Despite a recently imposed 68% windfall tax on copper and gold, Mega Uranium (MGA-V, MGAFF-O) plans to continue work aimed at earning into 2,325 sq. km worth of Mongolian uranium properties held by Red Hill Energy (RH-V, RHFFF-O), formerly UGL Enterprises.
The company plans to focus 4,500 metres of rotary air blast (RAB) drilling on three elongated uranium anomalies situated along, and parallel to, a strong, resistivity-defined structural lineament on block 1 at the Baganurat property in southeastern Mongolia.
In all, around 100 shallow (30-60 metres) holes will be sunk on fences designed to cross several structures and coincident uranium-thorium anomalies. Additional holes will target several other uranium anomalies near strong structural lineaments.
On block 3, 1,000 metres of RAB drilling will be spilt into three holes on each of 3 north-south lines on the west, center, and eastern portion of the block. The holes will test for uranium mineralization within Lower Jurassic-Upper Cretaceous sedimentary rocks immediately overlying Paleozoic granites.
A pair of Russian exploration programs in the 1980s identified a 3.5-km-long zone of 2-to-3-metre thick uranium mineralization on the property. The reported reserve has yet to be verified.
Mega is also following up on a previously identified third fault-related zone of uranium mineralization on the Maikhan Tolgoi property in northeastern Mongolia. Drilling on the zone in the mid-1970s is believed to have been too shallow at around 50 metres.
Some 11.7 km of trenching by Russian operators in the mid-1970s delineated a 5-km long uranium zone measuring up to 70 metres in thickness on Maikhan. Assays ran up to 0.65% uranium.
Under a deal inked in June 2005, Mega can earn an initial 50% interest in Red Hill’s Mongolian uranium portfolio by spending US$1.5 million over three years. Thereafter, it can boost its stake to 60% by spending another US$2 million over a subsequent three years.
Meanwhile, in Argentina, drilling on Mega’s Patagonia uranium project in Chubut province’s San Jorge Gulf basin has returned some encouraging initial results.
The third hole of a recently completed 26-hole program cut 2 metres running 0.11% U3O8, beginning at a depth of 87 metres. Follow up drilling is planned once weather conditions improve in about 3 months.
The hole cut the tuffaceous rocks of the lower portion of the Cretaceous Los Adobes formation that hosts the Cerro Solo deposit, held by Argentina’s National Atomic Energy
The first hole of the vertical, reverse-circulation drill program, 1.5 km to the south, failed to encounter significant mineralization. Assay results are pending for the remaining holes.
Cerro Solo is home to 10.3 million lbs. of mineable uranium reserves averaging 0.3% U3O8. The deposit also contains an average grade of 0.3% molybdenum.
Mega holds nearly 3,000 sq. km of prospective ground near CNEA’s Cerro Solo and Sierra Pintada deposits. The properties cover uranium occurrences, favourable geological settings, and radiometric anomalies identified by CNEA in the 1960s and 1970s.
The Sierra Pintada deposit, in Mendoza province, is home to a resource of some 30 million lbs. uranium averaging 0.12% U3O8. Mega’s primary target represents untested radiometric anomalies adjacent to the north of Sierra Pintada.
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