News Release
West Hawk Clarifies Disclosure History
December 18, 2006 - Vancouver, B.C.: West Hawk Development Corp. (the "Company"), following discussions with the British Columbia Securities Commission (the "BCSC"), wishes to clarify certain issues surrounding technical disclosures on the Company's website www.westhawkdevelopment.com, and in relation to material distributed through news releases and promotional materials.
The Company has in the past disclosed speculative and hypothetical coal resource figures on its Groundhog, Tulita and Ellesmere Island coal properties. The category of speculative or hypothetical resources does not exist under NI43-101 reporting guidelines. The Company recognizes that the use of, or reference to, such terms is not considered suitable for public disclosure as they do not meet minimum standards for resource reporting. The Company recognizes the use of such figures may be misleading to the public as they do not comply with current reporting standards and are not compliant with NI43-101 reporting guidelines. Therefore, the Company wishes to retract any and all reference to speculative or hypothetical coal resource figures or any other resource or reserve figures on any of the Company's coal properties at this time.
The Company has not demonstrated the economic viability of the inferred resources on the Groundhog property or the historical estimates on the Tulita and Ellesmere Island properties. The historic results cannot be verified at this time by technical reports and therefore do not comply with minimum standards for reporting inferred resources. The Company did file a report on the Groundhog property, which it referred to as NI43-101 compliant. This report is deficient as it contained references to a speculative coal resource, contrary to NI43-101 standards, and was not prepared according to Form 43-101F1. Therefore, the Company wishes to clarify that the previously filed report on the Groundhog property should be disregarded in its entirety and is withdrawn. The Company is preparing a revised technical report in accordance with Form 43-101F1 in support of previously disclosed resource figures in the inferred category. The Company is also preparing technical reports in accordance with NI43-101 reporting standards on the Tulita and Ellesmere Island properties. Until such time as the aforementioned reports are filed, any and all reference to speculative or hypothetical resource figures or any other resource or reserve figures should be disregarded.
Further, the Company has used terms such as "world class" in reference to some of the Company's coal properties. The Company recognizes the use of such terms is overly promotional, is not suitable for public disclosure, and that no such category exists under NI43-101 reporting guidelines. Therefore, the Company wishes to retract any and all reference to such terms.
The Company has also made reference to a historic pre-feasibility study in describing the Tulita coal property. The Company recognizes that those terms and references are with respect to historic, non-NI43-101 compliant reports and therefore do not demonstrate the economic viability of the property. The Company wishes to make it clear that any and all reference to such terms or study should be disregarded.
The Company has also made reference to the future preparation of feasibility and pre-feasibility studies with respect to some of its properties. The Company has not yet established measured and indicated coal resources to justify proceeding with these studies. Accordingly, the use of such terms is premature and may be misleading. Therefore, the Company wishes to clarify that until such time as resources are established to justify the completion of such reports, reference to either feasibility or pre-feasibility studies should be ignored and are withdrawn.
The Company has also made reference to potential development of coal gasification plants with respect to some of its current properties, with Lu'An Mining Group of China, and with properties that the Company held at one time. The Company wishes to retract any reference to such potential developments as they may be misleading to the public until such time as sufficient resources are established, economic viability is confirmed and the necessary permitting and financing is obtained. These projects are in the conceptual stages only. The Company does not yet have coal resources or reserves that support this type of development. There is no guarantee that the Company will be able to establish sufficient coal resources or reserves to support this development. The Company has not completed a feasibility study to support the economic and technical viability of building and operating a coal gasification plant. Studies to date are preliminary in nature and the Company's projects are not yet at a stage where the Company can complete a feasibility study or meaningful economic analysis. There is no guarantee that the Company will ever be able to establish the economic viability of a coal gasification plant on any of its projects.
The Company would also like to retract unsubstantiated statements it has made in its public disclosure that suggest coal to gas production will be: low cost and price competitive in the global market for seaborne coal; cost competitive from a capital and O&M (Operating and Maintenance) basis; 5%-10% more efficient than traditional methods; and that it has the potential to produce coal to gas for well beyond 50 years, providing one of the world's cleanest fuel sources. All of such statements should be disregarded.
