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Athabasca Basin and beyond

February 10th, 2014

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

by Greg Klein

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Fission Uranium releases final summer 2013 assays from Patterson Lake South

Having spent months doling out only occasional assays from last summer’s drilling at Patterson Lake South, on February 5 Fission Uranium TSXV:FCU suddenly dumped results for 20 holes—half of which showed no significant mineralization. They did, however, improve the company’s “understanding of the geological setting and controls of mineralization at PLS.”

The best results came from R780E, the fifth of seven zones along a 1.78-kilometre potential strike. R780E now boasts a 75-metre strike, with a lateral width up to about 60 metres. A few highlights show:

Hole PLS13-105

  • 3.93% uranium oxide (U3O8) over 3 metres, starting at 128 metres in downhole depth
  • (including 10.85% over 1 metre)

  • 1.12% over 3.5 metres, starting at 189 metres
Uranium news from Saskatchewan and elsewhere for February 1 to 7, 2014

Hole PLS13-107

  • 1.94% over 3 metres, starting at 171.5 metres

  • 0.57% over 6.5 metres, starting at 192.5 metres
  • (including 1.58% over 1 metre)

  • 0.23% over 13.5 metres, starting at 251.5 metres

Hole PLS13-108

  • 0.99% over 19.5 metres, starting at 152.5 metres
  • (including 3.46% over 2 metres)
  • (and including 3.92% over 1.25 metres)

  • 0.67% over 6.5 metres, starting at 174.5 metres
  • (including 1.64% over 2.5 metres)

  • 1.33% over 11 metres, starting at 184.5 metres
  • (including 6.52% over 1.5 metres)

  • 3.48% over 4.5 metres, starting at 228 metres

Hole PLS13-109

  • 4.22% over 8 metres, starting at 108 metres
  • (including 11.1% over 3 metres)
  • (which includes 24.6% over 0.5 metres)

  • 0.55% over 17.5 metres, starting at 141 metres

  • 5.89% over 6 metres, starting at 205.5 metres
  • (including 14.57% over 1.5 metres)

Off the lake and onto dry land, zone R600W shows a 30-metre strike and a lateral width up to 20 metres. Some of the better results include:

Hole PLS13-118

  • 0.34% over 6.5 metres, starting at 192 metres

Hole PLS13-121

  • 0.2% over 11.8 metres, starting at 98.7 metres

Hole PLS13-124

  • 0.29% over 6 metres, starting at 97.5 metres

The company also released assays from one hole on the R585E zone, 150 metres west of R780E. R585E now shows a 30-metre strike and a lateral width up to 10 metres. Some highlights from PLS13-106 include:

  • 0.19% over 5.5 metres, starting at 158.5 metres

  • 0.11% over 17 metres, starting at 166.5 metres

  • 0.39% over 12.5 metres, starting at 202 metres

True widths weren’t provided. Holes were vertical or close to it. One R600W hole and nine stepouts east of the zone drew blanks. These results constitute the final batch of summer assays. The current $12-million campaign, including ground geophysics as well as 90 holes totalling 30,000 metres, will primarily try to fill in the gaps separating the high-grade zones.

Rio drills Purepoint’s Red Willow

Rio Tinto NYE:RIO has begun winter drilling at Red Willow, Purepoint Uranium TSXV:PTU announced February 5. About 2,500 metres will test four target areas identified by geophysics, geochemistry and historic assays, the company stated. Rio is nearly halfway into its $5-million option to earn 51% of the 25,612-hectare property by December 31, 2015. The major may spend a total of $22.5 million by the end of 2021 to earn 80% of the eastern Athabasca Basin project.

In another project with some big name buddies, Purepoint began a $2.5-million, 5,000-metre program at its Hook Lake project in January. Cameco Corp TSX:CCO and AREVA Resources Canada each hold a 39.5% interest in the PLS-vicinity property, leaving the junior with 21%.

Continental Precious Minerals updates PEA for Swedish polymetallic project

An updated resource and preliminary economic assessment takes a new approach to Continental Precious Minerals TSX:CZQ Viken uranium-polymetallic project in central Sweden. Using a 6.5% discount rate, the study calculates an after-tax net present value of US$943 million and a 12.9% internal rate of return. Pre-production capital comes to $1.23 billion with payback in 6.9 years from an operation with two open pits and a 34-year lifespan, according to the February 6 announcement.

Viken’s original 2010 PEA considered uranium-vanadium-molybdenum production using fine grinding, tank leaching and roasting. Now Continental plans bio-heap leaching for nickel, zinc and copper sulphides as well as uranium. “This has substantially lowered operating and capital costs, and has led to more robust project economics,” stated CEO/chairperson Rana Vig.

More details will be available on sedar.com within 45 days.

Eagle Plains options out eastside Basin project

Eagle Plains Resources TSXV:EPL announced a definitive option agreement on February 4 for its Tarku property in the eastern Basin. The non-arms-length deal would give Clear Creek Resources a 60% interest for $500,000 cash, $5 million in exploration and 1.2 million shares over five years. Clear Creek may increase its interest to 75% by paying Eagle Plains another $1 million and completing feasibility. Previous work, including historic airborne surveys that found northeast-trending conductors, make the property prospective for both gold and uranium, Eagle Plains stated.

Next month Clear Creek expects to complete a three-way amalgamation with Ituna Capital TSXV:TUN.P and its subsidiary. Eagle Plains holds interests in over 35 properties.

Alpha airborne over Noka’s Carpenter Lake; Noka boosts private placement

Project operator Alpha Exploration TSXV:AEX has begun flying a VTEM and magnetic survey over Carpenter Lake on the Basin’s south-central edge. The 1,892-line-kilometre survey will test the 19-kilometre strike of the Cable Bay Shear Zone, a “major regional shear zone with known uranium enrichment,” Alpha stated on February 3. The work initiates the company’s 60% earn-in on Noka Resources’ TSXV:NX 20,637-hectare property.

