Prophecy Coal Професи

Prophecy Secures Rail Loading Facilities to Transport Over 1.5 Million Tonnes Per Year of Mongolian Coal to Russia and China

VANCOUVER, B.C. - May 25, 2010, : Prophecy Resource Corp. (TSX.V: PCY; OTC: PCYRF; Frankfurt: 1P2) reports it has signed an agreement securing the loading  of and the capacity to transport 1.5 million tonnes of coal annually through Mongolia's Sukhbaatar Railroad Station (Trans-Mongolian Railway) with the option to increase capacity based on availability. 

The Sukhbaatar Station is located 120km (75 miles) by road east of Prophecy's 208.8 million tonne Ulaan Ovoo coal project. The station is located only 8km south of the Russian/Mongolian Naushki border linking with the Trans Siberian Railroad.  The Trans-Mongolian and Trans-Siberian Railroads share the same track gauge and have been providing cross border Mongolian/Russian trade since 1949. The Trans-Siberian Railroad services Russia's largest coal export facilities at Vladivostok and Vanino ports at the eastern seaboard where coal is exported to the world's top coal importing nations Japan, Taiwan and South Korea. Thermal coal comparable to Ulaan Ovoo's quality currently trades betweenUS$85-100 per tonne FOB at Vladivostok representing up to $150 million in annual coal sales based on minimum transportation capacity contracted by Prophecy.

The Trans-Mongolian Railroad connects to China's Erenhot (Erlian) port, which is 1,093 km south from Sukhbaatar and opens Ulaan Ovoo to China, the largest consumer of coal in the world. China consumed 3 billion tones of thermal coal in 2009 and plans to double its thermal coal import to 170 million tones in 2010 from last year.

On  May 21, 2010, Prophecy contracted Leighton Asia Ltd., ("Leighton") a wholly owned subsidiary of the Leighton Group, Australia, the world's largest contract miner to produce 250,000 tonnes of coal at Ulaan Ovoo in 2010, with further plans to mine 2 million tonnes of coal in 2011. Having established the mine plan and secured rail transport, Prophecy is finalizing a truck leasing agreement to provide hauling of coal from mine site to Sukhbaatar, thus rounding up the entire transportation logistics to Chinese and Russian markets.

Mineral resources that are not mineral reserves do not have demonstrated economic viability. Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this release.  

 Forward Looking Statements: This news release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, including, without limitation, statements potential mineralization, the estimation of mineral resources, the realization of mineral resource estimates, interpretation of prior exploration and potential exploration results, the timing and success of exploration activities generally, the timing and results of future resource estimates, permitting time lines, metal prices and currency exchange rates, availability of capital, government regulation of exploration operations, environmental risks, reclamation, title, and future plans and objectives of the company are forward-looking statements that involve various risks and uncertainties. . Although Prophecy believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Forward-looking statements are based on a number of material factors and assumptions. Factors that could cause actual results to differ materially from those in forward-looking statements include failure to obtain necessary approvals in respect of the Transaction, unsuccessful exploration results, changes in project parameters as plans continue to be refined, results of future resource estimates, future metal prices, availability of capital and financing on acceptable terms, general economic, market or business conditions, risks associated with operating in foreign jurisdictions, uninsured risks, regulatory changes, defects in title, availability of personnel, materials and equipment on a timely basis, accidents or equipment breakdowns, delays in receiving government approvals, unanticipated environmental impacts on operations and costs to remedy same, and other exploration or other risks detailed herein and from time to time in the filings made by the companies with securities regulators. Readers are cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral exploration and development of mines is an inherently risky business. Accordingly the actual events may differ materially from those projected in the forward-looking statements. For more information on Prophecy and the risks and challenges of their businesses, investors should review their annual filings that are available at www.sedar.com.

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

This press release does not constitute an offer to sell or a solicitation to buy any of the securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (“the U.S. Securities Act”) or any state securities law and may not be offered or sold in the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.