Kaminak inks Inuit deal, acquires uranium deposit (February 18, 2008)

VANCOUVER — An agreement signed with Inuit corporation Nunavut Tunngavik Inc. (NTI) will open up almost 73 sq. km of territory — including a historic deposit — to Kaminak Gold (KAM-V, KMKGF-O) for uranium exploration.

Located in Nunavut’s Kivalliq district, the Inuit-owned land will effectively consolidate more than 1,000-sq. km of exploration ground already held by Kaminak.

Included under the memorandum of understanding is the Lac Cinquante uranium deposit, which holds a historic resource of about 11.6 million contained pounds U3O8 in material averaging 1% U3O8. An additional 8.8 million contained pounds U3O8 of lower categorized historic resource is also discussed in old reports.

Discovered by Pan Ocean Oil in the late 1970s, Lac Cinquante (also called Yathkyed and RI-30) hosts uranium in a vein-type hydrothermal system. Mineralization consists of pitchblende and sulphides (along with hematite, carbonate, albite and silica alteration) in a series of steeply dipping fractures and veins from 1-3 metres in width. The hosting structure has been traced over 1,100 metres of strike with the mineralized section identified over roughly 400 metres. Past drilling has cut mineralization from surface to at least 265 metres depth and is reported to be open at depth.

Close to Lac Cinquante (to be renamed Angilak), Kaminak’s BOG and YAT uranium occurrences show characteristics of iron oxide copper-gold (IOCG) mineralization.

Under its agreement with NTI — the body that manages Inuit-owned land in Nunavut — Kaminak plans to spin out all its Nunavut uranium assets into a new company through a yet to be finalized plan.

Kaminak has also agreed to issue 1 million shares of the new company to NTI, staged over a three-year period, once regulatory approval of the spinoff is received. The Inuit corporation also holds an underlying 12% net profits royalty on all minerals from its land.

Once a feasibility study is completed on the new consolidated land package, NTI has the option of taking either a 25% participating interest or a 7.5% net profits interest in the project.

On news of the deal, shares of Kaminak closed up almost 50%, posting a 20 gain to close at 59 per share.

In the fall, Nunavut Tunngavik approved a policy allowing uranium exploration and development on Inuit land in the territory, reversing its previous opposition.