Inca Pacific Resources Inc.

Inca Pacific Resources Inc.

February 28, 2008 08:30 ET

Inca Pacific Provides Corporate Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 28, 2008) - Inca Pacific Resources Inc. (TSX VENTURE:IPR)(LIMA:IPR) ("Inca Pacific" or the "Company") announces that Activos Mineros, representing the Government of Peru ("GOP"), has acknowledged receipt of a comfort letter from each of BNP Paribas and Barclays Bank stating that they have reviewed the Final Feasibility Study for the Magistral project ("FFS") that was delivered on December 27, 2007 and that, based solely on a desk top review and without independent verification of the FFS's assumptions, they confirm that it is in a form and content that meets the requirements that would allow BNP Paribas and Barclays Bank to provide all or part of the finance for the Magistral project, after conducting a satisfactory due diligence investigation and subject to market and certain other conditions.

The GOP has acknowledged that in delivering the comfort letters Inca Pacific has complied with the requirement to provide one or more letters from major financial institutions stating that the FFS is a "Bankable" Feasibility Study. In addition, the GOP provided Inca Pacific with a list of observations about the FFS. The observations are principally requests for further information or detail. Inca Pacific has 90 days to respond to the observations.

The Company further reports that on January 31, 2008 Inca Pacific received a copy of an Initial Status Report from Pincock Allen & Holt ("PAH"), independent engineers, which summarizes PAH's site visit, provides their observations on the Magistral project's technical, environmental and economic information reviewed to date and provides an initial assessment of any project fatal flaws or risks. PAH was retained in December 2007 by Cutfield Freeman & Co Limited ("Cutfield Freeman") to act as independent engineer on behalf of potential lending institutions in connection with the possible senior debt component of project financing. In January PAH completed a site visit to the Magistral project and also commenced review of the December 2007 FFS prepared by Samuel Engineering.

In the report PAH state that their review to date has not identified any issues that would be considered "fatal flaws". There are, of course, issues that could pose a risk to the project including: permitting, environmental & social impact assessment preparation, site access roads, port facility construction, community agreements and relocation issues, low-grade ore stockpile location, closure and reclamation and overall project schedule. The Company believes that these are typical for a project at the stage of Magistral.

Anthony Floyd, President & CEO, said, "Receiving the bank comfort letters and completion of the independent fatal flaw review are two more significant steps in our development of the Magistral project. We now have 90 days to respond to the observations made by the Government of Peru and mitigate the risks outlined by PAH."

Finally, Cutfield Freeman continues to work with the Company to identify financing options and any other proposal which maximizes value to Inca Pacific shareholders.


Anthony Floyd, President and Director

The TSX Venture Exchange and the Lima Stock Exchange (the Bolsa de Valores de Lima) have not reviewed and do not accept responsibility for the adequacy or accuracy of this release.

Contact Information