Stock Symbol: WGF: TSX-V
SASKATOON, April 27 /CNW/ - Wescan Goldfields Inc. ("Wescan") reports the
audited results of Wescan's operations for the year ended December 31, 2008
have been filed and may be viewed at www.sedar.com. A summary of key financial
and operating results for the year follows:
- Extensive package of coal permits received for areas around Hudson
Bay and Pinehouse Lake, Saskatchewan.
- Completion of the winter drill program on its 100% owned Jojay gold
project in the La Ronge greenstone belt in northern Saskatchewan.
- Further work completed on the exploration program on the Munro Lake
joint venture in northern Saskatchewan.
- Successful financings that raised in excess of $2.8 million.
- Working capital of $2.3 million at year end.
- Issued and outstanding shares of 75,121,390 at December 31, 2008.
In the second quarter of 2008, immediately following the announcement of
a significant coal discovery in the east central area of Saskatchewan, Wescan
applied for an extensive package of coal dispositions. Coal permit
applications covering approximately 253,000 hectares in this region were
submitted in accordance with the Coal Disposition Act of Saskatchewan.
During the third quarter of 2008, Wescan announced it had received an
initial tranche of 229 coal permit certificates from the Saskatchewan Ministry
of Energy and Resources. These permits comprised a total area of 161,777
hectares (1,618 square kilometres) in the Hudson Bay area which will allow the
Company to actively explore the area for coal (see Wescan news releases dated
July 30 and September 18, 2008).
In the fourth quarter of 2008 Wescan received 95 additional coal permit
certificates comprised of 52 from the Hudson Bay area and 43 from the
Pinehouse Lake area of northern Saskatchewan located west of La Ronge. A total
of 324 coal permits have now been issued to the Company encompassing a total
area of 190,992 hectares (1,910 square kilometres) in the Hudson Bay region
and 33,008 hectares (331 square kilometres) in the Pinehouse Lake area. The
permits cover a period of one year with two possible six-month extensions and
thereafter convertible to a 15-year lease.
A review of regional geophysics and detailed topographic data is
currently underway to define drill targets. Applications for environmental
permitting with the Saskatchewan Ministry of Environment for an exploration
program are also currently in progress. Upon receipt of these permits, the
Company plans to test several anomalies within the permit areas through a
multi-hole core drilling program.
Drilling on Wescan's advanced stage Jojay project continued in the first
quarter of 2008. This program commenced after the completion of the drill
program on the Company's Fork Lake project in late 2007. The 2007-2008 Jojay
drill program included 6,336 metres of core drilling over 22 holes and was
completed in late February, 2008. This drill program focused on infill
drilling required for a resource estimate. In addition, drilling down plunge
of the known mineralized zone resulted in a significant overall deepening of
the deposit. The northern mineralized zone was extended from 200 metres to 300
metres from surface and the southern mineralization was extended from 150
metres to 250 metres from surface. These drill results demonstrate the
significant increase of potential at Jojay.
In 2008, the Company commenced work on the summer line-cutting and soil
geochemistry program on the Munro Lake joint venture project. The 2008
exploration program aimed to study the extent of gold mineralization on the
property. Exploration was targeted on the mafic metavolcanics that extend from
the southern claim boundary north-westwards through Munro Lake. This program,
which commenced in the second quarter of 2008, included line-cutting, soil
geochemical sampling (25 metre intervals), prospecting and mapping. Initial
data interpretation from this program is currently underway. The Company's
project partner Shane Resources Inc. chose not to fund their portion of the
2008 exploration program and as a result their participating interest was
reduced in accordance with the joint venture agreement resulting in Wescan now
Mud Lake Option Agreement
The Company exercised its right to terminate its obligations pursuant to
the Option Agreement between Wescan and Alto Ventures Ltd ("Alto'). As a
result, Wescan forfeited its interest of any description in the mineral
dispositions of the property in the Beardmore-Geraldton Gold Belt of northern
Ontario and has written down all capitalized costs associated with the Mud
Under the terms of the 2007 Option Agreement, Wescan had an exclusive and
irrevocable option to acquire an undivided 50% interest in Alto's Mud Lake
Project by making $600,000 in exploration expenditures and issuing 150,000
Wescan shares to Alto over a two year period.
Athabasca Basin Properties
Wescan elected not to fund its portion of the current year exploration
program related to the Company's co-owned uranium exploration properties in
the Athabasca basin of northern Saskatchewan. As a result of this decision,
Wescan had its interest diluted in the eleven properties in accordance with
the joint operating agreement. The Company's interest in the properties had
been reduced to a non-participating, non-voting Net Smelter Return royalty of
0.5%. As a result, at December 31, 2008 the Company wrote down all capitalized
costs associated with the Athabasca basin properties.
