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Posts tagged ‘Laramide Resources Ltd (LAM)’

Athabasca Basin and beyond

October 10th, 2014

Uranium news from Saskatchewan and elsewhere for October 4 to 10, 2014

by Greg Klein

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Fission unveils Patterson Lake South’s best intercept yet, moves to TSX

It’s now TSX:FCU. No longer preceding its ticker with a V to indicate “Venture,” Fission Uranium graduated to the big board on October 8. Two days earlier the company released its first assays from summer drilling, unloading reams of results for 29 delineation holes on Patterson Lake South’s main R780E zone. Composite numbers made hole PLS14-248 the project’s second-best so far, with one interval hitting 13.23% U3O8 over 47.5 metres—“the strongest discrete mineralized interval drilled at PLS to date,” the company crowed.

“All 29 holes returned strong to moderate mineralization at shallow depth,” Fission modestly added. Some of them also extended the main zone’s width and depth. At one point the zone was laterally extended 77 metres north; at another, 41 metres south. At its widest point R780E takes up 164 metres. With a continuous strike of 930 metres, it’s by far the biggest of four zones along a 2.24-kilometre potential strike.

Several of the best results follow:

Hole PLS14-220

  • 1.11% U3O8 over 14.5 metres, starting at 97 metres in downhole depth
  • (including 3.48% over 3 metres)

  • 1.22% over 10.5 metres, starting at 163.5 metres
  • (including 8.7% over 1 metre)
Uranium news from Saskatchewan and elsewhere for October 4 to 10, 2014

PLS crews drilled day and night to delineate a December resource.

PLS14-221

  • 1.88% over 12 metres, starting at 213.5 metres
  • (including 8.17% over 1.5 metres)

PLS14-223

  • 1.69% over 8 metres, starting at 122 metres
  • (including 3.6% over 3 metres)

  • 1.43% over 8 metres, starting at 178 metres
  • (including 4.75% over 2 metres)

PLS14-224

  • 1.24% over 17.5 metres, starting at 130.5 metres
  • (including 10.7% over 1.5 metres)

PLS14-225

  • 0.61% over 39 metres, starting at 146 metres
  • (including 1.97% over 8.5 metres)

  • 0.93% over 9 metres, starting at 214.5 metres
  • (including 1.84% over 2.5 metres)

  • 7.53% over 1.5 metres, starting at 260 metres

PLS14-226

  • 1.9% over 5 metres, starting at 176 metres
  • (including 5.5% over 1.5 metres)

  • 1.02% over 10 metres, starting at 192 metres
  • (including 4.02% over 2 metres)

PLS14-229

  • 1.75% over 27.5 metres, starting at 96.5 metres
  • (including 9.64% over 5 metres)

PLS14-230

  • 0.66% over 23 metres, starting at 183.5 metres
  • (including 4.99% over 1 metre)

  • 8.61% over 1.5 metres, starting at 229 metres

  • 2.16% over 13 metres, starting at 240 metres
  • (including 6.58% over 3 metres)

  • 1.46% over 13 metres, starting at 258 metres

PLS14-240

  • 0.72% over 41.5 metres, starting at 83.5 metres
  • (including 2.04% over 9 metres)

PLS14-243

  • 1.05% over 32.5 metres, starting at 102.5 metres
  • (including 4.85% over 7 metres)

PLS14-247

  • 0.79% over 13.5 metres, starting at 93.5 metres
  • (including 2.17% over 3 metres)

  • 2.67% over 30.5 metres, starting at 111 metres
  • (including 6.84% over 5.5 metres)
  • (and including 6.28% over 4.5 metres)

PLS14-248

  • 13.23% over 47.5 metres, starting at 130 metres
  • (including 35.13% over 16.5 metres)
  • (and including 14.92% over 1 metre)

  • 5.13% over 12 metres, starting at 230 metres
  • (including 35.3% over 1.5 metres)

True widths weren’t provided.

Still pending are assays for 31 delineation holes and 22 exploration holes. A maiden resource will likely precede the next round of drilling.

NexGen releases Rook 1’s best-yet results, offers $10-million bought deal

Staking its own claim to Athabasca Basin bragging rights, NexGen Energy TSXV:NXE released one hole October 6 that shows the best assays so far from Rook 1’s Arrow zone and “amongst the best drill results” in the Basin. While competing with even better assays announced the same day from next-door neighbour Fission, NexGen’s summer program has shown northern Saskatchewan’s potential for further discoveries.

Results for the vertical hole AR-14-30 showed:

  • 0.49% U3O8 over 92 metres, starting at 297 metres in vertical depth
  • (including 2.25% over 16.6 metres)

  • 2.45% over 45 metres, starting at 419 metres
  • (including 4.96% over 10 metres)
  • (and including 4.97% over 11.5 metres)

  • 15.47% over 4.5 metres, starting at 466.5 metres

  • 10.17% over 20 metres, starting at 488 metres
  • (including 13.92% over 14.5 metres)
  • (which includes 25.22% over 6.5 metres)

  • 7.54% over 63.5 metres, starting at 512.5 metres
  • (including 10.32% over 46 metres)
  • (which includes 35.19% over 7 metres)
  • (which includes 66.8% over 0.5 metres)

  • 0.08% over 7 metres, starting at 580 metres

  • 0.21% over 7 metres, starting at 721 metres

True widths weren’t provided.

Present too were gold, silver and copper. The best gold grades showed 10.78 grams per tonne over 10 metres, 3.23 g/t over 13 metres, 2.62 g/t over 14 metres, 6.97 g/t over 4 metres and 1.02 g/t over 5 metres. “There is some correlation of uranium values with these metals of potential economic interest, which are reported by SRC Geoanalytical Laboratories data to occur more frequently with the samples of higher-grade uranium mineralization,” NexGen stated.

“Consistent with all previous assays from Arrow, AR-14-30 returned very low concentrations of deleterious metals (arsenic, antimony, selenium).”

The zone currently covers 515 metres by 215 metres, with mineralization starting at 100 metres in depth and reaching 730 metres. Arrow remains open in all directions and at depth. The $7-million, 18,500-metre summer program consisted of 24 Arrow holes and nine regional holes. Winter plans include delineation and expansion at Arrow and exploration drilling to the northeast.

Additionally encouraging news came October 7 as the company announced a $10-million bought deal private placement, with an option to increase that to about $11.5 million. The offer’s expected to close on or about November 11.

On October 8 NexGen stated that legal action by Alpha Exploration TSXV:AEX had been dismissed by the Supreme Court of British Columbia. Alpha, which closed a $837,500 private placement October 9, said it “will consider pursuing a decision by full trial.”

Lakeland Resources finds strong surface radioactivity at Lazy Edward Bay

More results are coming but initial findings show radioactivity at surface in springs, muds and boulders at Lakeland Resources’ (TSXV:LK) Lazy Edward Bay project. Announced October 9, the 26,375-hectare property on the Athabasca Basin’s southeastern margin underwent a summer program of rock, soil and water geochemical surveys, as well as RadonEx.

