Western Canadian Coal announces second quarter 2008 operating results

    TSX: WTN & WTN.DB and AIM: WTN

    VANCOUVER, Nov. 15 /CNW/ - Western Canadian Coal Corp. (TSX WTN & WTN.DB;
AIM: WTN) ("WCCC" or the "Company") presents its operating results for the
three months ending September 30, 2007:

    Financial Summary:

    -   Net loss for the quarter is $43.9 million or a loss per share
        of $0.38. Included in the second quarter 2008 loss were the
        following one-time or unusual items (pre-tax): $14.7 million
        write-down of the future income tax asset, $2.8 million
        write-down of inventory, $2.6 million for a terminated
        contract, $1.5 million impairment on the Company's asset-
        backed commercial papers, and $1.0 million for transaction
        expenses that were abandoned. These items amount to
        $22.6 million or $0.20 per share. Year-to-date net loss is
        $46.9 million or $0.44 per share.

    -   At current coal prices and Canadian/US dollar exchange rates,
        the Company does not expect to have sufficient funds in the
        near term to meet its financial obligations as they come due.
        The Company will require additional capital from its major
        shareholder and external sources. In the past, the Company
        has been successful in raising additional capital, and
        management believes that these funds will be again available
        in the future.

    -   Capital structure changes include the Company repaying
        $20 million of the Wolverine project debt facility and
        obtaining a loan from its major shareholder, Cambrian Mining
        plc for $5 million.

    -   Sales for the quarter consist of 856,000 tonnes of coal from
        the Wolverine project, Perry Creek Mine (the "Perry Creek
        Mine") and the Burnt River project, Brule Mine (the "Brule
        Mine"). Revenues recognized during the three months ended
        September 30, 2007 totaled $67.9 million. The average price
        per tonne realized was $79.27 or US$75.57. Year-to-date sales
        consist of 1,485,000 tonnes average price of $82.80
        (US $76.75) per tonne.

    -   The Company recognized $1,741,000 or $2.03 per tonne of gains
        on its foreign currency forward contracts during the quarter.

    -   Cash costs for the quarter ended September 30, 2007 were
        $85.36 per tonne, consisting of $54.92 of production costs
        and $30.44 per tonne of transportation costs. Year-to-date
        cash costs were $83.71 per tonne.

    -   Operating loss of $13.5 million for the quarter ending
        September 30, 2007 on sales of $67.9 million versus a loss of
        $4.0 million in the first quarter of 2008 on $54.2 million.
        The increase in the Canadian dollar during the quarter over
        the previous quarter reduced sales by $3.3 million.
        Year-to-date operating loss is $17.5 million on sales of
        $122.1 million.

    -   The Perry Creek Mine produced 693,000 tonnes of run-of-mine
        (ROM) coal, and processed approximately 735,000 tonnes of ROM
        coal through the Wolverine plant, producing 431,000 tonnes of
        coal, for a processing yield of 58.6% for the quarter ended
        September 30, 2007. Shipments from Perry Creek for the
        quarter were 493,000 tonnes.

    -   The Brule mine produced 306,000 tonnes of ROM coal and
        325,000 tonnes were railed to port for the quarter ended
        September 30, 2007.

    "It was a disappointing quarter for the company," said John W. Hogg,
President and CEO. "Aside from the accounting adjustments recorded and the
impact of the strengthening Canadian dollar has had on our results, the
disappointment was in our mine performance. Equipment shortages and
maintenance issues all hampered production and therefore increased costs.
However, we know what the issues are and have a plan to fix them. We have
started with new leadership at the mine, acquiring more equipment and working
with Ledcor, our mining contractor, our other key suppliers and maintenance
contractors to improve maintenance practices. All of these will improve
productivity and lower costs over the coming quarters."
    Mr. Hogg continues, "We are seeing increased demand for our coal, so much
so that we are finalizing negotiations for long term contracts. With spot
market prices for hard coking coal and PCI much higher than current contract
prices, we are quite optimistic for possibly record coal prices in the
upcoming coal year. The positive outlook for the sector and our Company is
underscored by the number of approaches the Company has received from industry
participants expressing interest in investing and partnering in our business."
    "The Company continues to receive strong support from its major
shareholder Cambrian Mining Plc. Cambrian will work closely with the Company
to achieve its short and medium term financing requirements. In this regard,
Mr. Mark Burridge, CEO of Cambrian, has been asked to serve as a Senior
Advisor to the Western Canadian Coal Corp.'s Board to assist the Company in
its corporate development activities."
    "Cambrian invested $27 million to purchase the Falls Mountain Coal assets
which lie to the north of the Company's Brule Mine. These assets have the
potential to offer significant synergies to the Brule operations and greatly
reduce the capital expenditure for the long-term Brule Mine as well as adding
to the Company's production potential. Western Canadian Coal Corp has the
option to purchase these assets from Cambrian at cost plus carrying costs
before the end of 2007."

