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Prophecy Reports Multiple 1g/t Rhodium and 10g/t Platinum Group Metals Chip Samples from Extensive 2.5km Tunnel Sampling (Assay Files Included)

Vancouver, British Columbia, November 3, 2010: Prophecy Resource Corp. ("Prophecy" or the "Company") (TSX-V:PCY, OTCQX: PRPCF, Frankfurt: 1P2) reports that subject to TSXV disclosure regulations the company hereby retracts the gross metal value as reported in its prior press release (November 3, 2010). Cautionary statements have been added regarding disclosure of historical resources and geologic potential.

The East Zone of Prophecy's 100% owned Wellgreen Project located in the Yukon,Canada has seen substantial historic development, with almost 4,300 metres of underground development on seven levels, three internal shafts and over 500 surface and underground drill holes.

800 previously unreported chip channel samples taken at 2 metre intervals along the underground workings were assayed for Platinum (Pt) and Palladium (Pd) at ALS Chemex Labs in Vancouver, B.C. Of these, 174 samples where Platinum or Palladium grades exceeded 1g/t were thereafter assayed for Gold (Au), Rhodium (Rh), Osmium (Os), Iridium (Ir), and Ruthenium (Ru). The 2007 sampling program was overseen by Rory Calhoun, P. Geo., now an employee of Prophecy. Concentrations of Rhodium, Osmium, Iridium, and Ruthenium were present in all of the follow-up samples. Assays where Rhodium exceeded 0.5g/t are listed in the following table:

The results are consistent with the 265-page 1997 Bulletin of the Geological Survey of Canada entitled "Geology and Metallogeny of the Kluane Mafic-Ultramafic Belt, Yukon Territory. Canada: Eastern Wrangellia - A New Ni-Cu-PGM Metallogenic Terrane" By: L.J. Hulbert. Dr. Hulbert commented on page 55:

“Rhodium is present in anomalous concentration compared to other Canadian Ni-Cu ores. In fact the only other Ni-Cu cores with comparable values are the near age equivalent Noril’sk ores in Russia. Average massive sulphides contain 400 ppb Rh (0.4g/t) where values in the 0.3 g/t – 1g/t range are not uncommon in the basal portion of the massive sulphide orebodies.”

With these highly encouraging results, Prophecy is assaying 470 drill core samples for all 6 Platinum Group Metals from drill programs by Northern Platinum Ltd. and Coronation Minerals Ltd. since 2006. Those core samples were previously assayed for Platinum and Palladium and yielded results over 1g/t of Platinum and Palladium combined.

John Lee, CEO of Prophecy comments: "The underground sampling demonstrates the widespread occurrence of all 6 Platinum Group Metals. Particularly noteworthy is the discovery of (previously unknown) widespread occurrences of rhodium. Platinum Group Metals are highly valuable and this encouraging discovery should significantly enhance the economics and appeal of Wellgreen."

Prophecy also advises that it has started receiving results from Northern Platinum Ltd.'s summer drill program and Prophecy's fall drill program; the company will release them once data is received in full.

More details about Wellgreen

The Wellgreen claims are 7km strike and over 22 square kilometers. Wellgreen is 15 km from the paved 2 lane Alaska Highway and 402 km from Alaska’s Haines deep sea port.  It is part of Kluane Ultramafic Nickel belt, which is second largest behind the Thompson Belt in Canada and remains vastly unexplored.

Since 1952 exploration at Wellgreen was almost entirely focused on high-grade underground massive sulphide nickel and copper deposits. In 1972 Hudbay Minerals Inc. milled 171,652 tons grading 2.23% Copper and 1.39% Nickel at Wellgreen and while Platinum Group Metals and other valuable minerals were present they were neither assayed for nor credited.

A historic (non NI 43-101 compliant) resource of 55 million tonnes grading 0.35% Cu, 0.36% Ni, 0.82 g/t Platinum and Palladium. (prefeasibility study by WGM April 21, 1989) was estimated at Wellgreen, which equates to over 1.4 million oz of Platinum Group Metals and 400 million pounds of Nickel in situ. A qualified person has not done sufficient work to classify the historical estimate as current mineral resources, the issuer is not treating the historical estimate as current mineral resources and the historical estimate should not be relied upon.

