(COMTEX) B: VENCAP HOLDINGS INC - Timber and Lumber Joint Ventures in
B: VENCAP HOLDINGS INC - Timber and Lumber Joint Ventures in Venezuela - And
Guyana to Meet $30 Million Order
New York, New York, May. 25, 1999 (Market News Publishing via COMTEX)
-- The company announces that after a considerable period of timber
inventory assessment and market potential analysis, the company has
concluded, verbally and in principal, three joint ventures with South
American producers who hold significant acreages of forestland in
Venezuela and the Cooperative Republic of Guyana. In addition to its
current proposed holdings, VenCap (see news release dated Feb. 5, 1999)
has identified additional JV's as sources of supply necessary to
immediately export the volume of timber and cut logs which will be
required to meet its current sales orders.
In order to match supply with its current immediate demand, the
company determined it was necessary to gain access to additional
available timber acreage to meet the order requirements of
international buyers for significant volumes of the same types of
timber (roundwood) and sawn lumber in lengths appropriate to the needs
of end users.
Strong international interest in the types of wood available in the
areas of interest was paramount to VenCap extending its domain to meet
the needs of its timber buyers. The Company recently received a Letter
of Intent from a substantial European timber buyer to supply them with
a minimum of 15,000 m/3 per month, with delivery to begin as soon as
possible. It is the Company's intention to immediately enter into a
formal agreement with this buyer, which could result in more than $30
million in gross income in the first year. The terms of the contract
could include a renewal clause, which could extend the relationship for
many additional years (Note: 1 m/3 = 424 board feet).
VenCap has entered into marketing/export joint ventures with the three
aforementioned enterprises, whose holdings comprise some 1.375 million
acres of forestland, which could provide over 25 million cubic meters
(m/3) of various species of wood (85% hardwood; 15% softwood). These
tree types are already accepted and utilized worldwide in timber and
milled lumber production. Although the Company has not ratified a
formal agreement with two of the three producers, additional contracts
for monthly delivery of significant volumes of timber and milled lumber
are in negotiation at the present time.
The new direction being forged should strategically position VenCap to
(1) provide a range of critical construction and manufacturing
products, (2) gain a significant market position/share by virtue of
geographic location, pricing and economies of production and (3)
provide substantial return on investment.
Political, social and economic changes occurring in Venezuela and
guyana are creating unprecedented interest and opportunities. For its
part, VenCap plans to create model production programs which could
increase in-country technology and productivity, protect natural
resources through proper management, and educate and reward the local
population through enhanced wages and benefits. All of this will
result in a more rewarding economic development environment.
VenCap Holdings announces Sabana Mining Company, C.A. Letter of
Interest
Additionally, the company would like to announce that it has received
a Letter of Interest from Sabana Mining Company, C.A. ("Sabana") of
Venezuela, to join Sabana in a diamond and gold concession in the
southeastern part of the country. In exchange for financing and
operating the concession, VenCap would receive a 70% interest in the
concession. Sabana, a former producer, has received a legal opinion
from its Venezuelan counsel that it may enter into a future joint
venture relationship with the company. As a result, VenCap has
initiated discussions with RMS Ross regarding the latter's acquisition
of the Company's innovative gold recovery system for the joint venture.
The Company has requested additional documentation from Sabana and RMS
Ross in order to evaluate the potential economic viability of the joint
venture. It will announce its findings and determination in the near
future.
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TEL: (407) 783-0176 Angela Hardy, A.R. Hardy and Assoc.
TEL: (407) 783-0176 Angela Hardy, A.R. Hardy and Assoc
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