Work focused on two areas, the Bay and Liberty trends. At Liberty, a wide conductive zone about five kilometres long, the crew found a strongly radioactive spring and bog with scintillometer measurements between 500 and 3,300 counts per second. Radioactive boulders measured up to 5,600 cps. Historic work has found uranium in diabase dykes intruding on part of the conductive trend, including 224 ppm U3O8 over 0.5 metres.

The Bay trend consists of two parallel conductive trends, each about eight kilometres long, where historic drilling found anomalous uranium, boron, nickel and pathfinder metals. This summer’s RadonEx survey found strongly anomalous results associated with the historic conductors, the company stated.

“Our corporate strategy of identifying early-staged, grassroots projects through the review of historic exploration data continues to pay dividends as the Lazy Edward Bay property is confirmed to host multiple zones of radioactivity associated with historic conductors,” said Lakeland president Jonathan Armes.

Historic work came to millions of dollars. Multiple airborne and ground geophysical surveys and approximately 54 drill holes identified at least six conductive trends extending over 30 kilometres. Multiple sites featured strong alteration and/or anomalous radioactivity. Depth to the unconformity ranges from zero to 350 metres.

Still to come are full results for the summer program, prior to setting winter plans.

Last week Lakeland reported surface samples showing gold and platinum group elements, along with some rare earths and anomalous low-grade uranium, from its Star property. On the Athabasca Basin’s northern rim, the claims sit adjacent to Lakeland’s Gibbon’s Creek property, which has shown some of the Basin’s highest RadonEx readings, as well as boulder samples grading up to 4.28% U3O8. The two properties now comprise one project joined by a major regional structural lineament associated with three mineralized systems.

Read more about Lakeland Resources.

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Athabasca Basin and beyond

May 24th, 2014

Uranium news from Saskatchewan and elsewhere for May 17 to 23, 2014

by Greg Klein

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Kivalliq signs LOI with Westham Resources on Saskatchewan Genesis property

Its flagship Angilak project in Nunavut holds Canada’s highest-grade uranium deposit outside the Athabasca Basin. Nevertheless Kivalliq Energy TSXV:KIV was drawn into Saskatchewan with last January’s acquisition of the 198,763-hectare Genesis project. Now the company plans to bring in Westham Resources TSXV:WHR.P as a funding partner.

Under a letter of intent announced May 21, the capital pool company could acquire an 85% interest in return for 20% of its issued and outstanding shares, $1 million in payments and $5 million in spending over four years. The exploration commitment would include $1 million by year-end and another $1.5 million by August 31, 2016. Kivalliq would act as project operator for at least two years. Kivalliq director Dale Wallster would join Westham’s board.

Uranium news from Saskatchewan and elsewhere for May 17 to 23, 2014

Among other conditions, Westham must raise a private placement of at least $2 million.

The property lies northeast of the Basin in the prospective Western Wollaston Tectonic Domain and “covers basement rocks known to host uranium mineralization,” the companies stated. Previous operators and government surveys “outlined over 30 uranium showings that include several uranium-bearing boulder trains.” Based on that data, Kivalliq has identified eight initial targets for geophysics, sediment sampling, soil sampling, mapping and prospecting to be completed by early autumn. The company hopes to follow with a “major” drill program early next year.

Last February Kivalliq reported results of ore-sorting and metallurgical tests from Angilak’s Lac 50 deposit.

UEC adds one Texas property, “releases” another

Still expanding its southern Texas “hub-and-spoke” projects, Uranium Energy Corp NYSE MKT:UEC announced a new acquisition May 20, this one with a permitting advantage. The Longhorn project’s aquifer exemption “eliminates a major permitting hurdle” for a potential in-situ recovery operation, covering the mining zone of interest and allowing for expansion, the company stated. The project’s historic legacy includes drill maps and over 500 logs of gamma radiation data.

UEC compiled the project leases and data “over the last 18 months at a very low cost.”

The company also announced a decision to “release” its Channen project following evaluation of last summer’s drill results.

In April UEC completed a preliminary economic assessment for its Slick Rock uranium-vanadium deposit in Colorado. A week before that, the company announced its Burke Hollow ISR project in Texas had begun permitting.

UEC’s southern Texas holdings include the Hobson processing plant, the Palangana ISR mine, the Goliad development project and satellite properties. Of its nearly two dozen exploration properties, two are located in Paraguay and the others in the western U.S.

Unity picks up historic Uranium City region property

Twenty-six kilometres southwest of Uranium City, Saskatchewan, the Gulch Mine project comprises Unity Energy’s TSXV:UTY latest acquisition. Announced May 21, the 3,010-hectare property holds an historic, non-43-101 “reserve,” estimated by one source at around 928,796 pounds uranium oxide (U3O8) and by another at 1.65 million pounds. Gulch adjoins properties held by Fission 3.0 TSXV:FUU, Red Rock Energy TSXV:RRK and CanAlaska Uranium TSXV:CVV.

A 100% interest will require $1.2 million in payments over 18 months from Unity, which must drill 3,000 metres within three years. The vendor retains a 2.5% gross overriding royalty. Unity may buy back two-fifths for $1.5 million, less any previous royalty payments.

Earlier this month Unity closed a 100% option on the 14,200-hectare Camsell project in the northwestern Basin. In April the company optioned out 50% of its Mitchell Lake project to Rio Grande Mining TSXV:RGV.

MPVC tests NW Manitoba for uranium, “young” uranium, radon and lead 210

As a rotary air blast drill arrived on site, MPVC Inc TSXV:UNO updated its Northwest Manitoba project on May 22. The RAB drill is intended to quickly test shallow targets found by geophysical, geochemical and prospecting work. Drilling will take place over the lake while ice persists.

Two holes of core drilling have failed to convince a gamma ray spectrometer that they contain significant uranium mineralization, MPVC conceded. But “samples of the core are now being tested for radon, ‘young’ uranium and lead 210 which, if present, could signal the presence of uranium mineralization at greater depths.”

The company also reported receiving a letter of support for its one-year drill permit application from the Northlands Denesuline First Nation.

In early May MPVC stated preliminary results from the project’s radon-in-water survey showed, “to the author’s knowledge,” readings second only to Fission Uranium’s (TSXV:FCU) Patterson Lake South.

Contract prices, spending cuts help Ur-Energy withstand uranium’s descent

While uranium sinks to eight-year lows, on May 22 Ur-Energy TSX:URE revised its guidance for this year and next. With mid- and long-term contracts in place, customers have committed to buy approximately 518,000 pounds U3O8 at an average of $51.10 a pound this year, for projected revenues approaching $26.5 million.

As for 2015, the company so far has commitments for 630,000 pounds at an average of $50.10, for projected revenues of $31 million. With spending controls as well as managed production, Ur-Energy expects “to maintain a positive cash position throughout 2014 and 2015.”

Although its processing facility has a nameplate capacity of two million pounds annually, the company plans to keep production tied to contract obligations in 2015 “unless the market demonstrates sustained price improvement.”

Ur-Energy began ISR mining at Lost Creek in Wyoming last August.

