Kainantu Resources Provides Update on May River Project Acquisition
Kainantu Resources Provides Update on May
River Project Acquisition
VANCOUVER, BC
,
Sept. 21, 2021
/CNW/ - Kainantu Resources Ltd. (TSXV: KRL) (FSE: 6J0)
("KRL" or the "Company"), the
Asia-Pacific
focused gold mining company provides an update on
completion steps to acquire control of the May River Project ("Acquisitions") in the world-renowned
copper-gold district of
Frieda River
,
Papua New Guinea
("PNG").
Background
In a
press release
dated
June 15, 2021
("June Release"), KRL announced the execution of two
definitive agreements to acquire control of the May River Project ("Project") through the acquisition
of two unrelated holding companies: Hardrock Limited ("Hardrock") and Niuminco Group Limited
("Niuminco"). On closing of the definitive agreements, KRL would consolidate three adjoining
tenements, as detailed in Figure 1.
Figure 1: May River Project Tenements
Exploration
Licence/Name
Size
Current Holder
Prospects/Anomalous Areas
EL2603 - May River
331 km²
Hardrock
Skiraisa, Foya, Mountain Gate
EL2623 - Hotmin
1272 km²
Hardrock
Various Au-Cu drainage anomalies
EL2527 - Iku Hill
94 km²
Niuminco (ND) Ltd.
Iku Hill
The three tenements were previously contained in one licence: EL1441 (under control of Niuminco (ND) Ltd., before being separated into different holdings and owners in
2018/2019).
All tenements are highly prospective for copper and gold and are located in close proximity to the
world-renowned Frieda River Copper-Gold Project, with the district known for both porphyry and
high-sulphidation epithermal styles of mineralisation trending along the Fiak Fault.
In relation to EL2603 (being the tenement subject to a definitive agreement with Hardrock), the key
prospects of Skiraisa, Foya, Eserebe and Mountain Gate are situated along a 7 km long N-NW
trending structural corridor; exhibiting many attributes similar to the extended mineralised system
identified at the Frieda River Copper-Gold Project (located 10 km to 15 km to the east).
Update on closing of the Acquisitions
The following provides an update on progress toward closing of the definitive agreements, with
reference to the June Release for further particulars on the commercial terms agreed separately
with Hardrock and Niuminco.
Definitive Agreement with Hardrock
As agreed under the definitive option agreement between KRL, Hardrock and its shareholders, KRL
has an option to acquire Hardrock by way of a series of option arrangements.
As an initial step, KRL agreed, at its expense, to complete a field study and sampling programme at
May River ("Study") to increase confidence and understanding of the Project. On completion of the
Study, KRL has a right to exercise a first option to acquire a 10% equity interest in Hardrock (for no
further consideration beyond the "in-kind" expenditure incurred to complete the Study).
In collaboration with Hardrock, KRL reports positive progress towards completion of the Study and
is encouraged by initial trends that have emerged. KRL expects to finalise the Study within the
coming weeks and will provide a further update in the near future.
Definitive Agreement with Niuminco
As detailed in the June Release, KRL entered into a definitive agreement with Niuminco and its
related entities ("Niuminco Agreement") to indirectly acquire EL2527 and historic data in respect of
the Project.
Under the Niuminco Agreement, a key condition precedent to closing remains confirmation to KRL's
satisfaction as to the "good standing" of EL2527 (with Niuminco responsible for maintaining the
currency of such tenement). In this regard, Niuminco has advised KRL that the PNG Minister for
Mining has not consented to Niuminco's request for an extension of EL2527. Niuminco further
advises that it has commenced steps to review this decision; and that EL2527 remains on foot
pending a further determination.
The Niuminco Agreement has a sunset date of
October 31, 2021
(or such further date as KRL may
agree at its absolute discretion) for closing and satisfaction of conditions precedent (with Niuminco
advising that it expects a resolution prior to this time on securing an extension of EL2527). KRL will
continue to monitor any developments and provide a further update in due course.
Qualified Person
The scientific and technical information disclosed in this release has been reviewed and approved by
Graeme Fleming
, B. App. Sc., MAIG, an independent "qualified person" as defined under National
Instrument 43-101,
Standards of Disclosure for Mineral Projects
.
