Mr. Ellerton Castor reports

CANADA CARBON CLOSES PRIVATE PLACEMENT OF FLOW-THROUGH UNITS AND ORDINARY UNITS

Canada Carbon Inc. has closed a non-brokered private placement of 10,833,000 flow-through units at a price of six cents per FT unit for aggregate gross proceeds of $649,980. Each FT unit is composed of one flow-through share in the capital of the company and one common share purchase warrant. Each warrant shall entitle the holder thereof to acquire one common share in the capital of the company at a price of 10 cents per common share for a period of 60 months from the date of issuance. The FT shares will qualify as flow-through shares within the meaning of the Income Tax Act (Canada).

In addition to the FT offering, the company completed a non-brokered private placement of 1.3 million units at a price of six cents per ordinary unit for aggregate gross proceeds of $65,000 (the concurrent offering and, together with the FT offering, the offering). Each ordinary unit is composed of one common share and one warrant. Each warrant shall entitle the holder thereof to acquire one common share at a price of 10 cents per common share for a period of 60 months from the date of issuance.

All securities issued pursuant to the offering are subject to a hold period of four months plus a day from the date of issuance and the resale rules of applicable securities legislation. The proceeds of the FT offering will be used by the company for eligible flow-through expenditures and the proceeds of the concurrent offering will be used for general corporate expenses.

In connection with the offering, the company paid finders' fees to certain finders, consisting of: (i) a cash fee equal to $45,398; and (ii) 769,647 warrants. Each finder's warrant shall entitle the holder to acquire one common share at a price of 10 cents per common share for a period of 60 months from the date of issuance.

We seek Safe Harbor.