About 10 to 14 days have been allotted to this portion of the winter campaign, which will also include radon sampling. Spring and summer should see airborne radiometrics, ground prospecting and geochemical sampling.

With interests in several properties, the Alpha Minerals spinco announced other exploration plans in December and January.

Noka, a member of the four-company Western Athabasca Syndicate, stated on February 6 it would increase a “heavily oversubscribed” private placement from $500,000 to $1.1 million, subject to exchange approval.

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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

November 30th, 2013

Uranium news from Saskatchewan and elsewhere for November 23 to 29, 2013

by Greg Klein

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December 6 expected for Fission to finish Alpha acquisition; Fission spinco gets court approval

Now that both companies have put it to a vote, Fission Uranium’s TSXV:FCU acquisition of Alpha Minerals TSXV:AMW goes to the TSXV and Alberta Court of Queen’s Bench for final approval. The 50/50 Patterson Lake South joint venture partners announced overwhelming support at their respective meetings on November 28. The companies expect final approval on December 6.

The Fission tally was 99.55% from shareholders and 99.6% from security holders. Alpha’s enthusiasm was slightly more restrained, with 83.18% shareholder and 85.72% security-holder support.

Assuming final approvals come through, the arrangement will put the celebrated PLS uranium project under a single takeover target… er, company. Alpha and Fission will each create a spinco for their non-PLS assets.

Court approval for Fission’s spinco was announced November 29. Itself a spin-out resulting from last April’s Fission Energy acquisition by Denison Mines TSX:DML, Fission Uranium calls the new entity Fission 3.0. Each Fission Uranium shareholder gets one new share of post-arrangement PLS-holding Fission Uranium as well as a share of Fission Mach III, expected to start trading December 10.

Read more about the takeover.

Read more about uranium merger-and-acquisition activity.

PLS regional drilling disappoints but Fission/Alpha end campaign triumphantly

Two of the final 11 autumn holes at PLS confirmed continuity along a 30-metre strike at the project’s recently discovered sixth zone. But nine others failed to find significant radioactivity, according to scintillometer results released by Fission and Alpha on November 27. The non-mineralized nonet, sunk further west of the project’s western-most R600W zone, might please only an anti-nuke activist. Nevertheless “varying degrees of secondary hydrothermal alteration were present in all holes, thus providing encouragement for the prospectivity of the western strike extension” of the PL-3B EM conductor corridor. R600W remains open in all directions, the partners maintain.

Their hand-held scintillometer measures gamma ray particles in drill core up to a maximum of 9,999 counts per second. These results are no substitute for assays, which are still to come. But don’t hold your breath—so are assays for 40 holes drilled last summer.

Of the two mineralized holes, PLS13-123 reached a total depth of 260 metres, encountering sandstone at 90.7 metres and the basement unconformity at 100 metres. Some highlights show:

  • <300 to 1,200 cps over 20 metres, starting at 95 metres in downhole depth

  • <300 to 5,100 cps over 7.5 metres, starting at 132.5 metres

  • 320 to 2,300 cps over 2.5 metres, starting at 142.5 metres

Hole PLS13-124 found sandstone at 97.5 metres and the basement unconformity at 99 metres before stopping at 257 metres. Highlights include:

  • 450 to 5,500 cps over 6.5 metres, starting at 97.5 metres

  • <300 to 1,300 cps over 7.5 metres, starting at 114 metres

  • <300 to 2,500 cps over 11.5 metres, starting at 197 metres

True widths weren’t available. With dips of -87 and -89 degrees respectively, the two holes’ downhole depths are close to vertical.

The 11 land-based holes bring an end to this drill program, most of which took place from barges over the lake. Fifty-three holes totalling 16,485 metres found six near-surface zones along a 1.76-kilometre trend. Ending the season on a triumphant note, Alpha president Ben Ainsworth said the 12-month campaign nearly equalled “what was completed in four years of work on Hathor’s Roughrider discovery.”

Research report examines Lakeland Resources as company acquires additional Basin property

Just one day after a research report was released on Lakeland Resources TSXV:LK, the company reported expansionary plans in Saskatchewan’s Athabasca Basin. Announced November 27, a JV teams the company with Star Minerals Group TSXV:SUV on two claims totalling 1,092 hectares. The new turf sits adjacently north of the Gibbon’s Creek target, focal point of Lakeland’s Riou Lake property.

The acquisition takes place while results are pending from autumn field work at Gibbon’s Creek. “Based on preliminary findings we decided it was important that we acquire that ground,” Lakeland president/CEO Jonathan Armes tells ResourceClips.com. “Star Minerals is focused on a rare earth project north of the Basin so the agreement works well for both companies.”

Gibbon’s autumn campaign, including boulder sampling, line-cutting, a RadonEx survey and a ground DC resistivity survey, has just wrapped up, he adds. “We’re putting all the data together and we’ll get that out imminently.”

A distinct topographical feature of the new property is an uplifted block of basement rock that “highlights the evidence for structural offsets, a key feature of known unconformity-type uranium deposits,” Lakeland stated. Historic work by Cameco Corp TSX:CCO-predecessor Eldorado Nuclear found several anomalous soil samples around the uplifted block measuring up to 0.01% uranium. Trenching by Eldorado showed concentrations of rare earths that might also indicate unconformity-type uranium mineralization. The property has also undergone 14 historic drill holes.

Lakeland plans to follow up on the previous work while reviewing Gibbon’s Creek data to identify drill targets. “We still have two other priority projects, South Pine bordering Riou Lake on the west, and Perch Lake farther east,” Armes says. “There’s lots more field work we can do, even during winter. Both radon and resistivity can be carried out during the winter, so we’re not limited to fair weather programs.”

