PRE-FEASIBILITY CONFIRMS TECHNICAL AND ECONOMIC VIABILITY AND STRONG CASH
MARGINS EXPECTED FROM VISTA COAL PROJECT

Highlights:

• Pre-feasibility results confirm the technical and economic viability of the Vista Coal Project and demonstrate its capacity to operate with strong cash margins
• Project will be large scale with forecast annual production of 9.0Mtpa saleable coal and a long mine life of 31 years
• Initial Proven and Probable Marketable Coal Reserves of 260Mt defined from a Recoverable Coal Reserve of 522Mt
• Strong economics with low operating cash costs of C$51/t free-on-board Ridley Island Coal Terminal ("FOB Ridley") in the first 10 years
• Development costs to first production include coal handling, process plant and infrastructure capital costs of C$327 million; project indirects and contingency of C$143 million; and a further C$111 million in mining equipment
• Projected initial 10 year average annual operating cashflows (EBITDA) of C$361Mpa and life of mine ("LOM") average annual operating cashflows of C$375Mpa
• Pre-feasibility confirms potential to develop North America's largest dedicated export thermal coal mine. Project will result in Canada becoming an important strategic first world alternative of export thermal coal supply to the rapidly expanding Asian Pacific economies

PERTH, Western Australia, Dec. 13 /CNW/ - Coalspur Mines Limited ("Coalspur" or "Company") (ASX: CPL, TSX: CPT) is pleased to announce the completion of the Pre Feasibility Study ("PFS") on the Company's flagship Vista Coal Project ("VCP"). The PFS was undertaken by Wardrop, a Tetra Tech company ("Wardrop"), one of North America's leading coal industry engineering consulting firms. The PFS defined a 31 year mine life producing approximately 9.0 million tonnes per annum ("Mtpa") of saleable coal from the processing of approximately 18.0Mtpa of run of mine ("ROM") coal.

Commenting on the completion of the PFS, Managing Director and CEO, Gene Wusaty said "The PFS is a landmark study as it is the first comprehensive study to assess the potential of the consolidated Project area. Production of 9.0Mtpa saleable coal over a 31 year mine life has exceeded our expectations and confirmed that the VCP is now a strategic world scale project. The VCP has the potential to create one of the largest first world export thermal coal developments with existing modern rail and port infrastructure and will elevate Coalspur into the top echelon of global export thermal coal developers".

Mr Wusaty further commented on the exceptional results of the PFS by saying "The VCP is located in a known coal producing region near the town of Hinton, in one of the World's best mining jurisdictions. Low infrastructure costs to first production of only C$327 million highlight the importance of the Project's location and access to underutilised rail facilities that lead to an underutilised world class port. We have all the fundamentals in place to supply much needed energy resources in the medium term to the ever expanding Asian Pacific economies establishing Canada as a strategic alternative supplier of export thermal coal for the long term".

Coalspur will continue to refine the PFS ahead of the commencement of the Bankable Feasibility Study which is expected to begin in the first quarter of 2011. Furthermore it should be noted that the VCP provides a base from which to develop other coal resources in the area, notably the Vista South Coal Project ("VSP"), and other surrounding and contiguous properties.

Pre-Feasibility Key Results

Large Scale, Long Life Project: Approximately 18.0Mtpa run-of-mine operation producing 9.0Mtpa of export (8.0Mtpa) and domestic (1.0Mtpa) thermal coal for 31 years was defined as being technically and economically feasible on the Company's VCP. Upon development this will be the largest export thermal focused coal operation in North America and will rank in the top tier of export thermal coal mines globally.

Strategic Coal Reserve Base: 260Mt Marketable Coal Reserve defined from a 522Mt Recoverable Coal Reserve makes the VCP a globally significant, strategic export thermal coal asset.

Table 1: JORC / NI 43-101 Coal Reserves
	Recoverable Coal Reserve			Marketable Coal Reserve
	Proven	Probable	Proven & Probable	Proven	Probable	Proven & Probable
	(Mt)	(Mt)	(Mt)	(Mt)	(Mt)	(Mt)
Vista Coal Project	415.4	106.3	521.7	208.4	51.6	260.1

Strong and Competitive Economics: The VCP has the potential to achieve cash costs of ~C$51/t over the first 10 years and ~C$56.5/t over the first 20 years which places the Project as one of the most competitive new export thermal coal developments globally. Utilising forecast coal prices from Wood Mackenzie and an exchange rate of 0.92 Canadian dollar to 1 US dollar results in predicted strong EBITDA cashflows of C$361 million per annum ("Mpa") in the first 10 years of operations and C$375Mpa over the 31 year mine life.

