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News Releases
| | July 25, 2007
PROMONTORIO - DOW JONES: A View From Kootenay's Promontorio
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| | By Brian Truscott Of DOW JONES NEWSWIRES
VANCOUVER (Dow Jones)--One flagship property down Mexico way and a handful of joint-venture grassroot exploration projects north and south of the 49th parallel - that's the running business plan for Kootenay Gold Inc. (KTN.V). "We're building a portfolio of shares in other junior companies which are spending money on our properties; it will give us more leverage on the upside when we do have a discovery," said Kootenay President Ken Berry. "At the same time, it minimizes dilution to Kootenay shareholders but maximizes expenditure in the ground."
Here's how it works: Back in April 2006, Kootenay cut a deal with Astral Mining Corp. (AST.V), giving Astral the right to earn a 60% undivided interest in Kootenay's 11,800-hectare Jumping Josephine property in southern B.C. The catch? Astral must spend C$2.1 million on exploration, issue 400,000 shares to Kootenay and make C$100,000 in option payments over five years. So far, so good. A 20-hole phase-one drill program, started earlier this year, is showing strong results. In the first 11 holes drilled, intersections have been as high as 9.95 grams per metric ton.
Kootenay is doing much the same thing with Amador Gold Corp. (AGX.V) on its Connor Creek property in southeastern B.C. A drilling program has just been announced for that project. "We're also looking at drilling on our Murphy Creek property as well," Berry said.
While its B.C. properties are taken care of, Kootenay's generative, or grassroots, exploration program in Mexico is being funded by Klondike Silver Corp. (KS.V). In return, Klondike has the right to enter into joint ventures on three prospective properties in return for as many as 500,000 Klondike shares per property as well as a commitment to keep spending exploration money. Klondike is deciding which properties to take on, Berry said.
McDonald, Hughes At Heart Of Kootenay Model
Kootenay Gold's business model is the brainchild, if you will, of Chief Executive James McDonald, a well-known name within the industry. He co-founded Black Bull Resources Inc. (BBS.V), National Gold, which later merged with Alamos Gold Inc. (AGI.T) and was involved in both Genco Resources Ltd. (GGC.V), and the nickel discovery via Golden Chalice Resources Inc. (GCR.V).
McDonald founded Kootenay a few years ago with Richard Hughes, a Kootenay director who was involved in discovering the Golden Giant/Hemlo, Sleeping Giant and former Balmoral gold mines.
"If there's anything I could stress about Kootenay is that it's really the people behind it, and Jim McDonald's track record is tremendous," Berry said. Of course, the lynchpin to Kootenay's fortune is its flagship project, the 100%-owned Promontorio Silver project in northwestern Mexico, a well- documented silver site that has been a focal point for exploration and production numerous times during the past century. Since acquiring the project back in 2006, there has been a heavy focus on airborne surveys, surface sampling and mapping programs. Drilling has now started and should continue for the next two months or so, Berry said.
A C$2 million private placement in January provided funding for ongoing projects, but the company will likely tap the market for additional funds this fall, depending on how the current drilling programs progress, Berry said. "We're extremely positive on this flagship Mexican property; the historic results have shown some spectacular grades," he said. "If we're able to confirm the historic (resource estimates) and also test new areas, then I'm confident we'll be able to ramp up the second phase of exploration." Ultimately, Kootenay is looking at lots of key results over the next six months, which will determine the future course of the company, Berry said. Company Web Site: http://www.kooteneygold.com
-Brian Truscott, Dow Jones Newswires; 604-669-1595;
brian.truscott@dowjones.com
This story was published on Thomson ONE:
For information on Thomson ONE go to www.thomson.com/financial
( DJ ) 07/25 12:00PM = |
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| | You can view the Next News Releases item: Thu Sep 6, 2007, <html><FONT COLOR="FF6600"><b>PROMONTORIO - </b></font></html>Progress Report: Kootenay Announces Drill Results Pending on Four Separate Drilling Programs in Mexico and British Columbia
You can view the Previous News Releases item: Tue Jul 17, 2007, <html><FONT COLOR="FF6600"><b>PROMONTORIO - </b></font></html>Phase I Drilling Has Commenced On Kootenay's Promontorio Silver Property
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