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Athabasca Basin and beyond

April 6th, 2014

Uranium news from Saskatchewan and elsewhere for March 29 to April 4, 2014

by Greg Klein

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Fission Uranium stretches strike with new zone at Patterson Lake South, closes $28.75-million financing

Step-out drilling has added a new zone to Fission Uranium’s (TSXV:FCU) Patterson Lake South, shortly after infill drilling had merged other zones. Announced March 31, zone R1620E lies 465 metres east of R1155E, extending the project’s potential strike from 1.78 kilometres to 2.24 kilometres.

The results come from a hand-held scintillometer that measures gamma radiation from drill core in counts per second. Scintillometer readings are no substitute for assays, which are pending.

Uranium news from Saskatchewan and elsewhere for March 29 to April 4, 2014

The road to Patterson Lake South, where Fission has four
of its five rigs trying to merge zones into one big deposit.

Six new holes all showed mineralization, with the new zone’s inaugural hole, PLS14-196, revealing a 30-metre interval ranging between 300 cps and 6,100 cps starting at 99 metres in downhole depth. The maximum that the scintillometer can measure is 9,999 cps. Drilling on PLS14-196 continues.

Among other holes, PLS14-190, south of zone R1155E, “suggests that further step-outs to the south may be prospective,” the company stated.

Starting from the west, zone R600W has both a 30-metre east-west strike and a 30-metre north-south lateral width. About 510 metres east, discovery zone R00E has a strike of approximately 165 metres and a lateral width up to about 45 metres. Another 135 metres east sits R780E, with about 855 metres in strike and up to about 95 metres in lateral width.

Neighbouring 75 metres east, R1155E so far has just three mineralized holes. Fission Uranium declared the new zone, 465 metres east again, on the basis of a single hole over conductor PL-3C, “the suspected 1.3-kilometre-long strike extension of the mineralized PL-3B conductor” at an interpreted cross-fault, the company added.

So far 63 of a planned 100 holes totalling 30,000 metres have been sunk. The winter budget comes to $12 million but on April 1 the company announced its most recent private placement closed with gross proceeds of $28.75 million.

Three days later Fission Uranium granted insiders 6.5 million options at $1.65 for five years.

NexGen’s best-ever hole extends strike at Rook 1’s Arrow zone

NexGen Energy TSXV:NXE ended its Rook 1 winter drill program with a “massive” step-out showing the project’s best hole yet. Results for three holes released March 31 lengthen the strike to about 215 metres, open to the southwest.

The winter campaign comprised 17 holes totalling 7,442 metres, but it wasn’t until late February that the Arrow discovery diverted attention to this new zone of the PLS-adjacent project. A second hole in early March contributed to the company’s optimism. In all, seven of eight Arrow holes so far have found significant mineralization.

The results come from a hand-held spectrometer that measures drill core for radiation in counts per second. As is the case with Fission Uranium’s scintillometer readings, the results are no substitute for assays, which NexGen expects to see in about six weeks.

NexGen reports radiometric readings differently than Fission Uranium, providing a more detailed breakdown of small intercepts.

The step-out, hole RK-14-30, found a composite 47.2 metres (not true widths) of anomalous intercepts at least 0.05 metres wide measuring over 500 cps. A total of 8.3 metres surpassed the spectrometer’s maximum possible reading of 9,999 cps. Mineralization began at 84.15 metres in downhole depth, with the deepest intercept stopping at 701.45 metres.

RK-14-29 also revealed many small intercepts, with the first starting at 50.6 metres in downhole depth and the last ending at 569 metres.

RK-14-28 intercepts started at 87 metres in downhole depth, with the last ending at 549 metres.

Having closed an $11.5-million bought deal the previous week, NexGen now has about $15 million to spend. Spring breakup work will include detailed petrography and petrophysics before drilling resumes in the summer.

Denison drills 17.3% eU3O8 over 4.2 metres at new Wheeler River zone

Denison Mines TSX:DML reported a second hole on April 2 that supports last month’s discovery of the Gryphon zone at the Wheeler River JV. WR-560 was drilled 40 metres along the up-dip extension of the first hole, revealing one especially high-grade interval. The results come from a downhole probe that measures radiation in uranium oxide-equivalent (eU3O8). Although the probe is more accurate than a scintillometer or spectrometer, its readings are no substitute for assays. Nevertheless they show:

  • 0.1% eU3O8 over 1.3 metres, starting at 653.5 metres in downhole depth

  • 0.1% over 4.1 metres, starting at 676.2 metres

  • 17.3% over 4.2 metres, starting at 757.9 metres

  • 0.3% over 2.6 metres, starting at 770.7 metres

True widths are estimated at about 75%. Denison interprets these results “to be a new lens in the footwall, about 50 metres northwest of the high-grade intersection in WR-556,” Gryphon’s discovery hole. Mineralization lies approximately 200 metres beneath the unconformity and remains open in both strike directions and at depth, the company stated.

With spring break-up underway, drilling is expected to resume in early June, largely focusing on the new find. Gryphon is three kilometres northwest of the project’s Phoenix deposit, which produced a batch of drill results in February.

Denison holds a 60% interest in Wheeler and acts as operator. Cameco Corp TSX:CCO holds 30% and JCU (Canada) Exploration the rest.

Declan picks up six Alberta and Saskatchewan properties

Calling it a “six-pack” of new properties, Declan Resources TSXV:LAN announced a package of Alberta and Saskatchewan acquisitions in and around the Basin on April 1. Totalling roughly 101,000 hectares, the properties include Maurice Creek in Alberta, immediately northwest of the Northwest Athabasca project, a JV involving Cameco, Forum Uranium TSXV:FDC and NexGen that hosts the historic Maurice Bay deposit.

Two other Alberta properties, Maybelle North and Richardson River, “cover potential northerly extensions to the structure which is host to a significant uranium deposit at Dragon Lake along the Maybelle River shear zone,” Declan stated.

The other properties are Archer Lake and Jackfish Creek, also in Alberta, and Thorburn Lake in Saskatchewan.

The optioner gets $25,000 and 2.5 million shares on TSXV approval, another $125,000 within a year and a 3% gross overriding royalty with a 1% buyback clause for $1 million. To keep the properties in good standing Declan must spend $225,000 by April 17.

Declan also announced changes to its board, which now consists of David Miller, Wayne Tisdale, Michelle Gahagan, Hikmet Akin, Gordon King, Jamie Newall and Craig McLean.

Declan’s flagship is Gibbon’s Creek, a joint venture with Lakeland Resources TSXV:LK.

International Enexco reports new radiometric results from Mann Lake

The latest hole from its Mann Lake JV suggests the project has at least 300 metres of mineralized trend within the footwall of the western conductor target, International Enexco TSXV:IEC stated April 3. The results come from a downhole radiometric probe and are no substitute for assays.

Sunk 150 metres north of the project’s best interval so far, hole MN-065 showed:

  • an average 3.67% eU3O8 over 1.2 metres, starting at 689.8 metres in downhole depth

  • (including an average 6.51% over 0.7 metres)

  • (which includes an average 11.02% over 0.3 metres)

True widths weren’t available.

