TORONTO, June 18, 2012 /CNW/ - Northquest Ltd. (TSXV-NQ) (FWB: N3Q) ("Northquest" or the "Company") is pleased to announce that four mining claims (the "Subject Claims") have been added to the contiguous claim block of the Pistol Bay Gold Project. The Subject Claims were previously the subject of a Notice of Protest filed with the Mining Recorder of Nunavut and were awarded to the Optionor of the Subject Claims who has previously granted to Northquest an option to earn an interest in the Subject Claims.
As previously announced on December 2, 2010, the Company is party to an option agreement (the "Option Agreement") with a third party optionor pursuant to which it has been granted its option to earn a 100% interest in three mining claims (the "Original Claims") forming part of the project known as the Pistol Bay Project, in Nunavut Territory, Canada. Pursuant to the Option Agreement, the Company also acquired a supplemental option to acquire a 100% interest in the four Subject Claims, provided that title to such claims was subsequently awarded to the optionor upon resolution of a Notice of Protest. The Mining Recorder's Office of Nunavut has confirmed that the optionor has been awarded title to the claims.
As a result of this decision, the Company may now acquire a 100% interest in the Subject Claims by initially issuing 500,000 common shares and paying $50,000 to the optionor upon making a decision to exercise the supplemental option. On the first anniversary of such initial payment, the Company must pay $250,000 and on the second anniversary of such initial payment, the Company must pay $500,000. The payments for the supplemental option are optional and each of the first and second anniversary payments can be paid in cash, common shares, or any combination thereof at the Company's sole discretion.
In addition to the consideration for the option for the Original Claims and the supplemental option, in the event that a technical report discloses a Measured Mineral Resource of at least 1 million ounces of gold, on any property acquired through either the option or supplemental option, the Company must pay $0.75 per resource ounce of gold in increments of 1 million ounces. In the event that a technical report discloses a Measured Mineral Resource of over 5 million ounces of gold, the Company must pay $1.50 per resource ounce of gold in increments of 1 million ounces.
Northquest is a mineral exploration company focused on the acquisition, exploration and development of properties for the mining of gold and other minerals. Northquest has 25,315,823 shares outstanding (38,345,035 on a fully diluted basis). For further information please visit www.northquest.biz.
Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of Northquest, including, but not limited to, whether or not Northquest opts to exercise the supplemental option to acquire any interest in the Subject Claims, the impact of general economic conditions, industry and political conditions, volatility of commodity prices, risks associated with the uncertainty of exploration results and estimates and that the resource potential will be achieved on exploration projects, currency fluctuations, and the uncertainty of obtaining additional financing and exploration risk. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.
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For further information:
Dr. Jon North
President and Chief Executive Officer
Tel. (416) 306-0202
Tel. (416) 306-0486