Gibbon’s Creek and the new claims also benefit from close proximity to the town of Stony Rapids, a few kilometres away. Apart from the new acquisition, Lakeland has a portfolio of nine properties totalling over 100,000 hectares in the northern and eastern Basin.

Under the JV agreement, Lakeland may earn a 100% interest in the two additional claims by paying Star $60,000 and issuing 600,000 shares over 12 months. Star retains a 25% buy-back option for four times the exploration expenditures up to 90 days following a resource estimate.

One day before the announcement, prospect generator Zimtu Capital TSXV:ZC released a report on Lakeland. Written by Zimtu research and communications officer Derek Hamill, it places Lakeland in the context of Athabasca Basin exploration, the nuclear energy industry and the outlook for uranium prices. Presented as both research and opinion, Hamill’s work shows a shareholder’s perspective—Lakeland is a core holding of Zimtu.

So a degree of self-interest can be acknowledged. But the breadth of research goes far beyond Lakeland, its people and projects, providing a level of detailed scrutiny not often applied to early-stage companies.

Download the Lakeland Resources research report.

Read more about Derek Hamill’s research.

Read more about Lakeland Resources.

UEX announces final Shea Creek results, initial 2014 uranium exploration plans

North from PLS along Highway 955, and 13 kilometres south of the Cluff Lake past-producer, a year’s drilling has wrapped up at Shea Creek. UEX Corp TSX:UEX reported final results for two concurrent programs reported November 27.

UEX picked up the entire $2-million tab for drilling around the Kianna deposit while funding $1.27 million of $2.6 million sunk into property-scale exploration as part of the company’s 49%/51% JV with AREVA Resources Canada.

Results were given in uranium oxide-equivalent (eU3O8) using readings from a downhole radiometric probe which were calibrated with an algorithm calculated by comparing previous probe results with assays.

The most promising results came from the Kianna deposit. Kianna East hole SHE-142-3 reached a total depth of 1,065 metres, finding the unconformity at 736.9 metres and expanding the zone to the south. Highlights show:

  • 0.99% eU3O8 over 5.3 metres, starting at 961.2 metres in downhole depth
  • (including 3.21% over 1.5 metres)

In addition, UEX credited hole SHE-135-16 with a northwest expansion to Kianna East. Ending at 1,038 metres’ depth, the hole found the unconformity at 750.5 metres. Some of the better results show:

  • 0.16% over 5.2 metres, starting at 956 metres
  • (including 0.41% over 0.9 metres)
  • (and including 0.49% over 0.7 metres)

  • 0.48% over 3 metres, starting at 979.9 metres

Kianna North hole SHE-135-17 hit the unconformity at 732.2 metres before stopping at 1,059 metres, expanding the zone’s eastern extension of basement-hosted mineralization. Highlights include:

  • 0.33% over 9.4 metres, starting at 724.6 metres
  • (including 0.5% over 1.3 metres)
  • (and including 0.53% over 4.4 metres)

  • 0.8% over 31.5 metres, starting at 848.8 metres
  • (including 3.29% over 1.3 metres)
  • (and including 3.22% over 1.3 metres)
  • (and including 4.05% over 4.1 metres)

Of 10 exploration holes that tested two conductors, eight failed to find significant results. Two holes at Anne South showed these results:

  • 0.14% over 0.9 metres, starting at 765.4 metres

  • 0.21% over 0.9 metres, starting at 748.4 metres

(True widths were unavailable for all holes.)

Four of the 10 holes confirmed the Saskatoon Lake East conductor’s location, providing a new target area parallel to the roughly three-kilometre trend hosting Shea’s four deposits. Combined, they comprise the Basin’s third-largest resource after Cameco’s McArthur River and Cigar Lake, showing:

  • indicated: 2.07 million tonnes averaging 1.48% for 67.66 million pounds U3O8

  • inferred: 1.27 million tonnes averaging 1.01% for 28.19 million pounds

Still undecided are next year’s plans for Shea Creek, where AREVA acts as project operator. UEX states work will depend on Q1 capital market conditions.

But another November 27 announcement reported a $2-million budget for three western Basin projects. Plans include about 4,000 metres of drilling to test EM conductors at the Laurie and Mirror River projects, and a 50.4-line-kilometre ground tensor magnetotelluric survey at the Erica project. Work is expected to start in January. By that time ownership will be divided approximately 49.1% by UEX and 50.9% by AREVA, again acting as operator.

Among other UEX projects, its 100%-held Hidden Bay on the Basin’s east side has three deposits totalling:

  • indicated: 10.37 million tonnes averaging 0.16% for 36.62 million pounds U3O8

  • inferred: 1.11 million tonnes averaging 0.11% for 2.71 million pounds

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First place, second thoughts

November 8th, 2013

Some potential near-term graphite miners find time to revise their plans

by Greg Klein

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If the graphite game can be called a race to production, some companies seem to prefer the sure and steady progress of the tortoise. The hare’s dazzling example might have been discouraged by this year’s graphite price slump, down 20% according to Industrial Minerals. Even so, the authoritative journal anticipates a recovery next year, although not as strong as 2011. Those conditions might have inspired some front-running companies to revise their previous plans.

One of them is Focus Graphite TSXV:FMS. On November 7 the company released an updated preliminary economic assessment, replacing the previous PEA released in October 2012 for its Lac Knife project in northeastern Quebec. Thanks to streamlined metallurgy, the new study reports improved economics—the pre-tax internal rate of return increases to 36.4%, compared to 32% in 2012, and the pre-tax net present value to $317 million, compared to $246 million last time around.

Some potential near-term graphite miners find time to revise their plans

Flinders hopes to re-open Sweden’s Woxna graphite mine
and plant without undergoing feasibility studies.

