Baker Lake Uranium Project Agreement Amended to Include Aurora Energy Resources Inc.;
Kivalliq to Receive 2,000,000 Shares of Pacific Ridge
September 23, 2008
Vancouver, B.C. – Kivalliq Energy Corporation (KIV: TSX-V) today announced the amendment of the Baker Lake Uranium Project agreement with Pacific Ridge Exploration Ltd. (PEX: TSX-V) to include Aurora Energy Resources Inc. (AUX: TSX). The Baker Lake project is located in Nunavut and is approximately 225 kilometres northeast of Kivalliq’s flagship “Angilak” project. Kivalliq acquired the Baker Lake and Angilak projects through the recently completed spin-out of the uranium assets from Kaminak Gold Corporation (KAM: TSX-V). The amendment to the Baker Lake Project agreement is subject to TSX Venture Exchange and regulatory approval.
New Baker Lake Agreement - Key Points
- Pacific Ridge exercises the option to acquire a 100% project interest in the Baker Lake Uranium Project in exchange for issuing and delivering 2,000,000 shares of Pacific Ridge to Kivalliq
- Aurora can earn a 51% interest in the Baker Lake Uranium Project by incurring staged exploration expenditures totalling $15 million over a 36 month period
- Kivalliq retains a back-in right to acquire a 20% project interest upon the delivery of a pre-feasibility study by Aurora and Pacific Ridge
About the Baker Lake Project
Host to several uranium prospects, the Baker Lake project is situated within the Baker Lake Basin, a geological environment that is highly favourable for the discovery of high-grade uranium deposits. The Baker Lake project covers over 96,000 hectares and is located 40 kilometres south of the community of Baker Lake in Nunavut. 80 kilometres to the west of Baker Lake, AREVA Resources Canada is conducting a feasibility study on the Kiggavik uranium deposit. To date, Pacific Ridge has spent over $7,300,000 exploring the Baker Lake project since 2006.
With the amendment of the Baker Lake agreement, Pacific Ridge has now exercised the option to acquire a 100% project interest in the Baker Lake Uranium Project in exchange for issuing and delivering 2,000,000 shares of Pacific Ridge to Kivalliq.
During a 36 month initial option period, Aurora has the option to earn a 51% interest in the Baker Lake Uranium Project by incurring staged exploration expenditures totalling $15 million. Upon earning a 51% interest, Aurora may elect to either:
- earn an additional 14% by funding 100% of on-going costs and commit to producing a preliminary feasibility study no later than December 31, 2013
- enter into a joint venture with Pacific Ridge (51% Aurora, 49% Pacific Ridge).
If Aurora terminates the option agreement, then Kivalliq can elect to re-establish the terms of the original option, joint venture and back-in agreement with Pacific Ridge by returning the shares to Pacific Ridge.
The amendment to the Baker Lake Project agreement is subject to TSX Venture Exchange and regulatory approval. Complete details about the agreement can be found on SEDAR, www.sedar.com.
About Kivalliq Energy
Kivalliq Energy Corporation is a new uranium exploration and development company with a unique opportunity. Kivalliq is the first company in Canada to sign a comprehensive agreement to explore on Inuit Owned Lands for uranium.
Through the formation of a landmark partnership with the Inuit of Nunavut, Kivalliq is exploring the historic, high-grade Lac Cinquante Uranium Deposit. Reported to contain 11.6 million pounds of uranium oxide (non compliant with National Instrument 43-101)** with grades averaging 1.03% U3O8, the near surface Lac Cinquante deposit remains untested at depth and along strike. Kivalliq’s core asset, the 250,000 acre Angilak Project, is host to the historic Lac Cinquante deposit and 75 other uranium occurrences.
On behalf of the Board of Directors
John Robins, P. Geo.
President and CEO
Kivalliq Energy Corporation
For further information about Kivalliq Energy Corporation or this news release, please visit our website at www.kivalliqenergy.com or contact Tony Reda, Investor Relations, at toll free 1.888.331.2269 or directly at 604.646.4534.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
** The quoted disclosure for the Lac Cinquante Uranium Deposit was prepared by Aberford Resources Ltd. This estimate 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 and surface exploration 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 Kivalliq is not treating them as current mineral resources/reserves since work to date has not verified the historical estimates. Kivalliq 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.
Certain disclosures in this release, including management's assessment of plans and projects and intentions with respect to listings of securities, use of proceeds and future exploration programs, constitute forward-looking statements that are subject to numerous risks, uncertainties and other factors relating to Kivalliq's operations as a mineral exploration company that may cause future results to differ materially from those expressed or implied in such forward-looking statements, including risks as to the completion of the plans and projects. Readers are cautioned not to place undue reliance on forward-looking statements. Kivalliq 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.