    News Release

    This news release is prepared as at November 14, 2007 and should be read
in conjunction with the Company's audited financial statements for the year
ended March 31, 2007 and notes contained therein, and Management's Discussion
and Analysis (MD&A) for the same period. This news release does not constitute
MD&A as contemplated by relevant securities rules. Western Canadian Coal
Corp.'s Second Quarter Report and MD&A for the three and six months ending
September 30, 2007 are filed on SEDAR and are available at www.sedar.com and
the Company's website www.westerncoal.com.

    Financial Summary - unaudited:

    (In thousands of Canadian
     dollars, except tonnes and                 September      March
     per share data)                             30, 2007   31, 2007
    Cash & cash equivalents                     $  13,514  $  35,272
    Inventory                                      23,559     28,522
    Other current                                  28,690     29,803
    Total Assets                                  427,135    438,575

    Current liabilities                            90,027     75,063
    Long-term liabilities                         153,168    190,130
    Shareholders' equity                        $ 168,940  $ 173,382


                            Three months ending   Six months ending
                              September 30,         September 30,
                             2007       2006       2007       2006
    Tonnes sold             856,000    142,000  1,485,000    462,000

    Revenue               $  67,852  $  10,703  $ 122,066  $  40,685
    Cost of goods sold       81,382     10,123    139,569     32,567
    Operating (loss)
     profit                 (13,530)       580    (17,503)     8,118
    Other expenses           15,758      6,412     16,040     10,081
    Income tax expense
     (recovery)              14,578     (1,075)    13,380        487
    Net income (loss)     $ (43,866) $  (4,757) $ (46,923) $  (2,450)

    Earnings (loss)
     per share, basic     $   (0.38) $   (0.05) $   (0.44) $   (0.03)
    Earnings (loss)
     per share, diluted   $   (0.38) $   (0.05) $   (0.44) $   (0.03)

    Included in the above balances and results are the Company's
proportionate share of its interest in and results from the Belcourt Saxon
joint venture, as disclosed in note 4 to the financial statements for the
three and six months ended September 30, 2007.


    For the quarter ended September 30, 2007, total sales revenues were
$67,852,000 on 856,000 tonnes of coal sold. The average price per tonne
realized during the period was $79.27 or US$75.57. Shipments of coal during
the quarter were lower than expected due to production issues and rail car
shortages. The Company is working with CN Rail to improve the situation and
obtain the necessary rail cars needed to achieve targeted levels.
    During the quarter ended September 30, 2006, total revenues were
$10,703,000 on 142,000 tonnes sold. The average selling price per tonne
realized was $75.37 or US$67.50. These sales comprised solely of PCI coal from
the Dillon Mine, located within the Burnt River property.
    Year-to-date, total sales revenues were $122,066,000 and included: sales
of 1,485,000 tonnes of coal. The average price per tonne realized during the
period was $82.20 or US$76.75.
    The primary reason for the increase in the Company's total revenues over
the comparable quarter in the prior year is the increase in sales volume due
to the commencement of sales from the Perry Creek Mine. Realized revenues per
tonne were adversely affected by a stronger Canadian dollar and lower ULV-PCI
sales prices compared to the quarter ended September 30, 2006.

    Cost of goods sold

    Cost of goods sold for the three months ended September 30, 2007 totaled
$81,382,000 or $95.07 per tonne compared to $10,123,000 or $71.29 per tonne in
the second quarter of fiscal 2006. Cost of goods sold includes cost of
production, transportation, and depletion, amortization and accretion charges
as presented in the table below:

    (In thousands of      September             September
     Canadian dollars)     30, 2007    $/tonne   30, 2006    $/tonne

    Cost of production    $  47,014  $   54.92  $   4,931  $   34.73
    Transportation and
     other                   26,056      30.44      4,606      32.44
     amortization and
     accretion                8,312       9.71        586       4.12

    Total cost of goods
     sold                 $  81,382  $   95.07  $  10,123  $   71.29