So far eight holes have tested about 1.8 kilometres of the target, which the company says remains prospective for its entire 3.1-kilometre length. Enexco anticipates follow-up drilling next winter along the conductor and on other areas. The southeastern Basin project is operated by JV partner Cameco, which holds 52.5%, leaving Enexco with 30% and AREVA Resources Canada 17.5%.

But how long Enexco will be involved depends on the outcome of Denison’s most recent acquisition activities. The two companies signed a letter of intent last month for an all-share deal that would give Denison all of Enexco’s Basin properties while spinning out the others. The companies currently JV on another southeastern Basin property, Bachman Lake.

Uracan/UEX drill results suggest prospective target at Black Lake

Black Lake partners Uracan Resources TSXV:URC and UEX Corp TSX:UEX reported the first six holes from their northern Basin JV on April 2, with one mineralized hole suggesting a new target. BL-148 showed:

  • 0.13% U3O8 over 0.5 metres, starting at 275 metres in downhole depth

  • 0.04% over 0.5 metres, starting at 299.5 metres

  • 0.12% over 1 metre, starting at 317 metres

True widths weren’t provided. The three intervals occur up to 19 metres below a footwall unconformity between the basement and sandstones, representing a mineralization style that “has not been encountered previously in this area of the property and represents a new prospective target,” the companies stated.

Next in line is a ground DC resistivity survey to precede further drilling and field work. Uracan may earn 60% of the 30,381-hectare project from UEX, which holds an 89.99% interest. AREVA Resources Canada holds the remaining 10.01%. UEX acts as operator.

Previous Black Lake drilling has found intervals as high as 0.69% over 4.4 metres, starting at 310 metres in downhole depth, 0.79% over 2.82 metres, starting at 310 metres, and 0.67% over 3 metres, starting at 274 metres.

The property borders Gibbon’s Creek, where JV partners Lakeland and Declan have reported boulder samples grading up to 4.28% and some of the Basin’s highest-ever radon readings.

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Athabasca Basin and beyond

March 9th, 2014

Uranium news from Saskatchewan and elsewhere for March 1 to 7, 2014

by Greg Klein

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Fission Uranium merges two zones, narrows gap between two others at Patterson Lake South

Fission Uranium merges two zones, narrows gap between two others at Patterson Lake South

Fission Uranium has four of its five rigs trying
to fill the gaps in the now six-zone PLS project.

With several zones stretched along a 1.78-kilometre potential strike at Patterson Lake South, Fission Uranium TSXV:FCU obviously wants to find one big, shallow, high-grade deposit. That dream came closer to reality with radiometric results released March 5 and 7. Zones R780E and R945E are now one, forever intertwined, while the gap between two zones to the west has been narrowed.

Scintillometer results from 20 holes released March 5 show mineralization at depths as shallow as 54 metres and as deep as 459 metres. Thirteen holes showed off-scale intervals, reaching the maximum 9,999 counts per second on the hand-held device that measures drill core for gamma radiation. Scintillometer readings are no substitute for assays, which are pending.

Apart from the hope of merging more zones—the goal of this winter’s drill program—Fission Uranium sees expansion potential. The best hole of this batch was the most easterly of the newly merged zone, which “bodes extremely well for high-grade expansion to the east.”

Two days later Fission Uranium unveiled scintillometer results for four more holes, each from a different zone, starting with R780E and moving west to the discovery zone. The interval nearest to surface started at 51 metres and the deepest ended at 276 metres. Intervals from one hole showed a total of 16.18 metres of off-scale radioactivity, while another hole gave up an off-scale composite of 2.65 metres. The gap between R390E and R585E has been narrowed to about 60 metres.

With 36 of the planned 85 winter holes complete, Fission Uranium claims a 100% hit rate. The company has one rig exploring outside the mineralized trend and four others attacking the gaps between these six zones:

The discovery zone, R00E, has a 165-metre strike and a lateral width up to about 45 metres. About 135 metres east, R390E has a 255-metre strike and a lateral width up to about 50 metres. Sixty metres east again, R585E has a 75-metre strike and a lateral width up to about 20 metres. About 105 metres east, R780E now has an approximately 270-metre strike, as a result of subsuming R945E. The lateral width reaches up to about 90 metres.

R780E’s geology “is similar to other zones,” Fission Uranium stated, “consisting of mineralization primarily associated with sequences of steeply south-dipping pelitic lithology with localized mylonites and cataclasites.”

Two other zones at the eastern and western extremities, R1155E and R600W, bring the potential strike to 1.78 kilometres.

Two weeks earlier Fission Uranium released lab assays from R585E that showed the project’s best hole ever—or maybe that should be “so far.”

Update: On March 10 Fission released its “second-best” radiometric results from PLS. Read more.

NexGen announces $10-million bought deal for Athabasca Basin exploration

Uranium news from Saskatchewan and elsewhere for March 1 to 7, 2014

With Fission Uranium’s PLS rigs in the background, NexGen drills Rook 1.

A $10-million bought deal for NexGen Energy TSXV:NXE reinforces the company’s new prominence in Athabasca Basin uranium exploration. Announced March 4, the private placement follows news of radiometric results from a new area of the company’s Rook 1 project, which is adjacent to PLS.

Subject to approvals, the deal involves 22.3 million units at $0.45 and gives the underwriters an option to buy an additional 15%. Each unit consists of a share and one-half warrant, with each entire warrant exercisable at $0.65 for two years. Proceeds will go to Basin exploration, working capital and general corporate purposes.

NexGen’s stock took off with the February 19 release of radiometric readings from the first hole in Rook 1’s Arrow area, which the company called “a totally new zone of uranium mineralization.” The news propelled the company from a 52-week low of $0.225 to a 52-week high of $0.65 in two days. The stock closed March 7 at $0.49.

Meanwhile NexGen has moved its other rig to Arrow to focus two drills on the new area.

NexGen holds several properties in the Basin. But it has yet to release results from last summer’s nine-hole campaign on the Radio project, where the company has a 70% earn-in.

NexGen expects to close the bought deal by March 26.

Zadar announces 2014 plans for PNE and Pasfield projects

With permit applications submitted, Zadar Ventures TSXV:ZAD announced plans for two projects on March 3. The 15,292-hectare PNE, about 11 kilometres northeast of PLS, has about 3,500 metres scheduled for winter and summer drilling, along with ground-based geophysics. Previously identified radon anomalies and conductive trends will help determine targets.

Plans for the 37,445-hectare Pasfield Lake property, within the Cable Bay shear zone in the east-central Basin, include airborne and ground geophysics and a proposed 3,800 metres of drilling “followed by a staged program of uranium exploration culminating in [a] 32,000-metre drilling program,” the company stated.

Pasfield Lake is one of a number of properties that Zadar acquired from Canterra Minerals TSXV:CTM late last year.

