Inca Pacific Resources Inc.

Inca Pacific Resources Inc.

July 12, 2007 08:30 ET

Inca Pacific Granted Key Modifications to Its Agreement With Government of Peru

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 12, 2007) - Inca Pacific Resources Inc. (TSX VENTURE:IPR) (the "Company") reports that it has been granted the following modifications from Proinversion and Activos Mineros S.A.C. representing the Government of Peru ("GOP") with respect to its agreements concerning the core claims at the Magistral Copper-Molybdenum property:

- An extension until December 31st, 2007 of its requirement to file a Feasibility Study.

- An extension until February 28th, 2008 of its requirement to provide one or more letters from major financial institutions stating that the Feasibility Study is a Bankable Feasibility Study.

- An extension until the later of, February 28th, 2008 or approval by the GOP of the Feasibility Study, of its requirement to grant the GOP certain annual performance guarantees concerning the investment commitment during the permitting and construction of the mine.

Upon execution of formal documentation of the above modifications the Company will pay the GOP the sum of US$200,000 and upon achievement of commercial production the Company will pay the sum of US$5,000,000 into a trust account for the benefit of the communities in the immediate area of influence of Magistral.

Anthony Floyd, President & CEO said, "We are pleased that the Government of Peru recognizes that the Company is doing everything within its control to move Magistral towards production notwithstanding the many constraints facing the mining industry at this time."

Juan Valdivia, Minister of Mines of Peru said, "The Government of Peru recognizes Magistral could generate significant taxes and royalties to the benefit of all Peruvians if it becomes a mine therefore I agree with the additional term granted by Proinversion to Inca for completing its Feasibility Studies and source financing to construct a mine. The fact that we shall create a trust fund for the communities near Magistral demonstrates that both the Government and the Company recognize the importance of fostering sustainable development around mining projects".

Inca Pacific has invested over US$18 million on exploration and development of the Magistral property. It currently has over 50 local people employed at site plus four engineering firms working to complete the Feasibility Study.


Anthony Floyd, President and Director


This news release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Forward-looking statements include Inca Pacific's commitment to, and plans for completing a final feasibility study, obtaining approval of an Environmental Impact Assessment and developing the Magistral Project. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "can", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Inca Pacific to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the exploration and potential development of the Magistral Project, risks related to international operations, the actual results of current exploration activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of copper, silver and molybdenum. Although Inca Pacific has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Inca Pacific does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws. The Company's mineral property is located in Peru and thus may be exposed to various and unpredictable levels of political, economic and other risks and uncertainties. The Company conducts operations through Peruvian subsidiaries which hold the rights to the mineral properties. Operations may be affected in varying degrees by government regulations with respect to, but not limited to, expropriation of property, maintenance of claims, environmental legislation, land use and land claims. Failure to comply with applicable laws, regulations and local practices relating to mineral right applications and tenure could result in loss, reduction or expropriation of entitlements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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