Industrial Minerals Engages RBC Capital Markets as Financial Advisor

Market Wire, October, 2008

Industrial Minerals Inc. (OTCBB: IDSM) has engaged RBC Capital Markets, a division of the Royal Bank of Canada, as financial advisor with respect to strategic options facing the company. The engagement is for a term of 12 months with success fee based compensation for completion of a transaction.

Industrial Minerals Inc. is developing a world class graphite mine at Bissett Creek, near North Bay, Ontario, Canada. Based on a recently completed National Instrument 43-101 compliant report, the property contains a resource of 725,600 tonnes of flake graphite found on approximately 7.0% of the property. Bissett Creek has been the subject of substantial exploration drilling, trenching and metallurgical test work by KHD Canada, Kilborn Engineering, Pincock Alan and Holt and Cominco Engineering Services. The Company believes the property is one of the largest and purest natural flake graphite deposits in the world. Based on a projected annual production volume of 25,000 tonnes per year on the approximate 7.0% of the property drilled to date, mine life is estimated to be 30 years.

The company's office has been relocated to Ottawa, Canada, and the Board of Directors includes Christopher Crupi, CEO of Paramount Gold and Silver Corp. (AMEX: PZG)(TSX: PZG), who has been appointed Chairman of the Board, Robert Dinning, CEO, and Greg Bowes, (CFO of Orezone Resources AMEX:OZN/TSX:OZN).

Cautionary Note to US Investors - The SEC limits disclosure for U.S. reporting purposes to mineral deposits that a company can economically and legally extract or produce. The reader is cautioned that the term, "resource," is not a term that is recognized by SEC guidelines for disclosure of mineral properties. Generally, "resources" estimates do not rise to the level of certainty required by SEC guidelines. The mineralized material described above is not considered a "reserve" as that term is used in the mining industry and in SEC disclosure guidelines. The Company must undertake a feasibility study before it can estimate the value of its mineral assets. U.S. investors are urged to consider closely the disclosure in our Form 10-KSB, File No. 000-30651 available on the SEC's website http://www.sec.gov/edgar.shtml .

Contacts: Industrial Minerals, Inc. Robert Dinning, CEO www.industrialmineralsinc.com Platinum Communications Investor Relations 613-288-4288