Kincora Copper, a Canadian junior company headquartered in Vancouver, British Columbia, reported on November 6, that the Mineral Resources Authority of Mongolia (MRAM) had revoked 106 mineral exploration licenses, including the Tourmaline Hills and North Fox licenses wholly owned by a Kincora subsidiary company, Golden Grouse LLC. Kincora’s flagship Bronze Fox license remained in good standing. The revocation of the licenses was effective October 30.
Kincora did not pursue any exploration activity on the Golden Grouse licenses during the 2013 field season because of uncertainty relating to criminal legal proceedings against former government officials that brought into question the legal rights and interests of the owners of the 106 exploration licenses.
Kincora’s November 6 press release stated that 11 foreign and 67 local groups were the owners of the 106 revoked licenses. As of that time, 24 of these companies holding 31 of the revoked licenses, including Kincora, were seeking direct dialog and discussions with appropriate government authorities. These 31 licenses were issued prior to a decree banning issuance of new licenses for mineral resources dated April 20, 2010. The press release stated that an estimated $19 million had been invested and a further $36 million had been planned for investment on these 31 licenses.
Kincora acquired the Golden Grouse licenses in April 2012 for $5 million in Kincora shares and has since spent about $1.8 million exploring the properties. Acquisition of the licenses followed detailed due diligence by Kincora, with MRAM confirming that the licenses were in good standing. The exploration costs were incurred following MRAM approval of the proposed exploration program. Annual license fees had been incurred and licenses extended by MRAM.
The company was accessing avenues available to it regarding its legal rights and potential recourse relating to the Golden Grouse licenses.