Canarc Leases Permitted La Plata Processing Plant In Zacatecas Mexico

VANCOUVER, BC - Canarc Resource Corp. has signed a definitive agreement with the Zacatecas state government to lease and operate the permitted 500 tonne per day La Plata ore processing plant in the city of Zacatecas, Mexico, through its wholly owned Mexican subsidiary, Minera Oro Silver.

Canarc plans to use the plant for processing ore from the Company's recently acquired, permitted El Compas Mine, located 20 kilometers away from the plant by road. Canarc also agreed to reserve up to 100 tonnes per day for toll milling of ores produced by local small miners in the area.

The plant was constructed by the Zacatecas state government in September 2013 for processing minerals available from local small miners in the state. The plant last operated in October 2014 and it remains a fully permitted crushing, grinding, flotation and tailings facility.

Canarc technical staff inspected the plant equipment and found it to be in generally good condition but it requires approximately US$1 million in capital investment to refurbish certain pieces of equipment and recommence operations.

Canarc will now turn its focus to arranging the estimated US$8 million in pre-production capital financing needed to develop the mine, refurbish the plant and commence production. Discussions with several groups are now underway.

Catalin Chiloflischi, CEO of Canarc, said "This marks the completion of yet another key step forward by Canarc to transition into a producing gold-silver mining company during 2016. With the lease agreement and PEA now complete, we are now focused on arranging the financing required to develop the mine to production this year."