    Costs during the recent quarter were higher than expected due to
production issues at the Perry Creek Mine. A shortage of equipment, higher
than anticipated maintenance costs and training issues were all factors for
the lower productivity and therefore, higher costs. Since the end of the
quarter, the necessary equipment has arrived to improve productivity, the
Company will be moving into a new shop and warehouse facility which should
improve maintenance productivity and lower costs.
    Cost of product sold in the 2006 quarter solely relates to ULV-PCI coal
as the Perry Creek Mine was still in development. The increase in the current
quarter's per unit cost of product sold over the comparable prior quarter is
due to the slower than anticipated start-up of the Perry Creek Mine and the
requisite processing required on the Perry Creek hard coking coal through the
coal preparation plant. During the quarter ended September 30, 2007, the
Company wrote down its coal inventory balance to its net realizable value.
This write-down of $2,803,000 was required due to the strengthening of the
Canadian dollar in comparison to the US dollar. All sale prices are
denominated in US dollars. Per unit cost of product sold for the Brule Mine,
based on similar strip ratios and mining operations as the Dillon mine have
increased compared to those at Dillon due to higher fuel costs.
    The decrease in per unit transportation costs resulted from reduced
trucking expenditures since there is no truck haul associated with Perry Creek
hard coking coal. Burnt River ULV-PCI coal is trucked 94 km to the Bullmoose
    The increase in the period is due to the additional depletion,
amortization and accretion charges related to the Perry Creek Mine assets.
    For the current quarter, cash costs, a key performance indicator for the
industry, were $85.36 per tonne compared to $67.16 per tonne for the quarter
ended September 30, 2006. The increase was primarily due to the increased
mining and processing costs realized at the Perry Creek Mine, partly offset by
the lower transportation costs at the Perry Creek Mine, both as described

    Operating (loss) profit

    The operating loss for the quarter ended September 30, 2007 was
$13,530,000 as compared to an operating profit of $580,000 in the same quarter
last year. Included in Other Expenses, foreign currency contract gains both
realized and unrealized, which are financial instruments the Company employs
to reduce the volatility of revenues from the translation of US dollar
receipts into Canadian dollar. The gain was $1,741,000 or $2.03 per tonne in
the quarter.

    Other expenses

    Other expenses, for the quarter ending September 30, 2007, were
$15,758,000 and include the following:


                           Three months ending     Six months ending
    (In thousands of          September 30,         September 30,
     Canadian dollars)       2007       2006       2007       2006
    General, administ-
     ration and selling   $   4,986  $   3,506  $   8,903  $   6,488
    Coal exploration          1,006      2,741      1,805      4,007
    Interest, accretion
     and financing fees       6,211        (15)    11,878          6
    Abandoned transaction
     expense                      -        620          -        620
    Investment impairment     1,500          -      1,500          -
    Terminated contract
     expense                  2,590          -      2,590          -
    Gains on forward
     exchange contracts      (1,741)      (286)   (11,204)      (286)
    Other expenses
     (income)                  (535)      (154)       568       (754)
    Total other expenses  $  15,758  $   6,412  $  16,040  $  10,081

