Orebodies to Acquire Up to a 100% Interest in Potential Large Tonnage Iron Project

Canadian Orebodies Inc. (TSX VENTURE:CO) ("Orebodies") is pleased to announce
that it is has entered into a non-arm's length Purchase Agreement (the
"Agreement") to acquire up to a 100% legal and beneficial interest (subject to a
3% GOR retained by the Vendors, of which 1/3rd can be purchased by Orebodies for
a maximum of $3,000,000) in the Inuit Owned Lands Mineral Exploration Agreement
(the "NTI Agreement") with Nunavut Tunngavik Incorporated ("NTI") which covers
the Haig Inlet Iron Ore Project, located on the Belcher Islands, Nunavut, Canada
(the "Property").


About the Property:

The Haig Inlet Iron Project covers over 2,680 hectares on Flaherty Island. A
significant amount of exploration work, including numerous widely-spaced diamond
drill holes, was carried out on the property during the 1950's by Belcher Mining
Corporation Ltd ("BMC"). BMC's exploration programs targeted the Kipalu
Formation of iron-bearing rocks containing laterally extensive magnetite (with
subordinate hematite) iron formations of the Superior type. The Property is host
to a significant unclassified historically estimated mineral resource of 907
million tonnes grading 27% iron as defined in the government publication,
"Northern Mineral Policy Series; NM1: Mines and Important Mineral Deposits of
the Yukon and Northwest Territories, 1982(i)".


(i)The mineral resource outlined here is a non-compliant NI 43-101 Mineral
Resource since it is historical in nature and should not be relied upon. There
is no direct evidence that these numbers or any portion thereof will ever be
achieved at any time with further exploration work. These are historical
resource estimates that do not comply with the current Canadian Institute of
Mining, Metallurgy and Petroleum Resources (CIM) Definition Standards on Mineral
Resources and Mineral Reserves as required by National Instrument 43-101 (NI
43-101) "Standards of Disclosure for Mineral Projects." Historical BMC
exploration results were studied by a qualified person and compared with other
non-BMC exploration programs carried out on the Belcher Islands. Although
conclusions support the presence of a large area of iron mineralization, the
historical results are not considered reliable given an incomplete database of
diamond drill hole logs and the lack of accurate collar surveying related to the
BMC historical exploration programs. In addition, the unknown level of quality
assurance/quality control implemented during the historic BMC programs, which is
currently required to be carried out under the supervision of a qualified person
as defined by NI 43-101 policy, questions the reliability and confidence in the
historic estimate.


Gordon McKinnon, Orebodies President & CEO stated "This project represents a
major step for the company to take advantage of the booming iron ore sector and
opens the door to the significant amount of capital that has been pouring into
junior iron ore companies. We have seen that other iron ore projects within
Nunavut such as Baffinland Iron Mines Corp. ("Baffinland") and Advanced
Explorations Inc. ("Advanced") are being sought after by large international
companies. Both Baffinland and Advanced having their deposits in Nunavut in
harsher climates and much more remote locations shows projects like the Haig
Inlet Iron Property are in demand and garnering the attention of large
international steel and iron ore companies."


Terms of Agreement:

The Agreement is a non-arm's length transaction between Donald McKinnon
(Orebodies Chairman and Director), Gordon McKinnon (Orebodies President & CEO),
Randall Salo (the "Vendors") and Orebodies, the closing of which is subject to
TSX Venture Exchange, NTI and disinterested shareholder approvals.


In order to purchase a 100% interest in the NTI Agreement, Orebodies is required to:



1.  Issue to the Vendors an aggregate amount of 3,000,000 common shares on
    closing to earn a 10% interest in the NTI Agreement. 
    
2.  Issue to the Vendors an aggregate amount of 4,000,000 common shares on
    the first year anniversary of closing to earn an additional 15% interest
    in the NTI Agreement. 
    
3.  Issue to the Vendors an aggregate amount of 7,000,000 common shares on
    the second year anniversary of closing to earn the remaining 75%
    interest in the Agreement. 



After the issuance of 3,000,000 common shares on closing to earn a 10% interest
in the NTI Agreement, Orebodies may elect not to proceed with the share
issuances outlined in items 2 and 3 above.




4.  Grant a 3% Gross Overriding Royalty ("GOR") of which 1/3rd may be
    purchased at anytime by Orebodies for $3,000,000, in the event that
    Orebodies has acquired the 100% interest in the NTI Agreement. If
    Orebodies has elected not to purchase a 100% interest in the NTI
    Agreement, the consideration for a purchase of such 1/3rd of the GOR
    shall be pro-rated to Orebodies' interest in the NTI Agreement at such
    time. 

