Vancouver – With the power play for Hathor Exploration‘s (HAT-T) promising Roughrider uranium deposit now in its fourth (but perhaps not final) act, Saskatchewan’s Athabasca basin is taking centre stage in the battle for the world’s next best uranium deposits.
The strong displays of interest by Cameco (CCO-T, CCJ-N) and Rio Tinto (RIO-N, RIO-L) in Hathor’s Roughrider discovery, in which Rio is vying for its first foothold in the world’s preeminent high-grade uranium district, have led investors to look a closer look at other prospective deposits in the basin.
Fission Energy (FIS-V) and its advanced-stage Waterbury uranium project adjoining Roughrider’s western border have made the company one of the most-traded juniors on the TSX Venture Exchange in recent weeks. It averaged close to 3 million shares traded daily from Nov. 14-18. The company’s shares have risen as high as 99¢ on Nov. 18 from 50¢ on Aug. 25, the day before Cameco launched its first hostile takeover bid for Hathor.
Fission’s 40,256-hectare Waterbury property, jointly owned by Korea Electric Power Corp. (Kepco), lists several major uranium players as neighbours. Besides Hathor’s Roughrider deposit – which Fission says is actually “sandwiched” between two of its claims – Fission’s Waterbury property is roughly 10 km and 20 km west, respectively, from Cameco’s Tamarack deposit and its Rabbit Lake operation; only a few km north of the Midwest uranium project co-owned by Denison Mines (DML-T, DNN-X), French nuclear giant Areva and OURD Canada, a subsidiary of Japan’s Overseas Uranium Resources Development Company; and a dozen km west of the operating McLean Lake mill complex, similarly owned by the trio of Denison, Areva and OURD.
Kepco has earned a 50% interest in the Waterbury project under an agreement signed in January 2008 whereby it agreed to spend $14 million on exploration over three years. Fission retains a back-in option, however, to reacquire a 10% interest in the property for $6 million. The companies also recently signed a definitive agreement that accelerates exploration and development expenditures to $30 million over the next three years. Of note, Kepco holds an approximate 15% stake in Denison.
The JV partners have planned a $7.3-million winter exploration program at Waterbury schedule to begin in early January 2012 with three drill rigs. The program will include 69 drill holes totaling an estimated 25,000 metres, with three-quarters of the drilling occurring at the J zone, a recent high-grade uranium discovery, and a secondary target one km west called the Summit zone. The rest of the drilling will take place at other regional targets, including Oban, Oban North, Murphy Lake and the new Chivas target.
Fission first started exploring for uranium on the Waterbury property in 2008, after Hathor had announced a major discovery at Roughrider (11.9 metres grading 5.29% U308). A first-pass drill program by Fission identified a significant basement-hosted anomaly on a structural trend that straddles the Roughrider zone and extends for another 3 km to the west and southwest on the Waterbury property. This structural trend was named the Discovery Bay East-West Corridor after drilling in 2009 and 2010 returned 10.5 metres grading 1.91% U308 from 226 to 236.5 metres downhole, including a high-grade section of 1 metre grading 13.87% U308.
In early 2010, three step-out holes near Fission’s discovery hole resulted in the delineation of the J zone. Further drilling there in 2011 extended the east-west strike length of the zone to 578 metres by intersecting both unconformity and basement mineralization, and connected the J zone to the PKB zone. Fission says mineralization remains open along strike, laterally (horizontally at unconformity) and vertically (sandstone and basement).
Final assay results from summer drilling at the J zone in 2011 revealed uranium grades are not nearly as rich as Hathor’s Roughrider find, however. Hole WAT-11-198C intersected 10 metres at the unconformity (224 metres to 234 metres) grading 0.48% U308, while hole WAT11-200 intersected 11.5 metres grading 0.32% U308. Another hole returned slightly higher grades, 5.5 metres at the unconformity (209 metres to 214.5 metres) grading 0.87% U308, including a 1.5-metre section grading 2% U308.
In comparison, the West zone at Roughrider has an indicated resource of 394,200 tonnes grading 1.98% U308 for 17.21 million lbs. uranium oxide, and an inferred resource of 43,600 tonnes at 11.03% U308 for 10.60 million lbs. uranium oxide. The East zone has an inferred resource of 118,000 tonnes at 11.58% U308 for 30.13 million lbs. uranium oxide.
The primary focus of Fission’s 2012 winter exploration program will be to continue delineating the J zone’s unconformity mineralization as well as look for more high-grade mineralization in both step-out and regional exploration holes.
Fission has also recently begun 1,000-metre, first-pass drill program at its Patterson Lake South (PLS) uranium prospect, also in the Athabasca basin but much farther to the southwest. Fission discovered 123 radioactive boulders at PLS in its 2011 summer field season, with assays grading as high as 36.6% U308. It plans to complete 10 holes at the property by the end of the year in an attempt to find the boulders’ source with 50% joint venture partner Eso Uranium (ESO-V).
Fission has 102 million shares outstanding and a market cap of $101 million as at Nov. 18. It has a 52-week share price range of 48¢-$1.50.
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