UEX Completes Pre-Feasibility Study On West Bear Deposit

A preliminary feasibility study has upgraded UEX’s (UEX-T) previously released resource estimate for its West Bear uranium deposit in the centre of the eastern Athabasca uranium district to a probable reserve of 1.49 million lbs. U₃0₈ grading 0.94% U₃0₈ at a cutoff of 0.18% U₃0₈, which represents 96% of the resource.

The deposit is amenable to mining from a shallow pit, the company says, and metallurgical testing has demonstrated overall uranium recoveries of 95%.

West Bear is in the southernmost portion of the Hidden Bay project in Saskatchewan that also contains UEX’s Horseshoe and Raven deposits to the northeast.

Horseshoe and Raven are 4 km southwest of Cameco’s (CCO-T, CCJ-N) Rabbit Lake mill facility. Areva’s McClean Lake property is 4 km northeast of the Horseshoe deposit and about 22 km northwest of the Raven deposit.

The combined NI 43-101 compliant at a 0.05% U₃0₈ cut-off for the Horseshoe, Raven and West Bear deposits is 36.62 million lbs. U₃0₈ with an average grade of 0.16% U₃0₈ in the indicated category and 2.72 million lbs. U₃0₈ with an average grade of 0.111% U₃0₈ in the inferred category.

Those resources include a previously released NI 43-101 estimate for West Bear of 1.59 million lbs. U₃0₈ grading 0.843% U₃0₈ at a 0.04% U₃0₈ cut-off.

At a base case uranium price of $77.73 per lb. U₃0₈, the net present value would stand at $23.4 million with an internal rate of return of 118%.

Potentially economic material would be mined from an open pit and transported off-site to an existing processing facility for custom milling.

Capital costs are estimated to be about $20.8 million and mine closure costs are estimated at $8.75 million. Working capital requirements will run to about $0.5 million per month over the life of the operation.

UEX Corp. acquired the Hidden Bay project in 2002.

At presstime UEX was at $1.05 per share. Over the last year the uranium junior has traded in a range of 65¢-$1.80 per share.