KWG Resources Inc.

KWG Resources Inc.

October 01, 2007 13:25 ET

KWG and Spider To Drill Targets Beside Noront Discovery

MONTREAL, CANADA--(Marketwire - Oct. 1, 2007) - KWG RESOURCES INC. (TSX VENTURE:KWG) and SPIDER RESOURCES INC. (TSX VENTURE:SPQ) plan to drill selected geophysical (airborne with ground follow-up) targets approximately 3300 meters east-north-east of the new Noront Resources Ltd. (TSX VENTURE:NOT) magmatic nickel discovery. The JV partners discovered significant chrome-PGE-nickel mineralization in a layered peridotite in their first drill-hole in the target area in early 2006. Noront's nearby nickel-copper-PGE discovery provides both genetic context to these earlier results and consequent high encouragement for the testing of the JV's adjacent targets.

KWG and Spider equal in 65% earn-in

The JV partners are currently planning a $2 million program this winter in order to vest a joint 50% interest (25% each) under their option to earn up to a 65% interest from Freewest Canada Resources Inc. (TSX VENTURE:FWR) in the 78-unit claim group. A number of drill targets suggested by the geophysical data are being studied and prioritized for drilling.

KWG and Spider equal in McFaulds, next to Noront

Both Spider and KWG also have equal interests in their other assets in the McFaulds Lake area. The Spider/KWG Joint Ventures include the adjacent McFaulds Lake Project where 10 discoveries of copper and zinc mineralization have been made since 2002. The 2296-unit McFaulds East and McFaulds West claim group constitute the McFaulds Lake Project which, in turn, adjoins the Noront claims and is one of the largest land holdings in the area, covering some 360 square kilometres. UC Resources Ltd. (TSX VENTURE:UC) has recently spent some $1 million by completing ground geophysics (gravity and UTEM) as well as 7 diamond drill-holes for the first phase earn-in of a 10% interest in the project, reducing KWG and Spider to 45% each. UC may elect to enter their second phase at any time, to earn up to a 55% interest in these properties.

KWG and Spider own 6 area targets

The Diagnos Initiative is another 50%/50% JV between KWG and Spider comprising 6 widely dispersed claims east and north of the McFaulds Lake area, each containing a geophysically interpreted target, all of which were selected by the Diagnos Inc. (TSX VENTURE:ADK) proprietary computer-assisted algorithms, confirming or re-prioritizing other geophysical interpretation techniques that were instrumental in first bringing the joint venture to the Greater James Bay Lowlands project area in 1993. The parties are considering a drilling program to test the 2 highest priority targets this winter.

KWG and Spider share three diamond discoveries

The Spider/KWG Joint Ventures also include three diamond projects each of them being original JV discoveries including; the Wawa Project, the MacFadyen Project and the Kyle Project. The MacFadyen and the Kyle kimberlite swarms are in the Attawapiskat River basin of the James Bay Lowlands, proximal to the De Beers Victor Diamond Mine that is in its last stages of construction and development, scheduled for start up in late 2008. The MacFadyen project is contiguous to the Victor project, while the Kyle kimberlites are located about 100 kilometres to the west, in the vicinity of where the McFaulds Lake VMS occurrences and the Noront discovery are located. The Kyle Project has been optioned to Renforth Resources Inc, which may earn up to a 55% interest by completing total expenditures of $6 million over a newly agreed four year period. Renforth is nearing completion of their initial program, where it is anticipated they will have spent $2 million in exploration and other expenditures related to their initial earn-in requirements for a vested 20% interest in this project. KWG and Spider currently jointly hold the remaining 80% interest.

KWG operates MacFadyen; Spider operates Wawa

KWG has elected not to participate in funding the Wawa, Kyle and McFaulds Lake projects' exploration programs until its 50% JV interest has been reduced to 33%, Spider is the operator for these three projects. Spider has elected not to participate in funding the MacFadyen project exploration programs until its 50% JV interest has been reduced to 33%, KWG is the operator of the MacFadyen project. The Diagnos Initiative project and the Freewest Option project are equally held, with operatorship switching from year to year.

KWG name change

KWG's Directors have decided not to change the company's name at present.

Shares issued and outstanding: 188,144,578


Contact Information

  • KWG Resources Inc.
    Frank C. Smeenk
    President and CEO
    514-866-6193 (FAX)
    KWG Resources Inc.
    Michel Cote
    514-866-6001 - Ext. 266
    514-866-6193 (FAX)