The “Bulk Sample” column in Table 1 above provides the overall grade of uranium and vanadium in the gravel and sand samples from La Rosada. This grade is derived from a large sample in which all the material, including the barren pebbles and sand grains, have been crushed and assayed with the uranium-vanadium – bearing material that coats the grains. These grades provide the raw data that are necessary for future resource estimation.
The grade of the fine component, composed of grains less than 0.15 millimetres in diameter, that was separated from the pebbles and sand by sieving, has an average grade of 0.5% (5,319ppm) U3O8, with a sample that spiked to 2% U3O8 (20,764ppm, Table 1). The average grade of vanadium of the fine material is 0.23% (2,308ppm) V2O5. The average thickness of the gravel is 0.5 metres, with mineralization starting from 0.3 to 0.7 metres below surface. Only the fine component of the gravel would be processed for uranium and vanadium extraction.
Results from the unconsolidated sand layer that lies beneath the gravel at La Rosada show that its uranium and vanadium are also concentrated into the fine material by washing and sieving the sand. The average grade of the sand is 726ppm U3O8 while the fine component has a grade of 1,102ppm (0.1%) U3O8. Vanadium assays average 681ppm in the raw sand and 924ppm V2O5 in the fine component. The average thickness of the sand layer is 0.7 metres.
Where gravel and sand are mineralized in the same trench, the combined average thickness of the uranium-vanadium – bearing layer is 1.3 metres with an average grade, in the fine material, of 0.33% (3,355ppm) U3O8 and 0.16% (1,584ppm) V2O5.
Estimated Cash Cost of Production at Laguna Salada
The Preliminary Economic Assessment (“PEA”)1 modeled mining of the richest areas of the Laguna Salada Deposit followed by successively lower-grade areas so that the capital cost of the Project could be paid off as quickly as possible. Using the data available at the time of the PEA, this approach resulted in an estimated cash cost of production of US$11.62 per pound of uranium in year one, rising to average US$21.62 per pound over the life of the mine modeled in the PEA (Figure 2). This graphic shows the relationship between uranium grade and estimated cash cost of production by year established in the PEA on the Laguna Salada Deposit.
Figure 2. Estimated cash cost of production of uranium by year at Laguna Salada plotted against the average grade of the fine component of the gravel the material that would be processed each year as per the PEA.
Focus of Further Work
The next steps in the drive to lower estimated production costs for the broader Laguna Salada Project are as follows:
A link between mineralization in the tuff and the overlying gravel observed at La Rosada has led to a better understanding of higher uranium-vanadium grades found at the base of the gravel at Laguna Salada. With the insight gained from La Rosada, it is considered likely that higher-grade mineralization at the base, where the gravel rests on tuff, represents a second, deeper layer of mineralization that adds further, higher-grade resource potential at Laguna Salada2 that will be explored with trenching and vibrosonic drilling in due course;
Continued exploration of higher-grade mineralization in gravel, sand and volcanic tuff in the La Rosada area with the aim of identifying areas that could be cost-effectively included in a future resource estimate; and
Metallurgical test work to determine the efficiency of the U-pgrade© processing method to concentrate uranium and vanadium into a smaller mass than is currently being achieved with screening. With the identification of the uranium-vanadium – bearing sand at La Rosada, the planned test work was delayed in order to incorporate this new style of mineralization. Initial results are now expected in Q2.
Sample Preparation and Assay
Panel samples were taken on the walls of each trench, bagged and delivered to ACME’s preparation facility in Mendoza, Argentina. Each sample was riffle-split. One sub-sample was crushed, split and pulverized to 75µm and a split of 250 grams sent for assay to provide an assay value for the raw gravel and sand to provide data for resource estimation purposes. A second set of sub-samples was wet-screened through successively finer mesh starting at 2mm, through 550 micrometres (“µm”), 180µm and finally at 150µm. Each size fraction was dried in ovens at 60°C and each fraction was sent to ACME’s analytical facility in Vancouver, Canada, for analysis by ICP-ES and ICP-MS after four-acid digestion.
