VANCOUVER, June 26, 2012 /CNW/ - Prima Colombia Hardwood Inc. (TSX Venture:PCT) ("Prima" or the "Company") provides an update on the following Company matters:
On December 21, 2011, the Company advised that the cutting permits that it had hoped would be received by the end of 2011 had not yet been issued. These permits remain unissued.
Prima and the Ministry of Environment of Colombia ("Ministry") have continued to work constructively together and the permit process has progressed including successful completion of site technical visits by the Ministry on March 30, 2012 and issuance of certain technical reports from the Ministry to the independent Colombian Environmental Licensing Authority ("ANLA" or Autoridad Nacional de Licencias Ambientales).
The Company remains in contact with the Minister of the Environment and his senior staff and has not been advised of any issues which might prevent the issuance of the requested permits. The Ministry was reorganized in late 2011 and the Company continues to be advised that there is a significant back log of resource sector permit applications.
Although permits of this nature are routinely issued in Colombia and the above noted progress has been made, Prima remains unable to determine with any certainty the expected issuance date of the cutting permits required for the start up of its operations.
Cash Requirements & Funding
As advised on December 21, 2011, given the uncertainty of timing with respect to the issuance of the permits, the Company has rationalized the operation to reduce its monthly cash requirements in an orderly fashion in order to preserve the timber opportunity until the permits are obtained. At the current time, monthly cash requirements are less than $100,000 per month.
In order to fund this ongoing delay, the Company continues to sell assets. The Company has successfully completed sales of a helicopter, tug boat and some minor assets for total proceeds of approximately $USD 1.0 million. The Company is also in advance negotiation to sell a barge with an expected closing date of middle of July 2012. The Company will continue to actively market its remaining fixed assets until such time as the permits are issued.
At the current time, the Company has sufficient funds to maintain the permitting process through August.
The Company also announces the resignation of Harald Ludwig as a Director effective June 14, 2012. The Board of Directors would like to thank Mr. Ludwig for his contribution to the Company.
About Prima Colombia
Prima Colombia Hardwood Inc. is a TSX Venture Exchange listed Canadian based forest products company focused on international tropical hardwood timber development, production and marketing. Prima's timber concessions and operations are located near Bahia Solano, Department of Choco on the west coast of the Republic of Colombia. All Prima forestry concessions are intended to be operated following the highest standards of sustainable forestry and environmental management. Prima brings over 30 years of forestry experience and dedication to best environmental operating practices and working with local communities and governmental agencies.
This news release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Examples of such statements include statements pertaining to permitting and timing of and revenue from current and proposed timber development, operations, production and marketing.
There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements and information are based will occur. Forward-looking statements and forward-looking information are subject to a variety of known and unknown risks, uncertainties and assumptions, including those discussed in Prima's quarterly and annual management's discussion and analysis and under "Risk Factors" in Prima's Annual Information Form dated April 30, 2012, which are available at www.sedar.com under Prima's profile, and any of which may cause the actual results, performance or achievements of Prima to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained in this news release. Some of the factors which could affect future results and could cause actual results to differ materially from those expressed in the forward-looking statements and information contained herein include: general economic, market, business and governmental conditions; lack of operating history; results of operations and development activities; continued availability of capital and financing; foreign currency exchange rates, competition, reduced demand for timber (cyclical nature of industry); availability of necessary equipment or the failure of equipment or processes to operate as anticipated; transportation, development, construction and production delays; anticipated and unanticipated costs; accidents; the regulatory and foreign environment and the timing and possible outcome of regulatory matters, including governmental approvals; political instability in Colombia; property title disputes or claims; environmental risks, including natural disasters; reclamation expenses; labour disputes and other risks of the timber industry; and any of the assumptions below not being correct.
Such forward-looking information is based on a number of assumptions which may prove to be incorrect, including, but not limited to: cutting permits are issued on a timely basis; tree cutting commences on a timely basis; heavy lift helicopter arrives and harvesting commences on a timely basis; other equipment is delivered on a timely basis; and customer trial orders are fulfilled.
The factors identified above are not intended to represent a complete list of the factors that could affect Prima. Additional factors are noted under the heading "Risk Factors" in the Annual Information Form dated April 30, 2012 available at www.sedar.com under Prima's profile. Further, should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results, performance or achievement may vary materially from those expressed or implied by the forward-looking information contained in this news release. Forward-looking statements and information are based on the beliefs, estimates and opinions of management at the date the statements are made and are subject to change without notice. These factors should be carefully considered and viewers are cautioned not to place undue reliance on forward-looking information, which speaks only as of the date of this news release. Other than as required by law, Prima does not undertake to update forward-looking statements or information if management beliefs, estimates or opinions or other circumstances should change, or to reflect events or circumstances that occur after the date of this news release or to reflect the occurrence of unanticipated events. All forward-looking information attributable to Prima herein is expressly qualified in its entirety by the cautionary statements contained in or referred to herein.
Neither 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 news release.
For further information:
Donald P. Hayes
Chief Executive Officer & Director
T 604 620 7605
Suite 880-1090 West Georgia Street
Vancouver, British Columbia