Uranium Energy (NYSE: UEC) says new drill results expand the footprint of high-grade uranium mineralization at its Christie Lake project in northern Saskatchewan’s Athabasca basin.
Drill hole C-178-1 cut 15.6 metres grading 5.4% uranium oxide (U3O8) from 419.1 metres depth, including 3.4 metres grading 23% U3O8 from 426.6 metres downhole, UEC said in a news release on Monday.
The intercepts are the first results from UEC’s three-month winter drilling program before an update of the Christie Lake resource later this year, the company said. The hole expands the Sakura zone’s area of mineralization first reported in October when hole CB-176A located 10 metres from C-178-1 cut 2.1 metres grading 68.7% U3O8.
UEC said its strategy for the 80-sq.-km eastern Athabasca corridor includes cost savings among its Christie Lake, Roughrider and Horseshoe-Raven projects. Christie Lake is 9 km northeast of Cameco’s (TSX: CCO; NYSE: CCJ) McArthur River, the world’s largest high-grade uranium mine, and along the same geological trend. The Sakura zone, discovered in August 2022 along the Yalowega mineralized corridor, is open in all directions, UEC said.
“The confirmed continuity of the high-grade uranium mineralization at the Sakura zone suggests a previously unrecognized trend of uranium mineralization at Christie Lake,” Chris Hamel, the company’s vice-president of exploration in Canada, said in the release. “With constrained expenditures during the years of the uranium bear market, the exciting potential of Christie Lake was left under-explored.”
Mineralization at Christie Lake is 400 to 420 metres deep, about the same depth as the deposits at the high-grade Cigar Lake uranium mine and about 100 metres shallower than McArthur River, UEC said.
Corpus Christi, Texas-based UEC rapidly expanded in Canada last year. It bought UEX Corp. for $244 million to acquire the Christie Lake, Hidden Bay and Horseshoe-Raven projects on the basin’s eastern side. Then three months later in October UEC spent US$150 million to purchase Rio Tinto’s (NYSE: RIO; LSE: RIO; ASX: RIO) Roughrider project.
In an interview at the time with The Northern Miner, UEC CEO Amir Adnani said that the company sought to increase its total measured and indicated resources to 350 million lb. uranium oxide from 198 million lb., which he said would rank it third in size in the Athabasca region behind Cameco and French state-owned Orano.
“We hit the ground running in 2023 to follow-up and test the continuity at this new Sakura zone,” Adnani said in Monday’s release. “We have two objectives with our eastern Athabasca basin projects, 1) continue with aggressive exploration drilling for resource growth and 2) evaluate potential synergies for future development given the proximity of Christie Lake and Horseshoe Raven projects to our recently acquired Roughrider project.”
The Roughrider deposits hold a historic resource of 57.9 million lb. of uranium oxide (394 million indicated tonnes at 1.98% U3O8 and 161.6 million inferred tonnes at 11.43% U3O8), according to a 2011 resource estimate. A preliminary economic assessment from that time estimated a US$1 billion net present value using a 7% discount rate and a US$70 per lb. uranium price from producing 5 million lbs. a year over the 10-year life of a conventional underground mine.
Uranium exploration is benefiting from a growing acceptance of nuclear energy, with its zero carbon emissions, to fight climate change as well as provide an alternative to Russian gas in Europe. However, concerns remain about nuclear waste, power plant costs and accidents.
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