A new resource estimate for Strathmore Minerals’ (STM-V, STHJF-O) Reno Creek deposit in northeastern Wyoming’s Powder River basin is nearly twice previous estimates.
The National Instrument 43- 101 calculation was based on an analysis of the original logs for 1,083 holes drilled by former owners of the property, who had explored the terrain during the late 1960s to the mid-1990s.
The Reno Creek deposit has a measured and indicated resource of 7.43 million lbs. U3O8 (5.15 million tonnes) at an average grade of 0.065%, up from the historically reported 4 million lbs. In addition, the property has an inferred resource of 3.4 million lbs. U3O8 (2.39 million tonnes) averaging 0.065%.
The new resource calculation only covers the Reno Creek portion of the Pine Tree-Reno Creek properties, which makes up about 15% of the total area of the project. (Historical resources for the remaining 85% of the property total about 9.7 million lbs. U3O8.)
Last year, Strathmore entered into a joint-venture agreement with Nevada-based American Uranium (AUUM-O). Under the agreement, American Uranium will spend US$12.4 million to earn an initial 22.5% stake in Reno Creek and US$33 million over the next six years to earn a 60% interest.
The Reno Creek property covers 9.7 sq. km and is midway between Areva’s (ARVCF-O) Christensen Ranch in-situ leach (ISL) operation and Cameco’s (CCO-T, CCJ-N) producing Smith Ranch ISL facility, 30 miles south.
Areva’s Christensen Ranch facility is currently idle. Cameco’s Smith Ranch operation produced 2 million lbs. of uranium concentrate in 2006.
The uranium deposits on the Reno Creek property dip shallowly to the northwest and lie at depths of 52-137 metres from surface. The majority of the mineralization lies below 91 metres. There is no surface expression of the deposits.
Strathmore’s shares fell 10, or 5.56%, to close at $1.70 on the news, with 66,500 shares changing hands.
Craig Christy, a member of Strathmore’s investor relations team, noted that the markets have been weak “for quite some time” and “have been disappointing, not just for us, but for a number of companies.”
Strathmore has a 52-week trading range of $1.49-$5.50.
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