Mr. Zach Flood reports

KENORLAND OPTIONS THE SOUTH UCHI PROJECT TO AURANOVA RESOURCES INC.

Kenorland Minerals Ltd. has entered into a definitive agreement with Auranova Resources Inc., pursuant to which the company has agreed to grant to Auranova the right to acquire an up-to-70-per-cent interest in the South Uchi project, located in the Red Lake district of Northwestern Ontario.

Option agreement

Under the terms of the agreement, Auranova may acquire an initial 51-per-cent interest in the project by fulfilling the following conditions:

• Pay $250,000 upon signing the agreement;
• Pay an additional $250,000 upon receiving the drilling permit (as defined in the agreement);
• Complete at least 15,000 metres of diamond drilling or incur $8-million in qualifying expenditures on or before the second anniversary of the drilling permit issuance;
• Issue to Kenorland common shares of Auranova, representing a 19.9-per-cent equity interest;
• Grant Kenorland the right to receive additional shares, for no additional consideration, to maintain a 19.9-per-cent equity ownership until Auranova raises a minimum of $10-million through share issuances;
• Enter into an investor rights agreement, granting Kenorland the right to appoint one director to Auranova's board and maintain its pro rata equity ownership, for so long as Kenorland holds a 7.5-per-cent interest therein;
• Kenorland shall act as operator during the first option period in exchange for a management fee equal to 15 per cent of total expenditures.

Second option: acquiring an additional 19-per-cent interest

If Auranova exercises the first option, it will have the right to acquire an additional 19-per-cent interest in the project, for an aggregate 70-per-cent interest, by incurring an additional $10-million in qualifying expenditures on the project on or before the third anniversary of Auranova's election to proceed with the second option. If Auranova does not exercise the second option, it will transfer a 2-per-cent interest back to Kenorland, resulting in Kenorland holding a 51-per-cent interest and Auranova holding a 49-per-cent interest under a joint venture arrangement.

Joint venture and free carried interest

Upon completion of the second option, Auranova will hold a 70-per-cent interest in the project, and Kenorland will retain a 30-per-cent free carried interest until the completion of a National Instrument 43-101-compliant preliminary economic assessment, demonstrating at least one million ounces of gold equivalent in any category of mineral resource. Kenorland will also have the right to receive common shares of Auranova, for no additional consideration, to maintain a minimum 10-per-cent equity ownership in Auranova from the election to exercise the second option until the PEA is delivered. If a party's joint venture interest is diluted below 10 per cent, it will automatically convert to a 1-per-cent net smelter return royalty.

South Uchi geologic summary

Multiple major east-west-striking shear zones associated with the subprovince boundary between the volcanic-dominated Uchi geological subprovince to the north and the sedimentary-dominated English River geological subprovince to the south transect the project along its 90-kilometre strike length. The regional, east-west-striking deformation zones have strongly deformed the underlying Confederation assemblage volcanic rocks, a similar geologic setting to Kinross Gold's Great Bear project, located 45 kilometres along strike to the west. Deformation associated with these structures has resulted in zones of strong shearing, alteration and folding of the metavolcanic-clastic metasedimentary-iron formation stratigraphy. Gold mineralization hosted within intrusive, sedimentary and volcanic rock types is associated with penetrative fabrics, quartz-sulphide veining and variable alteration assemblages.

Systematic, regional geochemical sampling surveys completed between 2021 and 2023 defined two large-scale, coherent gold-in-till anomalies (see press release dated Feb. 28, 2024); the Papaonga target (gold-silver-tellurium-tungsten plus or minus arsenic-antimony) and Target B (gold-tellurium-tungsten plus or minus silver ) areas.

Papaonga target area summary

The Papaonga target is a large gold-in-till and heavy mineral concentrate (HMC) gold grain anomaly, covering approximately five kilometres of east-west strike length and eight km along the northeast-southwest ice flow direction. It is highlighted by newly discovered bedrock gold mineralization during the 2024 summer exploration program (see press release dated Sept. 11, 2024). The underlying geology is within the eastern pressure shadow of an interpreted early (pre to syntectonic) diorite pluton bounded by regional first-order, major east-west-trending deformation zones to the north and south. Northeast-trending, second-order structures have intensely deformed, folded and offset a geologically complex stratigraphy consisting of clastic sedimentary rocks intercalated with iron formations and polymictic conglomerates, calc-alkaline mafic volcanics, and tholeiitic mafic volcanics. Multiphase deformation has produced strong penetrative fabrics within all rock types (intrusive, sedimentary and volcanic rocks) commonly associated with sericite, iron carbonate, chlorite and calcite alteration.

During the 2024 summer field season, Kenorland conducted an HMC till sampling survey, mapping and prospecting program at the Papaonga target area. The program focused on identifying bedrock sources of gold-in-till dispersal plumes outlined in the 2023 exploration campaign. The HMC till sampling returned strong gold grain counts, including a peak of 951 total gold grains, 91 per cent of which was pristine, coinciding with the previously identified fine fraction gold-in-till anomaly. Prospecting efforts identified widespread gold and silver mineralization in outcrop, with rock sampling assay results of up to 13.35 grams per tonne Au and 60.4 g/t Ag. The prospecting campaign identified widespread gold mineralization across the Papaonga target area, associated with northeast-trending shear zones and multiple lithologies. These include diorite plutons, clastic sedimentary rocks and mafic volcanic rocks, each showing evidence of long-lived, overprinting hydrothermal alteration systems. The results further confirm the potential of the Papaonga target as a significant, previously unrecognized gold system.

About the South Uchi project

The South Uchi project was first identified and staked by Kenorland based on the region's prospectivity to host significant gold mineralized systems. The project covers a portion of Confederation assemblage volcanic rocks, as well as the boundary between the Uchi geological subprovince to the north and the English River geological subprovince to the south. Multiple major east-west-striking deformation zones associated with the subprovince boundary transect the project resulting in zones of strong shearing and folding of the supracrustal stratigraphy, which are favourable settings for orogenic gold mineralization. Prior to Kenorland staking the project, records indicated little to no systematic exploration had been completed, and the land package remained underexplored. The majority of gold deposits in the Red Lake district (Red Lake, Madsen, Hasaga and others) is located on the northern margin of the Confederation assemblage; however, recent discoveries such as the LP fault zone on the Dixie project by Great Bear Resources Ltd. (acquired by Kinross Gold and renamed Great Bear project) highlight the prospectivity of the entire Confederation assemblage along the southern margin of the Uchi subprovince.

Kenorland holds a 2-per-cent net smelter return royalty on the project (see press release dated Sept. 16, 2024).

Qualified person

Janek Wozniewski, BSc, PGeo (EGBC No. 172781, APEGS No. 77522, EGMB No. 48045 and PGO No. 3824), qualified person under National Instrument 43-101, has reviewed and approved the scientific and technical information in this press release.

About Kenorland Minerals Ltd.

Kenorland is a well-financed mineral exploration company focused on project generation and early-stage exploration in North America. Kenorland's exploration strategy is to advance greenfield projects through systematic, property-wide, phased exploration surveys financed primarily through exploration partnerships, including an option to joint venture agreements. Kenorland holds a 4-per-cent net smelter return royalty on the Frotet project in Quebec, which is owned by Sumitomo Metal Mining Canada Ltd. The Frotet project hosts the Regnault gold system, a greenfield discovery made by Kenorland and Sumitomo in 2020. Kenorland is based in Vancouver, B.C., Canada.

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