TSX: CCM, OTC-BB: CRCUF, DB-F: CAN) announces that it will not be proceeding with the purchase of the Relief Canyon gold mine assets from Firstgold Corporation for US$11 million as previously announced. The purchase agreement was subject to a due diligence period expiring February 4, 2011 and neither Canarc nor its lender, Effisolar, are satisfied with the results of the due diligence to date.

Canarc remains interested in acquiring the Relief Canyon gold mine assets once the secured lender to Firstgold acquires the gold mine assets through the bankruptcy proceedings, subject to resolving the remaining due diligence issues. The main issues relate to the facts that the known gold resource is only an inferred resource, it is not yet fully permitted for mining, it partly occupies the property adjacent to Firstgold, and Canarc was unable to acquire that property on commercially acceptable terms.

Effisolar has indicated to Canarc that they no longer intend to provide the Cdn$12 million bridge loan for the acquisition. However, as previously agreed, Effisolar will provide Canarc with a Cdn$300,000 convertible loan to close on or before February 3, 2011, maturing in one month, bearing no interest and automatically converting into Canarc common shares based on the 10 day average closing price on the TSX prior to closing, with the conversion subject to TSX approval.

Canarc