Noka Resources/Alpha Exploration begin radon surveys on Carpenter Lake

Radon surveys on lake water and sediment have begun at Carpenter Lake on the Basin’s south-central edge. Announced March 4 by Noka Resources TSXV:NX and Alpha Exploration TSXV:AEX, the four-to-five-week agenda will include sampling from about a thousand locations over a 16-kilometre stretch of the Cable Bay shear zone, which the companies have described as a “major regional shear zone with known uranium enrichment.”

Spring and summer plans for the 20,637-hectare property include high-resolution airborne radiometrics to search for near-surface uranium boulders, followed by ground prospecting and geochemical sampling. The work is part of the Alpha Minerals spinco’s 60% earn-in from Noka, a member of the Western Athabasca Syndicate that plans to drill its PLS-vicinity Preston Lake property this month.

Late last month Noka closed a $1.13-million private placement. Alpha Exploration announced plans for other projects in December and January.

Hodgins Auctioneers pursues Basin uranium claims

A company specializing in auctioning equipment and real estate has signed a conditional agreement to acquire uranium interests in the Basin. Under a deal announced March 6 with Majesta Resources Inc, Hodgins Auctioneers TSXV:HA would get a 25% interest in a 39,125-hectare contiguous package that comes within 10 kilometres of the Key Lake mill.

Apart from TSXV approval, the transaction hinges on raising a $350,000 private placement.

An initial 25% would cost Hodgins $100,000 in cash or debt, two million shares and $300,000 in exploration spending. An additional 35% would require an extra four million shares and $400,000 in spending. A further 30% would call for another $400,000 cash or debt and two million shares.

Hodgins attributed a “low cost relative to similar transactions in the area due to the relationship between two of the insiders of the corporation and the party which owns the mineral claims.” Majesta would act as project operator.

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Fission Uranium’s Patterson Lake South assays and other U3O8 news in brief

December 24th, 2013

by Greg Klein | December 24, 2013

Among a pre-Christmas blitz of uranium news from several companies, Fission Uranium TSXV:FCU released assays from Patterson Lake South—the second batch in five days from a project that’s largely ridden the market on scintillometer results. The December 23 announcement reports one hole from R585E and seven from R390E, narrowing the gap between the two zones.

Highlights from hole PLS13-098 on R585E show:

  • 0.73% uranium oxide (U3O8) over 11.5 metres, starting at 68.5 metres in downhole depth
  • (including 1.56% over 3.5 metres)
Fission Uranium’s Patterson Lake South assays and other news

  • 0.21% over 5.5 metres, starting at 113.5 metres

  • 8.47% over 16.5 metres, starting at 123.5 metres
  • (including 26.36% over 4.5 metres)
  • (which includes 60.3% over 0.5 metres)
  • (and including 7.51% over 2 metres)

  • 18.62% over 4 metres, starting at 145.5 metres
  • (including 34.78% over 2 metres)

  • 0.67% over 9.5 metres, starting at 160.5 metres
  • (including 3.41% over 1.5 metres)

From the R390E zone, highlights from the better holes show:

PLS13-083

  • 0.53% over 17.5 metres, starting at 53 metres
  • (including 1.63% over 4 metres)

  • 0.27% over 8.5 metres, starting at 132 metres

  • 0.44% over 3 metres, starting at 143 metres

  • 0.78% over 4 metres, starting at 151 metres
  • (including 4.09% over 0.5 metres)

PLS13-088

  • 0.1% over 14.5 metres, starting at 62.5 metres

  • 0.21% over 23.5 metres, starting at 80 metres
  • (including 1.35% over 1 metre)

  • 0.52% over 7 metres, starting at 135 metres
  • (including 1.42% over 1 metre)

  • 0.36% over 4.5 metres, starting at 163.5 metres

PLS13-094

  • 0.3% over 7.5 metres, starting at 104 metres
  • (including 2.24% over 0.5 metres)

  • 0.5% over 11.5 metres, starting at 130 metres
  • (including 1.16% over 3 metres)

PLS13-095

  • 0.63% over 11.5 metres, starting at 68 metres
  • (including 2.79% over 2 metres)

  • 0.2% over 6 metres, starting at 94 metres

  • 0.22% over 23.5 metres, starting at 125.5 metres
  • (including 1.02% over 1 metre)

PLS13-100

  • 0.75% over 5.5 metres, starting at 53 metres
  • (including 2.54% over 1 metre)

  • 0.35% over 3.5 metres, starting at 101 metres
  • (including 2.06% over 0.5 metres)

  • 0.17% over 12.5 metres, starting at 107 metres

  • 0.8% over 4.5 metres, starting at 138 metres
  • (including 2.42% over 1 metre)

True widths weren’t available. The company reported all holes as vertical.

A PLS13-098 interval within an interval shows the highest grade found at PLS so far, 60.3% over 0.5 metres.

The R390E zone now extends east, within about 105 metres of R585E. The two zones comprise the third and fourth of six zones along a 1.78-kilometre trend. Additionally, two R390E holes increase “the prospectivity of extending the zone laterally to the south along the entire length of the corridor,” the company stated.

Both zones remain open in all directions.

Other uranium news in brief…

On December 23 Uravan Minerals TSXV:UVN announced results from an airborne electromagnetic survey over its Stewardson Lake project in the Athabasca Basin. Among other findings, the data shows features “interpreted to be the northern extension of the C and E conductors identified on Cameco’s Virgin River project” adjacently south of Stewardson. With a 51% earn-in option, Cameco TSX:CCO is now reviewing Uravan’s proposed program and budget. Uravan acts as project operator.

European Uranium Resources TSXV:EUU and Portex Minerals CNSX:PAX announced a definitive agreement December 23 on their proposed merger, first announced in a letter of intent earlier this month. The new company would be named European Minerals Inc.

On December 23 Strateco Resources TSX:RSC announced closing a $3-million loan from the Sentient Group and amendments to a $14.9-million convertible note. The transaction allows Strateco to proceed with its 60% option on Denison Mines’ TSX:DML Jasper Lake project in Saskatchewan, among other goals.

Ur-Energy TSX:URE reported the first sale from its Lost Creek in-situ recovery mine in Wyoming. Some 90,000 pounds of U3O8 fetched an average $62.92 per pound. In another December 23 announcement, the company stated it closed its acquisition of Pathfinder Mines, a $5.18-million private placement and a $5-million loan redraw.

Majescor Resources TSXV:MJX announced the resignation of director Peter Chodos on December 23.

Aldrin Resource TSXV:ALN stated December 23 it cancelled a brokered $2-million private placement with Industrial Alliance Securities and was instead offering a $1-million non-brokered flow-through placement.

On December 24 Uracan Resources TSXV:URC announced raising $1.24 million from flow-through shares of $683,000 and non-flow-through units of $556,350.

The same day Purepoint Uranium Group TSXV:PTU reported closing the second tranche of a private placement to raise $441,949. Combined, the two slices equal $745,484.

CanAlaska Uranium TSX:CVV delists from the big board on December 27, the company announced December 24. But “it is understood” the company will begin Venture trading under TSXV:CVV on December 30.

Also on Christmas eve, Laramide Resources TSX:LAM announced closing a $2-million private placement.

See last week’s roundup of uranium news.

