Report #5

Helicopter-borne VTEM survey. Picture from Geotech Ltd., a global leader in technological innovation for airborne geophysical survey mapping, interpretation and analysis. The clarity of their data lets you see with accuracy and detail what’s beneath the earth, from near the surface to great depths. The VTEM+ system has a penetration depth of more than 800 m.

Today, King’s Bay announced preliminary results of the recently completed VTEM+ geophysical survey over its 100% owned Lynx Lake Property in southeastern Labrador, Canada. From the information provided by Geotech Ltd., King’s Bay identified several potential anomalies. As Geotech flew 382 line km (or 50 km2) over approximately 21% of the property (total size 240 km2), there is plenty room for more discoveries.

One of those identified anomalies is located in the eastern quarry pit (excavated by the Department of Transportation during construction of the near-by highway), where historic assays of up to 0.94% cobalt, 1.39% copper, 0.21% nickel and 6.5 g/t silver showed the great exploration potential.

The full report from Geotech is expected by the end of April. Once received, King’s Bay will analyze and interpret the data, and is expected to prepare for a maiden drill program to potentially discover a cobalt-rich deposit beneath shallow overburden.

Government regional low resolution residual magnetic surveys, and preliminary handheld electromagnetic surveys done by local prospectors, have shown strong conductors beneath the overburden, and provide incentive to explore the area further for additional subsurface mineralization.

In an increasing fashion, cobalt is grabbing headlines across the globe. The race is on to find non-Congolese cobalt supply.

Although the Lynx Lake Property has never been drilled before, the sampling assays in both the eastern and western part of the property (before it was expanded from 20 to 240 km2) indicate the possibility for a large body of mineralization at shallow depths.

Thanks to excellent road accessibility to deep sea water ports, a power line that runs directly adjacent to the property and the proximity to the town of Happy Valley-Goose Bay, it appears to be a perfect time now to explore this highly prospective property amid rising energy metal prices, first and foremost the battery-critical element cobalt.

Prior to 2008, the Lynx Lake Property was deemed too remote and as such remained virtually unexplored. In 2008, the Department of Transportation constructed the new Trans-Labrador Highway, which now runs through the property. During blasting (for road aggregate) on the property in the same year, disseminated and massive sulphide mineralization was discovered near surface.

In 2009, local prospectors sampled and assayed this aggregate quarry on the eastern portion of the property and assayed up to 0.94% cobalt, 1.39% copper, 0.21% nickel and 6.5 g/t silver.

In 2014, regional low resolution magnetic surveys by the government and hand-held electromagnetic surveys by local prospectors revealed strong conductors beneath the overburden.

In 2015, the western portion of the property was grab sampled, yielding up to 0.57% cobalt, 1.03% copper, 0.1% nickel, 0.36% chromium, 0.39% molybdenum, 0.23% vanadium and 5 g/t silver.

Previous coverage on King’s Bay noted that the year 2017 is poised to become a breakout year for cobalt prices. Having assembled a quality portfolio of 5 prospective cobalt exploration projects in Newfoundland and Québec, King’s Bay enjoys an early mover advantage in the cobalt space.



The Cobalt Boom

Bloomberg Thomas Wilson, April 19, 2017:
“Glencore Cobalt Supplies in Congo Face Hold Up Over Mine Row”

Sebastien Gandon, April 12, 2017:
“China’s Green Vehicle Revolution To Reshuffle The Cards For Cobalt“

Reuters Andy Home, April 10, 2017:
“If you thought lithium was exciting, try cobalt“

John Petersen, April 7, 2017:
“Cobalt: The Weak Link In Tesla’s Supply Chain“

Stefan Sabo-Walsh, March 29, 2017:
“The Hidden Risks of Batteries: Child Labor, Modern Slavery, and Weakened Land and Water Rights : With demand for cobalt and lithium surging, companies need to be aware of where they’re sourcing from”

Megan Dailey, March 25, 2017:
“Lithium and Cobalt: Where’s It All Coming From? Changing supply lines put the spotlight on a few big producers...“

The Economist, March 11, 2017:
“Mining companies have dug themselves out of a hole: Electric vehicles and batteries are expected to create huge demand for copper and cobalt“

Sebastien Gandon, November 18, 2016:
“Cobalt Is Keeping Battery Makers Awake At Night“

The price of cobalt is rising due to a combination of factors, some of which are related to unsettled conditions in areas such as the DR Congo, where the majority (up to 65%) of the world’s cobalt is mined. Other factors include an increased demand for batteries. A single rechargeable car battery contains some 23 kg of cobalt. By 2020, cobalt use in batteries alone could be greater than the entire world market for refined cobalt in 2015. China refines 52% of the world‘s cobalt. The silver-gray metal is also used in alloys for aircraft engine parts and for alloys with corrosion/wear resistant uses.

“Auto makers need cobalt that is not mined artisanally because the supply chain gets audited. So the hot commodity is to find non-Congolese cobalt sulphate and nickel sulphate.” (James West)

“In many ways, the cobalt industry has the most fragile supply structure of all battery raw materials.” (Andrew Miller)

“CRU estimates that the Electric Vehicle (EV) sector will consume around 4% of the world’s refined cobalt units in 2016. Whilst the industry remains in its infancy it is expected to drive much of the demand growth for refined cobalt units - in the form of battery grade cobalt sulphate. CRU estimates that combined production of pure electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs) will increase from around 1.15 million vehicles in 2016 to around 3.6 million in 2021. This will help increase global cobalt demand for plug-in vehicles at an average rate of around 20% per annum for the next five years. CRU expects over 40% of the world’s pure EVs to be sold in China over the next five years. As a result, global cobalt demand growth will be influenced by changes in the popularity of different battery types in the market. A considerable proportion of the world’s new EVs and PHEVs will undoubtedly adopt cobalt-bearing battery technologies; namely NMC (Nickel-Manganese-Cobalt) and NCA (Nickel-Cobalt-Aluminium).” (Source)

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Company Details

King‘s Bay Gold Corp.
Suite 1450 – 789 West Pender Street
Vancouver, B.C. V6C 1H2 Canada
Phone: +1 604 681 1568

Shares Issued & Outstanding: 41,006,423

Canadian Symbol (TSX.V): KBG
Current Price: $0.155 CAD (04/20/2017)
Market Capitalization: $6 Million CAD

German Symbol / WKN (Frankfurt): KGB1 / A2AN0E
Current Price: €0.098 EUR (04/20/2017)
Market Capitalization: €4 Million EUR



Previous Coverage

Report #4: “Escalating cobalt prices lead Kings Bay to acquire Trump Islands property” (February 16, 2017)

Report #3: “Advancing a cobalt-rich portfolio of discovery-ready exploration projects in Canada” (February 6, 2017)

Report #2: “Cobalt Crunch Time” (January 20, 2017)

Report #1: “Potential for a Massive Discovery of Cobalt, Copper and High-Tech Metals” (October 27, 2016)

Disclaimer: Please read the full disclaimer within the full research report as a PDF (here) as fundamental risks and conflicts of interest exist.

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Name: King‘s Bay Gold Corp.
Canada Symbol: KBG
Germany Symbol / WKN: KGB1 / A2AN0E
Shares Issued & Outstanding: 41,006,423
Phone: +1 604 681 1568

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