    General, administration and selling costs for the quarter ended September
30, 2007 increased by $1,480,000 or 42% to $4,986,000 over the same period in
the prior fiscal year. The increase is primarily due to the Company writing
off previously deferred transactions costs relating to an abandoned
transaction. Further, the increase can be attributed to an increase in
salaries, benefits and other remuneration as a result of the Company
increasing its staffing levels to support a larger scale operation, an
increase in sales and marketing costs, which are a function of coal sales from
the Perry Creek Mine, an increase in office and miscellaneous costs, which are
a function of supporting a larger scale operation and an increase in legal
fees due to legal consulting provided during the quarter. These increases are
partially offset by a decrease in stock based compensation due to a lower
weighted average fair value of options granted and travel expenses which are a
function of timing of employee travel. The remaining increase in other
expenses is due to building the necessary support systems for a larger,
multi-operational company.
    Coal exploration expenditures for the quarter ended September 30, 2007,
including the Company's proportionate share of expenses recorded by the
Partnership of $287,000, decreased to $1,006,000 from $2,741,000 in the same
quarter in the prior fiscal year. Coal exploration costs include property
development expenditures, field programs, consultants, coal license and lease
payments, engineering, environmental costs and other project administration
expenses. Exploration costs are charged to earnings in the quarter in which
they are incurred, except where these costs related to specific properties for
which economically recoverable reserves have been established, in which case
they are capitalized.
    Interest and accretion on the Company's convertible debentures, interest
on the Company's debt facilities and capital leases, and the amortization of
deferred financing costs, all of which relate to the Wolverine Project,
commenced being charged to operations effective October 1, 2006, when the
Perry Creek Mine was determined to have reached commercial production. Prior
to October 1, 2006, such costs were capitalized to the project. For the
quarter ended September 30, 2007, interest, accretion and amortization of
financing fees on long-term debt were $6,211,000 (2006 - $(15,000)).
    The Company recorded impairment on its asset-backed commercial paper of
$1,500,000 during the quarter ended September 30, 2007 (30% of Face Value). As
at September 30, 2007, the Company held two Canadian third party asset-backed
commercial papers ("ABCP") with a total maturity value of $5 million. When the
Company acquired these investments, they were rated R1 (High) by the Dominion
Bond Rating Service ("DBRS"), the highest credit rating issued for commercial
paper, and backed by R1 (High) rated assets and liquidity agreements. These
investments reached their maturity dates during the quarter ended September
30, 2007 but did not settle on maturity due to the liquidity issues in the
ABCP market. The ABCP in which the Company has invested continues to be rated
R1 (High, Under Review with Developing Implications) by DBRS.
    On August 16, 2007 an announcement was made by a group representing the
banks, asset providers and major investors that they had agreed in principle
to a long-term proposal and interim agreement to convert the ABCPs into
long-term floating rate notes maturing no earlier than the scheduled maturity
of the underlying assets. On September 6, 2007, a restructuring committee was
formed to propose a solution to the liquidity problem affecting the ABCP
market. On October 16, 2007, it was announced that the committee expected that
the restructuring would be completed on or before December 14, 2007. By means
of Extraordinary Resolutions of the trusts that had issued ABCP, until
December 14, 2007, trading has ceased and investors have committed not to take
any action that would cause an event of default.
    The ABCP in which the Company has invested has not traded in an active
market since mid-August 2007. The Company has assessed the fair value of these
instruments by obtaining bid prices from private third parties. The change in
fair value is considered to be other than permanent and as a result, an
impairment charge has been recorded during the period.
    The valuation of these investments involves management's judgment. Actual
results could differ from the estimates and assumptions used.
    In fiscal 2007, the Company bid on tendered contracts for the sale of
hard-coking coal from the Perry Creek mine. The Company was awarded two
contracts. As part of these contracts, the Company was required to post
performance bonds through letters of credit for US$891,000 relating to the
first contract and US$1,154,000 relating to the second contract. The letters
of credit are supported by term deposits. Both of these contracts were
contingent on the acceptance of a trial shipment. Notification of acceptance
of the trial shipment for the first contract was made after the expiry of the
first contract. The acceptance under the second contract was not made in time
for the Company to arrange for shipment. The Company tried to restructure the
contracts, but could not come to an agreement with the customer. As a result,
the customer terminated the two contracts. As at September 30, 2007, the
customer called on the letters of credit for non-delivery of product. These
amounts were paid as required by the letters of credit in October 2007. The
Company has recorded a charge in its financial statements during the period
and provided a provision against the deposits supporting the letters of
credit. The Company does not agree with the exercise of the letters of credit
and is currently reviewing its options. Previously deferred sales commissions
relating to these contracts totalling $537,000 have been expensed during the
quarter ended September 30, 2007.
    During the quarter ended September 30, 2007, the Company recorded
$1,741,000 of gains relating to its forward contracts entered into by the
Company to mitigate its exposure to currency fluctuation for the period ended
September 30, 2007 (See "Financial Instruments"), of which $801,000 are
unrealized at the end of the quarter. During the quarter ended September 30,
2007, the Company crystallized its forward US dollar currency exchange
contracts and realized, previously recorded unrealized foreign exchange gains.
In the quarter ended September 30, 2006, the company recorded a foreign
exchange gain of $268,000 resulting from put and call option contracts, or
costless collars, entered into by the Company to mitigate its exposure to
currency fluctuations.
    Other expenses amounted to $1,206,000 for the quarter ended September 30,
2007, as compared to other income $154,000 in the prior year. Other income for
the period ended September 30, 2007 consisted of $1,461,000 of realized
forward exchange losses on transactions, $385,000 in interest on short term
investments and $130,000 in miscellaneous expenses. Other income for the
period ended September 30, 2006 consisted of interest on short-term
investments of $172,000 offset by other expenses of $18,000.
    Per CICA Handbook Section 3465 "Income Taxes", a future income tax asset
can only be realized as a result of it being "more likely than not" that
sufficient future taxable income will be available to utilize such future
income tax assets. The future income tax asset must be assessed on a regular
basis. The "more likely than not" criteria is difficult to meet when there is
unfavourable evidence such as cumulative losses in recent years and a history
of tax losses. Given the Company's operating history, the Company does not
believe that it currently meets these "more likely than not" criteria and as a
result has written off the previously recorded future income tax asset. As a
result, the Company wrote off its future income tax asset for $14.7 million.