Athabasca Basin and beyond

December 7th, 2013

Uranium news from Saskatchewan and elsewhere for November 30 to December 6, 2013

by Greg Klein

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Introducing the Alpha Minerals spinco—Alpha Exploration Inc

With court blessing announced December 2 for the Alpha Minerals TSXV:AMW takeover by Fission Uranium TSXV:FCU, the deal faces just one more approval, this one from the TSXV. That was expected, but not announced, on December 6. Alpha’s spinco, Alpha Exploration Inc (anticipated ticker TSXV:AEX) gets about $3 million cash and all non-Patterson Lake South assets, including properties in Ontario and British Columbia as well as Saskatchewan. Each Alpha Minerals share fetches 5.725 Fission shares and one-half spinco share. Since December 3 Alpha Minerals shares have no longer traded with spinco shares attached.

The current Alpha Minerals board and management will “substantially” move into AEX positions.

Court approval for Fission Uranium’s spinco—tentatively titled Fission 3.0 to also commemorate Fission Uranium’s predecessor and Denison Mines’ TSX:DML acquisition Fission Energy—was announced the previous week. Each Fission Uranium shareholder gets one share of post-arrangement Fission Uranium as well as a share of the Fission spinout, expected to start trading December 10.

Having obtained full PLS ownership from its 50/50 joint venture ally, Fission Uranium has undoubtedly caught the attention of much bigger takeout artists.

Read more about the takeover.

Read more about uranium merger-and-acquisition activity.

Lakeland/Declan Resources JV accelerates work, strengthens their positions

In this market you have to work with strong partners. You have to collaborate and be a bit creative. We’re fortunate to work with people like Declan president Wayne Tisdale’s team and the financial connections they can bring.—Ryan Fletcher, director of Lakeland Resources

A new team of Lakeland Resources TSXV:LK and Declan Resources TSXV:LAN means an accelerated winter drill program for their Gibbon’s Creek flagship as well as the opportunity to put additional work into other Basin-area projects.

Declan’s first-year commitment will inject another $1.25 million into Gibbon’s, a 12,771-hectare north-central Basin property that already underwent over $3 million of work prior to last fall’s field campaign by Lakeland. Declan may earn 50% of the project by spending that $1.25 million, paying Lakeland $100,000 and issuing two million shares in 12 months. Over four years Declan may obtain a 70% interest for a total of $1.5 million in cash, 11 million shares and $6.5 million in spending.

The agreement further demonstrates Declan’s new direction, following its acquisitions in September and October of the 9,000-hectare Patterson Lake Northeast and 50,000-hectare Firebag River properties.

Declan’s commitment also allows Lakeland to ramp up its campaign for two other north-central Basin properties, South Pine and Perch Lake. Work on all those properties will be managed by Dahrouge Geological Consulting, led by PLS and Waterbury Lake veteran Jody Dahrouge.

Field results from Lakeland’s fall campaign are pending, while new appointments are anticipated from Declan.

Read more about the Lakeland/Declan JV and their other projects.

Read more about Lakeland Resources here and here.

Macusani claims low-cost uranium potential in Peruvian PEA

Macusani Yellowcake TSXV:YEL presented its case for a low-grade but potentially low-cost uranium mining operation in Peru with a preliminary economic assessment released December 5. The company envisions both open pit and underground operations with “a low stripping ratio in the open pit operations, anticipated low acid consumption and high process plant recoveries expected to be achieved in a short period of time.”

Uranium news from Saskatchewan and elsewhere for November 30 to December 6, 2013

The under-explored Macusani plateau shows considerable
uranium potential, according to the eponymous Macusani Yellowcake.

The report, using U.S. dollars, uses an 8% discount rate to calculate a $417-million after-tax net present value with a 32.4% internal rate of return. Those numbers assume a long-term price of $65 a pound uranium oxide (U3O8).

Initial capital expenditures would come to $331 million to build the mine and a plant processing 8.5 million tonnes per year. Total sustaining capital costs for the 10-year lifespan would reach $228 million. Payback would take 3.5 years.

Life of mine cash costs would average $20.57 a pound but, Macusani emphasized, years one to five would average $19.45, “placing it in the lowest quartile in the world using 2012 production figures.” Those first five years would produce an average 5.17 million pounds annually which would, were it operating now, rank the mine the world’s sixth largest, the company maintained. The 10-year average would be 4.3 million pounds.

The project, on the Macusani plateau in southeastern Peru, features multiple deposits, some adjacent to each other, others a few to several kilometres apart. The December 5 news release once again claimed last August’s resource update showed a 167% increase in measured and indicated categories. But there was no increase in the measured category. In fact measured pounds equal less than 1% of the M&I total.

Calling the project potentially “one of the lowest-cost uranium producers in the world,” Macusani CEO Laurence Stefan added, “The PEA demonstrates that the Macusani plateau has significant potential to become a major uranium-producing district, considering that only small areas have been explored to date.”

The company expects to begin pre-feasibility work in 2014.

NexGen announces initial geophysical results for Rook 1

An airborne radiometric survey over the PLS-vicinity Rook 1 project found at least five zones with elevated readings, NexGen Energy TSXV:NXE reported on December 2. Two of the zones are “proximal” to last summer’s drilling and could provide targets for another program beginning in January. Additionally aeromagnetic data identified regional and local basement structures.

The company will pursue the source of the elevated radiometrics next summer through ground radiometric surveying, mapping and sampling. Meanwhile the current data from 5,772 line-kilometres of high-resolution magnetic, very low frequency and radiometric surveys undergoes more comprehensive analysis.

Still to come are assays from NexGen’s nine-hole, 3,473-metre campaign at the eastside Basin Radio project, where the company holds a 70% option two kilometres east of Rio Tinto’s NYE:RIO Roughrider deposits. Having raised $5 million in late August, NexGen stated it’s still well-financed.

More near-surface, district-wide potential found in Argentina, says U3O8

In mid-November U3O8 Corp TSX:UWE said a discovery roughly 40 kilometres northeast of its Laguna Salada deposit could indicate district-scale potential. On December 4 the company stated another Argentinian discovery, on the southern extension of Laguna Salada, further suggests that potential. In both cases vertical channel sampling found near-surface, soft gravel uranium-vanadium mineralization.

Laguna Salada trials showed that screening could concentrate over 90% of its uranium in about 10% of the gravel’s original mass, resulting in 10 to 11 times greater grade, U3O8 stated. The company maintains its deposits offer continuous surface mining potential with alkaline leaching.

Dubbed La Susana, the new discovery’s slated for pitting and trenching to determine the extent of mineralization. While Laguna Salada’s PEA nears completion, the company continues JV negotiations with a province-owned mining company that could unite Laguna Salada with adjoining concessions.

U3O8 has a Colombian uranium-polymetallic project with a PEA and an earlier-stage project in Guyana.

Aldrin finishes Triple M gravity survey, offers $2-million private placement

With its ground gravity survey complete, Aldrin Resource TSXV:ALN stated anomalies coincide with previous results and already-identified drill targets. Data from 871 stations on Triple M, adjacent to and southwest of PLS, covered two parallel bedrock conductors already noted from an airborne VTEM survey and surface radon anomalies, the company reported on December 4.

