Matoush shaping up for Strateco

The discovery of the first recognized unconformity-type uranium deposits made for a revolution in the uranium mining industry, so it’s only natural to think of the Athabasca and Thelon basins as uranium country. But the flat, little-deformed Proterozoic sandstone basins don’t stop with the Central time zone, and recent work by Strateco Resources (RSC-V, SRSIF-O) underlines that.

Strateco’s Matoush project in the Otish Mountains of north-central Quebec has delivered some significant drill intersections since work began in the early part of the year. The company has a $6-million budget for work through to the end of the year, including about 14,000 metres of drilling, and expects to have a resource calculation before the winter.

Matoush, about 250 km northwest of Chibougamau and not far from the winter road that once served the Eastmain gold mine, was explored in the 1980s by German uranium explorer Uranerz. Tracing a boulder train that had yielded samples with up to 15% U3O8 to its presumed source up-ice, Uranerz drilled about 20 holes in 1984. All the holes encountered some uranium mineralization, with the best cutting 16 metres grading 0.95% U3O8. But in 1984, the price of uranium fell US$5 per lb. and budgets for drilling in more remote locations fell faster.

Uranerz left the exploration business in the late 1990s, Cameco (CCO-T, CCJ-N) taking over the company’s Canadian assets in 1998. Montreal junior Ditem Explorations (DIT-V, DTEMF-O) optioned the Uranerz holdings in the Otish Mountains area to explore for diamonds.

Ditem’s geochemical reconnaissance work found little evidence of kimberlite indicators in the Lac Matoush area, but the company kept the property anyway. Strateco, watching the increase in the uranium price, optioned Matoush (and another property at Beaver Lake about 20 km west) in 2005, with a deal to earn 51% in exchange for a work commitment, $125,000 cash, and 600,000 shares. Ditem and Strateco renegotiated that to a 100% interest in 2006, with Strateco issuing another 400,000 shares to Ditem and paying $150,000 in cash. Ditem kept a 2% net smelter return.

To consolidate the land holding, Strateco also optioned the clat property, immediately to the south, and map-staked another 113 sq. km surrounding Matoush. Cameco is tied on to the south of clat.

Strateco started with a winter program of ground electromagnetics (the deep-viewing UTEM system) and a 6-hole drilling campaign around Uranerz’s most promising hole. The mineralization is in sediments of the Otish group, near a gabbro dyke around which the sediments are tourmalinized. The tourmaline alteration gives way to chlorite and micas, which in turn give way to hematite and limonite further from the dyke.

The first hole gave poor recovery and deviated to the left, which led the drill contractor (Major Drilling) to bring in a foreman with experience in drilling faulted sediments. Recovery and accuracy improved for the subsequent five holes, and as the ice broke up, Strateco had defined a fault-controlled mineralized zone over 50 metres of strike and 60 metres of vertical depth.

The widest intersection was an 18.2-metre cut that essentially twinned the 1980s Uranerz hole; it graded 0.74% U3O8. About 20 metres below it, another hole intersected 3.5 metres grading 1.47% U3O8, but it had also cut 14.1 metres of mineralization in the hangingwall that graded 1.01% U3O8. A subsequent hole, about 20 metres to the west and slightly updip, intersected 11.3 metres in the hangingwall that graded 1.33% U3O8 and 1.9 metres in the fault zone that ran 1.19%. Strat-eco estimated the true width of most of the intersections was between 70% and 80% of the core length.

The last two holes indicated that a second zone — at comparable grades to the first — could be defined in the hangingwall of the fault. Both zones appear to be “perched,” confined to the sedimentary sequence above the unconformity that separates the Otish sediments from the crystalline basement rocks below.

Strateco cashed up for the planned program with a $9-million financing of 7.2 million shares at $1.25. Each share came with half a warrant attached, and a full warrant is exercisable at $1.50. The summer’s fieldwork would consist of about 30 holes to define the mineralized zone.

The financing also leaves room for a $1-million program on its Hanson Lake uranium project in the Grenville rocks of southwestern Quebec. Hanson Lake is one of several small uranium deposits already known in the area, about 30 km northeast of Mont Laurier. It has a historic resource estimate of 540,000 tonnes grading 0.075% U3O8.

Strateco, which had traditionally been a gold company, still has a number of gold assets in northwestern Quebec. Most recently it took over the half-interest held by joint-venture partner Campbell Resources (CCH-T, CBLRF-O) in the Discovery project northwest of Lbel-sur-Quvillon, for $1.5 million in shares and cash. The gold assets are to be moved into a new company, Cadiscor Resources, currently a subsidiary of Strateco but in the process of arranging a public offering. Under the deal, Strateco gets a 20-million-share stake in Cadiscor, which will be distributed to Strateco shareholders as a dividend. The deal, notionally valued at $3.2 million, was approved by shareholders at a meeting on June 20.