Dr. Richard Spencer, P.Geo., CGeol., President and CEO of U3O8 Corp. and a Qualified Person as defined by National Instrument 43-101, has approved the technical information in this news release relating to the Laguna Salada Deposit and the related PEA.
About U3O8 Corp.
U3O8 Corp. is focused on exploration and development of deposits of uranium and associated commodities in South America. Potential by-products from uranium production include commodities used in the energy storage industry – in the manufacture of batteries – such as nickel, vanadium and phosphate. The Company’s mineral resources estimates were made in accordance with National Instrument 43-101, and are contained in three deposits:
Laguna Salada Deposit, Argentina – a PEA shows this near surface, free-digging uranium – vanadium deposit has low production-cost potential;
Berlin Deposit, Colombia – a PEA shows that Berlin also has low-cost uranium production potential due to revenue that would be generated from by-products of phosphate, vanadium, nickel, rare earths (yttrium and neodymium) and other metals that occur within the deposit; and
Kurupung Deposit, Guyana – a uranium resource has been estimated in four veins within a uranium-zirconium vein system. Resources have been estimated on four veins, while consistent mineralization of the same type has been intersected in scout drilling of an additional six veins, while yet other veins require first-time exploration drilling.
Information on U3O8 Corp., its resources and technical reports are available at www.u3o8corp.com and on SEDAR at www.sedar.com. Follow U3O8 Corp. on Facebook: www.facebook.com/u3o8corp, Twitter: www.twitter.com/u3o8corp and Youtube: www.youtube.com/u3o8corp.
This news release includes certain “forward looking statements” related with the development plans, economic potential and growth targets of U3O8 Corp’s projects. Forward-looking statements consist of statements that are not purely historical, including statements regarding beliefs, plans, expectations or intensions for the future, and include, but not limited to, statements with respect to: (a) the low-cost and near-term development of Laguna Salada, (b) the Laguna Salada and Berlin PEAs, (c) the potential of the Kurupung district in Guyana, (d) impact of the U- pgradeTM process on expected capital and operating expenditures, and (e) the price and market for uranium. These statements are based on assumptions, including that: (i) actual results of our exploration, resource goals, metallurgical testing, economic studies and development activities will continue to be positive and proceed as planned, and assumptions in the Laguna Salada and Berlin PEAs prove to be accurate, (ii) a joint venture will be formed with the provincial petroleum and mining company on the Argentina project, (iii) requisite regulatory and governmental approvals will be received on a timely basis on terms acceptable to U3O8 Corp., (iv) economic, political and industry market conditions will be favourable, and (v) financial markets and the market for uranium will improve for junior resource companies in the short-term. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in such statements, including, but not limited to: (1) changes in general economic and financial market conditions, (2) changes in demand and prices for minerals, (3) the Company’s ability to establish appropriate joint venture partnerships, (4) litigation, regulatory, and legislative developments, dependence on regulatory approvals, and changes in environmental compliance requirements, community support and the political and economic climate, (5) the inherent uncertainties and speculative nature associated with exploration results, resource estimates, potential resource growth, future metallurgical test results, changes in project parameters as plans evolve, (6) competitive developments, (7) availability of future financing, (8) exploration risks, and other factors beyond the control of U3O8 Corp. including those factors set out in the “Risk Factors” in our Annual Information Form available on SEDAR at www.sedar.com. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. U3O8 Corp. assumes no obligation to update such information, except as may be required by law. For more information on the above-noted PEAs, refer to the September 18, 2014 technical report titled “Preliminary Economic Assessment of the Laguna Salada Uranium-Vanadium Deposit, Chubut Province, Argentina” and the January 18, 2013 technical report titled “U3O8 Corp. Preliminary Economic Assessment on the Berlin Deposit, Colombia.”
1 September 18, 2014 technical report: “Preliminary Economic Assessment of the Laguna Salada Uranium Vanadium Deposit, Chubut Province, Argentina.”
2 May 20, 2011 technical report: “Laguna Salada Project, Chubut Province, Argentina, NI 43-101 Technical Report on Laguna Salada: Initial Resource Estimate”.