Selected financial highlights include (as at December 31):
2008 ($) 2007 ($)
Current assets 2,724,519 3,526,360
Property and equipment 9,453,030 8,440,082
Current liabilities 381,548 528,085
Future income tax liability - 25,500
Share capital and warrants 14,799,329 12,308,919
Contributed surplus 1,444,117 1,148,301
Deficit 4,447,445 2,044,363
Statements of Loss
Interest and other income 103,829 199,248
Operating Expenses 1,678,704 1,589,050
Loss for the period before income taxes 1,574,875 1,389,802
Net loss and comprehensive loss
for the period 2,403,082 1,046,802
Loss per share 0.04 0.02
Statements of Cash Flows
Cash flows from operating activities (1,367,651) (695,561)
Cash flows from investing activities (2,297,652) (2,563,461)
Cash flows from financing activities 2,801,463 1,448,023
Decrease in cash and cash equivalents (863,840) (1,810,099)
Cash and cash equivalents - beginning of year 3,413,275 5,224,274
Cash and cash equivalents - end of year 2,549,435 3,413,275
As at April 24, 2009, the Company has $2.3 million in cash and cash
equivalents that will be used to establish a drill program on the recently
acquired coal permit properties as well as continue exploration programs on
the Jojay, Fork Lake, and Munro properties. In addition, the Company will
continue to evaluate the potential for acquisition of more mineral properties
in Canada and internationally. Management has determined that the Company will
continue to require additional financing and believes it will have sufficient
access to financial markets to continue its planned objectives.
Caution regarding Forward-looking Statements
From time to time, Wescan makes written or oral forward-looking
statements within the meaning of certain securities laws, including the "safe
harbour" provisions of the Ontario Securities Act. Wescan may make such
statements in this MD&A, in other filings with Canadian regulators, in reports
to shareholders or in other communications. These forward-looking statements
include, among others, statements with respect to Wescan's objectives for the
ensuing year, our medium and long-term goals, and strategies to achieve those
objectives and goals, as well as statements with respect to our beliefs,
plans, objectives, expectations, anticipations, estimates and intentions. The
words "may," "could," "should," "would," "suspect," "outlook," "believe,"
"plan," "anticipate," "estimate," "expect," "intend," and words and
expressions of similar import are intended to identify forward-looking
statements. In particular, statements regarding Wescan's future operations,
future exploration and development activities or other development plans
contain forward-looking statements.
All forward-looking statements and information are based on Wescan's
current beliefs as well as assumptions made by and information currently
available to Wescan concerning anticipated financial performance, business
prospects, strategies, regulatory developments, development plans,
exploration, development and mining activities and commitments. Although
management considers these assumptions to be reasonable based on information
currently available to it, they may prove to be incorrect.
By their very nature, forward-looking statements involve inherent risks
and uncertainties, both general and specific, and risks exist that
predictions, forecasts, projections and other forward-looking statements will
not be achieved. We caution readers not to place undue reliance on these
statements as a number of important factors could cause the actual results to
differ materially from the beliefs, plans, objectives, expectations,
anticipations, estimates and intentions expressed in such forward-looking
statements. These factors include, but are not limited to, developments in
world gold markets, risks relating to fluctuations in the Canadian dollar and
other currencies relative to the US dollar, changes in exploration,
development or mining plans due to exploration results and changing budget
priorities of Wescan or its joint operation partners; the effects of
competition in the markets in which Wescan operates; the impact of changes in
the laws and regulations regulating mining exploration and development;
judicial or regulatory judgments and legal proceedings; operational and
infrastructure risks and the additional risks described in Wescan's most
recently filed annual and interim MD&A and Wescan's anticipation of and
success in managing the foregoing risks.
Wescan cautions that the foregoing list of factors that may affect future
results is not exhaustive. When relying on our forward-looking statements to
make decisions with respect to Wescan, investors and others should carefully
consider the foregoing factors and other uncertainties and potential events.
Unless otherwise required by applicable securities laws, Wescan does not
undertake to update any forward-looking statement, whether written or oral,
that may be made from time to time by Wescan or on our behalf.
"Neither 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."
For further information:
For further information: Mr. Todd M. Grychowski, Chief Financial
Officer, 600 - 224 4th Avenue South, Saskatoon, SK, S7K 5M5, PH: (306)
664-2422, FAX: (306) 667-3557; OR Mr. Darren Anderson, Interim President, 600
- 224 4th Avenue South, Saskatoon, SK, S7K 5M5, PH: (306) 664-2422, FAX: (306)