Gravity anomalies consist of relatively low readings “reflecting the dissolution and removal of rock mass by the same basinal fluids that may also precipitate uranium,” Aldrin explained.

Two days earlier the company announced a $2-million private placement for Triple M exploration and drilling. The offer comprises 18.18 million units at $0.11, with each unit consisting of one flow-though share and one-half warrant, with each full warrant exercisable at $0.16 for 18 months.

In early November Aldrin reported closing a $972,500 first tranche of a private placement that had been announced the previous month. The company has also indicated plans to buy the Virgin property around the Basin’s south-central rim.

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Athabasca Basin and beyond

August 18th, 2013

Uranium news from Saskatchewan and elsewhere for August 10 to 16, 2013

by Greg Klein

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Alpha/Fission add fourth zone, extend PLS strike to 1.02 kilometres

Barely into their current $6.95-million campaign, Fission Uranium TSXV:FCU and Alpha Minerals TSXV:AMW once again grabbed the market’s attention by reporting a fourth zone at Patterson Lake South on August 15. With off-scale scintillometer readings for one hole 165 metres grid east of zone R780E, the new zone gets the informative but unsentimental name R945E. The quartet of zones now extends along a 1.02-kilometre trend.

The hand-held scintillometer measures drill core gamma radioactivity in counts per second, up to an off-scale reading of 9,999 cps. The results are not assays, which are pending. A downhole probe will also be used to measure radioactivity. Some highlights for hole PLS13-084 include:

  • <300 to 800 cps over 4 metres, starting at 104.5 metres in vertical depth
  • <300 to 1,500 cps over 7 metres, starting at 132.5 metres
  • <300 to 3,700 cps over 35.5 metres, starting at 159.5 metres
  • <300 to 5,100 cps over 7 metres, starting at 198 metres
  • <300 to 4,500 cps over 12.5 metres, starting at 209.5 metres
  • <300 to 9,999 cps over 18 metres, starting at 234 metres.

True widths were unavailable. The hole reached a total depth of 302 metres, striking the basement unconformity at 59 metres. Drilling continues on this hole.

Uranium news from Saskatchewan and elsewhere

On the left are barges supporting two of three drills, part of Patterson
Lake South’s $6.95-million, 44-hole, 11,000-metre campaign.

The target was chosen after radon water sampling found an anomaly parallel to a conductor and along strike of the project’s other zones. The 50/50 joint venture partners emphasized that the mineralization’s full potential “will not be fully realized until a complete fence of holes is completed across this anomaly.”

Three days earlier the JV reported its first summer hole from R780E, showing the zone’s “widest continuous and strongest results.” Drilled 10 metres grid south of a previous hole, it extends the zone’s width to about 45 metres at that point. Highlights from PLS13-080 include:

  • <300 to 9,999 cps over 48.5 metres, starting at 122.5 metres in downhole depth
  • <300 to 2,000 cps over 3.5 metres, starting at 173.5 metres
  • <300 to 9,999 cps over 11.5 metres, starting at 236 metres
  • <300 to 5,400 cps over 3 metres, starting at 298 metres.

True thicknesses weren’t available. The hole reached a total of 347 metres, hitting the basement unconformity at 54 metres. With an 89-degree dip, downhole depths approximate vertical depths. Still to come are lab assays and results from a downhole radiometric probe.

Like PLS13-084, the target was chosen to test an anomaly found by radon sampling, this one “within a resistivity low corridor proximal to an inferred north-south cross-cutting structure.”

On August 16 Fission announced the appointment of Ted Clark to its executive advisory board. Clark is chief of the Clearwater River Dene Nation and owner of Big Bear Contracting Ltd.

NexGen drills PLS-adjacent Rook 1, increases private placement again

Adjacently northeast of PLS, a two-drill, 3,000-metre campaign has begun on NexGen Energy’s TSXV:NXE Rook 1 project. Targets were identified and refined following airborne and ground geophysics that found overlapping anomalies, according to the August 16 announcement. NexGen expects to find basement rock at 65 to 100 metres in depth. Weather permitting, drilling will continue to late September.

What began as a $1.78-million private placement offered on July 29 has, after three increases, now reached nearly $5 million. The company doubled the offer to $3.53 million on August 1, increased it to $4.12 million on August 14 and, the following day, raised that to $5 million. This “third and final increase” now boosts the offer to 14.28 million units at $0.35 for gross proceeds up to almost $5 million.

Each unit consists of one share and one-half warrant, with each whole warrant exercisable for a share at $0.55 for 18 months. Raising the $5 million would leave NexGen with about $9 million cash on hand.

On the Basin’s east side, the company is earning a 70% interest in the Radio project, two kilometres east of Rio Tinto’s Roughrider deposits. Assays are pending from Radio’s 3,473-metre summer program.

Skyharbour closes $425,000 private placement, now fully funded for two years

Skyharbour Resources TSXV:SYH closed a private placement of 5.31 million flow-through units at $0.08 for $425,000 on August 14. Each flow-through unit consists of one flow-through share and one non-transferable non-flow-through warrant exercisable at $0.10 for two years. No finder’s fees were paid.

As part of the four-company Western Athabasca Syndicate exploring the PLS-area’s largest land package, Skyharbour is now fully financed for its portion of a $6-million, two-year program, president/CEO Jordan Trimble tells ResourceClips.com.

“The first phase of work, the airborne surveys, is complete,” he points out. “Fieldwork started ahead of schedule to test a target we’re excited about. We’ll be doing some radon surveying, geochemical sampling and prospecting, among other field techniques. We hope to have all the results in by the end of October.”

Referring to the Alpha/Fission discovery of a fourth PLS zone, Trimble says, “Clearly they’re dealing with a very powerful geological event that created this deposition of uranium. That has implications for the surrounding properties. Another point is the success they’re having with these indicators—the radon anomalies, the boulder train discovery. They’re having huge success with their methodology and the specific targets they’re drilling. That’s important for companies at an earlier stage, and I think Alpha and Fission have shown the market the significance of pre-drilling exploration and reconnaissance work. There’s a lot of value you can put into a project even before you get the drill rigs there.”

The syndicate, which includes Skyharbour, Athabasca Nuclear TSXV:ASC, Noka Resources TSXV:NX and Lucky Strike Resources TSXV:LKY, has “about 150 years of uranium exploration experience focused on the Athabasca Basin,” Trimble adds. Skyharbour’s Rick Kusmirski, for example, “has over 40 years in the field and his area of expertise is the Athabasca Basin. He was exploration manager for Cameco [TSX:CCO], he took over the helm at JNR Resources, made a discovery and got bought out by Denison [TSX:DML]. Bob Marvin, our other geologist, also has decades of experience with extensive work in the uranium space. Then there’s the other three companies, each with at least one geologist and the focus has been on uranium expertise.”

Read more about the Western Athabasca Syndicate Project.