5.  Grant a $250,000 advance royalty, in the event that Orebodies has
    acquired the 100% interest in the NTI Agreement, commencing on the
    earlier of (i) the date on which a production lease is entered into
    pursuant to the NTI Agreement, or (ii) on the 6th year anniversary from
    closing. If Orebodies does not hold the 100% interest in the NTI
    Agreement at such time as the advance royalty becomes payable, the
    advance royalty shall be pro-rated to Orebodies' interest in the NTI
    Agreement at such time. 
    
6.  Enter into a joint venture agreement on closing which governs the
    activities of Orebodies and the Vendors in respect of the Property and
    the NTI Agreement, until such time, as Orebodies acquires a 100%
    interest in the NTI Agreement. 



In addition, if Orebodies has acquired a 100% interest in the NTI Agreement,
Orebodies covenants to issue and deliver to the Vendors an additional 14,000,000
common shares on the following basis:




1.  Issue an aggregate 7,000,000 common shares (each such common share a
    "First Milestone Share") in the event that a technical report compliant
    with NI 43-101, which demonstrates at least 80,000,000 tonnes of Mineral
    Resources (defined in the Agreement as 'indicated mineral resources' or
    'measured mineral resources' as those terms are defined in NI 43-101)
    grading at least an average of 23% iron. 
    
2.  Issue a further 7,000,000 common shares (each such common share a
    "Second Milestone Share") in the event that a technical report compliant
    with NI 43-101, which demonstrates at least 200,000,000 tonnes which
    includes the 80,000,000 tonnes comprising the threshold for the First
    Milestone Shares, of Mineral Resources grading at least an average of
    23% iron. 



In the event that Orebodies has not acquired a 100% interest in the NTI
Agreement at the relevant time that First Milestone Shares or Second Milestone
Shares are to be issued, Orebodies covenants to issue to the Sellers in
aggregate a percentage of First Milestone Shares or Second Milestone Shares, as
the case may be, that is equal to Orebodies' interest in the NTI Agreement at
the relevant time.


The number of common shares to be issued to the Vendors on closing, the first
year anniversary of the date of closing, the second year anniversary of the date
of closing, and the issuance of any First Milestone Shares or Second Milestone
Shares to the Vendors shall be on the following pro-rata basis: 45% to Gordon
McKinnon, 45% to Donald McKinnon, and 10% to Randall Salo.


The Agreement as provides an extended area concept whereby the 3% GOR and the
requirement to issue First Milestone Shares and/or Second Milestone Shares
applies beyond the Property to include (i) specified additional areas in
proximity to the Property where Orebodies' has staked mineral dispositions, and
(ii) any areas or part thereof, lying within a distance of 10 kilometres from
the external perimeters of the Property in which Orebodies has or will stake any
mineral dispositions.


If all common shares are issued pursuant to the Agreement, the potential
shareholding of Donald McKinnon in Orebodies on an undiluted basis shall be
16.4% of the issued and outstanding common shares as at the date hereof, and the
potential shareholding of Gordon McKinnon in Orebodies on an undiluted basis
shall be 14.86% of the issued and outstanding commons shares as at the date
hereof.


In order to properly evaluate and negotiate the Agreement, Orebodies' board of
directors formed a special committee comprised of all independent directors to
act on behalf of Orebodies. The committee engaged Broad Oak Associates, an
independent third party firm to review and deliver a fairness opinion ("Fairness
Opinion") regarding whether the transaction would be fair to all the
shareholders of Orebodies. Based on a thorough review and the findings of the
Fairness Opinion, the independent special committee unanimously approved
Orebodies enter into the Agreement.


This press release has been prepared under the supervision of Mr. Randall Salo
(P.Geo.), who is an independent consultant to the Company and a "qualified
person" (as such term is defined in National Instrument 43-101). Mr. Salo has
verified the technical data disclosed in this press release.


Closing of the transaction remains subject to the approval of the TSX Venture
Exchange and NTI, and approval of a disinterested shareholder vote.


Forward Looking Information:

Some of the statements and information contained herein may be forward-looking
information which involves known and unknown risks and uncertainties, including
statements respecting the Agreement. Without limitation, statements regarding
the potential acquisition of a 100% interest in the NTI Agreement, statements
regarding potential mineralization and resources, proposed exploration
activities and future plans and objectives of Orebodies are forward looking
statements that involve various degrees of risk. The following are important
factors that could cause Orebodies actual results to differ materially from
those expressed or implied by such forward looking statements: changes in the
world wide price of mineral commodities, general market conditions, the
uncertainty of access to capital. In particular, there can be no assurance that
a definitive joint venture agreement will be entered into, that TSX Venture
Exchange or NTI approval of the Agreement will be obtained, or that Orebodies
will undertake any or all of the issuances necessary to complete the acquisition
of the 100% interest in the NTI Agreement.
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