An independent NI 43-101 report prepared for Prophecy by Wardrop Engineering ("Wardrop") dated July 2010 indicates that the potential of the Wellgreen property ranges between 77 to 254 million tonnes at 0.26 to 0.38% Nickel, 0.26% to 0.36% Copper, 0.55 to 0.85 g/t Platinum and Palladium, based on a strike length range of 4,000 to 7,000m and a width of 30 to 35m. The potential quantity and grade is conceptual in nature, there has been insufficient exploration to define a mineral resource, and it is uncertain if further exploration will result in discovery of a mineral resource.

Past drill results from Coronation Minerals/Northern Platinum included:

2010 Wellgreen drill program from surface:

These results are very important as they demonstrate the high precious metal content of the continuous disseminated sulphide mineralization. Prophecy is targeting Wellgreen to be a large scale deposit that could be mined by open pit and large tonnages. Drill locations of Hole 177 and Hole 178 can be viewed here .

Platinum Group Metal and Gold Pricing

The lesser known of the aforementioned Platinum Group Metals', all of which can be by-products of nickel and copper mining, are summarized as follows:

Osmium is obtained commercially as a by-product from nickel and copper mining and processing; twice as strong as lead it is often alloyed with other metals and utilized in high-wear applications.

Rhodium usage is dominated by automotive catalyst applications where it is used together with platinum and palladium to control exhaust emissions in addition to many other applications.

Iridium is used in the manufacture of rayon and is used in long-life aircraft engine parts and other industrial applications in addition to medical applications.

Ruthenium is used primarily for wear-resistant electrical contacts and the production of thick-film resistors; it is also used in some platinum alloys.

Complete assays of the entire 800 samples and the 174 samples where Platinum or Palladium grades exceeds 1g/t can be downloaded.

The technical information in this news release has been reviewed and approved by Mel De Quadros, P. Eng. and Rory Calhoun, P. Geo., both Prophecy employees and Qualified Persons as defined by NI 43-101.

For more information about Prophecy, please contact Scott Parsons at +1.604.642.2625 ext. 106, Paul McKenzie at +1.604.642.2625 ext. 107 or John Lee at +1.800.851.1528.



About Prophecy Resource

Prophecy Resource Corporation is an internationally diversified company engaged in developing energy, nickel and platinum group metals projects. The company controls over 1.4 billion tons of open-pittable thermal coal in Mongolia (839 Mt Measured, 579 Mt Indicated). In Canada Prophecy owns Wellgreen PGM Project in Yukon, Lynn Lake Nickel Sulphide Project in Manitoba, and a 10% equity stake in Victory Nickel. Mineral resources that are not mineral reserves do not have demonstrated economic viability.


ON BEHALF OF THE BOARD OF DIRECTORS Prophecy Resource Corp.
"JOHN LEE"
John Lee
Chairman
Telephone 1.800.851.1528
Email: [email protected]

 



Mineral resources that are not mineral reserves do not have demonstrated economic viability. 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. The potential quantity and grade is conceptual in nature. There has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in discovery of a mineral resource.  


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.

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*Ulaan Ovoo: 174 million tonnes  of measured and 34 million tonnes of indicated coal. Ulaan Ovoo’s resource numbers are from the Behre Dolbear & Company (USA), Inc  report referenced in the Dec 2010, 43-101 Prefeasibility Study by Wardrop Engineering. Chandgana consists of two properties-Chandgana Tal and Chandgana Khavtgai. Chandgana Tal consists of 141 mt of measured resource. Chandgana Khavtgai consists of 509 mt measured and 539 mt indicated resource. Chandgana Khavtgai’s resource estimates are based on the September 2010 NI 43-101 Chandgana Khavtgai Technical Report by Kravits Geological Services, LLC. The report is authored by Christopher M. Kravits CPG, LPG of Kravits Geological Services, LLC., who was an independent Qualified Person under NI 43-101 at the time of report preparation. And the Chandgana Tal resource estimate is also based on the September 2007 NI 43-101 Chandgana Tal Technical Report by Behre Dolbear & Company (USA), Inc..The report is authored by Mr. Gardar G. Dahl, Jr., CPG of Behre Dolbear & Company (USA), Inc., who is an independent Qualified Person under NI 43-101.