Kestrel Gold Inc. Provides Exploration Update- Toe Property, Yukon
|November 9, 2010|
Kestrel Gold Inc.(the "Corporation") (TSX VENTURE:KGC) is pleased to announce results from a limited diamond drill program conducted on the Toe property, situated seven kilometres northwest of and along trend with Capstone Mining Corp.'s Minto Mine, in Yukon. The $380,000 drill program was funded by the Corporation and operated by BCGold Corp. ("BCGold") as per stipulations under the Corporation's property option agreement with BCGold (see Toe Property Option Agreement below for more details).
2010 Toe Property Drill Program and Results
BCGold conducted a four-hole, 1,058 metre diamond drill program on the Toe property in order to test four Minto-type, coincidental geochemical and geophysical anomalies for near-surface copper-gold mineralization earlier this season. Although no significant copper or gold intersections were returned, a number of intervals of biotite alteration and magnetite enrichment in Granite Mountain granodiorite (the geological setting of Minto-type copper-gold mineralization) were encountered in two of the four drill holes.
The Corporation is encouraged by geological observations, alteration distribution and intensity in the drill core and maintain that the Toe property holds excellent potential for Minto-type copper-gold mineralization. Both the Corporation and BCGold deem additional exploration to be warranted. This opinion is supported by Mr. Todd A. Ballantyne, P. Geo., consulting geophysicist to the Corporation and BCGold. Mr. Ballantyne suggests that drill target definition would be improved by conducting a pole-dipole induced polarization survey over the current gradient array survey area. Mr. Ballantyne further recommends that, before further drilling occurs on the Toe property and specifically on remaining induced polarization anomalies, a detailed pole-dipole induced polarization survey be conducted. He proposes this work in order to better resolve the induced polarization and resistivity targets with respect to their location, depth and extent.
Drill targets on the Toe property to date have been defined primarily by using the results of mobile metal ion (MMITM) soil geochemical surveys and a combination of gradient array induced polarization and airborne magnetic geophysical surveys.
2011 Proposed Exploration on the Toe Property
The Corporation and BCGold are currently reviewing exploration results and formulating plans for the 2011 exploration season on the Toe property. In order to retain the Toe property option in good stead, the Corporation must issue 100,000 common shares and make a cash payment of $25,000 to BCGold on or before June 1, 2011. In addition the Corporation must incur exploration expenditures of $350,000 in 2011.
Toe Property Option Agreement
BCGold granted the Corporation the option to acquire up to a 60% interest in the Toe property over a four year period by paying $250,000 cash to the Company, issuing 400,000 Kestrel common shares to the Company, and spending $2,000,000 in exploration on the Toe property. Kestrel can earn an additional 10% interest in the Toe property by completing a bankable feasibility study, for a total interest of up to 70%. The Toe property is subject to a 2.5% net smelter returns royalty interest, which is held by BCGold and a third party.
About Kestrel Gold Inc.
Listed on the Exchange, the Corporation is committed to acquiring, exploring and development of precious metal projects in North and South America. It has an experienced and committed board of directors and the financial ability to aggressively meet its objectives.Technical aspects of this news release have been reviewed and approved by T.J. Termuende, P.Geo., hereby designated as a qualified person under National Instrument 43-101.
This news release contains "forward-looking statements" within the meaning of applicable securities laws relating to potential mineralization of the Toe property, the future exploration program on the Toe Property and the payment of cash and issuance of shares required for the Corporation to maintain the option on the Toe Property. Readers are cautioned to not place undue reliance on forward-looking statements. Forward-looking statements are based on certain key assumptions made by the Corporation, including assumptions regarding the timing and type of future exploration programs, timing of any future payments or the future issuance of common shares by the Corporation and geological interpretations regarding the Toe Property. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, risks relating to the geological interpretation of exploration results, the maintenance of the option on the Toe Property by the Corporation, general economic conditions and the results of future exploration programs. The forward-looking statements in this press release are made as of the date of this release and the Corporation undertakes no obligation to update publicly or revise any forward-looking statements whether as a result of new information or otherwise, except as required by applicable securities laws. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Corporation or its financial or operating results or (as applicable) their securities.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.