It has also been brought to the Company's attention that NI43-101 compliant reports should have been provided with respect to the Tulita and Ellesmere Island properties in support of the Company's Annual Information Form (AIF) due to the materiality of the properties. The Company is preparing a revised AIF and is preparing NI43-101 compliant reports on the Tulita and Ellesmere Island properties, which it anticipates will be filed within the next 45 days. Weir International, Inc. ("Weir") has been contracted to prepare a report on the Tulita property, and has dispatched a geologist to the site to perform a site visit which will be incorporated in the report. While conditions do not allow for a site visit to Ellesmere Island at this time, the Company has also contracted with an independent geologist to prepare a non-site-visit NI43-101 compliant report on this property.
Prior to the release of these reports on the Tulita and Ellesmere Island properties, the public should not rely upon the Company's previously disclosed historic estimates and resource figures on these properties as they are not NI43-101 compliant and should be disregarded.
The Company has also reported on certain properties in the past with wording that may not be clear to the public as to the current status of each property and the potential the Company foresees or has foreseen in each location. The Company now realizes that the use of language with respect to envisioned potential was inappropriate and premature and may have been misleading.
The Company would also like to clarify releases concerning some of the properties the Company has owned and reported on in the past, specifically the Australian Creek, the Coal Creek and the Sustut coal properties, which the Company dropped in September 2006.
The Company reached a decision not to proceed with these three projects for the following reasons:
The Company has also not provided an update on the status of the drilling program planned for the spring/summer of 2006 on the Groundhog property. While the Company was in the midst of trying to negotiate a bypass to a First Nations blockade, a decision was made to not release information in respect of the ongoing access negotiations. The Company has been made aware that a news release concerning the delay should have been disclosed at that time. Going forward, the current status of the Groundhog drill program for 2006 is that it is currently suspended, with equipment on standby. A news release will be issued once the Company has made a decision to carry forward with a limited winter program, or to delay access until a spring/summer 2007 program is more practical.
The Company announced a Memorandum of Understanding with Lu'An Mining Group Corporation of Shanxi Province, the Peoples Republic of China on May 11, 2006 concerning potential future joint development of IGCC electrical plants and Coal-to-Liquids plants. While discussions concerning future endeavors with Lu'An continue, there have been no material steps taken towards financing, development or construction of any facilities at this time, nor is it guaranteed that discussions and agreements will ultimately lead to the construction of any facilities.
While the Company has in good faith entered into agreements to obtain properties which the Company feels warrant further exploration, there are always risks involved in exploring and developing any properties. The Company cannot provide guarantees that any further exploration will result in the proving of reserves sufficient to justify further development, nor can the Company guarantee that any further development would be economically justified, nor are there any guarantees that the Company would be able to secure the necessary capital or permits to further development on any of its properties.
For further information concerning this release, please contact the Company.
On behalf of the Board of Directors,
THE TSX VENTURE EXCHANGE HAS NOT YET REVIEWED AND DOES NOT TAKE RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS NEWS RELEASE.
About the Company: West Hawk Development Corp. is focused on providing valuable, high-demand energy products from a variety of sources. Assets include the 500 billion cubic feet (as per NI51-101 report) Figure Four natural gas property located in the Piceance Basin, Colorado, being developed under a drilling and development agreement with EnCana Oil & Gas (USA) Inc.; the Tulita coal property in the Northwest Territories; the Groundhog coal property located in northwest British Columbia; and the Ellesmere Island, Nunavut Territory coal property.
Cautionary note: This report contains forward looking statements, particularly those regarding cash flow, capital expenditures and investment plans. Resource estimates, unless specifically noted, are considered speculative. The company has filed a National Instrument 51-101 Report on the Figure Four property. Any and all other resource or reserve estimates are historical in nature, and should not be relied upon. By their nature, forward looking statements involve risk and uncertainties because they relate to events and depend on factors that will or may occur in the future. Actual results may vary depending upon exploration activities, industry production, commodity demand and pricing, currency exchange rates, and, but not limited to, general economic factors. Cautionary Note to US investors: The U.S. Securities and Exchange Commission specifically prohibits the use of certain terms, such as "reserves" unless such figures are based upon actual production or formation tests and can be shown to be economically and legally producible under existing economic and operating conditions.
