Inca Pacific Announces Steps to Conserve Working Capital
Mon Nov 3, 8:30 AM
ca.news.finance.yahoo.com
VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 3, 2008) - Inca Pacific Resources Inc. (TSX VENTURE: IPR.V) announces that as a result of turbulent equity, debt and metal markets it is taking steps to conserve working capital.
Until recently the Company, in the interests of accelerating the development of its Magistral Copper & Molybdenum property, had budgeted to order long lead time equipment and upgrade the main access road to the project prior to receiving approval of its Environmental & Social Impact Assessment (ESIA) and being granted the majority of its construction permits.
As result of current circumstances and the uncertainty of when project financing might be obtained the Company has decided to:
1. cancel the previously placed order for a ball mill announced in August;
2. postpone any new orders for long lead time equipment; and
3. postpone the upgrade of the main access road.
All efforts will now be focused on obtaining ESIA approval and the principal construction permits. Once permitting has been achieved and assuming a return of more stable equity, debt and metal markets the Company will resume development of the project.
These decisions may impact the commencement of commercial production. Under the Company's current agreement with the Government of Peru (GOP), Inca Pacific has an obligation to place the Magistral property into production no later than December 31, 2011. Failure to meet this deadline may result in the loss of a key portion of the Magistral property. As the current deterioration of equity, debt and metal markets is beyond the control of the Company, Inca Pacific intends to request an extension of the current deadline from the GOP by invoking the clause in our existing agreement which provides that terms may be extended for duly justified causes.
As of August 31, 2008 the Company had working capital of US$17.3 million. The board of directors recently approved a US$11.5 million budget covering the period September 1, 2008-February 28, 2010. A cancellation charge payable to the supplier of the ball mill will be reported in the fourth quarter financial statements.
INCA PACIFIC RESOURCES INC.
Anthony Floyd, President and Director
Standard & Poor's Listed
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Contacts
Bill Galine
Inca Pacific Resources Inc.
Investor Relations
(604) 662-3922
Email: bgaline@incapacific.com |
