Sumitomo makes strategic investment in Kenorland Minerals

Kenorland Minerals (TSXV: KLD) has closed a $5.2 million (US$4.2 million) strategic investment from Sumitomo Metal Mining Canada.

Under the financing, Sumitomo purchased approximately 5.21 million common shares of Kenorland at $1.00 each, giving Sumitomo about 10.1% of the company's share capital.

A majority of the financing proceeds (80%) will be allocated to Kenorland's exploration activities, with the remaining 20% to be used for general and administrative purposes.

Kenorland has mineral exploration projects across North America. In Quebec it holds three orogenic gold projects, where work is being completed under joint venture and earn-in agreement from third parties.

Kenorland Minerals' Frotet gold project in northern Quebec. (Image courtesy of Kenorland Minerals).

The Frotet project, one of the company's three flagships, is currently held under a joint venture with Sumitomo. Chicobi, a grassroots project, is also optioned to Sumitomo, while the Chebistuan project is under option to Newmont (TSX: NGT; NYSE: NEM).

In Ontario, Kenorland holds the South Uchi project under an earn-in agreement with a wholly owned subsidiary of Barrick Gold (TSX: ABX; NYSE: GOLD).

The company also owns 100% of the advanced-stage Tanacross porphyry copper-gold project, as well as an option to earn up to 70% from Newmont on the Healy gold project, both located in Alaska.

"We are delighted to welcome Sumitomo Metal Mining as a strategic investor in Kenorland," Zach Flood, Kenorland's president and CEO, stated in a news release.

"Sumitomo's investment is a significant milestone for us and represents a strong endorsement of our team, the Frotet project, and our additional projects and partnerships within the exploration portfolio."

Kenorland has a market capitalization of $36.2 million.