Pacific Coal Resources Ltd announced an illegal work stoppage at their La Caypa Mine located in the municipality of Barrancas, Department of La Guajira, Colombia.
The personnel involved in this action are not employees of Pacific Coal, nor its subsidiary Carbones Colombianos del Cerrejon. The disruption began on Sunday, January 22 at 0600 hours when unauthorized personnel blocked all access to the mine using heavy mining equipment. The striking workers belong to Gente Caribe and Gente Estrategica, a personnel provider to mining contractor Obras Proyectos Minera SA ("OPM"), who is contracted by the Company to provide coal extraction and overburden removal services at La Caypa.

Allegations by personnel involved are in respect a dispute involving their Union, OPM and the personnel providers which, at present, are under review by the labour courts at Riohacha, Guajira. CCC and Pacific Coal are not a part of these proceedings.

The Company views the actions of retaining private property (mining equipment and infrastructure), occupation of private premises and blocking the mine as illegal. On Monday, January 23, the Company requested the local authority, the Mayor of the Barrancas Municipality, to uphold the Company's rights over its equipment and premises and order the striking personnel to vacate the premises and return all equipment.

Mr Luis Carvajales CEO of Pacific Coal said that "Pacific Coal places a high value on providing a safe and positive working environment. While this dispute does not involve our Company or subsidiaries, we are taking all of the steps necessary to ensure this situation is resolved as soon as possible so that normal operations can resume expediently. We are currently liaising with local and regional authorities with the aim of ensuring the safety of our employees, that the law is enforced with respect to our contracted operations, and that our property rights are protected and upheld."

The estimated loss of production to date due to this disruption is approximately 75,000 tonnes of coal. However, the current production increases at the Company's Cerro Largo mine has been instrumental in helping the Company alleviate this issue. The Company has two ships scheduled to uplift a total of 130,000 tonnes of coal by February 5, 2012. These 130,000 tonnes are comprised of coal from the port stockpile and production from its Cerro Largo mine.