Last updated on April 17, 2014 at 9:41 EDT

Pacific Coal Resources Ltd. announces first quarter 2012 financial results

May 30, 2012

TORONTO, May 31, 2012 /PRNewswire/ – Pacific Coal Resources Ltd. (TSXV: PAK)
has filed on May 30, 2012 its unaudited consolidated financial
statements for the three months ended March 31, 2012, together with its
Management’s Discussion and Analysis (“MD&A”) for the corresponding
period. All financial figures contained herein are expressed in U.S.
dollars unless otherwise noted. These documents will be posted on the
Company’s website at www.pacificcoal.ca and are available under the Company’s profile at www.sedar.com.

Luis Carvajales, Chief Executive Officer, commented: “We have been proceeding according to plan on both of our producing
thermal coal properties – La Caypa and Cerro Largo. Our production and
stripping ratios would be in line with our full-year 2012 projections
had we not experienced unforeseen and unavoidable production
disruptions in the first quarter of 2012. These disruptions, while
handled admirably by our personnel, did cost the Company some
production. With those situations resolved, we remain committed to
lowering our operating costs, improving our stripping ratios, and
boosting our production. We are confident that we will achieve all
three of these objectives in the coming quarters.”

Financial and Operating Summary

A summary of the financial and operating results for the three months
ended March 31, 2012 and 2011 is as follows:

    |                                           |         First Quarter   |
    |(000's except per share and operating data)|      2012  |      2011  |
    |                                           |            |            |
    |Operational                                |            |            |
    |Tonnes of coal produced                    |     317,070|     361,772|
    |Average stripping ratio - operations       |     10.83:1|      7.10:1|
    |Tonnes of coal sold                        |     257,123|     380,868|
    |Average realized price per tonne sold      |$     103.27|       96.92|
    |Operating margin per tonne sold (1)        |     (27.19)|       16.97|
    |                                           |            |            |
    |Financial                                  |            |            |
    |Revenues                                   |$     28,424|$     36,915|
    |Gross margin (2)                           |     (9,056)|     (5,843)|
    |Net (loss) earnings attributed to          |            |            |
    |shareholders                               |    (21,106)|    (36,465)|
    |Basic and fully diluted (loss) earnings per|            |            |
    |share                                      |      (0.07)|      (0.16)|
    |Total cash                                 |       4,176|      11,062|
    |Total assets                               |     375,008|     437,274|
    |Total debt (3)                             |      38,963|      18,643|

    (1)  "Operating margin per tonne sold" - see additional financial
         measures in MD&A.

    (2)  "Gross margin" represents total revenues, net of operating costs,
         transportation and port services costs, selling costs, mine
         disruption costs, depreciation, depletion and amortization, and
         impairment charges related to inventory.

    (3)  Includes bank indebtedness, long-term debt (including current
         portion), and obligation under finance lease (including current

First Quarter Highlights

        --  The Company produced 317,070 tonnes of coal during the first
            quarter of 2012. Production at the Cerro Largo mine reached
            131,895 tonnes, representing an increase of more than 50% over
            the previous quarter. Production at La Caypa of 185,175 tonnes
            was negatively impacted by a two week disruption at the mine
            resulting from an illegal work stoppage by employees of the
            mine contractor which resulted in lost production of
            approximately 75,000 tonnes.

        --  The Company completed 90% of its planned drilling program at
            the La Caypa, Cerro Largo and C.I. Jam properties. Updated NI
            43-101 compliant technical reports in respect of the Company's
            properties are currently in progress and are expected to be
            released between the third and fourth quarters of 2012.

Q1 2012 Production at La Caypa

    |          |Production of Coal|  Waste  |Strip Ratio|
    |          | (metric tonnes)  |(bcm (1))|           |
    |Actual Pit|           185,175|1,297,248|     7.01:1|
    |South Pit |                 -|  321,424|         NA|
    |Total     |           185,175|1,618,672|     8.74:1|

(1)   ”BCM” is Bank Cubic Metres

During the first quarter of 2012, the Company produced 185,175 tonnes at
La Caypa completing 87% of its planned production for the quarter,
despite a two week blockade as a consequence of an illegal strike by
employees of a mine subcontractor (see Pacific Coal press releases
dated January 30, 2012 and February 6, 2012). Operational stripping
ratios at La Caypa are consistent with the first quarter of 2011, which
was a historical low. Total stripping ratios at La Caypa now reflect
waste volumes moved from the south pit.