Interestingly, the 2012 report omitted after-tax numbers. But the current figures show a post-tax IRR of 28.6% and NPV of $185 million, using an 8% discount rate. Using a 10% discount rate, as was done in 2012, the NPV shows $250.1 million pre-tax and $143.3 million post-tax.

Both studies relied on the January 2012 resource estimate to calculate a 20-year mine life for an open pit unearthing 300,000 tonnes per annum for a lifetime total of six million tonnes averaging 15.66% graphitic carbon (Cgr). But higher-grade concentrates shown by more recent pilot plant tests now cut operating costs.

No longer relying on a third party “and the associated $27.6 million in working capital requirements” to purify some of the concentrate, Focus says an optimized flotation and polishing circuit can produce concentrate of 98% total carbon for all flake sizes above 200 mesh. As a result, the company maintains, even the smaller flake product will see improved economics.

In a statement accompanying the announcement, Focus CEO Gary Economo said the company has started a feasibility study which “moves us closer to financing, securing off-take agreements, permitting and construction.”

Another potential near-term producer reconsidering its plans is Northern Graphite TSXV:NGC. The company first filed a feasibility study for its southeastern Ontario Bissett Creek project in August 2012. An update followed in September 2013. Then, on October 23, Northern announced a PEA that considers doubling mill throughput after three years of operation.

The plan would knock six years off the previous 28-year mine life but increase average annual production to 33,183 tonnes of concentrate, from 20,800 calculated in September. That would result in a 22% after-tax IRR (compared to 17.3% in September) and a $150-million after-tax NPV (compared to $89.3 million), using an 8% discount rate.

The new scenario would help meet expected growth in demand, the company stated. CEO Gregory Bowes sees an advantage for Bissett Creek in a graphite supply chain that he describes as “heavily dependent on China and … characterized by many inefficient producers with poor environmental and labour practices and inconsistent product quality, delivery and reliability.”

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Athabasca Basin and beyond

November 3rd, 2013

Uranium news from Saskatchewan and elsewhere for October 26 to November 1, 2013

by Greg Klein

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Alpha/Fission hit 5.98% U3O8 over 17.5 metres, including 19.51% over 5.5 metres

With so many scintillometer results announced already, assays for the same holes can be anti-climactic. But that’s the way Fission Uranium TSXV:FCU and Alpha Minerals TSXV:AMW have orchestrated their Patterson Lake South campaign, now giving observers a near sense of déjà vu. Assays from four holes announced October 29 add little to the news of August 8, although results from the lab are much more reliable than those from the hand-held radiation-detecting gizmo. The assays come from R00E, the farthest southwest of the project’s five zones.

Hole PLS13-074

  • 0.13% uranium oxide (U3O8) over 2.5 metres, starting at 65 metres in downhole depth

PLS13-076

  • 0.09% over 2 metres, starting at 178.5 metres

  • 0.08% over 1.5 metres, starting at 183 metres

  • 0.16% over 4.5 metres, starting at 186.5 metres

PLS13-077

  • 0.39% over 11.5 metres, starting at 59 metres

  • 0.13% over 15.5 metres, starting at 73 metres

PLS13-079

  • 5.98% over 17.5 metres, starting at 83 metres

  • (including 19.51% over 5 metres) (Update: On November 4 the JV partners corrected the intercept width from 5.5 metres to 5 metres.)

True widths were unavailable. Three of the holes were vertical, while 079 dipped at -75 degrees. That hole expands the zone’s high-grade southern area, the companies stated, while all four holes confirm R00E’s east-west strike at 165 metres. The zone remains open in all directions.

With the summer barge-based campaign complete, attention now turns to a land-based program west of R00E. Fission acts as project operator on the 50/50 joint venture until its acquisition of Alpha closes. Fission shareholders will vote on the deal’s spinout aspect on November 28.

(Update: On November 4 the JV announced a sixth PLS zone west of the discovery. Read more.)

Rio Tinto plans winter drilling at Purepoint’s Red Willow

Purepoint Uranium Group TSXV:PTU announced plans on October 29 by Rio Tinto Exploration Canada for 2,500 metres of drilling at Red Willow, a 25,612-hectare property on the Athabasca Basin’s eastern edge. Rio identified targets based on historic drill logs and more recent geophysical and geochemical work. The company built a 28-person camp last summer.

Depth to unconformity in the area varies from zero to 80 metres, Purepoint stated. The company says five major deposits—JEB, Midwest, Cigar Lake, McArthur River and Millennium—“are located along a NE to SW mine trend that extends through the Red Willow project.”

Rio has so far spent about $2.25 million out of a $5-million commitment to earn an initial 51% interest by December 31, 2015. The giant’s Canadian subsidiary may earn 80% by spending $22.5 million by the end of 2021.

In early October Purepoint announced a winter drill campaign for the Hook Lake JV held 21% by Purepoint and 39.5% each by Cameco Corp TSX:CCO and AREVA Resources Canada.

Strong Q3 financials surprise Cameco shareholders

Despite historic low uranium prices, Cameco came out with Q3 earnings far beyond the same period last year. In his October 29 statement, president/CEO Tim Gitzel attributed the success to a contracting strategy “providing us with higher average realized prices that are well above the current uranium spot price.”

Uranium news from Saskatchewan and elsewhere for October 26 to November 1, 2013

Rabbit Lake was one of three Cameco operations that received
10-year licence renewals the same week that the company
surprised investors with an especially strong quarterly report.

Adjusted net earnings for three months ending September 30 came to $208 million, a 324% increase over Q3 2012 or, at 53 cents a share, a 342% increase. Year-to-date figures came to $295 million (up 48%) and 75 cents a share (up 47%).

Gitzel added that Cameco’s “starting to see some of the cost benefits of the restructuring we undertook earlier” and plans to “take advantage of the opportunity we see in the long term.”

