West Kirkland Mining announces $4.0 mln private placement financing

West Kirkland Mining (CVE:WKM) said Wednesday it has arranged a private placement financing for just over $4.0 million in proceeds.

The placement, with PI Financial and Cormark Securities as co leads and joint book runners, will consist of 11.43 million units at a price of 35 cents each.

Each unit will comprise one common share and one half of one common share purchase warrant.

A whole warrant entitles the holder to acquire one common share for a price of 60 cents for a period of 18 months from the closing date.

"This financing will allow the company to continue our drilling programs and commence engineering work on our TUG project along the Utah-Nevada border," said vice president of exploration for West Kirkland, Michael G. Allen.

"We have a large land position and recently announced our first resource estimate in the Long Canyon Trend in Nevada. This will be our focus for the balance of 2012."

Earlier this month, the company unveiled an initial 679,000 gold equivalent ounce inferred mineral resource estimate* (27.1 million tonnes at 0.78 g/t AuEq, 0.1 g/t Au cut-off, Caracle Creek, see WKM news June 1 2012) for its TUG deposit located in Utah, along the Long Canyon Trend.

Approximately 34 per cent of the tonnes of the resource, representing 44 per cent of the gold equivalent ounces, are located within 40 metres from surface, providing potential for very low stripping and mining costs as well as short project lead times, the company said.

The company has the right to earn a 60 per cent interest at TUG as part of a regional transaction completed in December 2010 with Fronteer Development (USA) Inc., which is now a subsidiary of Newmont Mining (TSE:NMC)(NYSE:NEM).

In terms of future plans for TUG and Nevada, West Kirkland said it plans to start the design of a preliminary open pit, permitting and an economic assessment for TUG.

This work will be integrated into the company's regional exploration program planned for the Long Canyon Trend.

At the 12 mile showing, located roughly 10 kilometres to the west of TUG, a new discovery of 1.73 g/t gold in oxidized material at surface was found.

Drilling of this new discovery at 12 Mile and additional targets within the Long Canyon Trend will be a priority in the months ahead.
              
The financing is subject to the approval of the TSX Venture Exchange, with closing expected in mid July.

An over-allotment option has also been granted to the underwriters, to purchase up to an additional 15 per cent of units up until the closing date.

As consideration for their services, the underwriters will also receive a cash commission of 7 per cent of the gross proceeds.
               
Formed in 2010, West Kirkland Mining is focused on gold exploration along major trends in North America.

The company has consolidated mineral rights positions in the Kirkland Lake area of Ontario and within major gold trends of North Eastern Nevada.                

* Prepared by Jason Baker, P. Eng. of Caracle Creek International Consulting Inc. (“Caracle Creek”) May 29, 2012 and accepted by the Company on May 30, 2012. Michael G. Allen, Vice President of Exploration for West Kirkland, and a qualified person as defined by NI 43-101, has reviewed and approved the technical information in June 1, 2012 news release other than the inferred mineral resource estimate, including but not limited to the plans of the Company. He is the non-independent qualified person for the purpose of this news release.