World Class Rail and Port Infrastructure: A mine location that provides ready access to underutilised world class coal logistics infrastructure is a key competitive advantage of the VCP. The Project is adjacent to the main line of CN Rail with significant spare capacity to transport coal to the Ridley Island Coal Terminal which is a deepwater, capesize port and capacity to ship significantly greater coal tonnages.

Details of the key results from the PFS are summarised in Table 2 which shows production metrics split into the first three decades of operations.

Table 2: Prefeasibility Study Production Metrics
Mine Schedule	Years 1-10	Years 1-20	Years 1-31
Waste Mined (kbcm)	561,429	1,560,448	2,666,858
ROM Coal Production (kt)	146,513	323,938	524,676
Clean Coal Production (kt)	74,730	163,912	261,363
ROM Coal Strip Ratio	3.8 : 1	4.8 : 1	5.1 : 1
Clean Coal Strip Ratio	7.5 : 1	9.5 : 1	10.2 : 1
Export Coal Production (kt)	68,000	148,002	229,715
Domestic Coal Production (kt)	6,730	15,910	31,648

The development of the mine is planned to be completed in two phases to enable the Company to use an existing mine permit which covers the eastern half of the VCP. The existing mine permit provides for the first phase construction of a 4.2Mtpa operation. In addition to improving initial development timelines, this phased approach will reduce the upfront capital required before achieving significant operating cashflows. The Company anticipates building some of the core infrastructure required to meet the projected additional production from the second phase in the first phase of construction. The PFS schedule shows the second phase production beginning two years after the initial first phase such that full production capacity of 9.0Mtpa is achieved in the fourth year of operation. The PFS first phase development schedule is based on the existing mine permit enabling the project to secure all other regulatory requirements.  

First Phase: Coalspur has initiated permitting discussions with the respective regulatory government authorities with respect to development of the first phase to 4.2Mtpa saleable production as per the existing permit that was acquired with the purchase of the New Coal Leases in July 2010. The first module of the process plant, a single ROM crusher and a coal dryer are constructed with a design throughput of 1,100tph enabling the production of 4.2Mtpa saleable coal as per the existing mine permit by the end of year 2. Development of conveyors and rail load out facility will be built to support 18.0Mtpa ROM and 9.0Mtpa clean. Mining equipment will be added to enable the mining of 8.4Mtpa ROM coal. The first phase will allow the Company to utilise the initial cash flows earned from Phase 1 to pay for a significant portion of the development in second phase. The first phase manpower will reach approximately 400.

Second Phase: Ramp up of production will start in year 3 and full capacity will be achieved by end of year 4. Development will be funded primarily from first phase cash flows and will entail the addition of a second 1,100tph process plant module, coal dryer module, raw coal crusher and the addition of further mining equipment over the ramp up period to achieve nameplate capacity at the mine and processing plant. At full capacity there will be 8.0Mtpa of export coal production and 1.0Mtpa of domestic coal production. During the later years of production manpower levels will reach 900.

The full version of this announcement is available on the Company's website at www.coalspur.com and SEDAR at sedar.com.

Regulatory Disclosures

For further information regarding the Project, including a description of Coalspur's quality assurance program, quality control measures, the geology, samples collected and testing procedures in respect of the Project please refer to the technical report on the Project titled "Resource Estimate for the Vista Coal Property" (the "Technical Report") which is compliant with National Instrument 43-101 - "Standards of Disclosure for Mineral Projects" ("NI 43-101") and is available for review on SEDAR at sedar.com.

Competent Person / Qualified Person Statements

The information in this news release that relates to Coal Resources is based on information compiled by Mr. Robert J. Morris, who is a Member of the Association of Professional Engineers, Geologists and Geophysicists of Alberta.  Mr. Morris is a full-time employee of Moose Mountain Technical Services, who are consultants to Coalspur. Mr. Morris has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' ("JORC Code"), and a "Qualified Person" under NI 43-101. Mr. Morris consents to the inclusion of such information in this news release in the form and context in which it appears.

