Kenadyr Mining (Holdings) Corp. (the "Corporation" or "Kenadyr") is pleased to announce it has finalized a drill contract with Quest Exploration Drilling ("QED").
Kenadyr is in a strong position to embark on this upcoming program, having a strong balance sheet, no debt nor significant payments owing, a strong institutional shareholder base and a management team with extensive in-country operational experience, and merger and acquisition expertise.
QED and its predecessor company have a 30 year history and QED has grown their business to be an industry leader in the provision of drilling services to varied clients. QED's services includes diamond drilling, reverse circulation (RC) drilling, RC grade control, geothermal, geotechnical drilling, water boring and slope stability solutions. QED acts as a drill contractor for multiple public and private companies around the world including major, mid-tier and exploration focused companies.
Drilling is expected to commence within the next 90 days and the updated contract with QED reflects a focus on high impact areas of the project. The drill program will include both core drilling and reverse circulation drilling. A focus of the initial drill program is to establish correlation between extensive previous historical Soviet drilling and modern drilling. Drilling at the Borubai project has the potential to increase both the size, and the grade, of the mineralization (from historic numbers) as a result of increased core recovery and modern drilling and assaying (Fire Assay versus ICP analysis) techniques. Core recovery during Soviet drilling averaged only 60%.
In addition to initial drilling in the high priority South Zone, an area of mineralization directly adjacent to the Zijin Mining Group Co Ltd.'s ("Zijin") Taldy-Bulak Levoberejny ("TBL") mine, Kenadyr will undertake drilling, bull dozer trenching and sampling cuts on the SS Zone and SS Trend. As well as drilling, the Corporation intends to take approximately 1,250 channel samples and 2,200 soil geochemistry samples in this area.
Dr. Alexander Becker, Kenadyr Chief Executive Officer, states, "The underlying geology within this belt is conducive to large size and high grade. Based on this, the strategic location and the immense amount of historical investment in drilling to guide us, we are enthusiastic about the start of this work program. Kenadyr will seek to confirm and enhance past historical estimates of both size and grade."
Kenadyr's Bourbai project comprises a 100-per-cent-owned exploration licence covering a contiguous 164-square-kilometre land package that encircles the Zigin/Kyrgyz/Altyn newly constructed and operational TBL mine, which was built at a cost of $296-million (U.S.), in northern Kyrgyz Republic.
Zijin, the majority owner of the TBL mine, is one of China's largest gold producers, second-largest copper and zinc producer, as well as a major producer of tungsten and iron ore. In 2015, Zijin's sales revenue and net profit attributable to the parent company reached $11.44-billion (U.S.) and $255-million (U.S.), respectively, ranking first and second, respectively, among 14 major global public gold miners (source: Zijin website). According to a news release published by Zijin. on Aug. 15, 2011, the national resources table of Kyrgyz Republic stated that the TBL field contains (C1 plus C2) 8,906,100 tonnes of gold ore (the average grade is 7.23 grams per tonne) and the gold metal volume is 64,420.5 kilograms, among which the C1 grade (initial mining reserve) is 4,949,754 tonnes of gold ore (the average grade is 7.02 grams per tonne) and the gold metal volume is 34,754.6 kilograms. The TBL mine is designed to produce 125,000 ounces of gold per annum. The TBL mine deposit is directly adjacent to Kenadyr's initial drill target, the South Zone, which was previously drilled by the Soviets, with drilling on the Bourubai License exceeding 98,000 meters.
Readers are cautioned that the resource and reserve estimates relating to the TBL mine do not extend to the Borubai project. Kenadyr has not independently verified the information with respect to the TBL mine provided in this news release and it is not necessarily indicative of the mineralization on the Borubai project. A qualified person has not done sufficient work to classify the historical estimates on the TBL mine as current mineral resources or mineral reserves, and Kenadyr is not aware of the resource and reserve categories, or the key assumptions, parameters and methods used to prepare the historical estimates on the TBL mine. Kenadyr is not treating the historical estimates on the TBL mine as current mineral resources or mineral reserves as defined in National Instrument 43-101. While Kenadyr considers the historical estimates on the TBL mine disclosed in this news release to be relevant to investors, Kenadyr cautions readers that they should not be unduly relied upon in drawing inferences on the mineralization on the Borubai project.
Kenadyr's Borubai project, which surrounds the TBL mine, has been the subject of extensive historic exploration including drilling (98,200 metres in 184 diamond drill holes), trenching (13,800 cumulative metres), bulldozer cuts (33,400 cumulative metres), geologic mapping at 1:25,000 and 1:50,000 scales, ridge, spur and grid soil geochemistry for multi-elements (14,200 samples), rock geochemical sampling (2,320 samples), pan concentrate sampling (790 samples), 100 metres of adits, and 184 metres of underground raises. Additionally, the entire area has been subject to airborne magnetic, radiometric and gravity surveys, as well as ground-based resistivity and induced polarization surveys. Additional high grade gold targets exist throughout the Borubai license. The entire license has been subject to extensive geochemical and geophysical surveys, with follow up trenching and drilling on only a few of the identified anomalies.
Additional information in respect of the Corporation's business and the Borubai project is available in the Corporation's filing statement dated February 27, 2017, available under the Corporation's profile on SEDAR.
Kenadyr has an expert team of mine developers with considerable local and regulatory knowledge, led by Chief Executive Officer Dr. Alex Becker, who has operated successfully in the country for much of the past 20 years. The board and management team includes; R. Stuart (Tookie) Angus (Chairman), Alexander Becker (Chief Executive Officer), Bryan Slusarchuk (President), Douglas J. Kirwin (Director), Brian Lueck (Director) and Kevin Ma (Chief Financial Officer). Mark Eaton will act as an adviser to the Corporation.
Kenadyr has 83,947,623 common shares issued along with common share purchase warrants exercisable at various prices for an aggregate of 4,633,044 common shares. Additional to this, Kenadyr is also pleased to announce that the Corporation has retained Skanderbeg Capital Advisors Inc. (principals Carson Seabolt and Mario Vetro, of British Columbia, Canada) to provide investor relations services to the Corporation for an initial 12-month term at a rate of CAD $6,000 plus GST per month and 500,000 incentive stock options exercisable at a price of $0.80 cents for period of 5 years and vesting quarterly over the first 12 months following the grant. Investor relation services include communication with existing and prospective Kenadyr investors. Further, the Corporation has granted an additional 7,885,000 incentive stock options exercisable at a price of $0.80 cents for a period of 5 years to various directors, officers, employees and consultants of the Corporation, also subject to 20% vesting on the date of grant and 20% vesting each 6 months thereafter over a 5 year period from the date of grant.
Brian Lueck, P. Geo, a director of the Kenadyr and a qualified person as defined by National Instrument 43-101, has reviewed and approved the technical information in this news release.
On behalf of Kenadyr Mining (Holdings) Corp.
Dr. Alexander Becker
Chief Executive Officer and Director