However the company’s statement noted “there have been some deferrals of future projects due to uranium prices insufficient to support new production. The deferrals will not directly impact the near-term market, but could have an effect on the longer term outlook for the uranium industry. Complicating the supply outlook further is the possibility of some projects, primarily driven by sovereign interests, moving forward despite market conditions.”

The company forecast strong long-term fundamentals, mostly to China which has “reaffirmed its substantial growth targets out to 2020 and indicated plans to pursue further growth out to 2030. Their growth is palpable as construction on two more reactors began during the third quarter, bringing the total under construction to 30.”

As for Cameco’s long-delayed Cigar Lake mine, the company’s sticking to its current plan of Q1 2014 production and Q2 milling.

But while junior exploration flourishes, especially in the Athabasca Basin, the major plans a 15% to 20% cut in exploration spending this year.

Three Cameco operations get 10-year licence renewals

Licences for Cameco’s Key Lake, McArthur River and Rabbit Lake operations have been renewed for 10 years, the Canadian Nuclear Safety Commission announced October 29. The CNSC granted the extensions after three days of public meetings that heard from the company, 27 interveners and CNSC staff. The commission agreed to Cameco’s request for 10-year renewals, twice the previous term.

MillenMin finds radioactive outcrops on east Basin properties, reports AGM results

MillenMin Ventures TSXV:MVM completed initial field work at two eastside Basin properties, the 2,759-hectare Highrock Lake NE and 1,648-hectare Smalley Lake W. Work included prospecting, outcrop mapping and examination of previously found mineralization, the company announced October 28.

Grab samples from radioactive outcrops on both properties have been sent for assays. MillenMin first announced its foray into uranium last May and has staked 11 claims totalling about 18,983 hectares in and around the Basin.

On October 31 the company reported AGM results with directors re-elected, auditors re-appointed and other business approved.

Declan options northeastern Alberta property

Southwest of the Basin’s Alberta extremity, Declan Resources TSXV:LAN has optioned the 50,000-hectare Firebag River property. Previous geophysical survey data “shows a complex pattern of magnetic lows and highs, truncated or offset in the northern part of the property by the Marguerite River Fault,” Declan stated on October 29. Exploration in 1977 “confirmed the presence of a southwest-oriented fault zone and a geochemical anomaly with 11 ppm cobalt in lake sediments atop this structure,” the company added.

The deal would have Declan paying $85,000, issuing five million shares over two years and spending $3 million over three years. The optioner retains a 2% NSR on metals and a 4% gross overriding royalty on non-metallic commodities.

In September Declan announced an option to acquire the Patterson Lake Northeast property. The company plans to engage Dahrouge Geological Consulting to explore its uranium properties.

Rockgate takeover offer: Denison softens conditions, extends deadline

Denison Mines TSX:DML advanced its attempted takeover of Rockgate Capital TSX:RGT by lowering the minimum tender condition from 90% to two-thirds of outstanding shares. In an October 30 statement Denison also extended the offer’s deadline again, this time to November 18, and dropped conditions related to staff retention and consulting agreements.

The same day Rockgate said insiders agreed not to exercise their options unless another company comes up with a better offer. Denison had requested a cease trade order on 11 million Rockgate options granted on September 30, which Denison termed “improper defensive tactics.” The British Columbia Securities Commission didn’t agree. But rather than risk Denison withdrawing its offer, Rockgate insiders “put the interests of the shareholders of Rockgate before their own personal interests and agreed to amend the terms of the options,” company president/CEO Karl Kottmeier said.

The tone of the companies’ statements has warmed considerably since Kottmeier labelled Denison’s offer an “unsolicited opportunistic hostile takeover bid.” Denison president/CEO Ron Hochstein thanked Kottmeier and the Rockgate board “for their contributions to allowing the offer to proceed towards a successful conclusion.”

Meanwhile Rockgate continues prefeasibility work on its flagship Falea uranium-silver-copper project in Mali.

Read how Denison’s offer defeated Rockgate’s proposed merger with Mega Uranium.

Read more about uranium merger-and-acquisition activity.

Lakeland Resources’ JV partner New Dimension to drill for gold

Lakeland Resources TSXV:LK announced on October 31 an imminent drill campaign of at least 1,800 metres by JV partner New Dimension Resources TSXV:NDR on the Midas gold property in north-central Ontario. Lakeland optioned the project to New Dimension in September in order to focus on Saskatchewan uranium exploration. But Lakeland will retain a 30% interest in Midas carried to an initial 43-101 resource estimate.

I’m excited that the project’s going to continue to be worked while we focus on uranium.—Jonathan Armes, president/CEO
of Lakeland Resources

“New Dimension is a great group to work with and the deal was easy to do,” Lakeland president/CEO Jonathan Armes tells ResourceClips.com. “I’m excited that the project’s going to continue to be worked while we focus on uranium. The onus is on them to explore that project and we share in any benefits that result.”

The previous week Lakeland closed a private placement for a total of $1,057,718 and announced the appointment of Basin veteran John Gingerich to the company’s advisory board. Field work continues on Lakeland’s Riou Lake uranium project.

Read more about Lakeland Resources.

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Athabasca Basin and beyond

August 25th, 2013

Uranium news from Saskatchewan and elsewhere for August 17 to 23, 2013

by Greg Klein

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Fission/Alpha extend zone, find “potential candidate” for PLS bedrock source

More scintillometer readings from Patterson Lake South show a 47-metre interval of continuous radioactivity and a 15-metre extension to one zone. Of five holes reported August 22, three showed no sandstone above the basement unconformity. According to joint venture partners Alpha Minerals TSXV:AMW and Fission Uranium TSXV:FCU, that “makes the R390E zone a potential candidate area for one of the bedrock sources of the large uranium boulder field.” R390E is the second of four zones extending northeast along a 1.05-kilometre potential strike.

