Uranium City Resources raises cash

Uranium City Resources (UCR-V) will raise up to $3 million through a private placement and put the funds into the ground in northern Saskatchewan.

On Apr. 3 the Kirkland Lake-based, junior exploration company announced that Northern Securities will act as agent for an offering that will see up to $1.5 million in units issued at a price of 35 per unit. Each unit will consist of one common share and one half of a common share purchase warrant.

The remaining $1.5 million will be raised through flow-through units priced at 40 per unit. Each Flow-Through Unit will consist of one flow- through share and one half of a warrant.

Each full warrant will entitle the holder to purchase one additional common share at 45 for a period of 18 months following the closing of the offering.

In the press release Uranium City says proceeds will be used for exploration and development purposes at its northern Saskatchewan property as well as for general working purposes.

In 2005, the Company completed its initial exploration campaign at its Contact Lake, Lorado, Fish Hook and Nicholson Uranium Projects. An airborne versatile time-domain electromagnetics (VTEM) survey was flown to confirm known targets and find new ones. Geochemical surveys were done to confirm and prioritize targets determined by the airborne survey. Rock samples were also taken.

The company says its two drilling campaigns at Contact Lake and Fish Hook were especially encouraging. Anomalous values of uranium were found at Contact Lake and values from Fish Hook confirmed known uranium grades and anomalous values of vanadium and other metals from the past-producing mine.

The company says Fish Hook, Nicholson and on-strike from Lorado, are its drilling priorities and plans to spend $500,000 for approximately 5,000 metres of drilling during its initial drilling phase.

The projects are located in the Uranium City mining district — an area with a 30-year history of producing uranium. In that time the region contribued roughly 65 million lbs. of uranium but operations were suspended in 1982, due to a falling uranium price.