Gold and Diamonds at the Kahuna Project

October 17, 2016 – Vancouver, BC, Canada. – Dunnedin Ventures Inc. (the “Company” or “Dunnedin”) (TSX-V: DVI) today reports gold-in-till results from its 2015 diamond exploration program, and provides a compilation of historical gold exploration results at the Kahuna project, Nunavut.

“While Dunnedin will remain focused on advancing our compelling diamond assets at Kahuna, we have also identified widespread gold mineralization,” said Chris Taylor, Dunnedin’s CEO, “This is not surprising given the proximity to the Meliadine project of Agnico Eagle Mines Ltd. and the geology shared by both properties.  The identification of gold proximal to our diamond resources and adjacent to one of Canada’s best new development stage gold mines could yield unique synergies between diamond and gold exploration at Kahuna.”

Highlights of results include:

• Gold results in tills, bedrock and historical drill core define multiple targets across the property.
• Gold was found through neutron activation analysis of heavy mineral concentrates in 84 of 129 (65%) till samples collected by Dunnedin in 2015.
• Mineral concentrates that returned gold values were confirmed to contain coarse gold grains. Grains were evaluated for transport characteristics, and have fragile textures suggesting local bedrock sources.
• Metasediment belts including that hosting gold at Meliadine have been repeated through regional folding and on-strike extensions at Kahuna, where they also host gold.
• 97 mineralized historical grab samples returning between 0.05 g/t and 2.52 g/t gold were collected across four metasediment and structural zones.
• Historical drilling targeting kimberlite encountered visible gold returning 7.24 g/t gold over 0.68 m along the strike extension of Agnico’s Aklak and Aquik Gold Zones of the adjacent Meliadine property; host rock was mineralized banded iron formation of similar type to that observed at Meliadine.
• One area of strong gold-in-till concentration occurs at the 10 km2 hinge domain of a previously un-tested folded metasediment belt where a number of diamond-bearing kimberlites including PST, Notch and 07KD-24 are also located, suggesting proximal bedrock sources of gold and diamonds.

Figure 1: Gold-in-till results showing diamond-bearing kimberlite bulk sample locations and the locations of gold mineralized zones at Meliadine.

Gold-in-till results are provided in Figure 1.  Dunnedin submitted heavy mineral concentrates from its 2015 till survey to Activation Laboratories Ltd. (“ActLabs”) of Ancaster, Ontario, for neutron activation testing, an assay technique that preserves the mineral samples.  129 samples were sent for analysis, of which 84 (65%) returned  greater than 50 ppb gold and are considered anomalous, and 12 samples (9%) returned greater than 1000 ppb gold with a high of 5930 ppb gold.   Table 1 includes a description of coarse gold grains identified to date from these samples.  Gold grain recovery is ongoing, and additional grains are expected to be recovered once mineral concentrates are returned from ActLabs and can also be screened.

The identification of gold at the hinge of a folded metasediment belt suggests structurally-controlled gold mineralization similar in style to many Archean sediment/greenstone hosted gold deposits such as Meliadine (NU), Lupin (NU), and Musslewhite (ON) may also be present at Kahuna.  This hinge domain also hosts several known diamond-bearing kimberlites including those from which diamond recoveries have recently been reported (see Dunnedin news releases of November 12, 2015 and September 6, 2016).  Of note, diamond indicator mineral results from these same till samples also point to potential extensions to known kimberlites, and additional kimberlite pipe and dike targets that are prospective for diamonds (see Dunnedin news release of July 25, 2016).

Table 1:  Description of gold grains recovered to date with neutron activation sample grade provided

The folded metasediment belt associated with this gold has a geophysically interpreted strike length of 16 kilometres.  The interpreted source area covers approximately 4.3 kilometres of strike, corresponding to the folded hinge of the belt, while the remaining 11.7 kilometres of the prospective formation was staked by Dunnedin earlier in 2016.  First pass wide spaced till sampling has already been completed on the strike extension of this belt during Dunnedin’s recent 1,111 sample 2016 till program.

Historic Gold Results (2005 – 2009)

Historic results retrieved from publicly available data include gold analysis for 338 till samples, 97 rock samples and re-sampling of 10 drill holes.  Drill holes were originally completed to explore kimberlite targets.  Gold encountered in this drilling was incidental, and assays for gold were collected sporadically.  Nonetheless, gold was reported in six drill holes as shown in Table 2.

Table 2: Historic gold results from diamond exploration drill holes

*width of the sample represents core length and not true width.  Historical drill hole results were obtained from various SEDAR filings of news releases and reports by past explorers including the Hunter Exploration Group. 

97 rock samples collected across the property returned between 0.05 and 2.52 g/t gold.  Gold is associated with magnetically responsive formations that have been mapped as metasediment belts and regionally significant, deep seated shear zones.  Historic tills yielded anomalous gold values down-ice from gold-in-bedrock mineralization as confirmed through later sampling and drilling.  The aggregate strike length of these gold-hosting formations is approximately 80 kilometres on the Kahuna claims.

