Purepoint Uranium Group Inc.
TSX VENTURE : PTU
September 29, 2009 08:01 ET
Purepoint Uranium Group Inc: Project Status and Exploration Plans
TORONTO, ONTARIO--(Marketwire - Sept. 29, 2009) - Purepoint Uranium Group Inc. (TSX VENTURE:PTU) is pleased to provide the following overview of its current operations and exploration plans for the coming year.
"As 2008 closed, the exploration industry's five year bull market came to a hard stop, and Purepoint announced its decision to dramatically reduce field work and conserve cash until signs of improvement in the capital markets were apparent" said Chris Frostad, President and CEO of Purepoint Uranium Group Inc. "Now, as global economies begin to emerge from that severe recession, Purepoint remains well positioned as a unique opportunity in Canada's Athabasca Basin uranium region".
- Over a period of five years, during which the capital markets were providing the lowest cost of capital the exploration industry has seen in decades, Purepoint resolved to utilize its own capital to advance its early stage projects while maintaining a 100% ownership interest; deferring joint venture potential until higher value could be empirically demonstrated. As a result of that strategic decision Purepoint is now the only remaining public exploration junior in the Basin actively advancing a portfolio of 100% owned, highly prospective uranium projects of proven value;
- Purepoint continues to closely monitor exploration developments in the Basin and has recently staked a new block of promising properties within the Basin's primary mine trend;
- Joint venture discussions with more than a dozen Asian based companies have recently resumed, companies which were forced to suspend negotiations last year as global economies weakened;
- In anticipation of the pending Canada/India nuclear trade agreement, new discussions with several large Indian companies have recently commenced;
- Purepoint has now fully earned an initial 23% in its Smart Lake joint venture with Cameco Corporation and can earn an additional 27% by spending an additional $1.9 million by March 31, 2013;
- Purepoint has now fully earned an initial 20% in its Hook Lake joint venture with Cameco Corporation and Areva Resources Canada Ltd. and can earn an additional 30% by spending an additional $4.3 million by March 31, 2013;
- At the close of its last fiscal quarter (June 30, 2009) the company held a working capital balance in excess of $2.8 million.
- The company will resume drilling activities in the upcoming winter season, focusing its efforts on three high priority projects, Red Willow, Smart Lake and Turnor Lake.
- Re-logging of drill core at Purepoint's Red Willow project has provided a more detailed interpretation of the mineralized structures within the Osprey Zone (assaying as high as 3.03% U3O8);
- At Purepoint's Smart Lake joint venture with Cameco a radioactive structure, originally intersected by SMT08-01, was successfully traced for 50 metres during the last drill program, returned assays up to 0.19% U3O8 over 0.1 m, and is associated with the graphitic "Shearwater Conductor" that has been outlined for over 1.4 kilometers;
- The most recent drill programs at the company's Turnor Lake project continued to show that anomalous uranium mineralization is spatially associated with the unconformity throughout the property. As previously reported, last year's single drill hole into the Serin Lake Zone intersected an interpreted uplifted block of basement rocks, an important feature associated with many high-grade uranium deposits in the Athabasca Basin.
- Purepoint was fortunate to have recently staked an additional 723 hectares in close proximity to its Henday Lake project. The entire Henday Block now covers 1,752 hectares within the Athabasca Basin's eastern uranium mine trend and is situated less than ten kilometers from both Hathor's recently discovered Roughrider Zone and Denison's Midwest uranium deposit.
Red Willow Project
Last year, a 37-hole diamond drill program totaling 7,160 metres was completed on the Red Willow Property, a large property containing more than 22 targets, each identified by multiple indicia of Basin type deposits. This drill program successfully followed up the 2007 Osprey Zone discovery, discovered two additional radioactive structures within the Long Lake area, and demonstrated the favourable prospectivity of the Radon Lake area (see announcement dated June 11, 2008).
Drilling of the Osprey Zone intersected a structure averaging 0.58% U3O8 over 1.0 metre (RW-19) that included an interval assaying 3.03% U3O8 over 0.1 metres. The RW-19 intercept is located approximately 80 metres north from the Osprey zone discovery hole RW-07, which returned 0.20% eU3O8 over 5.8 metres in 2007. Hole RW-13 returned 0.27% U3O8 over 1.2 metres that represents a 20 metre step-out south of RW-07. The 2008 Osprey drilling results indicate that significant uranium intercepts are related to a 40 - 50 metre wide pyritic/graphitic shear zone. The prospective shear zone remains unexplored to depth and along most of its strike length.
First pass drilling within the Long Lake area intersected a 1.6 metre radioactive structure in LL08-05 (including 269 ppm U over 0.5 m) and two narrow mineralized structures in LL08-07 (611 ppm U and 237 ppm U over 0.1 and 0.2 m, respectively). Two of three eastern electromagnetic conductors drill-tested in 2008 at Long Lake are now known to reflect altered, graphitic rocks. These two target areas represent 8.7 kilometers of prospective EM conductors.
