Kent Executes Gold Property Proposal with Teck Australia Pty Ltd
Kent Exploration Inc. announce that it has jointly executed with Teck Australia Pty Ltd (Teck), a proposal by the Company to earn 100% of Teck’s interest in the Gnaweeda Gold Project in the northern Murchison Province of Western Australia. Teck currently has the right to earn a minimum 70% interest in the Project from Chalice Gold Mines Ltd, an ASX-listed company.
The Gnaweeda Project, which lies approximately 640km northeast of Perth and 35km northeast of the townsite of Meekatharra, comprises a package of two exploration licenses over a strike length of 28km of the Gnaweeda Greenstone Belt. Three gold deposits in excess of 1 million ounces each, Bluebird, Meekatharra and Reedy, occur within the adjacent Meekatharra-Mt. Magnet Greenstone Belt.
The Company will be the operator of the Project during the option period and is pleased to announce the appointment of Nancy Reardon, M.Sc. P.Geol., as the Company’s senior consulting geologist for Australia and New Zealand, who will be responsible for the Company’s exploration program on the Project. The Company is commissioning a NI 43-101-compliant report on the property.
Teck reports that, since 2006, it has conducted limited RC drilling (less than 300m deep) that returned significant gold intersections at depths ranging from 17m to 280m, including 4m at 17.7gt, which includes a 1m intersection of 59.27g/t, 5m at 13.49gt, 5m at 11.64g/t, 3m at 11.87g/t, 3m at 4.85g/t and 3m at 4.39g/t. Newcrest and Australian Gold Resources identified extensive gold and arsenic anomalies in historic intersections on the property in an area along a 15km strike and up to 750m wide.
The Company has paid Teck a non-refundable AUD$50,000 deposit on acceptance of the proposal, which provides for a three month exclusive option period during which time Teck and Kent will enter into a formal option agreement. To earn its interest in the Gnaweeda Project, the Company is required to fund AUD$3 million in exploration expenditures over 4 years, with a AUD$200,000 first phase exploration program (including the non-refundable deposit, which is to be expended on exploration on the Project) to be completed by December 31, 2009. Once the Company has earned its interest in the Project, Teck has the right to claw back 75% of the Company’s interest by spending 2.5 times the Company’s exploration expenditures.
In conjunction with the Option Agreement, and to ensure the Company does not incur significant dilution in funding this project, the Company directors have approved, subject to shareholder approval to be sought at the earliest opportunity, the creation of a new, solely gold-focussed company (NewKent), through a plan of arrangement, to hold and explore the project.
Subject to shareholder approval, the recommendations of a NI 43-101-compliant report, and a valuation of the properties intended to be held by NewKent, the proposed Plan of Arrangement would provide for the issuance to existing shareholders of the Company, on a record date to be determined, one share in NewKent for every four shares of the Company held by the shareholders. Subject to financing and TSX-V and other required approvals, the Company intends to list NewKent on the TSX Venture Exchange.