The Company has in the past disclosed speculative and hypothetical coal resource figures on its Groundhog, Tulita and Ellesmere Island coal properties. The category of speculative or hypothetical resources does not exist under NI43-101 reporting guidelines. The Company recognizes that the use of, or reference to, such terms is not considered suitable for public disclosure as they do not meet minimum standards for resource reporting. The Company recognizes the use of such figures may be misleading to the public as they do not comply with current reporting standards and are not compliant with NI43-101 reporting guidelines. Therefore, the Company wishes to retract any and all reference to speculative or hypothetical coal resource figures or any other resource or reserve figures on any of the Company's coal properties at this time.
The Company has not demonstrated the economic viability of the inferred resources on the Groundhog property or the historical estimates on the Tulita and Ellesmere Island properties. The historic results cannot be verified at this time by technical reports and therefore do not comply with minimum standards for reporting inferred resources. The Company did file a report on the Groundhog property, which it referred to as NI43-101 compliant. This report is deficient as it contained references to a speculative coal resource, contrary to NI43-101 standards, and was not prepared according to Form 43-101F1. Therefore, the Company wishes to clarify that the previously filed report on the Groundhog property should be disregarded in its entirety and is withdrawn. The Company is preparing a revised technical report in accordance with Form 43-101F1 in support of previously disclosed resource figures in the inferred category. The Company is also preparing technical reports in accordance with NI43-101 reporting standards on the Tulita and Ellesmere Island properties. Until such time as the aforementioned reports are filed, any and all reference to speculative or hypothetical resource figures or any other resource or reserve figures should be disregarded.
Further, the Company has used terms such as "world class" in reference to some of the Company's coal properties. The Company recognizes the use of such terms is overly promotional, is not suitable for public disclosure, and that no such category exists under NI43-101 reporting guidelines. Therefore, the Company wishes to retract any and all reference to such terms.
The Company has also made reference to a historic pre-feasibility study in describing the Tulita coal property. The Company recognizes that those terms and references are with respect to historic, non-NI43-101 compliant reports and therefore do not demonstrate the economic viability of the property. The Company wishes to make it clear that any and all reference to such terms or study should be disregarded.
The Company has also made reference to the future preparation of feasibility and pre-feasibility studies with respect to some of its properties. The Company has not yet established measured and indicated coal resources to justify proceeding with these studies. Accordingly, the use of such terms is premature and may be misleading. Therefore, the Company wishes to clarify that until such time as resources are established to justify the completion of such reports, reference to either feasibility or pre-feasibility studies should be ignored and are withdrawn.
The Company has also made reference to potential development of coal gasification plants with respect to some of its current properties, with Lu'An Mining Group of China, and with properties that the Company held at one time. The Company wishes to retract any reference to such potential developments as they may be misleading to the public until such time as sufficient resources are established, economic viability is confirmed and the necessary permitting and financing is obtained. These projects are in the conceptual stages only. The Company does not yet have coal resources or reserves that support this type of development. There is no guarantee that the Company will be able to establish sufficient coal resources or reserves to support this development. The Company has not completed a feasibility study to support the economic and technical viability of building and operating a coal gasification plant. Studies to date are preliminary in nature and the Company's projects are not yet at a stage where the Company can complete a feasibility study or meaningful economic analysis. There is no guarantee that the Company will ever be able to establish the economic viability of a coal gasification plant on any of its projects.
The Company would also like to retract unsubstantiated statements it has made in its public disclosure that suggest coal to gas production will be: low cost and price competitive in the global market for seaborne coal; cost competitive from a capital and O&M (Operating and Maintenance) basis; 5%-10% more efficient than traditional methods; and that it has the potential to produce coal to gas for well beyond 50 years, providing one of the world's cleanest fuel sources. All of such statements should be disregarded.
It has also been brought to the Company's attention that NI43-101 compliant reports should have been provided with respect to the Tulita and Ellesmere Island properties in support of the Company's Annual Information Form (AIF) due to the materiality of the properties. The Company is preparing a revised AIF and is preparing NI43-101 compliant reports on the Tulita and Ellesmere Island properties, which it anticipates will be filed within the next 45 days. Weir International, Inc. ("Weir") has been contracted to prepare a report on the Tulita property, and has dispatched a geologist to the site to perform a site visit which will be incorporated in the report. While conditions do not allow for a site visit to Ellesmere Island at this time, the Company has also contracted with an independent geologist to prepare a non-site-visit NI43-101 compliant report on this property.
