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VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 13, 2010) - Prophecy Resource Corp. ("Prophecy") (TSX VENTURE:PCY)(OTCBB:PCYRF)(FRANKFURT:1P2) and Victory Nickel Inc. ("Victory Nickel") (TSX:NI) ([ www.victorynickel.ca ]) have agreed to reciprocal private placements enabling Victory Nickel to maintain an approximate 9.9% equity interest in Prophecy following its recent merger with Red Hill Energy Inc., in accordance with the terms of an Equity Participation Agreement with Victory Nickel dated October 20, 2009.

Prophecy will subscribe for 36,615,385 common shares in Victory Nickel at a price of $0.104 per common share for gross proceeds of $3,808,000. In turn, Victory Nickel will subscribe for 7,000,000 Prophecy common shares at a price of $0.544 per common share for gross proceeds of $3,808,000. This transaction will result in Victory Nickel maintaining a 9.9% interest in Prophecy and Prophecy acquiring a 9.8% interest in Victory Nickel.

"Victory Nickel's investment in Prophecy has proven to be a good one for shareholders," said Rene Galipeau, Victory Nickel's Vice-Chairman and CEO. "We like Prophecy's vision of building a base of significant assets internationally, and this transaction allows Victory Nickel to maintain its pro-rata stake at in Prophecy while minimizing costs by eliminating the need to raise money in the market to do so."

The proposed private placements are subject to the approval of TSX Venture Exchange in the case of Prophecy, and the TSX in the case of Victory Nickel.

About Prophecy

Prophecy controls over NI-43-101 compliant Measured and Indicated mineral resources of 232 million pounds of nickel, 1 billion tonnes of coal and 116 million pounds of copper as well as inferred resources of 82 million pounds of nickel, 500 million tonnes of coal, and 593 million pounds of copper. The Company's Ulaan Ovoo Coal Project, Mongolia is expected to be in production this year. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Prophecy will hold properties with significant exposure to vanadium and titanium. All Prophecy's coal assets are located in Mongolia with its remaining assets located in Canada. The Company is currently reviewing additional opportunities for growth.

About Victory Nickel

Victory Nickel Inc. is a Canadian company with four sulphide nickel deposits containing significant NI 43-101-compliant nickel resources. Victory Nickel is focused on becoming a mid-tier nickel producer by developing its existing properties, Minago, Mel and Lynn Lake in Manitoba, and Lac Rocher in northwestern Quebec, and by evaluating opportunities to expand its nickel asset base. Victory Nickel also owns shares in Prophecy Resource Corp. (TSX-V: PCY) and approximately 5% of Wallbridge Mining Company Limited (TSX: WM), the third largest landholder in the Sudbury Basin, which in turn owns approximately 12.9% of Duluth Metals Limited.

ON BEHALF OF THE BOARD OF DIRECTORS of Prophecy Resource Corp.

John Lee, Chairman

"Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."