Otterburn Announces K92 Completes Purchase of Kainantu Mine from Barrick Gold Corp. and Files Initial Independent Technical Report and Resource Estimate
- Purchase of Kainantu Mine from Barrick Gold Corp. completes
- K92 staffs up key positions and assumes full operational control of Kainantu Mine
- Initial NI 43-101 compliant resource estimate at Kora-Eutompi and Irumafimpa confirms:
- 240,000 oz. Au at 13.3 g/t Au eq. in the Indicated Category, and
- 1.84 M oz. at 11.6 g/t Au eq. in the Inferred Category
Otterburn Resources Corp. (“Otterburn”) (TSX VENTURE:OBN) is pleased to announce that K92 Holdings International Limited (“K92”) has completed the purchase of Barrick Kainantu Limited (“BKL”) from Barrick Gold Corporation (“Barrick”). Otterburn, as previously disclosed, is purchasing 100 percent of the shares of K92 in a share exchange purchase agreement.
With the purchase of BKL now complete, K92 owns 100 percent of the Kainantu Mine Project located in Papua New Guinea, including Mining Lease 150, Mining Easements 80 and 81 and License for Mining Purposes 78, all granted for a period of 10 years by the applicable government authorities in accordance with PNG Mining Act 1992.
K92 currently has approximately 70 local staff onsite, most of whom were previously employed by Barrick, along with several North American, Australian and South African geologists and engineers who are currently focused on detailed mine planning and plant engineering studies. The number of staff will increase as the company moves from the current transitional stage to project ramp up. The fully developed infrastructure at the Kainantu project, in addition to the underground mine development, includes a mill processing facility, staff housing, a life of mine tailings pond and office space. The site has a dedicated power line from the nearby Yonki hydro electric energy facility and is accessible via a paved road.
On March 6th, Otterburn received an Independent Technical Report and Resource Estimate (“ITR”) for the Kainantu Mine Project. The report was authored by Anthony Woodward, BSC Hons., M.Sc., MAIG of Nolidan Mineral Consultants, located in Queensland, Australia.
Within the ITR, it is stated “Nolidan notes that Barrick originally purchased the Kainantu Project for the porphyry Cu-Au potential and internal reports rank the project very highly on a global scale. The decision to divest the project was made for corporate rationalisation reasons based on global competition for exploration expenditure rather than geological reasons.”
A key component of the ITR is a mineral resource estimate of the Irumafimpa-Kora gold copper deposit. This mineral resource estimate is based on 78,935 metres of drilling from 767 holes and 18,312 metres of assayed intervals across all lodes.
Nolidan notes, “Within ML150 this includes the Kora lodes which are strongly mineralized at the limit of drilling and open in all directions, as well as the Judd, Karempe and other unnamed mineralized lodes parallel to defined resources which have potentially economic grade…”
The initial resource estimate for these deposits is 1.84 M inferred oz. at 11.6 g/t Au eq. and 240,000 indicated oz. at 13.3 g/t Au eq.
See Figure 1: Cross Section of the Irumafimpa-Kora gold copper deposit.
In addition to the mineral resource estimate, the ITR also discusses exploration potential. The author notes “The Kainantu project is located in a world class Cu-Au province as evidenced by the underlying geology and presence of nearby major projects operated by global majors Barrick, Newcrest and Harmony. Nolidan concludes that based on a review of historical exploration and the identified mineralization within the Kainantu Project package there remain a significant number of major untested and early stage targets.” In addition to exploration comments regarding the high grade intrusive vein system at Kainantu, the author also notes “A major porphyry Cu-Au target is evident at shallow depth in the A1/Tempe/Tankuanan area…”
Historic drilling on the project by Barrick, Highlands Pacific and others has outlined numerous high grade gold targets, some with unclassified historic resources such as Maniape, Arakompe and Aifunka.
Other targets previously explored by drilling and surface sampling include the high grade vein deposits at Judd and Karempe which are parallel lodes to the Kora-Irumafimpa deposit.
