Since a group of four geologists in their thirties created Kenorland Minerals (TSXV: KLD; US-OTC: KLDCF) in 2016, the junior explorer has staked over 15,000 km2 – roughly the size of 2.8 million football fields – across Canada and Alaska and made two significant greenfield discoveries in Quebec.
In the process it has struck deals with Sumitomo Metal and Mining (now a 10% shareholder in the company), Newmont (TSX: NGT; NYSE: NEM; ASX: NEM), Freeport-McMoRan (NYSE: FCX), Barrick Gold (TSX: ABX; NYSE: GOLD) Centerra Gold (TSX: CG; NYSE: CGAU) and Antofagasta (LSE: ANTO) — with the majors funding about 80% of the $98 million the company has spent on exploration.
“When we started the company, it had a few hundred thousand dollars in the bank for staking ground and our focus was, and still is, new discoveries,” reminisces Zach Flood, Kenorland’s president and CEO and one of the company’s founders. Today the company has over $20 million in cash, no debt, and a history of finding gold systems under cover on the Eastern Canadian Shield.
“What makes Kenorland unique is the very skilled and multidisciplinary team that can tackle all the generative, technical and operational aspects of exploration, and that’s not common with smaller juniors,” says Flood, an exploration geologist. “The reason we’ve had success with the majors is that we’ve got an experienced team with a track record of grassroots discoveries.”
The company’s strategy is to sift through all the publicly available spatial data to find areas that have seen little or no exploration in the past. It then goes out and acquires big land packages – typically between 500 and 1,000 km2 – and carries out large-scale systematic geochemical sampling programs. “Sometimes you don’t need a drill hole to attract a major,” says Flood, “you just need a large, under-explored property with great geologic potential and a sound strategy to advance it to discovery.”
That was the case with Sumitomo, which funded a regional till-sampling program in 2018 on Kenorland’s 560-km2 Frotet project in Quebec, about 100 km north of Chibougamau. That joint venture partnership led to the discovery in 2020 of the Regnault gold system within the Frotet-Evans greenstone belt.
In January, Kenorland converted its 20% JV interest in the Frotet project to a 4% net smelter return royalty (NSR). “The value of the company is now back-stopped by this royalty and there’s incredible upside if the project moves towards development,” Flood says.
Highlights from drilling at Regnault include 29.1 metres grading 8.47 g/t gold , including 11.1 metres of 18.43 g/t gold in hole 20RDD007; 3.1 metres of 138.74 g/t gold, including 0.4 metres of 476.4 g/t gold in hole 23RDD167; and 19.3 metres grading 19.95 g/t gold, including 1.9 metres of 106.48 g/t gold in hole 23RDD185.
“Regnault has the potential to become a Tier 1 gold asset,” Flood says. “It’s a very high-grade gold system, with clear multi-million ounce potential, in a very mining-friendly jurisdiction, and is about an hour outside of Chibougamau, with great infrastructure. These are the qualities that you look for in deposits that have the potential to become real operating mines one day.”
Regnault was a “new discovery and that really gave us some credibility from a technical sense,” he says. “But we also found a niche. The majors do want to do greenfields exploration, but many of them don’t have the teams to do it, and typically the other juniors tend to gravitate towards more advanced projects, where they can quickly generate drill results. A lot of the projects we see out there are recycled stories. The industry needs something new because there isn’t a lot of high-quality inventory on the shelf.”
Kenorland made its second discovery in Quebec at its Chebistuan project in the first quarter of 2023. It staked 1586 km2 in the Abitibi Greenstone Belt west of Chibougamau and spent the next two years doing geochemical sampling. It then drilled seven holes (2,170 metres) in its first pass and discovered an intrusion-related gold system at the Deux Orignaux target.
The project, most of which is covered under glacial till, covers about 100 km of a major east-west trending deformation zone, which the company believes may represent the continuation of the Sunday Lake Deformation zone, which hosts major deposits such as Agnico Eagle Mines’ (TSX: AEM; NYSE: AEM) Detour Lake open pit gold mine and Wallbridge Mining’s (TSX: WM; US-OTC: WLBMF) Fenelon gold project.
Newmont has a two-phased earn-in for up to an 80% interest by funding to a prefeasibility study with a minimum1.5-million oz. gold resource within nine years of an exploration agreement between the parties.
Flood notes that most majors don’t have field teams or teams dedicated to generative exploration on a regional scale, and staking ground can be a challenge to approve within the bureaucracy of a larger organization. “It comes down to their inability to move quickly and stake ground themselves. We bring these opportunities to them, along with a phased plan and budget to take the project from regional exploration to drill targets in a relatively short period of time. The land package is secured and planning is done in advance, so all they need to do is enter into an agreement and start funding the exploration.”
Elsewhere in Quebec, Kenorland has optioned its O’Sullivan gold project, where it recently completed its first drill program, to Sumitomo, and its Hunter gold project to Centerra. In Alaska, the company has optioned its 462-km2 Tanacross copper-gold-molybdenum project to Antofagasta, which can earn a 70% stake. The project hosts a cluster of late Cretaceous porphyry copper occurrences and is thought to be similar in age to the mineralization at Western Copper and Gold’s (TSX: WRN) Casino project, about 140 km to the southeast in the Yukon.
Other projects include Kenorland’s 70%-30% JV with Newmont on the Healy gold project in Alaska, and its 51%-49% JV with Sumitomo at the Chicobi gold project in Quebec.
Kenorland also has more than 10 wholly owned projects spread across Quebec, Ontario and Manitoba, where it is searching for copper, gold, nickel, lithium, and other metals.
One priority is the 834-km2 South Uchi project in the Red Lake district. The company recently completed several large geochemical surveys across the property targeting undiscovered gold, nickel, and lithium systems.
The company believes that discoveries like Great Bear Resources’ LP Fault zone at the Dixie project, which was later acquired by Kinross Gold (TSX: K; NYSE: KGC), highlight the prospectivity of the entire Confederation Assemblage along the southern margin of the Uchi Subprovince.
The company also has been consolidating land in northwestern Ontario in the Wabigoon Subprovince, just west of New Gold’s (TSX: NGD; NYSE: NGD) Rainy River mine. It has put together a land package of over 2,000 sq. km and is planning large-scale systematic geochemical surveys this summer.
“There are multiple targets developing in our portfolio that appear to be related to undiscovered mineral systems, which we will be drill testing within the next year or two.” Flood notes. “Any of these targets could become game changers for the company, like Regnault.
Kenorland shares traded at 71¢ apiece at press time, for a market cap of about $45 million.
The preceding Joint Venture Article is PROMOTED CONTENT sponsored by Kenorland Minerals and produced in co-operation with The Northern Miner. Visit: www.kenorlandminerals.com for more information.
October 31, 2024
October 31, 2024
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