Lakeland offers $1.25-million private placement, plans Riou Lake exploration

Lakeland Resources TSXV:LK offered private placements up to $1.25 million on August 16. The pure play uranium exploration company announced up to 10 million units at $0.10 for gross proceeds of $1 million, with each unit consisting of one share and one warrant exercisable at $0.15 for one year. Another two million flow-through units at $0.125 consist of one flow-through share and one warrant exercisable at $0.15 for a year. Proceeds will go to Athabasca Basin exploration and general working capital.

With nine uranium properties, Lakeland’s initial focus will be the Gibbon’s Creek area of its Riou Lake project on the northern Basin’s edge, says corporate communications manager Roger Leschuk. “It’s already had work done on it so we have a lot of historic data to go through. Because it’s on higher ground we can drill year-round. We’ve got existing data, so we can work from that and possibly be drilling as early as October.”

Two of Lakeland’s properties are in the eastern Basin, with the other seven in the north-central and northeastern Basin. “The Basin’s trends run from southwest to northeast. The early discoveries were on the eastern side of the Basin, on the Wollaston trend. That goes into Manitoba and finishes in Nunavut. The next trend is at Patterson Lake South, where the Alpha/Fission story is happening. Our properties on the northeast side of the Basin are part of that trend. So it’s not inconceivable that we could find something similar. The previous Riou Lake operator did find a boulder grading 11% uranium, the drilling found some very similar things, so we’re very excited about that.”

Gibbon’s Creek offers other attractions, Leschuk adds. “It’s not only on high ground but it’s very shallow to the basement rock. We’re talking maybe 50 metres down, so our drilling is going to be very shallow and very cheap to drill. Only a few kilometres away there’s a community called Stony Rapids, so we don’t have to set up a camp. We can hire people from the community who can drive to and from work, so our costs will be even lower. Our money will go a long, long way. We’re looking at 1,500 to 2,000 metres initially but we’ll get a big bang for our buck. We’re looking forward to that.”

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Out Of Many, Goliath

September 6th, 2011

Treasury Moves Toward Feasibility in Ontario

By Greg Klein

It began as a case of fragmented ownership, explains Treasury Metals President/CEO Martin Walter. Teck Resources made the discovery in the early 1990s while exploring Ontario’s Kenora Mining District. Corona Gold came in as a JV partner. Then Laramide Resources staked the down-dip portion of the project. “Corona Gold and Laramide decided to put both parts of the project together, and that’s what constitutes Treasury Metals today,” Walter says. And, as if completing an Old Testament genealogy, Treasury begat Goliath.

The Goliath Gold Project, that is. Once the properties were assembled into a single 49-square-kilometre entity, Treasury began drilling in earnest. A resource estimate came out in 2009 and a PEA in 2010. An updated resource is scheduled for November with full feasibility to follow.

Treasury Moves Toward Feasibility in Ontario

Despite a mining history dating to the 19th century, the Kenora Mining District remains underexplored, the company maintains. Walter calls the local infrastructure “perfect—probably among the best in the world.”

Goliath’s 2009 43-101 estimated 3.4 million tonnes grading 2.5 grams per tonne for 270,000 gold ounces indicated and 10.6 million tonnes grading 2.7 g/t for 930,000 ounces inferred.

Based on that resource and a gold price of $1,200 per ounce, the July 2010 PEA projected a combined open-pit/underground operation with an initial CAPEX of $76 million, an after-tax net present value at 5% of $91 million and a 43% internal rate of return.

Goliath assays released August 26 included 8.1 g/t gold over 6.4 metres (including 11.6 g/t over 4.4 metres), 3.1 g/t over 13.4 metres (including 6.2 g/t over 3.7 metres), 2.3 g/t over 13.5 metres (including 4.4 g/t over 3.6 metres) and 2.9 g/t over 10.5 metres (including 8.2 g/t over 2.6 metres). On August 30 Treasury released one additional result: 22.3 g/t over 6 metres.

“We still have two machines turning on site,” Walter reports. “We started off talking about a program of 20,000 metres. But the results have been so encouraging, our knowledge of the deposit has increased so much and the targeting is getting much better, so we’re starting to really understand the geometry of the ore body. Because of that, the program has just been ongoing. Now we’re touching 45,000 to 50,000 metres. There was some drilling late last year too, so we’ll have something like 60,000 or 65,000 metres to add to the resource.”

The updated estimate is scheduled for early November, with feasibility beginning late this year or 1Q 2012.
Walter also hopes to get an advance exploration permit by January. “When Teck had the project they actually put a portal and a decline into the footwall of the project, down to 75 metres. We need to get that permit, reopen the decline and extend it down to 400 metres. That’s going to be a big part of next year.”

Last July the company finished a heli-borne EM survey over Goliath and Goldcliff, Treasury’s early-stage project 40 kilometres away. “We’re expecting those results to come in very shortly,” Walter says. “That will further drive exploration on both properties.”

Everything is looking positive and, as long as we keep up the good work, we’ll make that decision in the next eight to 12 months. And yes, the plan is to put it into production ourselves —Martin Walter

Although Goliath is the company’s flagship, negotiations are underway to pick up another gold property that’s closer to production. Pico Machay in Peru could open as early as late 2012. A simple open-pit dump-leach operation, it would require a very low CAPEX of $15 million to $20 million, Walter says. Once in production, it’s projected to produce 50,000 gold ounces a year. Negotiations with Pan American Silver Corp include Treasury issuing Pan Am 11.5 million common shares, paying US$21 million and turning over Treasury’s 3% NSR from Goldgroup’s Cerro Colorado Gold Project in Mexico.

In early August, Treasury filed a preliminary prospectus for a $16-million share offering to help finance the deal. On August 31, the two parties extended the closing date to September 21, their second extension since July 31.

Pico Machay became Pan Am property in 2009 when the company bought Aquiline Resources. Walter, Treasury chairman Marc Henderson and CFO Dennis Gibson are all former Aquiline alumni—hence their interest.

“Over the past six to eight years we’ve been involved in all the drilling, all the metallurgy and all the engineering work that has been completed on that project. So we know it very, very well,” Walter says.

Pico Machay has a 2011 resource estimate of 10.6 million tonnes grading 0.78 g/t for 270,000 gold ounces measured and indicated and 23.9 million tonnes grading 0.58 g/t for 450,000 ounces inferred.

“We want to put that into production and use the cash flow to further the development of Goliath,” Walter says.

As for Peru’s mining outlook, “I think it’s business as usual. The new government [of President Ollanta Humala] has given out positive signs that the mining industry will continue as it did under the previous government. There may be some minor changes, but nothing earth shattering.”

Back to Goliath, “We’re still probably about eight to 12 months from a production decision,” Walter says. “Everything is looking positive and, as long as we keep up the good work, we’ll make that decision in the next eight to 12 months. And yes, the plan is to put it into production ourselves.”

At press time Treasury had 47.71 million shares trading at $1.11 each for a $53.9 million market cap. About 54% of shares are held by retail, 35% by institutions and 11% by management. Top shareholders are Laramide and Corona with 11% each.