God's Lake Resources Inc.

God's Lake Resources Inc.

October 03, 2011 14:46 ET

God's Lake Resources Responds to KI Accusations

TORONTO, ONTARIO--(Marketwire - Oct. 3, 2011) - God's Lake Resources Inc. (CNSX:GLR) ("the Company) in response to recent reckless accusations from Chief Donny Morris and the Kitchenuhmaykoosib Inninuwug (KI) First Nation, would like to provide the following facts:

  1. The Sachigo Mine operated from 1938 to 1942 as a small, high grade gold producer. Mine Superintendent B.G. Edwards, P.Eng. documented that 50% of the labour at the mine was supplied by local Natives and reported no fatalities or graves on site.
  2. Exploration has been carried out by numerous companies, since the mine closure, with no complaints or involvement from local First Nation Communities. These include: Flint Rock Iron Mines, Lac Minerals, Inco, Mr. Warren Hunt and in early 2009 God's Lake Resources. Data indicates no burial or grave sites were located during their work, or that KI First Nation made any attempt to identify traditional burial sites over the course of 73 years of exploration history.
  3. In the early 1990's the Province of Ontario granted a 21-year lease on 16 claims covering the Sachigo Mine, on Foster Lake (1.2km north of Sherman Lake) which includes mining and surface rights. This has been public knowledge since the grant of the lease and is kept in good standing by yearly rental payments. It can be considered private property.
  4. Government work in late 1990's indicated gold in samples derived from basal till and later confirmed by Northern Superior Diamonds, defining a dispersion train of anomalous gold values over a large area. An additional 186 claim units were staked covering this anomalous region.

Numerous phone calls and letters have been exchanged with the KI since Mid-August 2010. GLR has asked in writing for the Chief, Council and Elders to identify any burial sites and trap-lines so that no exploration would take place over those areas. At no time was it mentioned that the KI had to locate the burial sites themselves. GLR has asked, in writing, for both parties to engage in consultation discussions. Responses from the KI have always been politically charged rhetoric with no response to either identifying burial sites or entering into consultation discussions.

At the request of the Ontario Government GLR held off from any exploration work until the KI's referendum, which showed promise for entering into discussions. Consultation protocols adopted in the referendum make outrageous demands of any mining company wishing to explore on their traditional homeland. It can be interpreted as being a deterrent for any exploration or development and is a combination of Religion, rhetoric, bureaucracy and some business and is not a workable document in today's modern business world.

A preliminary exploration program was started in mid July and has just been completed. The purpose of the program was to prospect, map and sample the geology and gold occurrences around the mine site, verify data from previous operators and conduct a limited soil sampling program. A tent camp was used with some camp gear stored in a small shed, on-site with the balance removed from the property.

No graves or burial sites were located during this work.

On September 22, 2011 four Native people, in canoes were discovered as the work crew was approaching the shore of Foster Lake. The crew discovered that the paddles for the canoe were taken and upon returning to camp alcohol had also been stolen. Attempts were made to talk with these people – once again no response as they paddled away. Rather than rob the camp, a more appropriate action would have been to direct company representatives to the burial sites.

GLR's position is to engage in exploration activities on the leased 16 claims. The property has excellent exploration potential with assays to follow as they are made available to the Company. As with many First Nations in Ontario, GLR would like to have a negotiated agreement in place with the KI, addressing both parties concerns and activities with mutual respect and understanding.

For readers unfamiliar with the Ontario Mining Act, regulations, process and protocols, mining companies such as GLR have only 2 years in which to carry out and report work on staked mining claims. If work is not reported, the mining claims expire.

Although the Ontario Government provides basic guidelines, including the recommendation and obligation to consult with First Nations, there are currently no guidelines in place to help us determine how to act when attempts to consult go unanswered for long periods of time.

Furthermore, the obligation to consult has been interpreted by many First Nation communities to mean "obtain their permission". Under the new Mining Act, claimholders in Ontario do not require permission from First Nations – rather, they are required to consult with First Nations. In our current case, KI chose to stonewall, rather than to communicate back on burial site locations, or allow any form of consultation.

GLR believes this is too important to ignore or neglect in the manner which K.I. leadership has chosen to handle this assigned process. In the absence of any genuine reply from K.I., our company made the decision to proceed with work.

This work has little or no environmental impact. Contrary to KI's news bulletins, no graves were "desecrated". Overburden, moss and trees remain undisturbed and our company worked respectfully at all times. Flagging tape is commonly used to mark important sites, but is chemically inert (plastic).

As much as GLR resents being painted as reckless, we recognize that K.I. and GLR may have 1 goal in common. The Ontario First Nations and all claimholders in Ontario need to have guidelines that help us to interact respectfully, when the recommended consultation process fails. Burial sites deserve respect.

GLR is in favour of any improvements that can be made between Government, First Nations and the exploration industry.

GLR would once again like to invite the KI First Nation to enter into consultation discussions instead of stirring media controversy and bringing accusations that are reckless and potentially damaging to GLR's reputation.

Forward-Looking Statements

This press release may contain forward-looking statements, which are subject to risks and uncertainties and other factors that may cause the Company's results to differ materially from expectations. When reviewing the Company's forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. These include risk relating to market fluctuations, investee performance, strength of the North American and European economy, foreign exchange fluctuations and other risks not yet know to the Fund. These forward-looking statements speak only as of the date hereof. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update these forward-looking statements. The Fund does have an ongoing obligation to disclose material information as it become available. The discussion also includes cautionary statements about these matters. You should read the cautionary statements made as being applicable to all forward-looking statements wherever they appear in this document.

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