Kinbauri Gold Corp.
110 Westhunt Drive
P.O. Box 158
Carp, Ontario K0A 1L0 CANADA
Stock Symbol: TSXV.KNB
FOR IMMEDIATE RELEASE 2009-07
KINBAURI RECEIVES FINAL SCOPING STUDY REPORT; CLOSES FIRST TRANCHE OF PRIVATE PLACEMENT
OTTAWA, ONTARIO, March 04, 2009: Kinbauri Gold Corp. ("Kinbauri") (Toronto: TSXV.KNB; Frankfurt: 3KG.DE) is pleased to announce that it has received the final report of the Preliminary Economic Assessment or Scoping Study (the "Scoping Study") prepared by Scott Wilson Roscoe Postle Associates ("SWRPA") for its 100% owned El Valle/Carl?s project (the "Project") in northwestern Spain. As announced in the press release February 12, 2009, under the base case scenario, the results reveal a pre-tax NPV (at a 10% discount rate) of CAD $132M and an IRR (internal rate of return) of 42%. Using current metal prices and exchange rates (as of February 12th) the Project has a pre-tax NPV (at a 10% discount rate) of CAD $221M and an IRR of 58%. The financial highlights of the study are summarized below.
Scoping Study(1) Financial Summary
Base Case Scenarios(2)
Current Metal Prices(3)
Undiscounted cash flow (pre-tax)
NPV @ 10% (pre-tax)
Undiscounted cash flow (after tax)
NPV @ 10% (after tax)
IRR (after tax)
Total gold production
Total copper production
(1) All conversions to CDN dollar are based on an exchange rate of 1.6 CDN equals 1 euro
(2) Base case price $750 Au, $2.50 Cu, Exchange rate Euro to USD 1.4
(3) Current price $910 Au, $1.50 Cu, Exchange rate Euro to USD 1.3
Cautionary Statement as Required by NI 43-101, Sect 2.3 (3): This assessment is preliminary in nature; it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary assessment will be realized.
The Scoping Study will be filed on SEDAR shortly.
Other Corporate Developments
Kinbauri also announced today that it has closed the first tranche of its previously announced (February 20) brokered private placement of up to 6,666,667 Units of Kinbauri at a price of $0.45 per Unit. The first tranche consisted of 3,208,601 Units for a total of $1,443,870.45. Each Unit consists of one common share and one-half of a common share purchase warrant. Each whole warrant entitles the holder to purchase one common share at a price of $0.70 for a period of 12 months from the date of issuance. The securities are subject to a four month hold period from the date of the closing.
In connection with the closing of the first tranche of the offering, M Partners Inc. has been paid a commission of $59,030.59, and broker warrants to purchase an aggregate of 131,179 Units at a price of $0.45 for a period of 12 months from the date of the closing. The proceeds of the financing will be used for general working capital purposes and the advancement of the El Valle/Carl?s project in northwestern Spain. The placement is subject to acceptance by the TSX Venture Exchange.
Kinbauri continues its assessment of strategic alternatives towards advancing the Project for the purpose of ensuring maximum shareholder value (see press release dated December 15th, 2008). The Company plans to release an update on this in the near term. Dr. Vern Rampton, Kinbauri's President and Chief Executive Officer commented, "We are pleased to be making this level of progress in advancing the El Valle project in these difficult times. We believe it says a lot for the quality of the project and the people we have working on it."
This press release has been prepared by Dr. V. N. Rampton, P. Eng in his capacity as a qualified person under the guidelines of NI 43-101.
Kinbauri is a TSXV - Tier 1 Mineral Exploration Company focused on the development of precious metal prospects in Spain, Nevada and Canada. Its immediate focus is to begin operations at its El Valle/Carl?s property in Asturias, northwestern Spain by 2011. Immediately prior to this placement it had 48,894,450 common shares issued and outstanding.
THIS PRESS RELEASE WAS PREPARED BY KINBAURI GOLD CORP. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This press release contains certain forward-looking statements, which are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected. Kinbauri undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
FOR FURTHER INFORMATION CONTACT:
Darrell Munro, BB.A, LL.B, Manager, Corporate Communications
Tel: (613) 836-0198
Dr. Vern Rampton, P. Eng., President firstname.lastname@example.org
Tel: (613) 836 2594 Fax: (613) 831 2730
Ruediger (Rudy) Hnyk, CEO
Investor Relations & Telecommunications
Kinbauri Gold's Hub at http://www.agoracom.com/IR/kinbauri where investors can post questions and receive answers or review questions and answers already posted by other investors. Kinbauri Web-Site: www.kinbauri-gold.com