Coalcorp Provides Updated Default Status Report

    TORONTO, Aug. 5 /CNW/ - Coalcorp Mining Inc. ("Coalcorp" or the
"Company") (TSX-CCJ) is providing its twelfth Default Status Report in
accordance with National Policy 12-203: Cease Trade Orders for Continuous
Disclosure Defaults ("NP 12-203"). On February 6, 2009 Coalcorp announced that
it would delay the filing of its second quarter interim financial statements,
CEO and CFO certifications and related management discussion and analysis
(MD&A) for the three and six-month periods ended December 31, 2008 (the
"Second Quarter Interim Financials") beyond the filing deadline of February
16, 2009. On May 13, 2009 Coalcorp announced that it would also delay the
filing of its third quarter interim financial statements, CEO and CFO
certifications and related management discussion and analysis (MD&A) for the
nine month period ended March 31, 2009 beyond the filing deadline of May 15,
    On February 18, 2009 the Ontario Securities Commission (the "OSC") issued
a temporary management cease trade order related to the Company's securities
against the Chief Executive Officer and the then Chief Financial Officer
(Liliana Aleman has since stepped down from that role as announced on March
30, 2009) of the Company for so long as the Second Quarter Interim Financials,
and related certifications and MD&A are not filed. The issuance of such
management cease trade order does not affect the ability of persons to trade
in their securities of Coalcorp, other than the Chief Executive Officer and
Liliana Aleman, the former Chief Financial Officer. However, the OSC, in its
discretion, may determine at a later time that it would be appropriate to
issue a general issuer cease trade order affecting all of the Company's

    Update Matters

    The Company reports the below matters which are material changes to the
information contained in the eleventh default status report issued by the
Company on July 22, 2009.
    On August 4th, 2009 - Coalcorp announced that it has commenced a
strategic alternatives review process to realize value for the Company and its
stakeholders based on the board's and management's firm belief that the
current market value of the Company does not reflect the value of the
Company's assets, as supported by the results of its most recently completed
and filed National Instrument 43-101 technical report. Accordingly, the
Company initiated a process to consider various strategic alternatives to
maximize the value of Coalcorp's assets, including but not limited to, the
possible sale of the La Francia mine and associated infrastructure assets and
other potential corporate transactions. A Special Committee of directors,
independent of management and the Company's significant shareholder, was
established to oversee the strategic review process.
    As announced on that date, the Company completed and filed its updated
National Instrument 43-101 technical report on that date (the "NI 43-101
Report"). The key highlights of the NI 43-101 Report are below:

      -  Over 60 million tonnes (Mt) of total reserves and approximately 145
         Mt of total resources
      -  Annual mine production of approximately 3.0 Mt of coal over 20 years
      -  Approximate net present value of the La Francia mine of USD$404
         million under a self perform mining scenario and USD$374 million
         under a contractor mining scenario based on an 8% discount rate and
         long-term net coal prices of USD$66.00 per tonne.

    On July 29, 2009, Coalcorp announced that Xira Investment Inc. ("Xira")
failed to make payment of the USD$7 million instalment payment that was due
and payable on July 27, 2009 to Andean Coal Corporation B.V.I. ("Andean"), a
subsidiary of Coalcorp. The instalment payment was required to be made by Xira
to Andean under the terms of the Sale and Purchase Agreement dated June 27,
2008 ("SPA"), which set out the terms upon which Xira purchased 40% of the
issued share capital of Carbones Colombianos del Cerrejon S.A., the owner of
the Caypa mine. It is the Company's position that Xira's failure to make the
due instalment payment constituted a violation of the terms of the SPA. Andean
delivered a notice dated July 29, 2009 to Xira stating that Andean was
exercising its right to terminate the SPA in accordance with its terms (the
"Notice of Termination"). Xira is contesting the Notice of Termination.
    The Company confirms that, except as described herein and in its initial
default announcement and subsequent default status reports: (i) there has been
no material change to the information set out in its initial default
announcement filed pursuant to NP 12-203; (ii) there has been no failure by
the Company in fulfilling its stated intention with respect to satisfying the
provisions of the alternative information guidelines set out in NP 12-203;
(iii) there is no actual or anticipated specified default subsequent to that
disclosed in the initial default announcement; and (iv) there is no other
additional material information concerning the affairs of the Company that has
not been generally disclosed.
    The Company will continue to provide bi-weekly updates, as required by NP
12-203, until the required filings have been made and the Company is no longer
in default.

    Coalcorp is a coal mining, exploration and development company with
interests in the La Francia coal mine and related infrastructure projects and
a number of coal exploration properties, all located in Colombia. Coalcorp
also holds a 60% equity interest in Carbones Colombianos del Cerrejon which
owns the La Caypa coal mine in Colombia. Further information can be obtained
by visiting our website at or under the Company's profile at
    Statements made in this news release may be forward-looking and therefore
subject to various risks and uncertainties. Certain material factors or
assumptions are applied in making forward-looking statements and actual
results may differ materially from those expressed or implied in such
statements. Coalcorp does not undertake to update any forward-looking
statements; such statements speak only as of the date made.

For further information:

For further information: Joseph Belan, Interim Chief Executive Officer,
+57-1-658-5050 Ext: 9990

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