Kenorland Minerals Ltd (TSX-V:KLD) announced that it has begun exploration activities and outlined the 2022 exploration budget at its Tanacross project in Alaska, which is held under an earn-in agreement with a wholly-owned subsidiary of Antofagasta PLC (LSE:ANTO).
The North-American focused exploration company said the 2022 field program includes various geophysical, geological, and geochemical surveys covering the East Taurus, McCord Creek, West Taurus, and South Taurus target areas.
“This comprehensive exploration program will create a strong foundation for future drill targeting,” Kenorland Minerals CEO Zach Flood said in a statement.
READ: Kenorland Minerals options Tanacross copper-gold project to Antofagasta
“We believe there's incredible potential in this fertile and target rich environment,” Flood added.
Kenorland noted the total approved budget for the 2022 summer exploration program, along with certain fixed costs in 2023, amounts to US$2 million.
It added that exploration activities at Tanacross are planned to carry on through August and September 2022.
A 42 line-kilometer induced polarization (IP) and magneto-tellurics (MT) survey will be carried out over the East Taurus-McCord Creek-West Taurus complex, along with detailed mapping and soil sampling, as the company said it believes the complex hosts numerous mineralised intrusions and alteration systems variably enriched in copper, gold, and molybdenum.
Kenorland also noted that the detailed surveys carried out in 2022, combined with historical datasets, will provide fundamental information for drill targeting across multiple target areas.
Antofagasta can earn a 70% interest in Tanacross by making cash payments totalling US$1 million plus a success payment of US$4 million upon exercise of the option and spending US$30 million on exploration over eight years while delivering a NI 43-101-compliant preliminary economic assessment (PEA) report with a firm commitment to spend US$1 million in year one.
During the option period, Antofagasta will fund all exploration and Kenorland will be the initial operator, according to the company.
Once Antofagasta has earned its 70% interest, Kenorland and Antofagasta will form a 30:70 joint venture. If either party's interest in the joint venture falls below 10%, that party's interest will be converted to a 2% NSR, one quarter of which can be purchased by the other party for US$2 million.
Kenorland's focus is on early to advanced-stage exploration in North America. It currently holds four projects in Quebec, where work is being completed under joint venture and earn-in agreement from third parties.
In Alaska, the company owns 100% of the advanced stage Tanacross porphyry copper-gold-molybdenum project as well as a 70% interest in the Healy project, held under a joint venture with Newmont Corporation.
Contact Sean at sean@proactiveinvestors.com