Essential Power…Infinite Possibilities

March 6, 2003

Formation Raises $632,000 and Appoints Financial Advisor

Vancouver, B.C., March 06, 2003, Formation Capital Corporation (Formation, FCO-TSE) announced today it has closed a private placement with the issuance of 3,161,290 units at $0.20 per unit, each unit being comprised of one common share and one half common share purchase warrant, each whole common share purchase warrant entitling the purchase of one additional common share of the Company at a price of $0.25 per share until March 1, 2005. All shares and warrants comprising the units are subject to a hold period in British Columbia expiring at 12:00 midnight on June 29, 2003. On the closing of the private placement, the Company realized gross proceeds of $632,258 that are intended for general working capital purposes. Certain fees were paid on the closing of the private placement.

In addition, the Company is pleased to announce the appointment of Mr. Roman Friedrich III to act as Senior Financial Advisor to the Company. Mr. Friedrich, principal of Roman Friedrich & Company of Vancouver, B.C., has been an investment and commercial banker to the mining and metals industries for over 20 years. Prior to establishing his company, Mr. Friedrich had been a senior investment banker with TD Securities Lancaster Financial Corporation (a firm specializing in mergers and acquisitions), Wood Gundy, Burns Fry, Chase Manhattan Bank and First Chicago. Over his long career, he has provided numerous companies with advice on acquisitions, mergers and divestitures; provided valuations and fairness opinions to mining, metals and industrial companies; and raised project financings through a variety of equity and debt capital vehicles. Mr. Friedrich will focus his efforts on debt financing of the Company’s Idaho Cobalt Project (ICP) that include provisions for the retro-fitting of the Company’s Big Creek Hydrometallurgical Complex to accept ICP cobalt concentrate.

The Company’s immediate focus is the start-up of its Sunshine Silver Refinery, a stand-alone operation at its recently purchased Big Creek Hydrometallurgical Complex in the Silver Valley of Idaho. The Company’s initial plans would be to process silver dore and other high-grade silver materials for certain parties requiring custom silver refining. The start-up of the refinery would create significant revenue for the Company that could then be used to assist in the funding of the Company’s Idaho Cobalt Project. The Company is actively seeking funding to proceed with the silver refinery start-up and discussions with various parties regarding feed are ongoing.

The Company’s Idaho Cobalt Project, located near Salmon Idaho is a unique high-grade, primary cobalt deposit that is currently in the mine permitting stage of development. The Company is encouraged by the strengthening price of cobalt that has risen over 35% from a low of US$6.20/lb in October of 2002. Permitting of the project is ongoing, with most of the baseline studies completed and technical memorandum supporting the Plan of Operations written. The project has received strong support on all levels, although due to the present uncertain economic situation and market conditions the process has been slower than previously forecast. The mine is forecast to produce approximately 1,500 tonnes of cobalt per year, representing approximately 4% of world production.

Formation is dedicated to the principles of environmentally sound mining and refining practices, and believes that environmental stewardship and mining can co-exist. The Company trades on the Senior Board Toronto Stock Exchange under the symbol FCO.

Formation Capital Corporation
“Mari-Ann Green”
Mari-Ann Green

For further information please contact:
Formation Capital Corporation
720 - 789 West Pender Street, Vancouver, BC, V6C 1H2
Head Office: 604-682-6229
Email: - Or visit our Web site at:

The statements contained in this news release in regard to Formation Capital Corporation that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including Formation Capital Corporation’s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to the parties as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.
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September 24th, 2002, Purchase of Metals Processing Complex Complete
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March 12th, 2003, Warrants Extension