Prior to the release of these reports on the Tulita and Ellesmere Island properties, the public should not rely upon the Company's previously disclosed historic estimates and resource figures on these properties as they are not NI43-101 compliant and should be disregarded.
The Company has also reported on certain properties in the past with wording that may not be clear to the public as to the current status of each property and the potential the Company foresees or has foreseen in each location. The Company now realizes that the use of language with respect to envisioned potential was inappropriate and premature and may have been misleading.
The Company would also like to clarify releases concerning some of the properties the Company has owned and reported on in the past, specifically the Australian Creek, the Coal Creek and the Sustut coal properties, which the Company dropped in September 2006.
The Company reached a decision not to proceed with these three projects for the following reasons:
- Upon extensive review of material for the Australian Creek project, the exploration potential was deemed not as large as was previously believed, and therefore would not justify the large expense necessary to build and operate an economically viable mine-mouth gasification facility;
- Upon extensive review of material, and review of data retrieved through the Company's winter/spring 2006 drilling performed on the Coal Creek project, it was determined that the exploration potential did not justify the expenses or efforts required to continue proceeding towards production of coal from this property;
- Upon extensive review of the historic material on the Sustut coal property, it was determined that the exploration potential combined with the necessary expense of developing such a property did not justify continued expenditure or efforts.
The Company has also not provided an update on the status of the drilling program planned for the spring/summer of 2006 on the Groundhog property. While the Company was in the midst of trying to negotiate a bypass to a First Nations blockade, a decision was made to not release information in respect of the ongoing access negotiations. The Company has been made aware that a news release concerning the delay should have been disclosed at that time. Going forward, the current status of the Groundhog drill program for 2006 is that it is currently suspended, with equipment on standby. A news release will be issued once the Company has made a decision to carry forward with a limited winter program, or to delay access until a spring/summer 2007 program is more practical.
The Company announced a Memorandum of Understanding with Lu'An Mining Group Corporation of Shanxi Province, the Peoples Republic of China on May 11, 2006 concerning potential future joint development of IGCC electrical plants and Coal-to-Liquids plants. While discussions concerning future endeavors with Lu'An continue, there have been no material steps taken towards financing, development or construction of any facilities at this time, nor is it guaranteed that discussions and agreements will ultimately lead to the construction of any facilities.
While the Company has in good faith entered into agreements to obtain properties which the Company feels warrant further exploration, there are always risks involved in exploring and developing any properties. The Company cannot provide guarantees that any further exploration will result in the proving of reserves sufficient to justify further development, nor can the Company guarantee that any further development would be economically justified, nor are there any guarantees that the Company would be able to secure the necessary capital or permits to further development on any of its properties.
For further information concerning this release, please contact the Company.
On behalf of the Board of Directors,
"Chris Verrico" "Mark Hart"
Chris Verrico, Co-Chairma Dr. Mark Hart, Co-Chairman
THE TSX VENTURE EXCHANGE HAS NOT YET REVIEWED AND DOES NOT TAKE RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS NEWS RELEASE.
About the Company: West Hawk Development Corp. is focused on providing valuable, high-demand energy products from a variety of sources. Assets include the 500 billion cubic feet (as per NI51-101 report) Figure Four natural gas property located in the Piceance Basin, Colorado, being developed under a drilling and development agreement with EnCana Oil & Gas (USA) Inc.; the Tulita coal property in the Northwest Territories; the Groundhog coal property located in northwest British Columbia; and the Ellesmere Island, Nunavut Territory coal property.
Cautionary note: This report contains forward looking statements, particularly those regarding cash flow, capital expenditures and investment plans. Resource estimates, unless specifically noted, are considered speculative. The company has filed a National Instrument 51-101 Report on the Figure Four property. Any and all other resource or reserve estimates are historical in nature, and should not be relied upon. By their nature, forward looking statements involve risk and uncertainties because they relate to events and depend on factors that will or may occur in the future. Actual results may vary depending upon exploration activities, industry production, commodity demand and pricing, currency exchange rates, and, but not limited to, general economic factors. Cautionary Note to US investors: The U.S. Securities and Exchange Commission specifically prohibits the use of certain terms, such as "reserves" unless such figures are based upon actual production or formation tests and can be shown to be economically and legally producible under existing economic and operating conditions.
Contacts
North America
West Hawk Development, 303-524-1424
Email: news@westhawkdevelopment.com