The hand-held scintillometer scans drill core to measure gamma rays in counts per second up to an off-scale reading above 9,999 cps. Scintillometer readings are not substitutes for assays, which have yet to come. Radioactivity will also be measured with a downhole probe.

Dips range from 84 to 90 degrees, making downhole depths close to vertical depths. True widths were unavailable. Hole PLS13-078 was drilled to a total depth of 224 metres, encountering sandstone at 50 metres and the basement unconformity at 53.5 metres. Highlights include:

  • <300 to >9,999 cps over 31.5 metres, starting at 85 metres in downhole depth

  • <300 to 5,900 cps over 10 metres

Drilled to a total depth of 230 metres, hole PLS13-081 found two metres of sandstone before striking the basement unconformity at 51.5 metres. The one result released showed:

  • <300 to 7,300 cps over 25.5 metres, starting at 105 metres in downhole depth

Hole PLS13-083 stepped out 15 metres west to extend the zone’s strike. It found no sandstone before striking the basement unconformity at 53 metres, reaching a total depth of 278 metres. Highlights include:

  • <300 to >9,999 cps over 17.5 metres, starting at 53 metres in downhole depth

  • <300 to >9,999 cps over 16.5 metres

  • <300 to >9,999 cps over 7.5 metres

With a total depth of 224 metres, hole PLS13-085 hit the basement unconformity at 57 metres without encountering sandstone. Highlights include:

  • <300 to 2,800 cps over 5.5 metres, starting at 58.5 metres in vertical depth

  • <300 to >9,999 cps over 22.5 metres

Hole PLS13-086 was drilled to a total depth of 263 metres, finding no sandstone but hitting the basement unconformity at 50 metres. Highlights include:

  • <300 to >9,999 cps over 47 metres, starting at 75 metres in downhole depth

  • (including 530 to >9,999 cps over 22.5 metres)

PLS13-083’s 15-metre step-out brings the R390E zone’s strike to 120 metres, twice that of last winter. The zone remains open in all directions. The 50/50 JV’s $6.95-million campaign of drilling and ground geophysics continues just beyond the Athabasca Basin’s southwestern rim.

Update: On August 26 Fission announced a proposal to take over Alpha. Read more.

Fission, Azincourt complete airborne geophysics over Patterson Lake North

Backed by another JV partner, Azincourt Uranium TSXV:AAZ, Fission is also exploring the Patterson Lake North project adjacent to PLS and about 5.7 kilometres north of the discovery. On August 20 the companies announced completion of an airborne VTEM survey over the 27,000-hectare property’s northern half.

Uranium news from Saskatchewan and elsewhere for August 17 to 23, 2013

JV partners Fission and Azincourt plan a $1.53-million
summer/winter program for their Patterson Lake North project.

At 400-metre line-spacing, the survey flew 303 line-kilometres to provide data that might show basement conductors or enhanced sandstone alteration. Late summer and fall are scheduled for ground geophysics featuring time domain electromagnetic (TDEM) and magnetotellurics surveys. The partners have budgeted $530,000 for geophysics and about $1 million for winter drilling.

Azincourt may earn 50% of the project by paying $4.75 million in cash or shares and spending $12 million by April 2017. Fission retains a 2% NSR and acts as operator. Prior to the JV Fission had already spent about $4.7 million exploring PLN.

Forum begins Clearwater ground campaign, raises private placement to $2.25 million

Adjacently southwest of PLS, Forum Uranium TSXV:FDC has begun field work on its 9,910-hectare Clearwater project. Having interpreted data from airborne surveys, Forum says the EM conductor hosting the PLS discovery and parallel conductors trend onto Clearwater in a northeast-southwest direction. Radiometrics show uranium channel anomalies and historic surveys reveal two areas with highly anomalous lake sediment samples, according to the August 20 announcement.

Clearwater’s current campaign consists of prospecting with scintillometers, soil radon surveys and lake sediment sampling, along with additional ground geophysics. The company plans to begin drilling in January.

A $1.5-million private placement announced the morning of August 21 was, by late afternoon, raised to $2.25 million. On offer are up to 6.08 million units at $0.37, with each unit comprised of one share and one warrant exercisable at $0.50 for two years. Proceeds will go to Clearwater’s ground geophysics and 3,000-metre campaign.

Ground work begins at Aldrin’s PLS-adjacent Triple M

Adjacently west of PLS and contiguous with Clearwater, Aldrin Resource TSXV:ALN has begun field work on its Triple M property, according to an August 20 news release. Following up on radiometric anomalies identified by an airborne survey, the company will prospect for uranium boulders and map surficial geology. In September another crew will take surface radon samples above bedrock conductive anomalies found in an airborne VTEM survey.

The schedule calls for drilling to begin by January.

Skyharbour arranges additional $75,000 private placement

On August 19 Skyharbour Resources TSXV:SYH announced an additional $75,000 non-brokered private placement of 937,500 flow-through units at $0.08. Each unit consists of one flow-through share and one non-transferable warrant exercisable for a non-flow-through share at $0.10 for two years. No finder’s fee will be paid.

The company also granted incentive stock options up to a total of 531,250 shares at $0.10 for five years. The previous week Skyharbour closed a $425,000 private placement that left the company fully funded for its portion of a $6-million, two-year program.

Skyharbour is part of the Western Athabasca Syndicate, a four-company strategic alliance with Athabasca Nuclear TSXV:ASC, Noka Resources TSXV:NX and Lucky Strike Resources TSXV:LKY that’s exploring the PLS-area’s largest land package.

Read more about the Western Athabasca Syndicate Project.

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Opportunity knocked

July 11th, 2013

Is Ontario compounding the challenges faced by explorers and miners?

by Greg Klein

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Resource Clips - essential news on junior uranium, gold, silver, fluorspar, graphite, metals exploration miningWorking in Ontario has become a competitive disadvantage, according to at least one CEO. Explorers have already expressed widespread disenchantment with new mining regulations that took full effect last April. Then Cliffs Natural Resources partly blamed government intransigence for the company’s decision to suspend its Ring of Fire chromite project. Now Northern Graphite TSXV:NGC CEO Gregory Bowes has slammed the province’s Ministry of Northern Development and Mines for what he says are unaccountable delays.