The information in this news release that relates to mining engineering and Recoverable Coal Reserves is based on information compiled by Mr. Robert Fong, who is a Member of the Association of Professional Engineers, Geologists and Geophysicists of Alberta. Mr. Fong is an associate of Moose Mountain Technical Services, who are consultants to Coalspur. Mr. Fong has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Fong consents to the inclusion of such information in this news release in the form and context in which it appears.

The information in this news release that relates to coal quality and process yield estimates to derive Marketable Coal Reserves is based on information compiled by Mr. Robert Leach, who is a Member of AusIMM  Mr. Leach is a full-time employee of Bob Leach Pty Ltd, who are consultants to Coalspur. Mr. Leach has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Leach consents to the inclusion of such information in this news release in the form and context in which it appears.

The information in this news release that relates to capital costs for coal crushing, coal handling, and infrastructure is based on information compiled by Mr. Kevin Souza, who is a Member of the Association of Professional Engineers and Geoscientists of British Columbia. Mr. Souza is a full-time employee of Wardrop Engineering Inc., who are consultants to Coalspur. Mr. Souza has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Souza consents to the inclusion of such information in this news release in the form and context in which it appears.

The information in this news release that relates to economic financial analysis is based on information compiled by Mr. Miloje Vicentijevic, who is a Member of the Association of Professional Engineers and Geoscientists of British Columbia. Mr. Vicentijevic is a full-time employee of Wardrop Engineering Inc., who are consultants to Coalspur. Mr. Vicentijevic has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Vicentijevic consents to the inclusion of such information in this news release in the form and context in which it appears.

The information in this news release that relates to coal crushing and handling and associated operational costs is based on information compiled by Ms. Ting Lu, who is a Member of the Association of Professional Engineers and Geoscientists of British Columbia. Ms. Lu is a full-time employee of Wardrop Engineering Inc., who are consultants to Coalspur. Ms. Lu has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Ms. Lu consents to the inclusion of such information in this news release in the form and context in which it appears.

The information in this news release that relates to coal processing and thermal drying is based on information compiled by Mr. Les Geczy, Chartered Professional Engineer, who is a Fellow of the Institution of Engineers, Australia (IEAust) and is listed on the National Professional Engineers Register (NPER).  Mr. Geczy is a full-time employee of CPG Resources - QCC Pty Ltd, a Downer company, who are consultants to Coalspur. Mr. Geczy has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Qualified Person" under NI 43-101. Mr. Geczy consents to the inclusion of such information in this news release in the form and context in which it appears.

All other scientific and technical information in this news release is based on information compiled by Mr. Eugene Wusaty, who is a Member of the Association of Professional Engineers and Geoscientists of Alberta. Mr. Wusaty is a full-time employee of Coalspur.  Mr. Wusaty has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a "Competent Person" as defined in the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Wusaty consents to the inclusion of such information in this news release in the form and context in which it appears.

Forward Looking Statements

This news release contains 'forward-looking information' that is based on the Company's expectations, estimates and projections as of the date on which the statements were made.  This forward-looking information includes, among other things, statements with respect to the Company's business strategy, plans, development, objectives, performance, outlook, growth, cash flow, projections, targets and expectations, mineral reserves and resources, scoping, pre-feasibility and other studies, results of exploration and related expenses.  Generally, this forward-looking information can be identified by the use of forward-looking terminology such as 'expect', 'potential', 'outlook', 'anticipate', 'project', 'target', 'likely', 'believe', 'estimate', 'intend', 'may', 'would', 'could', 'should', 'scheduled', 'will', 'plan', 'forecast', "evolve" and similar expressions. Persons reading this news release are cautioned that such statements are only predictions, and that the Company's actual future results or performance may be materially different.

Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the Company's actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information.  Forward-looking information is developed based on assumptions about such risks, uncertainties and other factors set out herein, including but not limited to the risk factors set out in the Company's Annual Information Form.  This list is not exhaustive of the factors that may affect our forward-looking information.  These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information.

The Company disclaims any intent or obligation to update or revise any forward-looking statements whether as a result of new information, estimates or options, future events or results or otherwise, unless required to do so by law.

For further information:

GeneWusaty
Managing Director and CEO
Telephone: [phone]