Other Updates

The Company also reports that in recent discussions with local government in both Rankin Inlet and Chesterfield Inlet, plans were provided to Dunnedin for an all season access trail that is currently under construction by local authorities from Chesterfield Inlet to within a few kilometres of the Kahuna kimberlite, where Dunnedin has published an Inferred diamond Resource (see Dunnedin news release of January 26, 2015).  Approximately 35 kilometres of trail have been completed to date, with full completion expected by approximately 2020.  Dunnedin has pledged $25,000 to the Chesterfield Inlet town council towards transport of a bridge span from Rankin Inlet to Chesterfield Inlet during winter 2016 which will complete a crossing on the trail.

Long-term plans were also provided to the Company of a proposed route connecting the current all-season Meliadine mine access road to the trail under construction from Chesterfield Inlet.  The proposed route would connect the two communities, and would pass within a few kilometres of most known kimberlite occurrences at the Kahuna project.

The Company also wishes to announce the addition of Mr. Sorin Posescu, P.Geo, to its board of directors.  Mr. Posescu, an exploration geologist with over 20 years of experience across North America and Europe, is one of the underlying vendors of the Kahuna project.  Mr. Posescu is an expert in geological modeling and precious metals exploration, with a strong background in strategic corporate development and property assessment.  Mr. Posescu is also Vice President, Exploration of Brixton Metals Corp. (TSX-V: BBB).

Note on Meliadine

Agnico’s Meliadine project has approximately 14.5 million tonnes of Proven and Probable Reserves grading 7.32 g/t gold, containing 3.4 million ounces of gold as of December 31, 2015.   There is an additional Indicated Resource of 20.7 million tonnes grading 4.95 g/t gold containing 3.3 million ounces of gold, and an additional Inferred Resource of 14.7 million tonnes grading 7.51 g/t gold containing 3.5 million ounces of gold (source: www.agnicoeagle.com).

Mr. R. Bob Singh, P.Geo, Exploration Manager, is the qualified person responsible for the technical content of this news release.

For further information please contact Mr. Chris Taylor, M.Sc., P.Geo, CEO at 778-327-5799, or Mr. Knox Henderson, Investor Relations, at 604-551-2360.

On behalf of the Board of Directors

Dunnedin Ventures Inc.

Chris Taylor

Chief Executive Officer

About the Kahuna Project

Kahuna is an advanced stage high grade diamond project located near Rankin Inlet, Nunavut, where Dunnedin is earning a 100% interest.  Dunnedin is recovering diamonds and indicator minerals from a series of kimberlite and till samples collected in summer 2015, and has completed a 1100 till sample program in summer 2016.  An Inferred Resource released by Dunnedin showed over 4 million carats of macrodiamonds (+0.85 mm) at a grade of 1.01 carats per tonne had been defined along the partial strike length of the Kahuna and Notch kimberlite dikes through shallow drilling.  The largest diamond recovered was a 5.43 carat stone from the Kahuna dike which was a piece of a larger diamond that had been broken during the sample preparation process and was reconstructed as having an original size of 13.42 carats.  Recent results include a 0.82 tonne sample of the PST kimberlite dike which returned 96 macrodiamonds totalling 5.34 carats (+0.85 mm) and a 2.32 tonne sample of the Notch kimberlite which returned 85 macrodiamonds totalling 1.95 carats (+0.85 mm).  The Kahuna project is located adjacent to the development-stage Meliadine gold project of Agnico Eagle Mines Ltd. and has also yielded gold results, including visible gold in drill core, gold mineralization in the strike extension of the Meliadine host stratigraphy, and new gold-in-till targets proximal to diamond-bearing kimberlites.

Note on Gold-in-Till Results

Till sampling completed at Meliadine by the Geological Survey of Canada studied gold-in-till results across the Meliadine Trend.  Results from the GSC’s neutron activation assays of heavy mineral concentrates from Meliadine are provided in Figure 1.  Pristine to dominantly re-shaped gold grains occur proximal to the known gold zones, and the up-ice termination of gold-in-till trains and bedrock gold sources are highly correlated.  The report concludes “Basal Till over much of the Meliadine Trend is an appropriate sampling medium for gold prospecting.  Till is abundant and locally derived and its provenance reflects a clear southeasterly direction of glacial transport”.  As the Kahuna project is immediately adjacent to Meliadine, use of till sampling to track gold-in-bedrock sources is expected to be similarly effective.

The heavy mineral recovery circuit employed by Dunnedin was designed for diamond indicator mineral recoveries and only recovers coarse gold with a diameter exceeding 0.425 mm.  Most gold-in-till exploration programs also recover much smaller gold grains (down to 0.001 mm; 425 times smaller than the smallest grains recovered by Dunnedin).  For example, reports by the GSC at Meliadine determined 92% of recovered gold grains were less than 0.006 mm in diameter, and would not have been recovered by Dunnedin.  As such, Dunnedin’s grain counts from the 2015 till sampling program are expected to be proportionately lower, however the coarser gold that is recovered is anticipated to be more reflective of proximal bedrock source and provides a valuable exploration tool.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Statements included in this announcement, including statements concerning our plans, intentions and expectations, which are not historical in nature are intended to be, and are hereby identified as, “forward-looking statements”.  Forward-looking statements may be identified by words including “anticipates”, “believes”, “intends”, “estimates”, “expects” and similar expressions. The Company cautions readers that forward-looking statements, including without limitation those relating to the Company’s future operations and business prospects, are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements.