Reliant Gold Provides Corporate Update and Progress Report on Its East Bay Property, Located in the McVicar Lake Area
TORONTO, Sep 28, 2016 - Reliant Gold Corp. ("Reliant Gold" or the "Corporation") (TSX VENTURE:RNG) is pleased to provide a (i) corporate update and (ii) progress report on its East Bay Property, located in the McVicar Lake area of northwestern Ontario, Canada. Please see below an Ontario map showing the location of the Corporation's East Bay Property. To view the map, please visit the following link: http://media3.marketwire.com/docs/rng0928map1.pdf.
I. RELIANT GOLD - CORPORATE UPDATE
The public junior mineral exploration and mining sector in Canada has been in a downturn cycle for nearly the past eight years. As a result, publicly-traded Canadian junior mineral exploration and mining companies have experienced significant challenges in successfully completing equity financings in order to raise much-needed capital to:
| (i) | carry out exploration and development activities; |
| (ii) | acquire new projects that are prospective for mineral discovery; |
| (iii) | fund working capital requirements; and |
| (iv) | pay for the ongoing regulatory costs of maintaining a stock exchange listing. |
Reliant Gold has not been immune to these significant challenges affecting the broader Canadian public junior mineral exploration and mining sector. However, as a result of management's commitment to (i) constraining expenses and (ii) protecting its shareholders by preserving the Corporation's stock exchange listing, Reliant Gold has been able to deftly manoeuvre through the past several years of a cyclical downturn in the mining sector.
Since re-joining the board of directors (the "Board") and senior management team of Reliant Gold in January 2016, Kabir Ahmed, the Corporation's Chairman, President and CEO, has quickly taken a number of strategic steps to:
| (i) | to re-capitalize the Corporation; |
| (ii) | build up a new management and geological exploration team; |
| (iii) | commence the process to possibly re-start early-stage exploration activities at its current East Bay Property; and |
| (iv) | evaluate additional mineral projects - that are prospective for gold discovery - for possible future acquisition. |
Because Mr. Ahmed has ownership of 14.5% of the issued and outstanding common shares of the Corporation, he is squarely aligned with the best interests of Reliant Gold and its shareholders. For instance, since January 2016, Mr. Ahmed has been executing on a strategic plan that will hopefully build success for Reliant Gold and increase value for its shareholders. A summary of the steps taken, to date, under the strategic plan, include the following:
| (i) | changes to the Board and management team were made; |
| (ii) | a new Chief Financial Officer was appointed; |
| (iii) | in May 2016, Mr. Ahmed and a director of Reliant Gold invested their own personal funds of a combined amount of $30,000 into Reliant Gold in order to re-capitalize the Corporation; |
| (iv) | in June 2016, Mr. Ahmed successfully completed the sale of the Corporation's remaining 49% interest in the Borden Lake South Property mineral claims to Goldcorp Inc. By doing so, Reliant Gold was able to generate much-needed capital to fund the ongoing regulatory expenditures related to maintaining the Corporation's stock exchange listing and keeping the Corporation's current interest in the East Bay Property mineral claims in "good standing"; and |
| (v) | Mr. Rick Risto, M.Sc., P.Geo., Senior Associate Geologist of Watts, Griffis and McOuat Limited, was appointed as the Corporation's independent geological consultant and Qualified Person, as defined under National Instrument 43-101 - "Standards of Disclosure for Mineral Projects" (As Consolidated on May 9, 2016). Mr. Risto will assist Reliant Gold in evaluating its East Bay Property and identifying potential new acquisitions that are prospective for gold mineralization. |
II. PROGRESS REPORT ON RELIANT GOLD'S EAST BAY PROPERTY
A. Description of the East Bay Property
Reliant Gold's East Bay Property, comprised of 56 mineral claim units totalling 896 hectares, is located in the McVicar Lake area, approximately 90 kilometres west of Pickle Lake, Ontario, and 130 kilometres southwest of Goldcorp Inc.'s Musselwhite Gold Mine. The East Bay Property may be accessed by road from Thunder Bay, Ontario to Pickle Lake, Ontario, where a float plane can then be taken from Pickle Lake to the East Bay Property. Please refer to the Corporation's press release dated March 16, 2015 for additional information on the East Bay Property (the "March 2015 PR").
The following map shows the location of the East Bay Property, in relation to Pickle Lake; Goldcorp Inc.'s Musselwhite Gold Mine; and Thunder Bay.
To view the map, please visit the following link: http://media3.marketwire.com/docs/rng0928map2.pdf.
A report with respect to the East Bay Property dated January 31, 2004, filed with the Ministry of Northern Development and Mines, Ontario entitled "Report on the 2003 Overburden Stripping, Geological Mapping and Sampling Program conducted on the McVicar Lake Property, Patricia Mining Division, Northwestern Ontario" (the "Report") and prepared for Continuum Resources Ltd. and Prospector Consolidated Resources Inc. by D.B. McKay, M.Sc., P.Geo. of Eveleigh Geological Consulting, describes the previous work performed on the property and surrounding area and results thereof.
The Report was filed on SEDAR by Continuum Resources Ltd. on February 16, 2004. The exploration results summarized in the Report are historical in nature and were compiled by previous operators, in part, prior to the implementation of National Instrument 43-101 and are noted for reference purposes only. Because these results were compiled by previous operators, Reliant Gold and its independent Qualified Person, Mr. Rick Risto, M.Sc., P.Geo., Senior Associate Geologist of Watts, Griffis and McOuat Limited, have not verified them as yet and they should not be relied upon.
The Report lists a total of thirteen significant gold bearing intersections on the East Bay Property's Altered Zone and North Flexure Zone from previous diamond drilling programs conducted between 1984 and 2003. Please refer to the Corporation's March 2015 PR for a summary table presenting the historical thirteen gold bearing intersections. Please note that the nature of the geological setting of the mineralized bodies results in highly variable shapes and orientations of the zones and, as a result, no estimation of the true width of the intersections can be provided for these results at this stage.
In order to fully evaluate the potential and prospectivity of the East Bay Property for gold mineralization, the Corporation has now commenced the process of renewing its interests in the mineral claims underlying the East Bay Property and keeping them in "good standing".
B. Consultations with First Nations Communities and Protocol for Carrying Out Early-Stage Exploration
Earlier this week, Mr. Ahmed met with the exceptional staff of the Ontario Ministry of Northern Development and Mines (the "MNDM") to consult with and receive guidance from the MNDM with respect to the protocol for carrying out early-stage exploration in northwestern Ontario. The MNDM "advocates on behalf of Ontario's northern region, as well as on behalf of the province's minerals industry" (www.mndm.gov.on.ca). In addition, the MNDM also administers the Mining Act of Ontario (the "Act"), and the regulations under the Act. The purpose of the Act "is to encourage prospecting, staking and exploration for the development of mineral resources, in a manner consistent with the recognition and affirmation of existing Aboriginal and treaty rights in section 35 of the Constitution Act, 1982, including the duty to consult, and to minimize the impact of these activities on public health and safety and the environment". (www.mndm.gov.on.ca).
The Act specifies that if and when a mineral exploration company wishes to carry out early exploration activities pursuant to an Exploration Plan, as prescribed in the accompanying Regulations, it must (i) engage in sharing of information and consultations with the First Nations Communities in the relevant region and (ii) submit an Exploration Plan to the MNDM, which is also provided to First Nations Communities in the relevant region. Reliant Gold strongly believes in early engagement and consultations with First Nations Communities in the relevant region, since such early engagement and consultations will help to build a collaborative relationship with our First Nations neighbors. In turn, participation from the First Nations Communities in the relevant region, at an early stage, will ensure that their concerns are reflected in and responded to in an Exploration Plan, even before it is submitted to the MNDM. In addition to the protocols of the MNDM, Reliant Gold may also be subject to other regulations and permit requirements before early exploration activities pursuant to an Exploration Plan, as prescribed in the accompanying Regulations under the Act, may be commenced.
