Stans Energy Corp. (TSX-V: HRE, OTCQX: HREEF), (“Stans” or the “Company”), announces that it has made an application to the Ontario Securities Commission to approve a temporary management cease trade order (“MCTO”) under National Policy 12-203 Cease Trade Orders for Continuous Disclosure Defaults (“NP 12-203″), which, if granted, will prohibit trading in securities of the Corporation by certain insiders of the Corporation, whether direct or indirect.
The Company is unable to file its 2013 unaudited interim financial statements for the quarter ended September 30, 2013, management discussion and analysis (MD&A) relating to the unaudited interim financial statements, and CEO and CFO certificates relating to the unaudited interim financial statements, as required by National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings (collectively, the “Required Filings”) by the November 29, 2013 filing deadline.
The reason for the delay is that the Company is considering impairment charges against its assets and needs more time to determine the appropriate impairment for inclusion in our financial reporting.
IFRS 6 Exploration for and Evaluation of Mineral Resources requires entities recognizing exploration and evaluation assets to perform an impairment test on those assets when facts and circumstances suggest that the carrying amount of the assets may exceed their recoverable amount. Entities shall measure the impairment in accordance with IAS 36 Impairment of Assets once it is identified.
On October 31, 2013, Stans announced that it had filed an international arbitration action against the Government of Kyrgyzstan for its expropriatory and unlawful treatment of the issuer in relation to the issuer’s Kutessay II rate earth project. Stans has complained that state action and inaction has unduly delayed, prohibited and prevented it from completing necessary pre-feasibility, feasibility, and other development work at Kutessay II, and generally has resulted in the issuer being deprived of the value of its asset. This arbitration does not strictly relate to state action or inaction with respect to the issuer’s other properties, but there are dependencies which need review and analysis. We also observe that our stock market capitalization has fallen below the carrying amount of our assets.
Consideration of impairment necessarily follows. The necessary work to determine the scope and amount of impairment is underway but is not complete.
The Company anticipates that it will be in a position to remedy the default by filing the Required Filings by January 28, 2013. The MCTO will be in effect until the Required Filings are filed.
The Company confirms that it intends to satisfy the provisions of the alternative information guidelines set out in section 4.3 and 4.5 of NP12-203 so long as it remains in default of filing the required filings.
There are no insolvency proceedings to which the Company is subject.
There is no material information concerning the affairs of the Company which has not been generally disclosed.
About Stans Energy
Stans Energy Corp. is a resource development company focused on advancing Heavy Rare Earth (HRE) properties in areas of Central Asia and Russia. In December 2009, Stans acquired a 20-year mining license for the past-producing Kutessay II rare earth mine from the Kyrgyz Republic. On May 26, 2011 Stans completed the purchase of the Kashka Rare Earth Processing Plant (KRP) the same plant that previously refined REEs from Kutessay II ores. The KRP was the only hard rock plant toproduce all rare earth elements outside of China, producing 120 different metals, alloys, and oxides. For over 30 years, Kutessay II produced 80% of the rare earth metals for the Former Soviet Union.
We seek safe harbour.
Interim President & CEO
VP Corporate Development
FORWARD LOOKING STATEMENTS: This document includes forward-looking statements as well as historical information. Forward-looking statements include, but are not limited to, use of proceeds from the Offering, the completion of the Offering, the continued advancement of the company’s general business development, research development and the company’s development of mineral exploration projects. When used in this press release , the words “will”, “shall”, “anticipate”, “believe”, “estimate”, “expect”, “intent”, “may”, “project”, “plan”, “should” and similar expressions may identify forward-looking statements. Although Stans Energy Corp. believes that their expectations reflected in these forward looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statement. Important factors that could cause actual results to differ from these forward-looking statements include the potential that fluctuations in the marketplace for the sale of minerals, the inability to implement corporate strategies, the ability to obtain financing and other risks disclosed in our filings made with Canadian Securities Regulators.
The State Prosecutors Office of the Kyrgyz Republic’s court action to invalidate the license issuance for the development of Kutessay II for Kutisay Mining LLC is still before the courts. Stans Energy hopes to be able to provide an update within this quarter on the status of the case.