“On their face, the financial results for 2005 were disappointing. However, when taken in the context of the substantial increase in activity that took place during the year, and the high level of administrative and professional fees needed to bring these projects to fruition, they can be regarded as acceptable. The work that has been done in 2005 will pay back to Hillsborough in subsequent years,” Hillsborough president and CEO David Slater said.

The reduction of $670,00 in year-over-year earnings was the result of higher general and administration costs associated with the company’s Northeast British Columbia properties and the consolidation of production costs in the fourth quarter due to the inclusion of Crossville Coal as it ramps up its Tennessee operations. Crossville’s operating loss during the first three months of its production start-up period was $1.2 million.

Mining commenced at Crossville initially by way of a boxcut taken to expose the underground access portals, and as a room and pillar mine during September last year.

During 2005, Hillsborough acquired 11 northeast properties and has begun an extensive exploration program to confirm resource estimates of metallurgical coal.