Vancouver, BC – KENRICH-ESKAY MINING CORPORATION (TSX-V:KRE; FRANKFURT-BERLIN: K7N)
and ST ANDREW GOLDFIELDS LTD. (TSX:SAS) are very pleased to announce
that Kenrich has entered into an option agreement with St Andrew to
acquire up to an 80% undivided interest in strategically located
mineral tenures held by St Andrew in the Eskay Creek area of British
Columbia. The additional mineral tenures increase the property position
of Kenrich by about 33,000 hectares, increasing Kenrich’s position from
13,400 hectares to a total of 46,400 hectares (now comprised of 177
mineral tenures).
The Agreement joins two very important properties in the Eskay Creek
camp, into one contiguous block that surrounds and abuts the Eskay
Creek mine property of Barrick Gold Corporation. Barrick Gold holds a
strike length of 4 km of the Eskay Rift belt. Kenrich’s property
position now controls the remaining 28 km of the belt.
The St Andrew properties allow Kenrich to expand its ongoing
exploration in the region and apply its accumulated geological
expertise onto this highly prospective new ground closer to the
prolific Eskay Creek mine. Significantly, portions of the St Andrew
property lie within 1 kilometer of the Eskay deposit. The optioning of
the property by St Andrew allows it to benefit from the exploration
program while allowing it to continue its primary focus on its
Holloway-Holt project.
The Agreement
In order to exercise the option and earn a 70% interest, Kenrich is
required to issue 500,000 shares and pay $50,000 to St Andrew upon TSX
Venture approval of the Agreement. Kenrich must then additionally
incur $750,000 of exploration expenditures, issue 500,000 shares and
pay $50,000 on or before May 7, 2009; incur $750,000 of exploration
expenditures, issue 500,000 shares and pay $50,000 on or before May 7,
2010; and incur $1,500,000 of exploration expenditures, issue 250,000
shares and pay $50,000 on or before May 7, 2011. Kenrich may increase
its interest to up to 80% by incurring an additional $1,000,000 of
exploration expenditures on or before May 7, 2012.
Upon being vested with a 70% or 80% interest in the property, as the
case may be, the parties intend to enter into an industry standard
joint venture agreement to govern further exploration and development.
In the event that St Andrew’s interest in the property is diluted to
less than 10%, its interest will revert to a 2% net smelter return
royalty.
The Property
The St Andrew property optioned to Kenrich comprises 140 claims
totalling over 33,000 hectares. The property covers extensive areas of
highly prospective Hazelton and Stuhini Group geological units. Similar
rock formations host the Eskay Creek gold-silver deposits of Barrick,
as mentioned above, and also the nearby Kerr-Mitchell-Sulphurets
copper-gold deposits of Seabridge Gold and the Snowfield gold deposit
of Silver Standard.
Perhaps of greatest immediate significance to Kenrich is the SIB
claim block that is located in the north central part of the property.
The SIB claim block abuts the southern extremity of the Barrick
property. The SIB contains a continuous succession of Eskay Rift
rhyolite and mudstone, the host units to the Eskay deposits.
Furthermore, drilling by past operators led to the discovery of the
Lulu Zone, a gold, silver and base metal-enriched zone of stringer and
semi-massive sulphides having the same geochemical and geological
characteristics as the Eskay deposit. The best drill intercept at Lulu
returned a value of 14.43 g/t Au over 14.3 metres (McGuigan, 2002
Technical Report on the Eskay Creek Properties of Heritage Exploration
Limited and Glenfred Holdings Inc.). Geochemical surveys and follow-up
diamond drilling by St Andrew and its predecessor company Heritage
Exploration led to the discovery in 2003 of the Hexagon Zone, a broad
area of hydrothermal alteration that hosts disseminated and stringer
sulphides and low grade gold enrichments that is likely indicative of a
large VMS-style hydrothermal system in the area east and northeast of
the Lulu Zone.
With the addition of the St Andrew property, Kenrich can now explore
a 28 kilometre-long belt of prospective Eskay Rift geology that extends
continuously from the southern boundary of the Eskay property to the
southeast boundary of the Corey Property. Kenrich will be able to apply
the expertise gained from the detailed geological and lithogeochemical
surveys carried out recently on their Corey Property to this greatly
expanded exploration property.
Upon examination and interpretation of St Andrew data archives,
Kenrich is planning to mount a significant exploration program on the
property that will run concurrently with the ongoing program at Corey.
Kenrich’s geological team are very enthusiastic about this new
opportunity and look forward to an exciting 2008 field season.
The geological portion of this release has been approved by Sean McKinley, M.Sc., P.Geo., Kenrich’s Qualified Person.
About Kenrich
Kenrich-Eskay Mining Corp. is engaged in the exploration and
development of strategic, mineral rich properties in British Columbia,
Canada. It is a fully compliant, publicly traded Canadian corporation
since 1989 with three active major exploration projects. Full detailed
information about the company may be obtained from the website: www.kenrich-eskay.com.
About St Andrew
St Andrew is a gold mining and exploration company with operations
in Timmins, Ontario and Alaska. St Andrew controls a very large land
position in the Timmins Mining Camp, an extensive land position at
Eskay Creek in northern British Columbia and land positions around
Nixon Fork Gold Mine in the Kuskokwim-Tintina Mining Camp in Alaska.
St Andrew also holds an approximate 29.4% equity interest in New
Zealand based gold explorer Glass Earth Gold Limited which holds
extensive land positions on the North and South Islands in New Zealand,
and an approximate 18.0% equity interest in Apollo Gold Corporation,
which has operations in Montana, Mexico and the Black Fox Deposit
located in the vicinity of St Andrew’s Timmins operations.
This news release contains forward-looking information under
applicable securities laws. Forward looking information is subject to
known and unknown risks, uncertainties and other factors that may cause
actual results to differ materially from those implied by the
forward-looking information. Reference should be had to the most
recent Annual Information Form of St Andrew and the securities filings
of Kenrich respectively for a discussion of the risks and uncertainties
impacting on St Andrew and Kenrich, respectively, which are available
at www.sedar.com.
For further information about Kenrich-Eskay Mining Corporation, please contact:
Wally E. Boguski
President, CEO, Director at (604) 582-0559 or
email: info@kenrich-eskay.com
For further information about St Andrew Goldfields Ltd., please
contact Investor Relations at (416) 368-3116 or toll-free at
1-800-463-5139 or email: investor@standrewgoldfields.com or contact:
Don Shaxon
Investor Relations Manager
Email: dshaxon@standrewgoldfields.com
Jacques Perron
President and CEO
Email: jperron@standrewgoldfields.com
Ben Au
CFO and VP Finance & Administration
Email: bau@standrewgoldfields.com
