Kincora Copper Limited

TSX VENTURE : KCC


Kincora Copper Limited

October 29, 2012 08:30 ET

Kincora Copper Announces Private Placement

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 29, 2012) - Kincora Copper Limited (the "Company", "Kincora") (TSX VENTURE:KCC) announces a private placement financing of up to 57,142,857 units at a price of C$0.105 per unit for gross proceeds of up to C$6 million (the "Offering"). Each unit will consist of one common share and one common share purchase warrant. Each whole warrant will entitle the holder to acquire one common share of Kincora for a period of three years from the closing date at a price of C$0.19 per share.

The Company is also pleased to announce that it has conditionally secured non-brokered subscription commitments for C$4 million of the proposed private placement with Origo Partners PLC ("Origo") having provided a subscription commitment in aggregate of C$2 million subject to certain terms being agreed. Origo is Kincora's largest shareholder.

The completion of the Offering will be subject to the approval of the TSX-V on such terms as the TSX-V may require. Finders fees may be payable in connection with the Offering in accordance with the policies of the TSX Venture Exchange.

Funds from the capital raising will be directed towards the continuation of drilling and exploration activities at the Company's flagship Bronze Fox project located in the emerging Oyu Tolgoi South Gobi porphyry copper belt in southeast Mongolia and for working capital.

Commenting on today's announcement, John Rickus, President and CEO of Kincora, said:

"The Directors of Kincora recognise the ongoing support that we continue to receive from our largest shareholder, Origo, and we are pleased to welcome a new institutional shareholder who has recently completed a site visit and detailed due diligence. Funds from the placement will largely be directed towards the Company's ongoing exploration activities at Bronze Fox which currently includes two drill rigs focused around the West Kasulu advanced exploration prospect. Our present attention is focused on gaining a better understanding of the prospects immediate potential for deeper higher grade porphyry and near surface oxide mineralisation. Our drilling programme also aims to test at least one priority anomaly target by year end that has been identified by our systematic approach to exploring our significant but largely under explored landholding. Continued exploration activities reiterate our belief that Kincora's wholly owned Bronze Fox project is highly prospective for both bulk lower grade and deeper higher grade copper mineralisation, further emphasized by two large scale, greenfield copper construction projects ongoing in our immediate region."

Key ongoing and planned work programmes (subject to funding) include:

Drilling the West Kasulu porphyry prospect at Bronze Fox - Step out drilling is ongoing testing the extent of mineralisation and tracking the identified halo east and west that runs for approximately 2km from the previously announced Hole F62 (refer to September 10th and August 8th press releases). Hole F62 intersected an extensive copper and gold mineralised zone with occasional elevated molybdenum intersections. These results included 661m at 0.35% Cu, 0.01% Mo and 0.08g/t Au (0.44% CuEq) from 399-1,060m, with 37m at 0.8% Cu (1.07% CuEq) between 573-610m. Of the 1,360 metres drilled (the deepest hole at the project) over 1,000 metres graded at least 0.40% CuEq. Assay results for ongoing and recently completed holes are pending.

Analysing the potential for an oxide development project - Over the 2011/12 drilling seasons Kincora has identified a large, lower grade, near surface oxide zone of copper mineralisation at the West Kasulu prospect. The Company has appointed independent consultants to undertake preliminary open pit optimisation and metallurgical analysis to determine the potential of a first phase development project that if viable could provide cash flow to be reinvested into further exploration. Current metallurgical tests, proposed infill drilling and ongoing desktop reviews for the availability of water and acid are expected to provide visibility as to whether feasibility studies may commence early next year. Approval for the development of this project is potentially assisted by the European Bank for Reconstruction and Development's ('EBRD') recent investment into the Tsagaan Suvarga copper mine development, privately owned by Mongolian Alt Corporation ('MAK'), which located approximately 40 kilometers along trend and is now developing significant infrastructure in the immediate region.

Drilling of untested anomalies at Bronze Fox - Via early stage exploration and regional M&A, Kincora has increased its priority exploration targets from four in 2011, to ten. It is proposed that at least one of the recently identified high priority targets will be drilled tested by year-end which will be the third phase of the following programme: early stage rock chip and soil sampling (completed in 2011); first phase 3D Induced Polarisation ('IP') analysis (completed 2Q'12); initial drilling for alteration (4Q'12); planned follow up drilling for economic grades/mineralisation (2Q'13) and deep IP analysis subject to successful initial drilling. This process of target identification, testing and realisation is an example for how Kincora proposes to systematically explore its large regional landholding the majority of which has experienced limited previous exploration.

Follow up geophysics and deeper IP at Bronze Fox - The Company is investigating the use of deeper IP analysis at its advanced exploration target zones to assist in identifying deeper porphyry targets both at West Kasulu and also other priority anomalies.

Targets identified and drilled at Tourmaline Hills - Initial drilling completed post the acquisition of Golden Grouse in Apr'12 has returned some promising gold-copper results. A systematic programme of exploration, including further IP and drilling, is planned with a number of drill ready targets identified.

Other regional opportunities - In the last year Kincora has secured 100% of Bronze Fox (from 75%) and acquired 100% of the neighboring Golden Grouse project. The Company continues to explore various other commercial opportunities with advanced exploration and/or development projects in its immediate region. Furthermore, Kincora continues to advance discussions with various potential strategic investors regarding technical and financial synergies. While the Company's core commodity focus remains copper exploration a number of early stage drilling results and rock chip samples supports the potential for primary gold mineralisation at both Bronze Fox and Tourmaline Hills.

The proposed issue of shares triggers a pro rata right of participation granted to certain shareholders of Temujin Mining Corp. ("Temujin"), in accordance with the terms agreed at the time of Kincora's acquisition of Golden Grouse LLC (refer to April 23rd press release). As per this agreement Kincora has provided written notice (the "Issuance Notice") to Temujin.

Qualified Person

The drilling results in this news release and on Kincora's website and the other scientific and technical information in this news release were prepared in accordance with the standards of the Canadian Institute of Mining, Metallurgy and Petroleum and National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") and were reviewed, verified and compiled by Kincora's geological staff under the supervision of John Rickus, President and Chief Executive Officer of Kincora, who is the Qualified Person for the purpose of NI 43-101.

About Kincora Copper Limited

Kincora Copper Limited is a mining exploration and development company based in Vancouver and listed on the TSX Venture Exchange that was formed in mid 2011.

Kincora's ambition is to be the leading listed independent copper exploration and development company in the highly prospective and proven Oyu Tolgoi South Gobi porphyry copper belt in southeast Mongolia. The Company is currently exploring its wholly owned Bronze Fox, Tourmaline Hills and North Fox projects which host an extremely large and strategically located mineralised footprint covering over 40km2.

The projects are situated only 250km from the Chinese border and within 140km of two large scale greenfield copper construction projects: Oyu Tolgoi, invested capital to date approximately US$6 billion and target production of 160,000t/ day; and, Tsagaan Suvarga, estimated capex US$1b and target production of 40,000t/ day. Other significant mines and associated infrastructure are being developed in this immediate region.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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