Kaminak Gold Corporation

Kaminak Gold Corporation

January 31, 2008 08:00 ET

Kaminak Signs Landmark Agreement with Nunavut Tunngavik Incorporated and Acquires Historic Deposit Reported to Contain 11.6 Million Pounds of Uranium (Non NI 43-101 Compliant)

Announces proposed spin-out transaction of uranium assets to shareholders

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 31, 2008) - Kaminak Gold Corporation (TSX VENTURE:KAM) today announced that Kaminak and Nunavut Tunngavik Incorporated (NTI) have signed a Memorandum of Understanding (MOU) extending to Kaminak uranium rights on 18,000 acres of Inuit Owned Land, located in the Kivalliq District of Nunavut, Canada. Kaminak now holds tenure on over 250,000 acres of highly prospective ground in the Angikuni - Yathkyed region.

Key Point Summary

- Kaminak is the first company to be awarded the right to explore for uranium on privately-held Inuit Owned Land in Nunavut

- Property hosts numerous high-priority targets, including the historic near-surface and high-grade Lac Cinquante Uranium Deposit(i)

- Proposed spin-out transaction of Kaminak's uranium assets to shareholders

"We recognize and respect the unique environment and culture in Nunavut, and we are looking forward to working directly with our aboriginal partners," stated Rob Carpenter, President and CEO of Kaminak. "This agreement will also provide the Kaminak shareholders with a new exploration opportunity."

This agreement consolidates over 250,000 acres of ground comprised of federally issued claims and prospecting permits as well as privately-owned Inuit Owned Land. To date, the property has been called by several different names (i.e. Yathkyed, RI-30); however, going forward, Kaminak will collectively refer to the entire property as the "Angilak Project". Angilak is an Inuit word that means "biggest".

Geology of the Lac Cinquante Uranium Deposit

The most significant prospect known to date on the Inuit Owned Land is the Lac Cinquante Uranium Deposit. This deposit was discovered by Pan Ocean Oil Ltd. in the late 1970's and was later acquired by Aberford Resources Ltd. The Aberford annual report from 1982 states that the deposit "contains approximately 11.6 million pounds of uranium oxide with grades averaging 1.03%." No additional information was available in the annual report. Very little geological assessment information is available in the public government archives; however, a researcher from the Geological Survey of Canada published a description of the deposit geology in the mid-1980's based on a study of outcropping surface mineralization and diamond drill core (CIMM Special Paper #33, p. 263 to 285).

The CIMM report described the deposit as a vein-type hydrothermal system which resembles the classical veins of the Beaverlodge District in Saskatchewan. Mineralization consists of a steeply dipping series of fractures and veins, 1 to 3m wide, that contain variable amounts of pitchblende and sulphide minerals accompanied by hematite, carbonate, albite and silica alteration. The host structure is at least 1100m long and the mineralized portion measuring about 400m in length. Mineralization extends from surface to at least 265m depth and remains to be fully delineated.

Vein-like structures observed at Lac Cinquante represent one of many different styles of uranium mineralization on the property. For example, Kaminak's BOG and YAT occurrences are both located less than 10 kilometers from Lac Cinquante and have geological attributes which are suggestive of IOCG (iron-oxide-copper-gold).

Terms of the MOU

NTI is the corporation established to implement the Nunavut Land Claims Agreement on behalf of the Inuit of Nunavut. NTI owns the mineral rights to over 9 million acres in Nunavut; however, NTI's agreement with Kaminak is their first to include uranium. Subject to TSXV and regulatory approval, Kaminak intends to spin-out all of its uranium interests in Nunavut, including its interest in two other Nunavut uranium properties (Washburn and Baker Lake) into a new company under a plan of arrangement ("Newco"). Details regarding the nature and timing of this transaction are currently being finalized by Kaminak's management.

In order to keep the property in good standing, Newco will agree to complete the following:

1) Newco will issue NTI 1,000,000 shares from treasury staged over 36 months beginning only after final TSXV approval for the spin-out transaction. No Kaminak shares will be issued to NTI.

2) Upon completion of a feasibility study on any portion of the property, NTI has the option of taking either a 25% participating interest or a 7.5% net profits royalty in the specific area subject to the study. These terms will include any feasibility study on Newco's adjacent 230,000 acre Yathkyed property.

3) Newco shall perform a minimum of 6,000m of drilling before the fourth anniversary of the agreement, including at least 3,000m to be completed at Lac Cinquante.

4) Upon completion of a National Instrument 43-101 compliant report that outlines a measured resource of at least 12 million pounds of uranium, Newco will pay NTI a cash sum of C$1 million.

5) As a consequence of the land claims settlement, the property is not subject to royalty obligations to the Government of Canada, but instead is subject to an underlying 12% net profits royalty payable on all minerals to NTI. During periods of positive operating revenue, gross uranium revenue shall be calculated as 130% of the value of the product.

6) Starting December 31, 2008, Newco will pay annual advanced royalty payments to NTI in the sum of C$50,000 annually. Upon signing of the MOU, Kaminak paid NTI C$50,000 in order to cover administrative and legal costs.

(i) The quoted disclosure for the Lac Cinquante Uranium Deposit was prepared by Aberford Resources Ltd. The deposit is historical and should not be relied upon since it is not compliant to standards set out in National Instrument 43-101. However, it is relevant because: it is indicative of a mineralized zone worthy of follow up exploration as it is based on drilling exploration and development carried out by what is believed to be knowledgeable explorers in accordance with acceptable industry practices at the time of the estimate. A Qualified Person has not classified historical estimates as current mineral resources/reserves, and Kaminak is not treating them as current mineral resources/reserves since work to date has not verified the historical estimates. Kaminak has not done any work to confirm these estimates but will be planning exploration programs aimed at evaluating the economic potential of the deposit and environs. It is uncertain if further exploration will result in the deposit being delineated as a mineral resource.

Kaminak's disclosure of a technical or scientific nature is prepared under the supervision of Rob Carpenter, Ph. D., P.Geo., Kaminak's President and CEO, who is a Qualified Person under the definition of National Instrument 43-101.

About Kaminak

Kaminak Gold Corporation is a prospect generator employing a joint venture strategy that maximizes opportunities for discovery while attempting to minimize exploration risk to Kaminak. A critical component of Kaminak's business model is working with strong project partners to advance Kaminak's exploration projects. Covering several million acres, Kaminak holds one of the largest land positions in Canada devoted to metallic mineral exploration. Kaminak's projects offer world-class exploration potential and present exposure to strategic commodities including, gold, uranium and nickel.

On behalf of the Board of Directors

Rob Carpenter, Ph. D., P.Geo., President and CEO

Kaminak Gold Corporation

Certain disclosures in this release, including management's assessment of Kaminak's plans and projects, constitute forward-looking statements that are subject to numerous risks, uncertainties and other factors relating to Kaminak's operation as a mineral exploration company that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. Kaminak expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Kaminak Gold Corporation
    Rob Carpenter, Ph. D., P. Geo.
    President and CEO
    (604) 646-4534
    Website: www.kaminak.com