U3O8 Corp.
TSX VENTURE : UWE

U3O8 Corp.

December 08, 2010 06:45 ET

U3O8 Corp. Reports 9.2m at 0.13% U3O8, 0.63% V2O5, 9.69% P2O5 Plus Rare Earths & Other Elements From Drilling at Its Berlin Project, Colombia

Diverse Suite of "Electric Metals" Offers Potential to Define a High-Value, Multi-Commodity Resource in the Near-Term

TORONTO, ONTARIO--(Marketwire - Dec. 8, 2010) - U3O8 Corp. (TSX VENTURE:UWE) a Canadian-based company focused on exploration and resource expansion of uranium and associated commodities in South America, reports grades of uranium, phosphate, vanadium, yttrium, rhenium, silver and molybdenum intersected in its first drilling of the Berlin Project in Caldas Province, Colombia. The Berlin Project is a sediment-hosted, multi-commodity prospect with a historic resource1 of 12.9 million tonnes at an average grade of 0.13% U3O8 (38 million pounds U3O8) estimated on the southern 4.4 kilometres ("km") of a 10.5km long mineralized trend. No estimate of other elements was reported from historic work. Trenching is underway to confirm historic data that indicates similar uranium grades occur in the northern 6km of the property. 

"U3O8 Corp's drilling has intersected similar uranium grades to historic data, but over greater widths and with an additional suite of valuable potential co-products. Given these results and the potential to define a high-value, multi-commodity resource in the near-term, a 10,000m drill program commenced immediately following the initial 1,500m drill program at Berlin," said Dr. Richard Spencer, U3O8 Corp's President and CEO. "Samples from recent drilling are undergoing metallurgical test work to determine the extent to which various co-products can be recovered from the mineralized rock. Preliminary metallurgical results are expected in Q1 2011 as we progress towards positioning the Berlin Project for potential National Instrument 43-101 ("NI 43-101") resource estimation in 2011."

Dr. Spencer continued, "Demand for most of the potential co-products is projected to increase: for uranium in response to accelerating nuclear power programs, vanadium in the development of smart electricity grids, phosphate for agricultural fertilizer and yttrium as the shortage of heavy rare earths becomes widely recognized. Rhenium is used in super-alloys designed for very high temperatures, principally used in jet engines and catalytic converters. And the silver adds a precious metal component to the commodity mix."

Table 1 – Assay Results for the Berlin Project

Summary results for the first six bore holes drilled from platforms P1 and P2 in the southern part of the Berlin Project (Figures 1 and 2).

Bore Mineralized Interval Grade
Hole # From To Width U3O8 V2O5 P2O5 Mo Y2O3 Re Ag
  (m) (m) (m) % lbs/st % % ppm % ppm ppm
DDB1 109.69 111.22 1.53 0.079 1.58 0.69 14.55 294 0.064 1.84 5.93
DDB2 74.67 82.28 7.61 0.068 1.36 0.71 3.21 447 0.035 3.01 3.54
Includes 79.24 82.28 3.04 0.137 2.74 0.76 4.22 360 0.070 5.09 5.86
DDB3 76.20 85.34 9.14 0.049 0.99 0.43 7.44 335 0.032 2.83 1.89
Includes 80.77 83.82 3.05 0.123 2.47 0.71 17.56 626 0.078 7.02 3.82
DDB4 Bore hole did not reach target depth
DDB5 137.13 146.28 9.15 0.131 2.62 0.63 9.69 571 0.057 7.23 5.51
DDB6 199.65 201.17 1.52 0.046 0.92 0.33 5.25 142 0.027 1.63 2.30
 
* lbs/st is an abbreviation for pounds per short ton. 1 short ton = 2,000lbs or 0.907 metric tonnes.

Note: Due to the bore holes being drilled near perpendicular to the mineralized zone, the core length of the intersection is approximately the true width of the intersection. There was extensive core loss immediately above and below the mineralized interval that was sampled in bore hole DDB6. Data from the Mount Sopris gamma ray probe for this hole yields an interval of 4.2m from 200.8m to 205.0m at an estimated U3O8 grade of 0.136%.

Potential quantity and grade are conceptual in nature. There has been insufficient exploration to define a mineral resource at the Berlin Project to date and it is uncertain if further exploration will result in the target being delineated as a mineral resource. 

Mineralization

The mineralized unit encountered in the drilling to date on the Berlin Project is a fine-grained sandstone layer that lies at the contact between a sandstone sequence and the overlying organic-rich, black shale (Figure 3). The mineralized sandstone unit is soft and poorly consolidated, which has led to core loss in some bore holes such as hole DDB6. Bitumen has impregnated parts of the mineralized sandstone and also occurs in the overlying shale. The black shale contains graphite and has a variable pyrite content from 0.5% up to 30%. 

