Otterburn To Acquire The Kainantu Gold-Copper Mine In Papua New Guinea [POST]
August 25, 2014 – Vancouver, British Columbia – Otterburn Resources Corp. (TSXV: OBN) (“Otterburn”) is pleased to announce that it has signed a Share Exchange Agreement (the “SEA”) with K92 Holdings International Limited, a private British Virgin Islands corporation (“Target”), and the shareholders of Target (the “Sellers”), whereby Otterburn will acquire all of the outstanding shares of Target in exchange for common shares (the “Payment Shares”) of Otterburn on the basis of one Payment Share for each share of Target outstanding, at a deemed price of $0.50 per Payment Share (the “Transaction”). The Target will own, on completion of the Transaction, 100% of the former operating Kainantu Gold-Copper Mine in Papua New Guinea (“PNG”), currently owned by a subsidiary of Barrick Gold Corporation (“Barrick”).
About the Target
The Target is a private, widely held, BVI company, with approximately 44,000,000 shares outstanding. The Target is arm’s length to Otterburn, except that Mr. Brian Lueck, a director of Otterburn, is a minority shareholder of the Target.
The Target wholly owns all of the outstanding shares of K92 Holdings (PNG) Limited (“K92PNG”), a private company incorporated under the laws of PNG. K92PNG is party to a Share Sale Agreement dated June 11, 2014 (the “BLK Purchase Agreement”) pursuant to which it has agreed to acquire all of the outstanding shares of Barrick (Kainantu) Limited (“BKL”; a private PNG company). BKL holds the following mineral rights and interests in PNG:
- Mining Lease 150 (“ML 150”);
- Mining Easement 80;
- Mining Easement 81;
- Lease for Mining Purposes 78,
- Exploration Licence 470, (“EL 470”);
- Exploration Licence 693;
- Exploration Licence 1277; and
- Exploration Licence 1341,
As well as a full mining processing plant, camp, infrastructure (both surface and underground), tailings facility and partial mobile fleet, all of which was previously or is operational, and which has been under care and maintenance for the past five years.
The Kainantu property covers a total area of 500 km2 and is located in the Eastern Highlands Province of Papua New Guinea, approximately 180 km west-northwest of the town of Lae, PNG.
Mineralization on the property includes gold, silver & copper occurring in epithermal gold telluride veins; copper/gold/silver sulphide veins and related porphyry copper/gold systems; and alluvial gold. The Irumafimpa-Kora vein deposit is the most advanced project at Kainantu with current defined resources and past modern mining activity in the Irumafimpa area. The Irumafimpa-Kora deposit occupies a broad NW trending mineralized zone more than 2.5 km long and up to 60 m wide.
The deposit occurs in the centre of a large mineralized system approximately 5 km x 5 km in area that has been partly delineated by drilling and comprises several individual zones of low sulphidation, intermediate sulphidation, possible high sulphidation veins and porphyry style mineralization. Other less advanced prospects on the property include epithermal veins similar to Irumafimpa-Kora, porphyry copper-gold and minor skarn mineralization.