Colonial Coal Announces Results of a Preliminary Economic Assessment and Increased Resources for Its Huguenot Project

VANCOUVER, BRITISH COLUMBIA -- (Marketwired - Sept. 24, 2013) - Colonial Coal International Corp. (TSX VENTURE:CAD) (the "Company" or "Colonial Coal") - David Austin, Colonial Coal's President and CEO, is pleased to announce the results of a recently completed Preliminary Economic Assessment (the "PEA") for the Company's 100% owned Huguenot metallurgical coal project (the "Huguenot Project") located approximately 85 kilometres southeast of Tumbler Ridge in northeast British Columbia.

The PEA report, prepared by Norwest Corporation ("Norwest") in accordance with CSA National Instrument 43-101 ("NI 43-101") standards, has been filed on SEDAR. The results of the PEA suggest that the Huguenot Project has positive economics and that it is worthy of continued exploration and development.

In summary, Norwest updated previously reported (2012) in situ and potentially mineable resources, developed a conceptual mine plan to exploit the coal resources through a combination of open pit and underground mining and prepared scoping-level cost estimates and economic analyses for the Huguenot Project.

Highlights of the PEA report respecting the Huguenot Project are summarized as follows (all costs are in US dollars):

- The Huguenot Project has an indicative after-tax (and royalty) net present value ("NPV") of US$1,100 million at a 7.5% discount rate (a US$1,579 million NPV at a 5% discount rate) at a base-case coal price of US$192.50 per tonne (which includes contingencies on capital costs only).

- The Huguenot Project has a total projected mine life of 31 years, with the open pit (Years -1 - 14) and underground (Years 3 - 31) operating simultaneously during Years 3 - 14.

- Measured and indicated in-situ coal resources total 277.7 million tonnes (132.0 million tonnes surface mineable plus 145.7 million tonnes underground mineable) and represent an increase of 46.6% over previous estimates for these two resource categories. Inferred resources total an additional 119.2 million tonnes (0.5 million tonnes of surface mineable plus 118.7 million tonnes underground mineable).

- The Huguenot Project's potential coal production is identified as hard coking coal similar to coking coal currently exported from northeast British Columbia.

- The base coal price used (US$192.50 per tonne) represents a discount of US$7.50 per tonne from a projected long-term benchmark price of US$200 per tonne for premium medium volatile coking coal.

- The PEA economic analysis is based on a conceptual open pit mine plan targeting 56 million Run-of-Mine ("ROM") tonnes of resource at an average stripping ratio of 8.6 :1 (bank cubic metres (bcm) :ROM tonnes) plus a conceptual underground mine plan that targets an additional 66M ROM tonnes of resource.

- The Huguenot Project has total projected clean coal production of 89 million tonnes over a mine life of 31 years.

- Projected clean coal production from combined surface and underground mining operations ranges from 1.4 million tonnes per annum ("Mt/a") to 5.9 Mt/a, averaging approximately 3.0 Mt/a.

- Projected clean coal production from the open pit averages approximately 3.2 Mt/a in Years 1 through 12 and 1.8 Mt/a from underground from Years 5 through 31.

- The Huguenot Project's proposed payback of initial capital is estimated at eight years after start-up.

- The Huguenot Project's cash operating costs are estimated at US$77.84 per tonne clean coal (capital cost contingency only) at the mine loadout. This figure increases to US$89.52 per tonne clean coal if an operating cost contingency is also applied.

- The Huguenot Project's average direct cost plus all offsite costs (ie, FOB cost) is US$122.51 per clean tonne (with a contingency on capital costs only) and US$134.19 per clean tonne (with contingencies on capital and operating costs).

As part of the PEA, updated previous resource estimates reported by Norwest in a prior NI 43-101 technical report issued in August 2012, to account for results from the 2012 drilling program. The revised resource estimates are tabulated below:

Deposit type	Measured (Mt)	Indicated (Mt)	Inferred (Mt)
Surface  	96.20	        35.75	        0.53
Underground	18.85	        126.88	        118.66
TOTAL	        115.05	        162.63	        119.19

Conceptual mine plans developed in the study utilize surface mining for the steeper dipping sections of the North, Middle and South resource blocks, while the shallower dipping portions of the North Block below the economic limits of the open pit were conceived as being mineable by underground longwall mining techniques. Coal resources accounted for in both the open pit and underground mine plans were estimated as:

Mining Method	ROM (Mt)	Clean (Mt)
Open Pit	56	        39
Underground	66	        50
TOTAL	        122	        89

It was assumed that the Huguenot Project would be connected by rail to the existing rail line south of Tumbler Ridge, and that a third party would construct this rail link, with costs being charged to the Huguenot Project on an annual basis. It was further assumed that other potential projects along that extended rail corridor would come on stream during the same general time frame as the Huguenot Project and that the rail costs would be shared among several users, such that the Huguenot Project's share of the annual costs would be no more than 50% of the total.

The initial capital costs of the Huguenot Project have been significantly reduced by assuming that major equipment items for surface mining would be leased, and are therefore included as cash operating costs. Pre-production capital cost for the proposed underground mine is estimated US$387 million including a 15% contingency allowance, with additional sustaining capital of US$186 million over the life of the mine.

A summary of the financial analyses is shown in the following table:

Coal Price	NPV (US$M) at Varying Discount Rates with IRR
w/ Capital Cost                 w/ Capital and Operating
Contingency Only	        Cost Contingencies
5%	7.5%	10%	IRR(%)	5%	7.5%	10%	IRR(%)
US$225/t	$2,634	$1,910	$1,420	49	$2,238	$1,602	$1,173	42
US$192.50/t	$1,579	$1,100	$ 780	32	$1,181	$790	$530	24
US$165/t	$680	$407	$230	16	$272	$ 85	- $32	9

This PEA is preliminary in nature and includes inferred mineral resources that are considered to be too geologically speculative to be subject to economic considerations that would enable them to be categorized as mineral reserves. There is no certainty that the forecast results stated in the PEA will be realized.

This press release has been reviewed by Warren Evenson of Norwest, a Professional Geologist and a Qualified Person, as defined in NI 43-101.


Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


About Colonial Coal International Corp.

Colonial is a publicly traded pure-play coking coal company in British Columbia. The northeast Coal Block of British Columbia, within which our Company's projects are located, hosts a number of proven deposits and has been the subject of M&A activities by Xstrata, Walter Energy, Anglo-American and others.

Additional information can be found on the Company's website www.ccoal.ca or by viewing the Company's filings at www.sedar.com.


Forward-Looking Information

Information set forth in this news release may involve forward-looking statements. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address a company's expected future business and financial performance, and often contain words such as "anticipate", "believe", "plan", "estimate", "expect", and "intend", statements that an action or event "may", "might", "could", "should", or "will" be taken or occur, or other similar expressions. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: risks associated with marketing and sale of securities; the need for additional financing; reliance on key personnel; the potential for conflicts of interest among certain officers or directors with certain other projects; and the volatility of common share price and volume. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and except as required by law, the Company undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change. Investors are cautioned against attributing undue certainty to forward-looking statements.

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CONTACT INFORMATION

Colonial Coal International Corp.
Perry Braun
604.568.4962
pbraun@ccoal.ca

Shane Austin
604.568.4962
saustin@ccoal.ca
www.ccoal.ca