Kenorland Minerals options O’Sullivan to Sumitomo

Dec 15, 2022

2022-12-15 12:53 ET – News Release

Mr. Zach Flood reports

KENORLAND MINERALS OPTIONS THE O’SULLIVAN PROJECT TO SUMITOMO METAL MINING CANADA LTD.

Kenorland Minerals Ltd. has entered into a property option agreement with Sumitomo Metal Mining Canada Ltd. (SMMCL), a wholly owned subsidiary of Sumitomo Metal Mining Co. Ltd., pursuant to which the company has agreed to grant to SMMCL the option to acquire up to a 70-per-cent interest in the O’Sullivan project, located within the Abitibi greenstone belt of Northern Quebec.

Option agreement

Pursuant to the option agreement, SMMCL can earn an initial 51-per-cent interest in the project by incurring an aggregate of $4.9-million in mineral exploration expenditures on or before the third anniversary of the option agreement (of which $1.2-million are guaranteed expenditures within the first three years). Kenorland will act as operator of the project in return for a management fee equal to 15 per cent of the total expenditures during the first earn-in period.

Following the earning of a 51-per-cent interest, SMMCL has the option to earn an additional 19 per cent (for a total of 70-per-cent interest), by delivering a National Instrument 43-101-compliant feasibility study on the project disclosing mineral resources in the measured and indicated categories of not less than 1.5 million ounces of gold (or gold equivalent) within an additional seven years. Once SMMCL has earned a 70-per-cent interest, Kenorland will have the option to forego a minority joint venture interest and immediately vest a net smelter return royalty interest of 4 per cent on the property. In the event of joint venture participation, any party which dilutes to below a 10-per-cent interest will exchange its joint venture interest for a net smelter return royalty of 3 per cent (subject to a 1-per-cent buyback for $1-million).

About the O’Sullivan project

The O’Sullivan project covers 27,595 hectares of mineral tenure within the Abitibi greenstone belt (AGB) along the Casa Berardi deformation zone (CBDZ). The CBDZ is one of the primary structures that controls orogenic gold mineralization in the belt and hosts the active Casa Berardi mine that has produced over 1.9 million ounces of gold since 1988, with recent proven and probable reserves of 1.7 million ounces (Dec. 31, 2019). Other major deposits along the CBDZ include the Douay gold deposit (2.35 million oz Au inferred and 422,000 oz Au indicated) as well as the Nelligan gold deposit, having a 3.2-million-ounce inferred resource (Oct. 22, 2019). The O’Sullivan project covers approximately 15 kilometres of strike length along the southern margin of the CBDZ where the deformation zone intersects volcanic rocks of the Stoughton-Roquemaure and Kidd-Munro assemblages.

Since acquiring the project through map staking in 2020, Kenorland has completed two phases of regional till sampling across the project. An initial 1,300-sample first-pass till program completed in 2020 covered the property at one km line spacing and 200-metre station spacing. Anomalous gold in till was identified in several locations across the property. An airborne lidar survey covering 245 square km of the property was also flown, followed by a surficial geological interpretation and ground truthing to aid in further targeting. Six target areas with anomalous results were identified for a follow-up sampling program in 2021 consisting of 500 samples at 100 m to 200 m line spacing and 100 m to 200 m station spacing. This sampling confirmed the anomalous Au in till and defined the anomalous till dispersion trains.

The systematic work performed by Kenorland demonstrates the potential of the O’Sullivan project to host gold mineralization, and the successive surveys have vectored toward favourable geological settings. Coherent gold-in-till anomalism along the northern shore of Lac Pusticamica (Pusticamica North) is coincident with strong deformation and a major felsic intrusive-volcanic contact. The dispersion train is open beneath the lake. A follow-up program of drone-based magnetic (MAG), time-domain electromagnetics (TDEM) and induced polarization (IP) geophysics is planned for the first quarter of 2023 designed to cover the deformation zone at the interpreted head of the anomalous till.

About Kenorland Minerals Ltd.

Kenorland Minerals is a mineral exploration company incorporated under the laws of the Province of British Columbia and based in Vancouver, B.C., Canada. Kenorland’s focus is early- to advanced-stage exploration in North America. The company currently holds five projects in Quebec where work is being completed under joint venture and earn-in agreement from third parties. The Frotet project and Chicobi project are held under joint venture with Sumitomo, the O’Sullivan project is optioned to Sumitomo, the Chebistuan project is optioned to Newmont Corp., and the Hunter project is held under option to Centerra Gold Inc. In Ontario, the company holds the South Uchi project under an earn-in agreement with a wholly owned subsidiary of Barrick Gold Corp. In Alaska, the company holds the advanced-stage Tanacross porphyry copper-gold-molybdenum project, optioned to Antofagasta, as well as a 70-per-cent interest in the Healy project, held under joint venture with Newmont.

We seek Safe Harbor.

https://www.kenorlandminerals.com/