Prophecy Coal (V.PCY) confirms Tugalgatai purchase termination – shares jump 41%
Prophecy Coal (TSX-V:PCY, StockForum), a Vancouver-based thermal coal mining and production company operating in Mongolia, released clarifications on their July 18, 2012 news release due to a British Columbia Securities Commission review of said disclosure.
The July 18 release announced that Prophecy had entered into a Sales and Purchase Agreement to acquire certain Tugalgatai coal exploration licenses from Tethys Mining and that the transaction was still subject to Mongolian governmental approval.
The release went on to state that the company had a resource estimate of 2.33 billion tonnes coal at Tugalgatai and it wasn't until August 7, 2012, that this estimate was classified as “historic”. However, Prophecy failed to include historic disclosure according to NI 43-101 stipulations in both the July and August releases.
The company also failed to disclose differences between Mongolian classes and Canadian Institute of Mining classifications as required under sections 1.2 and 1.3 of NI 43-101 in both releases.
According to today's news release, these reporting errors and omissions have been attributed to a “Qualified Person” oversight and the company wanted to assure investors they are not treating the 2.33 billion estimate as current.
However, intentions toward the Tugalgatai purchase have changed and the news release went on to state, “The Company would like to further confirm that the Agreement was terminated on November 5, 2012 and that Prophecy is not intending to proceed with an acquisition of the Tugalgatai Assets and so will not prepare and file a National Instrument 43-101 ("NI 43-101") compliant technical report for its Chandgana Property in Mongolia that includes the Tugalgatai Assets.”
Prophecy Coal was in the news recently when the company paid off an outstanding secured loan at the beginning of November.
Share rose 41.67% on the news to $0.085 per share.
Currently there are 248.4m outstanding shares with a market cap of $21.1 million.
The July 18 release announced that Prophecy had entered into a Sales and Purchase Agreement to acquire certain Tugalgatai coal exploration licenses from Tethys Mining and that the transaction was still subject to Mongolian governmental approval.
The release went on to state that the company had a resource estimate of 2.33 billion tonnes coal at Tugalgatai and it wasn't until August 7, 2012, that this estimate was classified as “historic”. However, Prophecy failed to include historic disclosure according to NI 43-101 stipulations in both the July and August releases.
The company also failed to disclose differences between Mongolian classes and Canadian Institute of Mining classifications as required under sections 1.2 and 1.3 of NI 43-101 in both releases.
According to today's news release, these reporting errors and omissions have been attributed to a “Qualified Person” oversight and the company wanted to assure investors they are not treating the 2.33 billion estimate as current.
However, intentions toward the Tugalgatai purchase have changed and the news release went on to state, “The Company would like to further confirm that the Agreement was terminated on November 5, 2012 and that Prophecy is not intending to proceed with an acquisition of the Tugalgatai Assets and so will not prepare and file a National Instrument 43-101 ("NI 43-101") compliant technical report for its Chandgana Property in Mongolia that includes the Tugalgatai Assets.”
Prophecy Coal was in the news recently when the company paid off an outstanding secured loan at the beginning of November.
Share rose 41.67% on the news to $0.085 per share.
Currently there are 248.4m outstanding shares with a market cap of $21.1 million.
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