In a July 8 news release, Bowes said his company submitted a mine closure plan for its Bissett Creek project to the ministry on October 31, 2012. “This ‘45-day approval process’ has been ongoing for over seven months despite Bissett Creek being a relatively benign operation with no major environmental issues. It has strong community support and first nation consultations have been positive and constructive,” the news release stated.

Is Ontario compounding the challenges faced by explorers and miners?

A number of developments question the Ontario legislature’s commitment to mining and exploration.

According to the company, the ministry completed its review but must issue a mining lease before it can approve the project. The company applied for the lease in October 2011. The following July, the company stated, it was ordered to “redo” a government survey. “The survey was submitted to the surveyor general’s office in November 2012 for a 30-day approval process but a mining lease has still not been issued. The company believes approval is imminent but cannot provide further guidance and suggests any interested parties contact the MNDM directly.”

When ResourceClips.com asked Bowes what’s going on, he responded, “Nothing’s going on. That’s the problem. I guess the simplest way to explain it is that the ministry just can’t deal with permitting in a timely fashion. They advertise a 45-day process and they advertise that it’s a one-window approach, in other words we just deal with the Ministry of Northern Development and Mines, and they’re responsible for dealing with all the other ministries and co-ordinating things. And neither is true.”

He adds, “We’re pretty much on our own to deal with other ministries and no one can stick to timelines, they don’t deal with issues, they don’t return phone calls.”

Anyone who took up Bowes’ suggestion to contact the MNDM directly might have got the same wordy but vague-to-meaningless e-mail that a ministry spokesperson sent ResourceClips.com. In response to a second phone call and a written list of questions, the ministry sent a second e-mail containing more feel-good fluff, but this time directed inquiries about the survey to Ontario’s Ministry of Natural Resources.

A spokesperson for Minister of Natural Resources David Orazietti told ResourceClips.com a request for the mining lease was received by the Crown land registry on July 9, 2013, and processing will likely take about a month. By press time she was unable to track information about the survey document Northern said was submitted in November.

Northern’s news release stated it is “competing with companies in Quebec, Europe, Africa and Australia to build the first new Western graphite mine in over 20 years. Being first to market is very important but the company is at a competitive disadvantage due to the regulatory process in Ontario which continues to damage the province’s reputation as a place to invest and is potentially depriving it of investment, jobs and tax revenues.”

As Bowes explains to ResourceClips.com, “Industrial minerals are smaller, more specialty markets. It’s not like gold where we can use two, three or four more mines and the market will absorb it. In this market there might only be room for one new mine and there might only be room for a couple of new mines over the next few years…. So timing is very important.”

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Carbon chronicles

April 3rd, 2013

A roundup of recent news from the ever-competitive graphite space

by Greg Klein

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While graphite frontrunners like Flinders Resources TSXV:FDR, Northern Graphite TSXV:NGC and Focus Graphite TSXV:FMS work through the pre-development or even pre-production stage, other companies vie for runner-up status. Among news announced April 3, Standard Graphite TSXV:SGH released assays from the final two holes of its 2012 drill campaign. These near-surface results come from the Oat Zone, east of the company’s Mousseau East Deposit in southwestern Quebec, showing 5.69% graphitic carbon over 6.8 metres and 5.73% over 20.1 metres.

True widths weren’t available. The top-most intercept started at a depth of 22 metres down hole while the deepest stopped at 64.6 metres.

A roundup of recent news from the ever-competitive graphite space

Additional assays and metallurgical results are pending
for Rock Tech Lithium’s Lochaber graphite project.

These assays conclude Standard’s 2012 campaign, which verified part of Mousseau East’s historic drilling as well as extending mineralization east and west. (Click here for some previous assays.) The company plans fieldwork and additional drilling this year to better define and expand the mineralization.

The same day Energizer Resources TSX:EGZ reported an analysis that it says further supports the February preliminary economic assessment for its Molo graphite deposit in Madagascar. In a statement accompanying the announcement, Energizer president/COO Craig Scherba said, “If the graphite price falls off by 25% and there is a 20% opex cost over-run, the project still has very positive IRR and NPV values.”

Going back a week, on March 27 Big North Graphite TSXV:NRT announced grab and channel sample assays for its Grand Lac du Nord property in eastern Quebec. The results “confirmed a multiple graphite-bearing structure covering an area approximately four kilometres by two kilometres, with results of up to 5.31% graphite,” the company stated. Its name notwithstanding, Big North also has a southern presence. That’s in Sonora state Mexico, where the company has three projects that include a 50% share in Nuevo San Pedro and 100% of Caraples and La Fortuna, all small-scale past-producing amorphous graphite mines. Last January Big North commissioned an NI 43-101 technical report for Nuevo San Pedro, which the company’s preparing to re-open.

On March 26 Canada Strategic Metals TSXV:CJC announced flake size distribution for grab samples from three parts of its 25-square-kilometre La Loutre property in southern Quebec. The company plans 15 to 20 holes of near-surface Phase I drilling this spring. One day earlier, Graphite One Resources TSXV:GPH announced it commissioned a PEA for its Graphite Creek property, 65 kilometres north of Nome, Alaska. Along with an updated resource, the study is slated for Q1 2014 release.

On March 21 Canada Carbon TSXV:CCB announced more surface sample assays that “confirmed the presence of a high-quality lump/vein graphite deposit” on the former Miller open pit mine about 80 kilometres west of Montreal. The company plans a busy spring with geophysics, channel sampling and drilling.

