Vancouver – Drilling by uranium producer Cogema, a subsidiary of French energy company Areva (ARVCF-Q), on its western Athabasca Basin Shea Creek joint venture, with UEX (UEX-T), has intersected some of the highest uranium grades ever encountered.
Drill hole SHE-114-5 intersected 8.8 metres (at 668 metres depth) grading 27.4% U3O8, including a 3.5 metre interval averaging 58.3% U3O8. The spectacularly rich intercept was encountered about 30 metres above the unconformity, in the sandstone.
The same hole also intersected a 2.2-metre interval (at 814 metres down hole) grading 1.1% U3O8, including 1.8 metres of 5.5% U3O8 within a strongly argillitized fault/breccia zone about 100 metres below the unconformity, in the basement rock.
The new mineralized zone is situated in the 63B area, about 600 metres northwest of the Anne deposit and about 1,600 metres southeast of the Colette deposit in a sparsely tested section of the Shea Creek corridor.
A number of drill holes in the area encountered elevated uranium values well above the unconformity, indicating a potentially strong mineralizing system.
Holes are drilled using a navigational drilling system (Navi-drilling) from an initial pilot hole. The technology uses a steerable drill bit allowing several target intersections, or unconformity impacts, from the pilot hole. Two directional-capable rigs are currently active on the project.
In early-2004, UEX entered an agreement with Cogema to earn a 49% interest in eight western Athabasca Basin uranium projects, including Shea Creek. UEX is to fund $30 million in exploration over 11 years, earning 12.25% for every $7.5 million spent. Cogema retains operatorship.
The high-grade intercepts lit up UEX trading market, powering the uranium junior to rally 78% on the news, gaining $1.42 to close at $3.24 per share on volume of over 4.7 million. With 152 million shares outstanding, the company posts a market capitalization of $490 million. Cameco (CCO-T) holds a 24% interest in the company.
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