Microscopic study of core samples shows that the phosphate occurs as fine, crystalline fluorapatite (Ca5(PO4)F) masses in the sandstone. Uranium is associated with the fluorapatite, while yttrium and some of the vanadium and molybdenum occur as phosphate minerals. 

Exploration Program

U3O8 Corp's initial 1,500m drill program on the Berlin Project commenced near the southern tip of the 10.5km long, canoe-shaped fold (Figure 1), and was primarily aimed at obtaining fresh samples for metallurgical testing. The drill results reported here confirm that the mineralization encountered at surface in the trenches extends to depth where it follows the "U"-like cross-sectional shape of the fold. 

U3O8 Corp's trenching has demonstrated consistent mineralization in the southern 3km of the fold (Figure 2) and a 10,000m drill program is already underway with the aim of confirming the continuity of mineralization at depth in the rest of that area. A second, man-portable rig is scheduled to arrive on site in January so that the exploration drilling can be completed in that area by mid 2011. U3O8 Corp. plans to commence infill drilling in the latter half of 2011 towards the definition of a potential NI 43-101 resource estimate. In addition, trenching continues in the northern part of the property to confirm historic records which show that the uranium-bearing layer extends along the full length of the fold. 

Metallurgical Test Work

Mineralized core samples have been submitted for metallurgical test work at SGS Lakefield's laboratory in Toronto under the guidance of external metallurgical consultant, Mr. John Goode. Results are expected in the first quarter of 2011. 

Commodities Associated with Uranium at Berlin

In the Berlin Project, significant grades of uranium associated with phosphate, vanadium, yttrium, rhenium, molybdenum and silver contribute to a potential high in situ value for this multi-commodity prospect. A conversion table for the various units is provided for convenience (Table 2).

Uranium
  • The current uranium spot price is $61.00 per pound (www.kitco.com)
Phosphate
  • Fluorapatite is the principal phosphate mineral found at Berlin. Phosphate, with nitrogen and potash, constitute the three principal components of agricultural fertilizers. The Berlin Project lies adjacent to the agricultural heartland of central Colombia – a favourable location for the potential production of fertilizer.
  • Current price of phosphate (DAP) is approximately US$530 per tonne or $0.53 per kilogram ("kg") (Bloomberg). 
Vanadium
  • Used as an alloy to strengthen steel.
  • Significant potential for large-scale energy storage units in emerging technology such as the vanadium redox-flow battery ("VRB"). VRB's can absorb and discharge large amounts of electricity simultaneously and instantaneously, recharge thousands of times and they contain no toxic materials. VRB's are proving to be a crucial component of green and conventional power grids since they can be charged with excess electricity during low-demand periods and feed power back into the grid as demand increases.
  • Combined with lithium to create a safer, longer lasting rechargeable battery for electric vehicles.
  • Vanadium prices are approximately $6.50 per pound ("lb") or approximately $14 per kg (www.metal-pages.com). 
Yttrium
  • A heavy rare earth element ("HREE") used to make red phosphors for television screens and LEDs.
  • Used in the production of electrodes, electrolytes, electronic filters, lasers and superconductors.
  • Yttrium prices are currently between $70 and $75 per kg (www.asianmetal.com).
Rhenium
  • A rare metal used in temperature resistant alloys such as for jet engines and catalytic converters.
  • Rhenium prices are approximately $3,500 to $4,000 per kg (www.metal-pages.com).
Molybdenum
  • Used principally as an alloy to strengthen steel. Molybdenum prices are currently approximately $15 per lb (www.metal-pages.com).
Silver
  • Silver prices are approximately $29 per troy ounce (www.kitco.com).
                 
                 
Table 2 – Conversion Factors for Various Units used in this Press Release
                 
Percentage   Equivalent kg per tonne (metric ton)   Equivalent lbs per tonne (metric ton)   Equivalent parts per million ("ppm")   Equivalent grams per tonne ("g/t")
1%   10kg   22 lbs   10,000   10,000
0.1%   1kg   2.2 lbs   1,000   1,000
0.01%   0.1kg   0.22 lbs   100   100
0.001%   0.01kg   0.022 lbs   10   10

Quality Assurance and Quality Control ("QAQC")

Drilling is being done by Kluane Drilling Ltd. of Whitehorse, Canada, with man-portable rigs. Each bore hole is started with NTW (nominal core diameter is 5.71cm) and the hole size is reduced at depth to BTW (normal core diameter is 4.2cm). On completion of each hole, the radioactivity of the walls of the bore hole is measured in detail with a Mount Sopris gamma ray probe and these data provide an estimate of uranium grade that is independent of the assay values obtained from sampling of the core. 

