King's Bay Gold Corporation (TSX.V: KBG) ("King's Bay Gold") is pleased to report that it has acquired 100 % ownership of the Gold Hill - Blackjack Property located in the Townships of Kirkup and Manross in the Kenora Mining District of Ontario. The property is located approximately 20 kilometres southeast of the City of Kenora, Ontario and is accessible from Highway 17 east to the Storm Lake Road. The property consists of 5 mining claims for 51 units covering an area of approximately 2,040 acres (approximately 826 hectares).
Under the terms of the Purchase and Sale Agreement dated January 20th, 2013 (the "Agreement"), King's Bay Gold will earn a 100% interest by completing one time payments to Luc Gagnon (50%) and David Clement (50%), the Vendors, totaling $18,100 CDN and the issuance of 500,000 common shares in the company. The common shares are to be issued within 10 days of receiving regulatory approval
of the Agreement. The Vendors understand and have acknowledged in the Agreement that the issued shares shall be subject to hold periods as required by the applicable policies of the TSX Venture Exchange and applicable securities laws. The Vendors will retain a 2.0 % Net Smelter Return (the "NSR") interest in the Property. King's Bay Gold can buy back one half or 1% of the "NSR" at any time by paying the vendor $1,000,000 CDN dollars.
King's Bay Gold President & CEO, Jim Rogers commented "The Rainy River to Kenora area is shaping up to be the newest gold mining district in Northern Ontario. With both Rainy River Resources Limited (TSX: RR) and Coventry Resources Limited (ASX: CVY) reporting positive Preliminary Economic Assessments (PEA), there is a high probability of new mine development that will bring increased activity and improved economics to the area. With our acquisition of the Black Jack Property, King's Bay Gold now has 4 road accessible gold properties within the Rainy River corridor that have the potential for gold discoveries. It has been over 100 years since any real exploration has taken place and in light of improved exploration and mining technology, the historical results suggest that the Black Jack property could have all of the ingredients to be a modern mine."
The property comprises the former Gold Hill Gold Mine (4 shafts) and Blackjack (1 shaft) property s, a past producer and a prospect, respectfully, as well as the Golden Gate gold prospect (1 shaft), the Combination Vein gold prospect (1 shaft), the Gold Lake copper (Cu), gold (Au), nickel (Ni) occurrence and the Hollow Lake copper (Cu) occurrence. The Blackjack, Gold Hill, Golden Gate and Combination Vein properties were all mined in the late 1800's. Work ceased in 1899 when the mill at the Gold Hill mine burned down.
Gold Hill has a reported historical production of 220 tons grading 4.95 oz Au/ton for a total historical production of 1,089 oz Au and Blackjack produced a historical bulk sample of fifty tons that produced 0.33 oz Au/ton. No production was reported from the Golden Gate and Combination Vein auriferous vein zones.
Historically, at Gold Hill, gold occurs mainly in the Pebble vein, a system of quartz veins in a shear zone hosted by mafic volcanics, within 1.6 kilometres of the western edge of the Dryberry Batholith. This batholith appears to be mineralized along its entire western contact. At Blackjack, gold occurs within and adjacent to ribboned and vein quartz in a highly fissile, chloritized, cross-cutting, carbonatized, shear zone, striking east-west, and within a highly silicified fine-grained felsic intrusive rock, possibly an offshoot of the batholith. The Pebble vein and shear zone system is reported to be continuous for at least 490 metres (or approximately 1,600 feet) (Kidd Creek). The shafts and numerous surface workings confirm this. It consists of a series of en echelon quartz veins in a shear zone that pinch and swell along a strike of from 110? to 125?, dipping an average of -75?S and ranging from eight inches to thirty inches wide. The vein system has been developed by three shafts with a reported fourth shaft of now uncertain location. The Gold Hill Pebble vein and Blackjack veins provided most of the ore mined.
The remains of two mills, two tailing ponds, and old newspaper clippings attest to the possibility of a much larger unreported historical production. The following shaft records indicate the amount of work done during this early period.
Goldhill #1 Shaft - 60' deep
Goldhill #2 Shaft- 150' deep, 2 levels totalling 83' drifting and crosscutting
Goldhill #3 Shaft - 25' deep
Goldhill #4 Shaft - 120' deep, 52' drifting
Shaft 112' deep, 2 levels and stoping area, l84' drifting on level 1, 25' drifting on level 2.
Shaft, 55' deep.
Shaft, 85' deep, drifting 50'. Extensive surface trenching on several veins.
The occurrence of a cross-cutting shear zone at the Blackjack, and carbonatized breccia zone at Gold Hill has allowed for a greater volume of gold to be concentrated, thus distinguishing these old prospects from many others in the area. The future potential of the Gold Hill - Blackjack property may lie in the delineation of these known structures laterally and vertically, and in the location of other, hitherto unknown ones nearby, and particularly the locus of vein convergence to the west of the Blackjack prospect under a swamp.
Other past producers in the region included the Sultana Mine, which produced 78,000 tons grading 0.21 oz Au/ton (16,000 oz Au), 7 miles to the northeast, and the Wendigo Mine, 4 miles to the southeast which produced 206,054 ton of ore grading 0.33 oz Au/ton (67,000 oz Au).
Three diamond drill holes were completed by Kerr Addison in 1968. A few surface property examinations were done in the 1980's, including one by Kidd Creek Mines in 1984-1985, when a combined air-mag and V.L.F. airborne survey of the whole then existent property occurred, backhoe clearing and washing all vein exposures was done, geological mapping of property and detail of surface workings was accomplished, and testing of I.P. and geochemical methods were undertaken. The Kidd Creek report recommended diamond drilling, but the company was taken over by Falconbridge and options dropped. No other significant drilling/mining has occurred here since 1899 and, except for two 100 metre diamond drill holes in 1990, one at Gold Hill and one at the Combination vein, no systematic drilling has ever occurred here.
King's Bay Gold's Qualified Person on the project, Russell Crosby, M.Sc., P.Geo. (ON) has reviewed and approved the content of this news release.
About King's Bay Gold Corporation
King's Bay Gold Corporation is an active Canadian mineral exploration and development company with mineral projects located in two of Canada's main gold camps - the Red Lake, ON and Rainy River, ON gold camps.
KBG Shares Outstanding: 97,726,913
King's Bay Gold Corporation
James Rogers P.Geo., CIM
President & CEO
This news release includes certain forward-looking statements concerning the future performance of King's Bay Gold Corporation's business, its operations and its financial performance and condition, as well as management's objectives, strategies, beliefs and intentions. The Company does not intend, and does not assume any obligation, to update these forward-looking statements. Forward-looking statements are frequently identified by such words as "may", "plan", "expect", "anticipate", "estimate", "intend" and similar words referring to future events and results. These forward-looking statements represent management's best judgment based on current facts and assumptions that management considers reasonable. The Company makes no representation that reasonable business people in possession of the same information would reach the same conclusions. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the speculative nature of mineral exploration and development, fluctuating commodity prices, competitive risks and the availability of financing and as described in more detail in the Company's recent securities filings available at www.sedar.com. Actual events or results may differ materially from those projected in the forward looking statements and readers are cautioned against placing undue reliance thereon.
Neither TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange Inc.) accepts responsibility for the adequacy or accuracy of this release.