"I look forward to initiating and fostering early and collaborative consultations with our First Nations neighbors in the relevant region," said Kabir Ahmed, Chairman, President and CEO of Reliant Gold. "It is only through such collaborative engagement and meaningful consultations - based on mutual respect - that the dual objectives of (i) respecting the concerns and rights of our First Nations neighbors and (ii) creating economic opportunities in northwestern Ontario by carrying out mineral exploration may both be achieved."
C. Flow-Through and Working Capital Financing Will Be Required
In addition to the required coordination and consultation that is expected to be carried out in collaboration with the MNDM and First Nations' Communities in the relevant region, it will be necessary, in the very near future, for Reliant Gold to raise a combination of Flow-Through ("FT") and Working Capital ("WC") financing in order to (i) fund early exploration activities at the Corporation's East Bay Property; (ii) evaluate and acquire additional mineral exploration projects; and (iii) meet the Corporation's ongoing working capital requirements, respectively. It is expected that the Corporation will make a public announcement if and when a financing is proposed to be carried out. Details of possible terms and conditions of any proposed financing will also be disclosed at that time.
Mr. Rick Risto, M.Sc., P.Geo., Senior Associate Geologist of Watts, Griffis and McOuat Limited ("WGM"), and a Qualified Person as defined by National Instrument NI 43-101 ("NI 43-101"), supervised the preparation of the technical information contained in this press release in compliance with NI 43-101. Both Mr. Risto and WGM are independent of Reliant Gold.
ABOUT RELIANT GOLD
Reliant Gold is a junior mineral exploration company with an experienced management team engaged in the acquisition, exploration and development of properties for the mining of precious and base metals. Reliant Gold currently holds a 100% interest in the East Bay Property, comprised of 56 mineral claim units totalling 896 hectares in the McVicar Lake area, located approximately 90 kilometres west of Pickle Lake, Ontario, and 130 kilometres southwest of Goldcorp Inc.'s Musselwhite Gold Mine.
The common shares of Reliant Gold trade on the TSX Venture Exchange under the stock symbol "RNG". The Corporation has 22,945,169 common shares issued and outstanding.
FORWARD-LOOKING STATEMENTS
Certain statements in this press release may constitute "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of Reliant Gold or the industry in which it operates to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this press release, the words "estimate", "believe", "anticipate", "intend", "expect", "plan", "may", "should", "will", the negative thereof or other variations thereon or comparable terminology are intended to identify forward-looking statements. Such statements reflect the current expectations of the management of Reliant Gold with respect to future events based on currently available information and are subject to risks and uncertainties that could cause actual results, performance or achievements to differ materially from those expressed or implied by those forward-looking statements. These risks and uncertainties are detailed from time to time, including, without limitation, under the heading "Risk Factors", in Reliant Gold's prospectus and in other continuous disclosure documents that are filed by Reliant Gold from time to time with the Ontario, Alberta or British Columbia Securities Commissions which are available at www.sedar.com and to which readers of this press release are referred for additional information concerning Reliant Gold, its prospects and the risks and uncertainties relating to Reliant Gold and its prospects. New risk factors may arise from time to time and it is not possible for management to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance and achievements of Reliant Gold to be materially different from those contained in forward-looking statements. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, Reliant Gold cannot assure investors that actual results will be consistent with these forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.
The forward-looking information contained in this press release is current only as of the date hereof. Reliant Gold does not undertake or assume any obligation, except as required by law, to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
No securities commission or regulatory authority has approved or disapproved the contents of this press release.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contact
Reliant Gold Corp.
Kabir Ahmed, Chairman, President, CEO and Director
(416) 820-4107
info@reliantgold.com