Fording announces higher coal prices CALGARY, Dec. 19 /PRNewswire-FirstCall/ -- Fording Canadian Coal Trust (TSX: FDG.UN, NYSE: FDG) today announced that the Elk Valley Coal Corporation (EVCC) has made substantial progress in annual price and volume negotiations with its export- coal customers for the coal year commencing April 1, 2004. Sufficient settlements have been achieved in all markets to indicate that EVCC's average price for coal sales during the 2004 coal year (April 1, 2004 - March 31, 2005), including normal levels of sales carried over from the 2003 coal year, is expected to be approximately US$51 per tonne. This represents an increase of nearly 20 percent from the average US dollar price realized during the current coal year. Price increases were attained for all of the EVCC's coal products. "Market conditions at this time are very favourable for seaborne and North American hard-coking coal," said Jim Gardiner, President of the Trust and President and Chief Executive Officer of EVCC. "The tight coal supply situation that currently exists in the face of strong demand from our traditional coal customers and from new customers in China has sharply increased the value of our coal while accelerating the negotiation and settlement process." More than 80% of EVCC's coal available for sale for the 2004 fiscal year has now been priced and contracted. Average coal prices for the fiscal year ending December 31, 2004 are expected to be US$48 per tonne, an increase of 13% over the current year. Assuming a US/Canadian dollar exchange rate of US77 cents and taking into account EVCC's foreign currency hedge position in 2004, the Canadian dollar price of coal is expected to increase 9% to $67 per tonne for the 2004 fiscal year. The distributable cash of the Trust, before the establishment of any cash reserves, is highly sensitive to coal prices. In addition to this, a significant portion of distribution costs (rail and port charges) that are included in the cost of coal sales will be determined with reference to changes in coal prices when those price changes come into effect. Accordingly, distribution costs are expected to increase around 13% when the new coal prices come into effect. For the 2004 fiscal year, distribution costs are anticipated to increase about 9% compared to the current year. As previously disclosed, the cost of producing coal at the mine sites is expected to decline over the next four years due to operating efficiencies, synergies and declining strip ratios. The sensitivity of distributable cash from the Trust for the 2004 fiscal year, before the establishment of any cash reserves, to a US$1 change in the average price of coal, and including the expected attendant change in rail and port rates, is anticipated to be approximately 25 cents per unit. This calculation assumes a US/Canadian dollar exchange rate of US77 cents. Previous disclosures by the Trust with respect to the sensitivity of distributable cash to changes in coal prices did not include the commensurate change in rail and port rates; the sensitivity of distributable cash to changes in cost of sales, including rail and port costs, was addressed separately. Fording Canadian Coal Trust is an open-ended investment trust. Through investments in metallurgical coal and industrial minerals mining and processing operations, the Trust makes quarterly cash distributions to unitholders. The Trust, through its wholly-owned subsidiary, Fording Inc., holds a 65% ownership of the Elk Valley Coal Corporation and is the world's largest producer of the industrial mineral wollastonite. The Elk Valley Coal Corporation, comprised of Canada's senior metallurgical coal mining properties, is the world's second largest exporter of metallurgical coal, capable of supplying approximately 25 million tonnes of high-quality coal products annually to the international steel industry. DATASOURCE: Fording Canadian Coal Trust CONTACT: Mark Gow, CA Director, Investor Relations, Fording Canadian Coal Trust, 403-260-9834,

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