Prophecy Submits Formal Request to Mongolian Government to Build Chandgana Power Plant
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 04/21/11 -- Prophecy Resource Corp. ('Prophecy' or the 'Company') (TSX VENTURE: PCY)(OTCQX: PRPCF)(FRANKFURT: 1P2) is pleased to report that after 8 months of due diligence, research and study, the Company has submitted the formal request with the Ministry of Natural Resources and Energy ('Ministry') to build the Chandgana Power Plant.
In August 2010, Prophecy engaged local Mongolian experts to initiate a Feasibility Study for the Chandgana mine mouth power plant with capacity of 600 MW, based on Prophecy's Chandgana coal deposit located in Khentii province, central Mongolia. With further assistance from Evonik Industries of Germany, the Prophecy team completed the necessary technical and financial analysis, including an Environmental Impact Assessment which was approved by the Mongolian Ministry of Nature and the Environment in November 2010 (see Prophecy news release dated November 15, 2010) and a Feasibility Study completed in accordance with Mongolia policies for the granting of a permit to construct and operate a power plant in Mongolia.
Prophecy's objective is to supply Mongolia with cleaner and affordable energy and to eliminate expensive and growing foreign electricity import. A number of antiquated Mongolian coal power plants are due to be decommissioned and Prophecy intends to build a modern 600MW thermal power plant complex at Chandgana and connect the power plant with Mongolia's existing Central and Eastern energy systems. This integration is critical to fuel Mongolia's growth and is part of the long term energy development policy of Mongolia. As the project scales up to 4,200MW, there is potential to export surplus power to China, with its capital Beijing located approximately 1,000km (600 miles) to the south. An independent transmission line study to connect Chandgana to China commenced in February. Prophecy has been in discussion with various investment banks interested in providing Chandgana with project financing.
Upon receiving Ministry's endorsement, Prophecy would then proceed to work with the Mongolian Energy Regulatory Authority ('ERA') for the issuance of the Power Plant Permit. Prophecy began comprehensive discussions with the Ministry and ERA since last October culminating in positive feedback for Prophecy to continue with its objectives. The anticipated time frame for the power plant permitting application process is 3 to 6 months.
John Lee, Chairman of Prophecy states that: 'Prophecy officers, directors and advisors have a solid track record of constructing, operating and financing large energy projects. Chandgana Power Plant represents modern industrialization and energy independence for Mongolia, new potential energy supply to China, and further accretion of significant value for Prophecy's shareholders.'
About Prophecy Resource
Prophecy Resource Corporation is an internationally diversified company engaged in developing energy, nickel and platinum group metals projects. The company controls over 1.4 billion tons of surface minable thermal coal in Mongolia (839 Mt Measured, 579 Mt Indicated). Prophecy's Ulaan Ovoo coal mine is fully commissioned. In Canada, Prophecy owns the Wellgreen PGM Project in Yukon, Lynn Lake Nickel Sulphide Project in Manitoba, and equity stakes in Victory Nickel Inc. and Compliance Energy Corp. On February 17, Prophecy agreed to sell its PGM Nickel assets to Pacific Coast Nickel Corp. for 450 million Pacific Coast Nickel shares. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
ON BEHALF OF THE BOARD OF DIRECTORS of Prophecy Resource Corp.
John Lee, Chairman
Forward Looking Statements: This news release includes certain statements that may be deemed 'forward-looking statements'. All statements in this release, other than statements of historical facts, including, without limitation, statements regarding future plans and objectives of the companies are forward-looking statements that involve various risks and uncertainties. Although Northern and Prophecy believe the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Forward-looking statements are based on a number of material factors and assumptions. Factors that could cause actual results to differ materially from those in forward-looking statements include general economic, market or business conditions, and other risks detailed herein and from time to time in the filings made by the companies with securities regulators. Mineral exploration and development of mines is an inherently risky business. Accordingly the actual events may differ materially from those projected in the forward-looking statements. For more information on Northern and Prophecy and the risks and challenges of their businesses, investors should review their annual filings that are available at www.sedar.com.
This press release does not constitute an offer to sell or a solicitation to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended ('the U.S. Securities Act') or any state securities law and may not be offered or sold in the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Neither the 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 release.
Contacts:
Prophecy Resource Corp.
John Lee
Chairman
1.800.851.1528
john@prophecyresource.com
Prophecy Resource Corp.
Scott Parsons
1.604.642.2625 ext. 106
Prophecy Resource Corp.
Paul McKenzie
1.604.642.2625 ext. 107
www.prophecyresource.com