In parallel with the exploration work metallurgical analysis has been ongoing. The findings from column leach tests on two bulk samples from material approaching the mixed sulphide oxide boundary support suitable copper recoveries with acid consumption identified as a key risk for a potential development project. Further bottle roll tests, to better understand the potential to lower and optimize acid consumption relative to copper recoveries, are planned as is the potential testing of a third bulk sample from material thought to be more representative of the broader West Kasulu oxides resource which is expected to have higher copper recoveries than the previously tested transitional material.
Desktop reviews and initial discussions for the availability and sources of water and acid have been progressed. A further small scale infill drilling programme and additional metallurgical analysis is contemplate which if favourable would help a decision to move to pre-feasibility studies.
Golden Grouse licenses activities and update - As announced on February 8th, 2013, a yet unsubstantiated local Mongolian media report alleges 107 licenses previously issued by Mineral Resources Authority of Mongolia ("MRAM") to unrelated parties are in violation of Mongolia's laws and that these licenses could be repatriated by the State, with compensation expected to be paid prior to any license(s) being cancelled. Included in the 107 licenses listed are two licenses held by Kincora's wholly owned subsidiary, Golden Grouse LLC ("GG"), a company purchased in April'12 from Temujin Mining Corp ("Temujin"). To the best of our knowledge the GG licenses are currently in good standing. Only in 3Q'12 was this confirmed by MRAM when Kincora was granted the first three year extension of the nine year exploration term.
The two GG licenses adjoin Kincora's flagship Bronze Fox project and host the Tourmaline Hills and North Fox earlier stage exploration targets which are lower priority targets for Kincora. The Company's core Bronze Fox project containing the majority of the primary exploration targets (and whose exploration results have been discussed at length in this exploration review), is held by a separate wholly owned subsidiary to GG and has not in any way been associated with the above-noted case.
Despite our efforts neither the Company nor GG have been able to determine if the allegations included in the local media report are in any way accurate with no official statement from the court nor correspondence from a Mongolian government authority, including MRAM, yet available. Neither Kincora, Temujin nor any of their employees have been associated with any wrongdoing.
A summary of exploration activities undertaken by Kincora since the acquisition of GG includes:
-- North Fox - Geological mapping over the north licence (15076X) was completed during October and November. 174kms were mapped at 1:50,000 scale. A small zone of Cu and Au mineralisation associated with magnetite-quartz-tourmaline veins and breccia has been identified. The purpose of this work was to meet the minimum tenement expenditure requirement and also to gather basic geological information, which was previously lacking for the license.-- Tourmaline Hills - Within the western license (15075X), 9 of the 16 holes drilled this year have returned intervals of greater than 1g/t Au, up to 7.7g/t Au and with up to 75g/t Ag locally in the mineralisation zone, often with elevated copper values. One new mineralisation zone appears in the west of Tourmaline Hill (F81 zone with an accumulated 4m @ an average of 2.84g/t Au and up to 75g/t Ag locally) that has an IP signature of about 1.5km strike length remain to be tested.
