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FOR: NORANDA INCOME FUND

Noranda Income Fund Announces a Cash Distribution for the Month of February 2012 and Updates on Determination of Distributions

Feb 14, 2012 - 18:57 ET

SALABERRY-DE-VALLEYFIELD, QUÉBEC--(Marketwire - Feb. 14, 2012) - Noranda Income Fund (the "Fund") (TSX:NIF.UN) announced today that the Board of Trustees of Noranda Operating Trust ("the Board") has approved a distribution for the month of February 2012 of $0.04167 per priority unit (each, a "Priority Unit") payable on March 26, 2012 to holders of Priority Units of record as at the close of business on February 29, 2012.

As announced in the Press Release dated November 11, 2011, the Board undertook, under the guidance of its Independent Committee, a review to determine the availability of funds for future distributions. Progress has been made and the Board has received a preliminary report from the international consulting group it had retained.

The preliminary report indicates, without concluding and subject to certain major assumptions that if the Fund is able to secure zinc concentrate in the market post-2017, and if the Supply and Processing Agreement (the "SPA") between Noranda Income Limited Partnership (the "Partnership") and Xstrata Canada Corporation ("Xstrata Canada") is not renewed, it could operate profitably. In the circumstances, it would be prudent for the Board, through its Independent Committee, to identify possible alternative sources of zinc concentrate post-2017 and the Partnership may be required to commit funds to assure the continued supply of concentrate.

There can be no assurance that alternative sources of zinc concentrate will be available or, if available, would be available in sufficient quantities and on terms and conditions, including pricing that will allow the processing facility to continue production and operations at profitable levels.

The SPA with Xstrata Canada is automatically renewed for successive periods of five years unless Xstrata Canada provides the Partnership with written notice to the contrary at least 180 days prior to the expiry of the applicable term. The current term expires in May 2017. Xstrata Canada is required to advise the Partnership by November 2016 of its decision with respect to an extension, if any, beyond 2017.

Due to the uncertainty of supply of concentrate post-2017, the Board has determined in its business judgment, as it did when it agreed to allow for the full amortization of the Fund's long-term debt concurrently to the end of fiscal 2016, that it would be wise and prudent, based on the preliminary information available at this time, to begin accumulating reserves that are expected to be required to pay for the closure costs of the facility at Salaberry-de-Valleyfield. The costs include severance payments, pension and retirement benefit plans and site rehabilitation costs. The amounts required to fund such reserves have been established by third-party independent professionals based on certain assumptions. Should these assumptions need to be modified due to changing circumstances, the amount of the necessary reserves may increase or decrease, with a corresponding effect on any cash available for distributions.

Notwithstanding the foregoing, and assuming no major sudden changes in the zinc and related by-products markets, while the reserves mentioned above are being accumulated, the Board has determined that the current level of distributions can be sustained for the present time.

There is no assurance that monthly distributions will continue in the future, nor is there any assurance that, if they do continue, the level or frequency of such monthly distributions will not vary from the level of the most recent monthly cash distributions.

Forward-Looking Information

This press release contains forward-looking information and statements within the meaning of applicable securities laws, including statements concerning the availability of further distributions, the expiry of the Supply and Processing Agreement, the potential availability of zinc concentrate post-2017 and the establishment of reserves in respect of the processing facility. Forward-looking information involves known and unknown risks, uncertainties and other factors, which may cause actual events, results or performance to be materially different from any future events, results or performance expressed or implied by the forward-looking information, and as a result, the Fund cannot guarantee that any forward-looking statements or information will materialize. Such risks and uncertainties include, but are not limited to, the effect of general business and economic conditions and the conditions of financial, securities and credit markets, the Fund's ability to operate at normal production levels, changes to global zinc market, including the supply and demand for specific zinc metal products, borrowing and credit risks associated with the Fund's long-term indebtedness, and other general risks and uncertainties set out in the Fund's continuous disclosure documents available on SEDAR at www.sedar.com, to which reference should be made.

Forward-looking information contained in this press release is based on, among other things, management's current estimates, expectations, assumptions, plans and intentions, which management believes are reasonable as of the current date, and which are subject to a number of risks and uncertainties. Except as required by law, the Fund does not undertake to update any forward-looking statements or information, whether written or oral, that may be made from time to time by the Fund or on the Fund's behalf.

Noranda Income Fund is an income trust whose units trade on the Toronto Stock Exchange under the symbol "NIF.UN". Noranda Income Fund was created to acquire Noranda Inc.'s CEZ processing facility and ancillary assets (the "CEZ processing facility") located in Salaberry-de-Valleyfield, Québec. The CEZ 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 zinc customers are located. It produces refined zinc metal and various by-products from zinc concentrates purchased from mining operations. The CEZ processing facility is operated and managed by Canadian Electrolytic Zinc Limited.

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



FOR FURTHER INFORMATION PLEASE CONTACT:

Michael Boone
Vice President and Chief Financial Officer,
Canadian Electrolytic Zinc Limited
Noranda Income Fund's Manager
416-775-1561
info@norandaincomefund.com



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