property (which hosts the Mesamax, Mequillon and Expo deposits), where its interest shall be increased to 80% simultaneously with the creation of the joint venture. Further, Canadian Royalties holds an underlying 2% NSR on the Expo-Ungava Property.

Forward-looking Statement

This news release contains certain forward-looking statements. These forward-looking statements are subject to a variety of risks and uncertainties beyond the Company's ability to control or predict which could cause actual events or results to differ materially from those anticipated in such forward-looking statements. Such risks and uncertainties are disclosed under the heading "Risk Factors" in the Company's Amended and Restated Annual Information Form dated July 10, 2007 for the year ended December 31, 2006. Accordingly, readers should not place undue reliance on forward-looking statements.

 Contacts: Canadian Royalties Inc. W. Grant Arnold, Vice-President Exploration 514-879-1688 Toll free: 877-879-1688 grant.arnold@canadianroyalties.com  C. Jens Zinke, Vice-President Business Development 514-879-1688 Toll free: 877-879-1688 jens.zinke@canadianroyalties.comwww.canadianroyalties.com  Renmark Financial Communication Jason Roy, Account Manager 514-939-3989 jroy@renmarkfinancial.com

SOURCE: Canadian Royalties Inc.

Source: MARKET WIRE

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