Q1 2012 Production at Cerro Largo – La Divisa

    |     |Production of Coal|  Waste  |Strip Ratio|
    |     | (metric tonnes)  |(bcm (1))|           |
    |Total|           131,895|2,135,468|    16.19:1|

(1) ”BCM” is Bank Cubic Metres

In the first quarter of 2012, the Company made substantial progress at
Cerro Largo in both production and reduction of strip ratio. Production
was up over 50% from the previous quarter, improving to 131,895 tonnes
from 87,297 tonnes in the fourth quarter of 2011, while the stripping
ratio was reduced by 9% to 16.19:1 from 17.72:1 in the fourth quarter
of 2011, marking the third consecutive quarter of declining stripping

The Company experienced some logistical disruption at Cerro Largo
associated with the collapse of a bridge on the route on December 26,
2011, which forced an additional 200 kilometre detour until February
21, 2012. However, the cost impact was mitigated and transport ensured
by the utilization of the Company’s own truck fleet. Additional fuel
and transportation charges for the first quarter of 2012 at Cerro Largo
as a result of this disruption totaled $2.83/tonne.

Coal sales during the first quarter of 2012 from La Caypa, Cerro Largo
and third party production totaled 260,495 tonnes.

CI Jam Operations in Q1 2012

    |Metallurgical Coal            |Q1 2012 Tonnes|Q4 2011 Tonnes|
    |   Third Party Purchases      |        14,645|        23,400|
    |   Company Production         |         1,123|         1,618|
    |                                                            |
    |Coke Operation                |Q1 2012 Tonnes|Q4 2011 Tonnes|
    |   Metallurgical Coke Produced|        10,547|         7,266|
    |   Metallurgical Coke Sales   |         4,796|         2,361|

Outlook and Revised Production Guidance

As a result of the production shortfalls in the first quarter of 2012,
2012 production at La Caypa is expected to be 1.3 million tonnes,
including coal from the South Pit expansion, down from previously
released guidance of 1.4 million tonnes.

At Cerro Largo, commissioning of additional equipment by the operator
will allow the Company to increase production from this mine, however
due to footwall instability in conjunction with heavy rainfall, planned
2012 production has been reduced from 800,000 tonnes to 700,000 tonnes.

The Company’s total 2012 forecasted production is 2.0 million tonnes, a
projected 40% increase from 2011 production.

The Company continues to focus on initiatives to reduce costs during
2012 and realized savings in general and administrative costs of more
than 10% in the first quarter of 2012 as compared to the previous
quarter. General and administrative expenses are expected to decline
further in 2012. In addition, the Company has commenced a strategic
review of each of its operations to identify further cost savings.

NCIB Update

As at May 30, 2012, approximately 11.2 million shares had been purchased
for cancellation under the normal course issuer bid, previously
announced on July 4, 2011. The Company currently has 322.1 million
shares outstanding. To date, the Company has repurchased approximately
3% of its issued and outstanding common shares for cancellation.

About Pacific Coal Resources Ltd.

Pacific Coal Resources Ltd. is a Canadian-based mining company focused
on coal, coking coal, asphalt and asphaltite exploration, development
and production from producing, development-stage and exploration-stage
properties in Colombia. The Company has acquired or entered into
agreements to acquire various interests in several operating coal mines
and projects, representing a substantive coal and asphaltite
exploration and production area throughout Colombia. Pacific Coal is
committed to implementing its exploration and development strategy with
a comprehensive environment, safety and community program, meeting
international standards of best practice.

Forward Looking Information:

This news release contains “forward-looking information”, which may
include, but is not limited to, statements with respect to the future
financial or operating performance of the Company and its projects.
Often, but not always, forward-looking statements can be identified by
the use of words such as “plans”, “expects”, “is expected”, “budget”,
“scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or
believes” or variations (including negative variations) of such words
and phrases, or state that certain actions, events or results “may”,
“could”, “would”, “might” or “will” be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Pacific Coal to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. Forward-looking statements
contained herein are made as of the date of this press release and
Pacific Coal disclaim, other than as required by law, any obligation to
update any forward-looking statements whether as a result of new
information, results, future events, circumstances, or if management’s
estimates or opinions should change, or otherwise. There can be no
assurance that forward-looking statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, the reader is cautioned
not to place undue reliance on forward-looking statements.

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.



SOURCE Pacific Coal Resources Ltd.

Source: PR Newswire