About KRL
KRL is an
Asia-Pacific
focused gold mining company with two highly prospective gold projects, KRL
South and KRL North, in a premier mining region, the high-grade Kainantu Gold District of PNG. Both
of KRL's projects show potential to host high-grade epithermal and porphyry mineralisation, as seen
elsewhere in the district. KRL has a highly experienced board and management team with a proven
track record of working together in the region; and an established in-country partner.
For further information please visit
https://kainanturesources.com/
Disclaimer and Forward-Looking Information
Mineralization hosted on adjacent and/or nearby
properties is not necessarily indicative of mineralization hosted on the Company's property. The
data disclosed in this release relating to drilling results is historical in nature. Neither the Company
nor a qualified person has yet verified this data and therefore investors should not place undue
reliance on such data, and no representation or warranty, express or implied, is made by the
Company, its affiliated companies, or any other person as to its fairness, accuracy, completeness,
or correctness.
This release contains forward-looking statements, which relate to future events or
future performance and reflect management's current expectations and assumptions. Such
forward-looking statements reflect management's current beliefs and are based on assumptions
made by and information currently available to the Company. All statements, other than statements
of historical fact, are forward-looking statements or information. Forward-looking statements or
information in this news release relate to, among other things: expectations regarding completion
of the Acquisitions, including timing, the results of the Study and further exploration activities on
the Project, the valuation of Hardrock, receipt of necessary regulatory approvals and the
formulation of plans for drill testing; and the success related to any future exploration or
development programs. These forward-looking statements and information reflect the Company's
current views with respect to future events and are necessarily based upon a number of
assumptions that, while considered reasonable by the Company, are inherently subject to
significant operational, business, economic and regulatory uncertainties and contingencies. These
assumptions include; success of the Company's projects; prices for gold remaining as estimated;
currency exchange rates remaining as estimated; availability of funds for the Company's projects;
capital, decommissioning and reclamation estimates; prices for energy inputs, labour, materials,
supplies and services (including transportation); no labour-related disruptions; no unplanned
delays or interruptions in scheduled construction and production; all necessary permits, licenses
and regulatory approvals are received in a timely manner; and the ability to comply with
environmental, health and safety laws. The foregoing list of assumptions is not exhaustive. The
Company cautions the reader that forward-looking statements and information involve known and
unknown risks, uncertainties and other factors that may cause actual results and developments to
differ materially from those expressed or implied by such forward-looking statements or
information contained in this news release and the Company has made assumptions and estimates
based on or related to many of these factors. Such factors include, without limitation: fluctuations
in gold prices; fluctuations in prices for energy inputs, labour, materials, supplies and services
(including transportation); fluctuations in currency markets (such as the Canadian dollar versus the
U.S. dollar); operational risks and hazards inherent with the business of mineral exploration;
inadequate insurance, or inability to obtain insurance, to cover these risks and hazards; our ability
to obtain all necessary permits, licenses and regulatory approvals in a timely manner; changes in
laws, regulations and government practices, including environmental, export and import laws and
regulations; legal restrictions relating to mineral exploration; increased competition in the mining
industry for equipment and qualified personnel; the availability of additional capital; title matters
and the additional risks identified in our filings with Canadian securities regulators on SEDAR in
Canada
(available at
www.sedar.com
). Although the Company has attempted to identify important
factors that could cause actual results to differ materially, there may be other factors that cause
results not to be as anticipated, estimated, described, or intended. Investors are cautioned against
undue reliance on forward-looking statements or information. These forward-looking statements
are made as of the date hereof and, except as required under applicable securities legislation, the
Company does not assume any obligation to update or revise them to reflect new events or
circumstances.
Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of
the TSX-V) accepts responsibility for the adequacy or accuracy of this release.
SOURCE
Kainantu Resources Ltd.
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http://www.newswire.ca/en/releases/archive/September2021/21/c2888.html
%SEDAR: 00046178E
For further information:
Enquiries: Kainantu Resources, Matthew Salthouse, Chief Executive
Officer (Tel: + 65 8318 8125), Callum Jones, Corporate Development Co-ordinator (Tel: + 61 450
969 697), Email: [email protected]
CO: Kainantu Resources Ltd.
CNW 12:26e 21-SEP-21