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Aquila Resources Inc
Symbol AQA
Shares Issued 234,421,913
Close 2016-11-10 C$ 0.245
Market Cap C$ 57,433,369
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Aquila identifies new zone at Back Forty in Q3

2016-11-10 17:21 ET - News Release

Mr. Barry Hildred reports

AQUILA RESOURCES FILES Q3 2016 RESULTS

Aquila Resources Inc. has provided an update on its recent progress and has filed its financial results for its third quarter ended Sept. 30, 2016. All amounts, unless indicated, are reported in U.S. dollars.

Chief executive officer commentary

"Our third quarter was marked by significant progress as measured by our receipt of three draft mining permits for Back Forty, the discovery of a new mineral zone and the advancement of our feasibility study," said Barry Hildred, president and CEO of Aquila Resources. "We expect to carry this considerable momentum into 2017."

Mr. Hildred added: "In the near term, our primary focus will be on completing our permitting activities. Based on preliminary feedback from the Michigan Department of Environmental Quality (MDEQ) and other government agencies, we expect to submit a new Wetlands protection permit within the next 60 days. With the public notice period for the three draft permits now closed, we anticipate that the MDEQ will issue these final permits imminently. Given the significance of these pending developments and the need to optimize our mine plan accordingly, we have made the decision to defer publishing our feasibility study to the second quarter of 2017. In the interim, we will continue to optimize our mine plan while looking to incorporate earlier development of the underground resource."

Third quarter 2016 highlights:

  • Received public notice from the Michigan Department of Environmental Quality (MDEQ) of its proposed decision to issue a draft non-ferrous metallic mineral mining permit for the company's Back Forty project; the public notice and commentary period have since closed, effective Nov. 3, 2016;
  • Received draft national pollutant discharge elimination and air pollution control permits from the MDEQ;
  • Discovered a new mineralized zone at its gold- and zinc-rich Back Forty project in Michigan's Upper Peninsula and provided preliminary drill results from the discovery holes; a total of 10 drill holes were completed with the goal of testing extensions of known mineralization and geophysical targets in proximity to the known resource at Back Forty; assay results for two of the 10 holes have been received; the company expects assay results for the remaining holes in the coming months;
  • Received $1,875,000 associated with the silver stream component of the company's multilevel financing agreement signed with Orion Mine Finance in March, 2015; to date, the company has received silver stream payments totalling $14,225,000;
  • Advanced work on the feasibility study for Back Forty; progress included: completion of processing plant design; updating the mineral resource model; start of capital and operating expenditure estimates for the process plant and mine plan; and continued with confirmatory metallurgical testwork;
  • As at Sept. 30, 2016, Aquila had cash of $1.5-million and working capital of $900,000; this compares with cash of $3.3-million and working capital of $2.3-million at Dec. 31, 2015; the working capital decline is due to financing for the company's feasibility study and increased overhead costs primarily relating to permitting activities.

Aquila's management's discussion and analysis and financial statements for the third quarter ended Sept. 30, 2016, are available on the company's website and on the company's SEDAR profile.

Qualified person

This news release was reviewed and approved by Thomas O. Quigley, vice-president of exploration and senior technical adviser for the Back Forty project. By virtue of his education, experience and professional association, Mr. Quigley is considered a qualified person as defined under National Instrument 43-101. Information regarding data verification is provided in Aquila's annual information form dated March 30, 2016.

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