IPR Inca Pacific Resources

Inca Pacific Resources Inc. (TSX VENTURE:IPR) ("Inca Pacific" or the "Company")
reports that the Company's subsidiary, Minera Ancash Cobre S.A. ("MACSA"), has
received confirmation from the arbitration panel as to a request by MACSA to
modify its original complaint with respect to the ongoing arbitration proceeding
over the Magistral Transfer Agreement. The Transfer Agreement governs the
privatization terms for 5 of the 26 concessions originally controlled by MACSA
that host the Magistral copper/molybdenum deposit.


Modified Complaint

MACSA's original complaint was comprised of six claims (refer to press release
dated October 26, 2010) including termination of the Transfer Agreement due to
serious breach of contract by Activos Mineros S.A.C. ("Activos Mineros") with
respect to its obligations under the Transfer Agreement (Fourth Claim), and
payment of US$195 million for the damages caused by the unilateral illegal
termination of the Transfer Agreement by Activos Mineros (Fifth Claim). Under
the modified complaint, MACSA has withdrawn the Fourth Claim and Fifth Claim,
and included a Seventh Claim whereby MACSA requests that the arbitration panel
orders Activos Mineros to pay MACSA approximately US$65 million for significant
damages caused by the delay originated by the unilateral illegal termination of
the Transfer Agreement by Activos Mineros. The arbitration panel has accepted
this modified demand, and Activos Mineros will have 20 business days to respond
to this modified demand.


While there are significant issues with the Transfer Agreement being reinstated,
the Company believes it is in the best interest of all its stakeholders to
request that the Transfer Agreement be reinstated and to reduce the amount of
damages. MACSA has invested $40 million into this Project, was committed to the
development of Magistral, and is committed to the goal today. Inca Pacific and
MACSA have worked extremely hard to find a resolution to the dispute so that the
development of Magistral could proceed. The Company has the resources to bring
capital and expertise to see that Magistral is developed. While significant
damage has been caused to MACSA and Inca Pacific, the Company is confident it
can find solutions with the government so Magistral can be brought into
production for the benefit of the Company, its shareholders, the communities and
Government of Peru. 


GOP Privatization Update

The Company continues to request that the Government of Peru cease the
privatization of the Magistral Deposit until the arbitration proceedings are
completed. This action by the Government of Peru to put the Magistral property
out for public tender while the arbitration proceedings are taking place suggest
that the government has little regard for the arbitration process. Currently,
the Government has extended the decision on this privatization effort until
March 18, 2011.


Community & Exploration Program

The Company continues with exploration plans to evaluate the 12,750 hectares of
mining concessions surrounding the five core claims subject to the dispute. Even
though the claims in dispute constitute the core of the known mineralization,
they represent less than 2% of the entire property area, which remains highly
prospective for a variety of mineralized systems. The Company has identified 12
priority targets of different mineralization style over its 100% owned mining
concessions. As part of this effort, the Company is working on two agreements
with the local communities of Conchucos and Pampas. As part of one of the
agreements, the Company may issue approximately 2 million common shares to the
communities. These shares would be held in escrow and released upon a commercial
deposit being brought into production over the property or a 10 year period. The
Company is also negotiating a cooperative agreement with the communities during
the exploration period. The Company and MACSA are looking for positive solutions
for the advancement of the Company's exploration portfolio as well as to resolve
the Magistral dispute and feel having the Communities as shareholders of Inca
Pacific is a positive step towards this effort. The possible share issuance
would be subject to the approval of the TSX Venture Exchange and applicable
regulatory authorities. 


About Inca Pacific 

Inca Pacific is a mineral exploration company with an experienced team dedicated
to preserving its rights and investment in the Magistral Project, seeing the
Magistral developed, and evaluating additional opportunities in the Magistral
district. 


INCA PACIFIC RESOURCES INC. 

Michael D. Winn, CEO & Director

Forward-Looking Statement - Some of the statements in this news release contain
forward-looking information that involves inherent risk and uncertainty
affecting the business of Inca Pacific Resources Inc. Actual results may differ
materially from those currently anticipated in such statements.

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