At Radon Lake, the VTEM conductor trending southwest from the lake was explored systematically. Graphitic units were intersected and anomalous uranium results were returned from RAD-08-01, RAD-08-02, RAD-08-05, RAD-08-06 and RAD-08-09. Drill hole RAD08-09 provided the best uranium assay at Radon Lake returning 283 ppm U over 1.1 metres between 106.1 and 107.2 metres. Favourable alteration, including strong chlorite and hematization, was intersected in most holes. Spring conditions prevented drill testing the northern extension of the EM conductor.
The most recent drill program at Red Willow highlighted this property's uranium potential by returning anomalous uranium concentrations from all three areas drilled. Each of these areas require further drilling to evaluate their potential while numerous prospective geophysical targets have yet to be tested by diamond drilling.
Smart Lake Project
The Smart Lake property is situated in the southwestern portion of the Athabasca Basin, approximately 60 km south of the former Cluff Lake mine. Depth to the unconformity is shallow, at zero to 350 metres. Aeromagnetic and electromagnetic patterns at Smart Lake reflect an extension of the unique patterns underlying the Shea Creek deposits (max. grade of 58.3% U3O8 over 3.5 m) just 55 km north of the property. Recent exploration by Purepoint and Cameco has firmly established the presence and location of a number of basement electromagnetic conductors never drill tested.
Previously reported drill hole SMT08-01 (see announcement dated November 4, 2008) intersected a major structure between 222.5 and 276.5 m (true width estimated at 20 m) that displayed intense clay alteration, silicification and hematization. The weak radioactive structure was brecciated and healed with an overprinting of alteration styles suggesting multiple episodes of alteration. Three holes were drilled to follow-up the favourable SMT08-01 structure and successfully intersected it 50 metres along strike. Drill hole SMT08-05 intersected the radioactive fault between 150.1 and 154.2 m and returned up to 0.22% eU3O8 over 0.2 m. SMT08-06 returned 0.19% U3O8 over 0.1 m from a tension fracture associated with the SMT08-05 radioactive fault.
The newly discovered radioactive structure at Smart Lake is associated with graphite and the Shearwater conductor which will aid ongoing exploration. The Shearwater conductor has been outlined over 1.0 kilometer by a ground EM survey and over 1.4 kilometers by an airborne EM survey.
Turnor Lake Project
Situated in the eastern side of the Athabasca Basin, the 100% owned Turnor Lake Project includes five claims with a total area of 9,705 hectares. Depth to the unconformity is shallow at approximately 180 metres.
The property covers known graphitic conductors that are associated with uranium showings on adjoining properties, namely Cameco's La Rocque showing (33.9% U3O8 over 5.5 m) to the west and Areva's HLH-50 intercept (5.2% U3O8 over 0.38 m) located to the south. The project lies in close proximity to several uranium deposits including Midwest Lake, McClean Lake, Eagle Point, and Collins Bay.
In light of the favourable results returned throughout the life of this project, all conductors on the property continue to warrant further diamond drill testing, specifically those conductors within the Laysan and Serin target zones. Further drilling is required in the area between drill holes TL-30 and TL-31 and in the vicinity of TL-28, which returned results showing extensive clay alteration of the sandstone. Follow-up holes to further test the areas of anomalous halo mineralization are warranted including the vicinity of TL-39. Drilling will also be conducted to determine the source of the radon anomaly detected in the vicinity of drill holes TL-41 and -42.
Purepoint's 100% owned Henday Block is situate within ten kilometers of both Hathor's recently discovered Roughrider Zone and the Midwest uranium deposit owned by Denison Mines Corp., AREVA Resources Canada Inc. and OURD.
The Henday Lake property falls within the Mudjatik-Wollaston Tectonic Zone, a northeast trending structural zone along the eastern margin of the Basin. Over 95% of known Canadian uranium deposits, and all operating uranium mines in Canada, are located on this trend. The Mudjatik-Wollaston Tectonic Zone is the NE trending high strain tectonic zone marking the boundary between the Archean gneisses and granitoids of the Mudjatik Domain to the west and Archean gneisses, metasediments, and pegmatite intrusions of the Wollaston domain to the east.
The Henday Block is 1,752 hectares in size, three times the size of Hathor's nearby Midwest Northeast Project, which hosts their Roughrider Zone. Only one historic drill hole is known to have been drilled on Purepoint's Henday property. That hole, drilled by Cogema Resources in 1998, encountered a steeply dipping, strongly graphitic fault gouge at the bottom of the hole.
Annual Option Grant
Purepoint is also announcing today that the company has approved the issuance of a total of 1,280,000 options to certain of its Board of Directors, management and staff pursuant to its stock option plan. The options are exercisable at a price of $0.14, are subject to agreed vesting schedules and expire in five years.
Under Purepoint's stock option plan there are at present 7,330,803 common shares reserved for issuance, of which only 4,560,000 shares are subject to outstanding option grants.
Purepoint Uranium Group Inc. is focused on the precision exploration of more than 55 defined target areas on its eight 100% owned projects in the Canadian Athabasca Basin, and its two Basin projects joint ventured with Cameco Corporation and AREVA Resources Canada Inc. Established in the Basin well before the resurgence in uranium, Purepoint is actively advancing this large portfolio of multiple drill targets in the world's richest uranium region.
Scott Frostad BSc, MASc, PGeo, Purepoint's Vice President, Exploration, is the Qualified Person responsible for technical content of this release.
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