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West Kirkland Mining Inc
Symbol WKM
Shares Issued 294,134,169
Close 2015-11-27 C$ 0.055
Market Cap C$ 16,177,379
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West Kirkland receives Three Hills construction permit

2015-11-27 10:14 ET - News Release

Mr. Sandy McVey reports

WEST KIRKLAND OBTAINS FEDERAL PERMIT TO CONSTRUCT AND OPERATE THREE HILLS MINE

West Kirkland Mining Inc. has received a decision record (DR) and finding of no significant impact (FONSI) for the environmental assessment (EA) of the Three Hills mine project located approximately one mile west of Tonopah in Esmeralda county, Nevada. The DR signifies completion of the National Environmental Policy Act (NEPA) and EA process and is the final major permitting step for construction to begin.

"We are very happy to have completed both a prefeasibility study and permitting at the Three Hills mine since acquiring the property in April, 2014. Construction permits significantly add to the value of any property -- this is a big step forward for West Kirkland. We appreciate the professionalism and hard work of the BLM staff, the staff at all involved state agencies, and our consultants for making this happen so quickly. We will now consult with our major shareholders on the next steps for the project," said R. Michael Jones, president and chief executive officer of West Kirkland Mining.

About the NEPA and EA process

The EA for the Three Hills mine is required under NEPA. The acts set up the procedural requirements for all federal governmental agencies to prepare environmental assessments in response to proposed major activities on federal lands. Part of Three Hills mine is on federal lands administered by the Bureau of Land Management, therefore NEPA requires the BLM to prepare an EA to analyze potential environmental consequences of the planned project and any reasonable alternatives. West Kirkland has advanced through baseline studies, the draft EA and the final EA and has now completed the process with the issuance of a decision record. Various state permits are also required and have either been obtained or are in the final stages of being processed by state agencies.

Technical report filed

The EA is based on the technical report that West Kirkland filed on SEDAR on July 17, 2015, titled "Technical Report and Preliminary Feasibility Study: Hasbrouck and Three Hills Gold-Silver Project, Esmeralda County, Nevada," effective June 19, 2015, and prepared in conformance with National Instrument 43-101 by Thomas L. Dyer, PE, and Paul Tietz, CPG, of Mine Development Associates (MDA), who are West Kirkland's independent qualified persons as defined under NI 43-101.

The project's base case has an after-tax internal rate of return (IRR) of 26 per cent and $75-million net present value at 5-per-cent discount rate (NPV 5 per cent) using prices of $1,225 per ounce gold and $17.50 per ounce silver (all reported values are in U.S. dollars and based on 100 per cent of the project). Initial capital to construct the Three Hills mine is estimated at $54.3-million, with an additional $34.8-million required in year 1 of the project to commence construction of the Hasbrouck mine. Processing is planned at an average 6.1 million ore tons per year for 71,000 ounces annual gold production for eight years.

An alternative to the base case is to delay construction of the Hasbrouck mine for four months, which would allow cash flow from the Three Hills mine to fully finance the construction of the Hasbrouck mine while only slightly reducing after-tax IRR from 26 per cent to 24 per cent and NPV from $75-million to $71-million.

About the Hasbrouck gold project

Located near Tonopah, Nev., the Hasbrouck gold project consists of two oxidized gold deposits eight kilometres apart, Three Hills and Hasbrouck. West Kirkland has a 75-per-cent controlling interest in the project. In 2015, Waterton Precious Metals Fund II Cayman LP bought a 25-per-cent interest in the Hasbrouck gold project and certain exploration assets from Allied Nevada Gold Corp. for $17.5-million (U.S.).

Sandy McVey, PEng, chief operating officer for West Kirkland and a non-independent qualified person as defined by NI 43-101, has reviewed the information contained in this news release and has verified the data.

We seek Safe Harbor.

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