Petaquilla Copper Ltd.

Petaquilla Copper Ltd.

August 28, 2007 19:00 ET

Petaquilla Copper Comments on Short-Term Investments Status

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 28, 2007) - Petaquilla Copper Ltd. ("PTC" or the "Company") advises on the impact of recent disruptions in global credit markets on $12.8 million of its cash and investments which is invested in Canadian asset-backed commercial paper ("ABCP"). The remaining $28 million of the Company's cash and investments is held in cash and savings deposits not affected by this situation.

The Company's cash management criterion is to invest in products that are ranked by the Dominion Bond Rating Service ("DBRS") as R1-High. In June and July of 2007, PTC invested, on the basis of professional advice, a total of $12.82 million in the following A Notes with one trust managed under the Coventree Capital Group Inc. ("Coventree"):



Maturity Date Issuer Nominal Value
August 13, 2007 Structured $ 6,808,052
Investment Trust III
August 27, 2007 Structured $ 2,005,046
Investment Trust III
September 26, 2007 Structured $ 2,004,230
Investment Trust III
October 29, 2007 Structured $ 2,002,912
Investment Trust III
Total: $ 12,820,240


Of the A Notes held by PTC, $6.8 million came due and payable on August 13, 2007, and $2 million came due and payable on August 27, 2007. Neither Note was paid and both Notes remain outstanding.

Coventree announced on August 13, 14 and 15, 2007, that it was experiencing market disruption and as a result was unable to meet its repayment obligations until its liquidity providers fund such repayments. DBRS has continued to rate the conduits in which PTC holds ABCP and their underlying assets as R1-High. According to DBRS, an R1-High rating is of the highest credit quality, and indicates an entity possessing unquestionable ability to repay current liabilities as they fall due.

PTC is currently investigating the implications of these events, which appear to be a result of the current lack of liquidity for asset backed securities of the type held by Coventree rather than the creditworthiness of its underlying assets.

PTC has sufficient cash available to continue its operations both in Canada and in Panama without any delays, provided this market disruption is resolved in a timely manner.

On behalf of the Board of Directors of PETAQUILLA COPPER LTD.

John Cook, President and Director

No stock exchange has approved or disapproved the information contained herein.

Contact Information

  • Petaquilla Copper Ltd.
    John Cook
    President and Director
    (604) 694-0021 or Toll Free: 1-877-694-0021
    (604) 694-0063 (FAX)
    Website: www.petaquillacopper.com