    Net (loss) income

    Net loss for the quarter ended September 30, 2007 was $43,866,000
compared to a net loss of $4,757,000 for the same period in the previous
fiscal year. Net loss period reflects: an operating loss of $13,530,000; other
expenses totaling $15,758,000 including general, administrative and selling
expenses; coal exploration; and interest, accretion and financing fees on
long-term debt; and a write-down of the future income tax asset of

    Long-Term Debt

    The Company has incurred substantial development costs to place its Perry
Creek Mine and the Brule Mine into commercial production through March 31,
2007. The production ramp-up at the larger of the two mines, the Perry Creek
Mine, was slower than anticipated, and both production and rail service have
not achieved targeted levels through September 30, 2007. In addition to this,
a general increase in mining costs and the weakening of the US currency in
relation to the Canadian dollar during the second quarter of this fiscal year
has resulted in lower than expected cash flows for the year to date.
Consequently, the Company has incurred a loss for the six months to September
30, 2007 of $46,923,000, including a write off of future income tax benefits
previously recorded.
    The Company was in violation of a financial covenant in respect of its
long term debt at September 30, 2007 and a waiver has been received in from
the Company's lenders. It is expected, however, that this financial covenant
will be violated in the 12 months following September 30, 2007, accordingly,
this debt has been classified as current in these interim financial
statements, with the result that the Company has a working capital deficiency
of $24,264,000 at September 30, 2007.
    At current coal prices and Canadian/US dollar exchange rates, the Company
does not expect to have sufficient funds to meet its long term debt
obligations as they come due and to continue the planned expansion of the
Perry Creek Mine, and accordingly the Company will require equity or debt
financing from external sources. These circumstances lend substantial doubt as
to the ability of the Company to meet its obligations as they come due and,
accordingly, the appropriateness of the use of accounting principles
applicable to a going concern. The Company has been successful in raising
additional equity and debt financing in the past to fund its capital
expenditures and operations, and management believes that these funds will be
available in the future, however there is no assurance that any required
funding would be available to the Company on acceptable terms.
    During the quarter ended September 30, 2007, amendments were made to the
credit agreement. In consideration of the covenants within the debt being set
at targets in line with the revised operating plans of the Company and certain
other requirements imposed by the banking syndicate, the Company has agreed:
to increase the mandatory principal prepayments after December 31, 2007 from
55% to 75% of excess cash flows, collapse the contingent support account of
$10,000,000, reduce the outstanding debt from $55,000,000 to $35,000,000,
obtain an additional equity investment in the Company of $10,000,000 by
November 30, 2007 and pay fees in the amount $1,050,000 of which $550,000 was
paid during the quarter. A fee of $300,000 is due no later than December 31,
2007, which shall be waived if the debt is repaid in full prior to this date.
    As at September 30, 2007, the Company was in violation of a financial
covenant relating to its current ratio. The Company has sought and received a
waiver from its lenders with respect to this financial covenant as at
September 30, 2007. However, EIC-59 "Long-Term Debt with Covenant Violations"
requires that if a covenant is likely to be violated within one year of the
balance sheet date, the debt must be classified as current. The Company
anticipates that over the next twelve months, under the current credit
agreement with the lenders, it will be in violation of certain financial
covenants and will be required to seek waivers on these anticipated violations
accordingly. In the absence of restructuring or refinancing the current
project facility and as a result of the anticipated covenant violations under
the existing project facilities credit agreement the Company has reclassified
the entire balance of the long-term debt to current liabilities.
    In consideration of the financial covenant being waived as at September
30, 2007, the Company has agreed: to increase the additional equity investment
in the Company by November 30, 2007 from $10,000,000 to $15,000,000 on terms
and conditions acceptable to the majority lenders, 25% of the amount by which
such net cash proceeds exceed $15,000,000, shall be deposited in a segregated
account by which withdrawals or transfers will require the prior written
approval of the lenders; and pay fees in the amount of $500,000 payable at the
earlier of November 30, 2007, an additional equity raising and refinancing of
the project facility.
    Subsequent to September 30, 2007, the Company was in violation of certain
covenants relating to the delivery of certain mine and financial planning
information to the lenders. The Company has sought and received waivers from
its lenders in respect of the covenants.

