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FOR: NORANDA INCOME FUND

Noranda Income Fund Advises on Weakness in Sulphuric Acid Market and Its Impact on the Fund

Feb 10, 2009 - 08:15 ET

VALLEYFIELD, QUEBEC--(Marketwire - Feb. 10, 2009) - The Noranda Income Fund (TSX:NIF.UN) reported today that it is experiencing a significant drop in sulphuric acid demand.

Sulphuric acid sales have slowed dramatically since early January because of the sharp drop in industrial activity. In addition to reduced demand for their products, sulphuric acid customers in the US have seen their competitiveness reduced by the stronger US dollar. These factors have resulted in a drop in sulphuric acid orders as customers have cut production to reduce product inventories.

The Fund's annual production of sulphuric acid, a byproduct of zinc refining, is approximately 400,000 tonnes. The Fund sells sulphuric acid through an agency agreement with Xstrata Canada Corporation ("Xstrata Canada").

The production of zinc and sulphuric acid is linked. Should the demand for sulphuric acid not improve, the lack of storage tank capacity may impact the Fund's ability to produce zinc. In an effort to alleviate the problem, Xstrata Canada is pursuing increased contractual and spot sales, including sales into the international vessel market and investigating alternative storage options.

In the event that the Fund is required to respond to the events noted above, the Fund's profitability and monthly distribution may be negatively impacted. Management is currently working on a plan to try to minimize the impact.

Investors are reminded that should it be necessary to cut distributions, the first step would be to reduce the monthly distribution from 8.5 cents a month to the Base Distribution of 8.333 cents a month. If further reductions are required, distributions to Xstrata Canada, the holder of the Ordinary Units, would only be made once the Priority Unitholders have received their Base Distribution of 8.333 cents per month. If distributable cash in any month is not sufficient to pay 8.333 cents per Priority Unit, then the monthly distribution to Priority Unitholders would be reduced to the amount that the Fund has the ability to pay.

Management will provide an update on its key drivers in the fourth quarter results on February 17, 2009.

Noranda Income Fund is an income trust whose units trade on the Toronto Stock Exchange under the symbol "NIF.UN". The Noranda Income Fund owns the CEZinc processing facility and ancillary assets (the "CEZinc processing facility") located in Salaberry-de-Valleyfield, Quebec. The CEZinc processing facility is the second-largest zinc processing facility in North America and the largest zinc processing facility in eastern North America, where the majority of its customers are located. It produces refined zinc metal and various by-products from zinc concentrates purchased from mining operations. The Processing Facility is operated and managed by Canadian Electrolytic Zinc Limited, a wholly-owned subsidiary of Xstrata Canada Corporation.

Further information about the Noranda Income Fund can be found at www.norandaincomefund.com

FOR FURTHER INFORMATION PLEASE CONTACT:

Financial information: Michael Boone
Vice President & Chief Financial Officer of Canadian
Electrolytic Zinc Limited, Noranda Income Fund's Manager
(416) 775-1561
Email: mboone@xstrata.ca
Website: www.norandaincomefund.com

or

Renmark Financial Communications Inc.
Christine Stewart
(514) 939-3989
Email: cstewart@renmarkfinancial.com

or

Renmark Financial Communications Inc.
Barbara Komorowski
(514) 939-3989
Email: bkomorowski@renmarkfinancial.com
Website: www.renmarkfinancial.com



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