|January 13, 2009|
Crowflight Implements Additional Metal and Foreign Exchange Price Protection
|CROWFLIGHT MINERALS INC. (the "Company") (TSX: CML) is pleased to announce that it has entered into additional forward sales contract agreements to further its risk management strategy to manage commodity price exposure on nickel sales and foreign exchange rates.|
Forward sale contracts were entered into for the first and second quarters of 2009 for a total of 700,000 pounds of nickel at a price of US$5.32 per pound. In addition, the Canadian dollar was hedged on these quantities. Details are as follows:
• Q1 2009 - 0.25 million pounds Nickel, with the Canadian dollar hedged at 1.1965
• Q2 2009 - 0.45 million pounds Nickel, with the Canadian dollar hedged at 1.1956
As per the press releases dated July 30 and October 28, 2008, Crowflight previously implemented nickel forward sale contract agreements of 2.27 million pounds of nickel at US$8.49 per pound for 2009.
In summary, the current weighted average hedging position for Crowflight is as follows:
Crowflight now has in total 2.97 million pounds of nickel hedged for 2009 at an average realized price of US$7.74 per pound nickel or Cdn$9.21 per pound nickel, which represents approximately 30% of planned 2009 production.
The forward sales contracts are considered derivative financial instruments and are used for risk management purposes and not for generating trading profits. Crowflight in conjunction with RMB may also implement future strategic currency and nickel hedges both to protect Crowflight cash flow and meet Lender requirements.
Commented Mike Hoffman, President and CEO of Crowflight, "Given the wide fluctuations we've seen over the last few months in metal prices, we felt it was prudent to lock in an additional portion of our 2009 production at the higher nickel prices experienced last week, while leaving room for us to benefit from any potential upside should nickel see any future price increases. We feel these measures provide the Company with further assurance of generating cash from Bucko in 2009, thereby putting us in a stronger position as we ramp up to full commercial production."
Production of nickel concentrate has begun at Bucko, with the first concentrate being produced in December 2008. Work is on-going to achieve full commercial production and preparations are being made for the first shipment of concentrate from Canada's newest nickel mine.
Crowflight Minerals -- Canada's Next Nickel Producer
Crowflight Minerals Inc. (TSX: CML) is a Canadian junior mining company that is producing nickel at the Bucko Lake Nickel Mine near Wabowden, Manitoba. Full commercial production is expected to be achieved at Bucko in early 2009. The Company is also focused on nickel, copper and Platinum Group Mineral (PGM) projects in the Thompson Nickel Belt and Sudbury Basin.
Cautionary Note on Forward-Looking Information
Except for statements of historical fact contained herein, the information in this press release constitutes "forward-looking information" within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as "plans", "proposes", "estimates", "intends", "expects", "believes", "may", "will" and include without limitation, statements regarding the terms of the hedging contract; impact of the hedge contract on the Company; production plans; costs of production; and metal prices and foreign exchange rates. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others, third party risks, production risks, metal prices, competition, risks inherent in the mining industry, and regulatory risks. Most of these factors are outside the control of the Company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the Company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.
The TSX does not accept responsibility for the adequacy or accuracy of this release.
Further information is available on the Company's website at www.crowflight.com or contact:
President and CEO
Tel: (416) 861-2964
Manager, Investor and Public Relations
Tel: (416) 861-5803
You can view the Next News Release item: Thu Jan 22, 2009, Crowflight Intersects 9.56 Metres Of 7.87% Nickel; Commences Phase 2 Delineation Program At Bucko
You can view the Previous News Release item: Wed Dec 31, 2008, Crowflight Amends Terms of Warrants in Connection with Debt Facility Restructuring
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