K92 Chief Executive Officer, Ian Stalker states, “Another significant step forward in reopening the K92 Mine in the Eastern Highlands Province of PNG has been achieved. It is important to note that when we develop and implement our future plans to test the significant exploration potential at Kainantu, we will have the benefit of access to a substantial volume of historical exploration data and will also have the depth of exploration expertise within our group that includes the likes of Alex Davidson and Doug Kirwin.”
“Another significant step forward in reopening the K92 Mine in the Eastern Highlands Province of PNG has been achieved.
It is important to note that when we develop and implement our future plans to test the significant exploration potential at Kainantu, we will have the benefit of access to a substantial volume of historical exploration data and will also have the depth of exploration expertise within our group that includes the likes of Alex Davidson and Doug Kirwin.”
Doug Kirwin is a former Executive Vice President of Ivanhoe Mines until its takeover by Rio Tinto in 2012 and was a member of the joint discovery team for the Hugo Dummett deposit at Oyu Tolgoi in Mongolia. Mr. Kirwin was the Co-recipient of PDAC’s inaugural Thayler Lindsley Medal awarded for most significant international mineral discovery 2004.
Alex Davidson is a former Executive Vice President, Exploration and Corporate Development for Barrick Gold Corporation. Mr. Davidson was presented the 2005 A.O. Dufresne Award by the Canadian Institute of Mining, Metallurgy and Petroleum to recognize exceptional achievement and distinguished contributions to mining exploration in Canada. In 2003, Mr. Davidson was named the Prospector of the Year by the Prospectors and Developers Association of Canada.
Upcoming activities planned by K92 onsite include the refurbishment of the existing mill and the Irumafimpa Mine underground infrastructure; underground and surface drill testing of the untested area between Irumafimpa to Kora; definition drilling in other zones of mineralization discovered but not yet defined as a resource; and exploration targeting of potential undiscovered high grade deposits. Future plans, dependent on available financing, include an underground incline drive from the Irumafimpa deposit to the Kora deposit, and additional upgrades to the mine and mill.
The team advancing K92, and their intended positions with Otterburn, includes:
R. Stuart (Tookie) Angus, Chairman and Director
Ian Stalker, Chief Executive Officer and Director
Bryan Slusarchuk, President and Director
Brian Lueck, Chief Operating Officer and Director
Mark Eaton, Director
Saurabh Handa, Director
Alex Davidson, Advisor to K92
Douglas Kirwin, Advisor to K92
Andrew Vigar, Advisor to K92
Daisy Taylor, Director (Papua New Guinea)
Justin Blanchet, Chief Financial Officer
ON BEHALF OF THE BOARD
Brian Lueck, President & CEO
Brian Lueck is the qualified person who has reviewed and approved the technical information contained in this news release on behalf of the Company.
Any references to historical estimates of mineral resource or mineral reserves are subject to the qualifications as set out in the ITR. The Company is not treating historical estimates as current mineral resources or mineral reserves as defined in NI 43-101. The Company cautions the reader that the historical estimates disclosed in this news release should not be relied upon. There have been no assumptions made as to metal prices or recoveries in the mineral resource estimates other than gold equivalents that are calculated for AuEq = Au g/t + Cu%*1.7308 + Ag g/t*0.0185.
Completion of the Company’s acquisition of K92 is subject to a number of conditions, including but not limited to, Exchange acceptance and disinterested shareholder approval. The transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Filing Statement or Management Information Circular to be prepared in connection with the transaction, any information released or received with respect to the reverse take-over may not be accurate or complete and should not be relied upon. Trading in the securities of Otterburn Resources Corp. should be considered highly speculative.
The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain “forward-looking statements” under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the proposed acquisition of K92; the terms and conditions of the proposed private placement; future exploration and testing; use of funds; and the business and operations of the Company after the proposed transaction. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Otterburn disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Otterburn Resources Corp.
Darren Devine or Ian Stalker