Speaking of drilling, on March 18 Rock Tech Lithium TSXV:RCK reported more assays from its Lochaber project, also in southwestern Quebec. One hole “intersected 84.56 metres of graphitic carbon at various depths with grades ranging from 1.11% to 4.42% Cg,” while another found 117.99 metres “at various depths with grades ranging from 1.3% to 3.63%.” Still to come are assays for 12 more holes, re-submitted assays from Phase I drilling and test results for flake size distribution and purity.

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Rating the risks

February 28th, 2013

A Fraser Institute survey shows how miners and explorers see the world they work in

by Greg Klein

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“Great mineral assets, highly corrupt government….” That’s sometimes the conundrum under which exploration and mining companies operate. And that was just one comment published by the Fraser Institute as it evaluated a world of challenges and opportunities in its annual Survey of Mining Companies released on February 28.

Between October 2012 and January 2013, 742 companies rated 96 jurisdictions which included countries and, in the case of Canada, Australia, the U.S. and Argentina, provinces, states and territories. Respondents considered 15 policy factors affecting investment decisions in those jurisdictions, for a possible maximum score of 100. Some factors included regulations, corruption, taxation, aboriginal land claims, infrastructure, the local workforce, political stability and physical security.

While the full report provides breakdowns by category, here are the top 10 jurisdictions for overall scores. The 2011-to-2012 rankings are in parentheses.

A Fraser Institute survey shows how miners and explorers see the world they work in

The Fraser Institute’s annual survey rates jurisdictional risk
for a number of factors concerning mining and exploration.

1. Finland (New Brunswick)
2. Sweden (Finland)
3. Alberta (Alberta)
4. New Brunswick (Wyoming)
5. Wyoming (Quebec)
6. Ireland (Saskatchewan)
7. Nevada (Sweden)
8. Yukon (Nevada)
9. Utah (Ireland)
10. Norway (Yukon)

Last but least, here are the bottom 10:

87. Greece (Vietnam)
88. Philippines (Indonesia)
89. Guatemala (Ecuador)
90. Bolivia (Kyrgyzstan)
91. Zimbabwe (Philippines)
92. Kyrgyzstan (India)
93. Democratic Republic of the Congo (Venezuela)
94. Venezuela (Bolivia)
95. Vietnam (Guatemala)
96. Indonesia (Honduras)

Utah and Norway knocked Saskatchewan and Quebec out of the top 10. Greece was added to the survey for the first time, only to join Zimbabwe and the Democratic Republic of the Congo for their bottom 10 debut. Another first-timer, French Guiana placed 27th overall, a fairly impressive ranking for a newcomer and non-First-World country.

Crisis-torn South Africa dropped to 64th place overall compared to 54th last year, retaining its fourth-from-last spot for “labour regulations, employment agreements and labour militancy or work disruptions.”

Of Canadian jurisdictions, Nunavut ranked worst at number 37.

Some anonymous concerns listed under “horror stories” ranged from uncertainty about native rights in Ontario to potential corruption in Quebec. One response stated that “endless ‘community consultation’” in the Northwest Territories costs the company more than exploration. Others noted confiscation of mining rights in Indonesia and expropriation in Bolivia.

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New stock on the block

October 30th, 2012

Mason Graphite’s grade even surpasses Lac Knife

by Greg Klein

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Graphite’s back in the news with two major announcements, one of which shows a new contender fast approaching Canada’s vanguard of advanced projects. On October 30, the day after Focus Graphite TSXV:FMS released its much-anticipated PEA, Mason Graphite TSXV:LLG hit the world stage—or at least the TSX Venture exchange.

The result of a reverse takeover with a capital pool company, POCML 1 Inc, Mason’s trading debut opened October 30 at $0.90 and dropped to $0.68 before closing at $0.75. The newcomer’s Lac Guéret project in northern Quebec overtakes Focus flagship Lac Knife’s claim to have the highest-known graphite grade.

Mason Graphite’s grade even surpasses Lac Knife

Mason Graphite didn’t begin TSXV trading until October 30
but plans to fast-track its Lac Guéret Project towards production.

The 11,630-hectare Lac Guéret has measured and indicated resources of 7.6 million tonnes grading 20.4% carbon and an inferred resource of 2.76 million tonnes grading 17.29%. CEO Benoit Gascon tells ResourceClips, “I visited many graphite mines that operated or still operate during my 20 years. This one is unique for that level of grade.”

Gascon was president of Stratmin Graphite, former owner of Quebec’s Lac-des-Îles Mine, the largest of Canada’s two producing graphite mines. In 2002 Gascon negotiated Stratmin’s takeover to form Timcal Graphite & Carbon, which now operates the mine. Gascon stayed with Timcal in senior roles.

Mason picked up Lac Guéret earlier this year from Cliffs Natural Resources, which got the property as part of its 2011 acquisition of Consolidated Thompson. The price tag for Mason totals $1.5 million in warrants and $15 million cash, which includes $2.5 million on completing feasibility and another $5 million on beginning commercial production.

Lac Guéret’s resource was calculated last summer, based on 2006 drilling. Any day now an 18,000-metre drill program will wrap up, with one resource update planned for December and another for Q1 2013. December’s also slated for a PEA. Looking further ahead, feasibility is scheduled for Q3 2014 and commercial production in Q4 2015.

As for community relations, the company hopes to have an impact benefit agreement finalized with the Pessamit Innu band by Q3 2013.

Lac Guéret is a flake graphite deposit, says Mason’s corporate development officer Simon Marcotte. Early indications show that “large- and medium-sized flake together is north of 60% [of the resource], but we’re hoping it’ll be more than that. We’ll have a better idea by year-end,” he says.

Marcotte doesn’t understate his optimism about the resource updates. The project will boast “not only the highest grade of graphite in the world but also the biggest deposit by far—no two ways about that—by a very significant margin.”

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