    Market Outlook

    With continued strong economic growth, the global supply of hard coking
coal is slowly adjusting to increased demand; however, the continued shortage
of transportation infrastructure in the major coal producing countries and
scarcity of key mining inputs such as skilled labour, mining equipment and in
some areas basic inputs like water have once again skewed the supply-demand
balance in favour of the producers. This trend has been evidenced in 2007,
with spot price settlements as much as US$35 or more per tonne higher than
contract prices. There is no indication that this trend will diminish prior to
settling prices for the 2008 coal year and a number of industry analysts are
projecting metallurgical coal prices to rise to the US$135 level.
    A similar situation exists in the supply-demand balance for low volatile
PCI coals, though the price volatility for these coals will likely be more
acute. Constraints on mine production in key supply areas have occurred in
2007 at the same time as demand has increased. Adding to this are recent
thermal coal price increases, which impact PCI pricing in that PCI coals,
which have superior quality (lower ash and higher heat values) command a
substantial price premium above thermal coal benchmark prices. These factors,
in conjunction with the Company's own experience with increased prices now
being received for its low and mid-volatile PCI coals, is strongly indicative
of buoyant pricing for such coals. For the coal year 2008, ULV-PCI coal prices
are projected to rise as much as US$35 per tonne over current year contract
prices. As evidenced by the tight market conditions, there has been very
little tonnage available at spot in this market.
    In the longer term, the Company believes that the market fundamentals for
metallurgical coal will provide substantial opportunity to increase market
diversity and market share. The Company's Wolverine hard coking coal has
received positive reviews from some of the world's leading steel mills. The
Company's Burnt River low volatile PCI coal is consistently ranked in the top
three PCI coals worldwide and has experienced unparalleled demand. These
coals, in conjunction with highly efficient rail and port infrastructure with
excess capacity, provide to the Company a strategic advantage to grow and


    The Company's low volatile PCI coal has been sold to major steel mills in
Japan, Korea, Taiwan, China, Europe and South America and its Wolverine hard
coking coal is being placed in similarly diverse and growing markets.
Previously secured term purchase and sales agreements in Korea for hard coking
coal and PCI coal have been augmented with sales agreements with the other
major Asian and European mills. The Company is currently in negotiations to
structure longer term supply arrangements with top tier steel mills with
excellent growth and stability prospects.
    During the quarter ended September 30, 2007, both production and rail
service have not achieved targeted levels. The Company anticipates 2.2 million
tonnes of production from the Perry Creek Mine compared to previous estimates
of 2.4 million tonnes, of which approximately 1.9 million tonnes will be
marketed as Wolverine hard coking coal compared to previous estimates of
2.1 million tonnes.

    Conference Call

    The Company will be hosting a conference call to discuss the second
quarter 2008 operating results at 10:00am (PST) on November 15, 2007. To
participate on the call, dial either 1-800-733-7560 or 416-644-3417. The call
will also be webcast live on the Company's website at www.westerncoal.com.

    Forward-Looking Information

    This release may contain forward-looking statements that may involve
risks and uncertainties. Such statements relate to the Company's expectations,
intentions, plans and beliefs. As a result, actual future events or results
could differ materially from those suggested by the forward-looking
statements. Readers are referred to the documents filed by the Company on
SEDAR. Such risk factors include, but are not limited to changes in commodity
prices; strengths of various economies; the effects of competition and pricing
pressures; the oversupply of, or lack of demand for, the Company's products;
currency and interest rate fluctuations; various events which could disrupt
the Company's construction schedule or operations; the Company's ability to
obtain additional funding on favourable terms, if at all; and the Company's
ability to anticipate and manage the foregoing factors and risks.
Additionally, statements related to the quantity or magnitude of coal deposits
are deemed to be forward-looking statements. The reliability of such
information is affected by, among other things, uncertainties involving
geology of coal deposits; uncertainties of estimates of their size or
composition; uncertainties of projections related to costs of production; the
possibilities in delays in mining activities; changes in plans with respect to
exploration, development projects or capital expenditures; and various other
risks including those related to health, safety and environmental matters.

    "John Hogg"
    President and Chief Executive Officer

For further information:

For further information: David Jan, Manager, Investor Relations &
Corporate Development, Phone: (604) 608-2692, Email: djan@westerncoal.com

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