Hathor, Fission feud over claim boundaries

Vancouver–A staking battle is brewing in Saskatchewan’s Athabasca basin: not long after Hathor Exploration (HAT-V, HTHXF-o) announced excellent drill results from its Midwest Northeast uranium project, Fission Energy (FISV, FSSIF-o) is now charging that Hathor recently had a drill operating on Fission’s claims.

Hathor’s Midwest Northeast property sits between two segments of Fission’s Waterbury Lake project, in the eastern Athabasca basin, 700 km due north of Saskatoon.

Fission’s 420-sq.-km property consists of a roughly triangular section of land, plus a small, disjointed segment 2 km distant from one side. Hathor’s 5-sq.-km property is sandwiched between Fission’s main area and the separate segment. Both companies’ properties abut the Midwest and Midwest A deposits, which are being put into production by Areva (ARVCF-o) and Denison Mines (DML-T, DNN-x).

In late February, Hathor drilled high-grade uranium mineraliza- tion at Midwest Northeast. The company’s share price jumped 128% when scintillometer readings from hole 12 averaged between 1,000 and 1,500 counts per second (cps) over 30 metres, with discrete zones returning 5,000 to 9,999 cps. A scintillometer measures natural gamma emission radiation, the level of which is a preliminary indication of a substance’s radioactive material grade.

Assay results in mid-March confirmed the presence of significant mineralization: the core from hole 12 contained 11.9 metres grading 5.29% U3O8.

In late March, scintillometer results from another seven holes boosted Hathor’s share price again, this time adding 22%. Six of the drill cores extended the mineralization encountered in hole 12, defining an area under a lake bay that Hathor has dubbed the Roughrider zone.

After the initial strong results from Roughrider, Hathor examined its field position to expand its claims if possible. Contrary to Fission’s view, Hathor says its own analysis revealed a gap between the southwestern edge of Hathor’s claims and the boundary with Fission, which Hathor then staked as a long, wedge-shaped fractional claim in March.

Now, Fission is alleging that a drill involved in Hathor’s current campaign in the vicinity of the Roughrider zone was actually sitting on Fission’s claims.

In an April 3rd press release, Fission president and COO Jody Dahrouge announced that his company would dispute Hathor’s claims with the Saskatchewan Mining Recorder and called on Hathor to “cease drilling activities on the company’s Waterbury Lake property.”

Hathor fired back with its own news release, with Hathor president and CEO Stephen Stanley calling Fission’s moves “an ill-advised, feeble, and opportunistic attempt to capitalize on Hathor’s successful discovery of the Roughrider zone of uranium mineralization.”

Hathor will hold Fission responsible for “all damage caused to Hathor and its shareholders as a result of Fission’s irresponsible allegations,” the release states.

“Our claim posts are where they should be and where they’ve always been,” Stanley tells The Northern Miner. “The drill rig may be close to the boundary but we’re drilling to the east, away from the boundary, because the zone itself is some 130 metres farther that way.”

Stanley also points out that many uranium deposits in the Athabasca basin are only some 100 metres wide, so the fact that the Roughrider zone is over 130 metres away from the claim boundary is key.

“Being 130 metres away is a lifetime in the basin,” he says.

The problem, of course, stems from the argument over where the claim boundary actually sits. According to Fission, Hathor’s original claim from January 2004 and Fission’s from May 2004 didn’t simply line up, and overlapped right from the start. Dahrouge says the claim map Hathor submitted to the mining recorder was “completely different” from Hathor’s claim as physically staked on the ground.

Hathor takes the opposite view. First, Stanley insists that maps submitted to the Recorder’s office are just a guide; claim boundaries are defined by claim posts, not maps. Second, since Hathor staked first and has not moved its claim posts, Hathor’s claim takes precedence.

But the dispute is not primarily over the initial claims, it is over the fractional claim to the southwest of Hathor’s much larger initial claim.

“Our contention is that no fraction exists,” Dahrouge says. “The claims clearly overlap — our post is 180 metres southeast of their post. We have no idea why they think there’s a fraction there.”

For Hathor’s part, Stanley says approval of the fractional claim is pending. The confusion continues: Hathor contends that it only has had a drill sitting on its original claim, while Fission argues that Hathor was drilling on the contested fractional claim and therefore, in its view, on Fission’s claim.

Atpresstime, Hathor shares were trading at $2.29 in a 52-week trading range of 45-$2.96, while Fission was at $1.05 in a 52-week window of 46-$1.59.