The core is transported to a central facility where its radioactivity is measured with a hand-held spectrometer. It is logged and sample intervals are determined and marked. The core is split with a spatula or diamond saw and half-core is bagged, numbered and submitted to ALS Chemex Laboratory's preparation facility in Bogota, Colombia. 

Quality control samples, that include certified standards, field blanks, ten mesh duplicates and pulp duplicates, constitute approximately 13% of the material assayed by the laboratory. The prepared sample pulps are then shipped by ALS Chemex to its analytical facility in Lima, Peru. Several types of analyses are performed on the samples including:

  • Inductively Coupled Plasma Mass Spectroscopy ("ICP-MS") after the sample has been dissolved by a mixture of four acids (ALS Chemex Method Code ME-MS61). This type of analysis provides assay data on 48 elements. 
  • ICP-MS after the sample has been dissolved by a mixture of four acids provides analyses for rare earth elements (ALS Chemex Method Code ME-MS81). 
  • Samples that have a phosphorous content in excess of 10,000ppm were analyzed by X-Ray Fluorescence Spectroscopy (XRF) using ALS Chemex Method Code XRF12. 

Dr. Richard Spencer, President & CEO of U3O8 Corp., a Qualified Person within the definition of that term in NI 43-101 of the Canadian Securities Administrators, has supervised the preparation of, and verified the technical information in this release.

Historic Resource1

The majority of the prior exploration on the Berlin Project was conducted by the French company, Minatome, between 1978 and 1981 during which time 11 bore holes were drilled, 20 trenches were dug and three adits were excavated. The historic estimate was generated on the southern 4.4km of a 10.5km long syncline (Figure 1). Historic data from trenching shows that anomalous grades of uranium continue along strike to the north. 

(1) The Berlin resource estimate is historical and is reported in Castano, R. (1981), Calcul provisoire des reserves geologiques de Berlin, sur la base des resultants des sondages, unpublished Minatome report, 15p. There has been insufficient exploration work completed to verify the historic estimate. U3O8 Corp. is not treating the historical estimate as current mineral resources and it should not be relied upon or considered a NI 43-101 compliant resource. As the 38 million pound U3O8 historic estimate is based only on 11 widely-spaced drill holes, it is regarded by U3O8 Corp. as merely an indication of the magnitude of the uranium resource potential of the southernmost 4.4 kilometre long portion of the syncline containing the Berlin uranium mineralization.

About U3O8 Corp.

U3O8 Corp. is a Toronto-based exploration company focused on exploration and resource expansion of uranium and associated commodities in South America – a promising new frontier for exploration and development. U3O8 Corp. has one of the most advanced portfolios of uranium projects in the region comprising NI 43-101 compliant resources in Guyana to significant historic resources in Colombia and near-resource and discovery potential in Argentina.

For further information on U3O8 Corp's Berlin Project, refer to the technical report entitled "Review of Historic Exploration Data from the Unaniferous Black Shales of the Berlin Project and Chaparral Concession, Colombia: A guide to future exploration" prepared by Richard Spencer and Richard Cleath dated March 23, 2010 and available at www.sedar.com. Additional information on U3O8 Corp. is available on the company's web site at www.u3o8corp.com.

Forward-Looking Statements

Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of U3O8 Corp., including, but not limited to, the impact of general economic conditions, industry conditions, volatility of commodity prices, risks associated with the uncertainty of exploration results and estimates and that the resource potential will be achieved on exploration projects, currency fluctuations, dependence upon regulatory approvals, and the uncertainty of obtaining additional financing and exploration risk. There is no assurance that the Berlin Project will add to U3O8 Corp's resource base in the short-term, or at all. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. 

To view, "Figure 1 – Map Shows the Location of Trenches and Drill Platforms in the Southern Part of the 10.5km Long Fold in the Berlin Project and the Extent of the Alaskite Batholiths," please visit the following link: http://media3.marketwire.com/docs/uwefig1dec.pdf.

To view, "Figure 2 – Drill Locations in the Southern Part of the Fold in the Berlin Project, Colombia," please visit the following link: http://media3.marketwire.com/docs/uwefig2dec.pdf.

To view, "Figure 3 – Cross Sections of the Berlin Project at Drill Platforms P1 and P2," please visit the following link: http://media3.marketwire.com/docs/uwefig3dec.pdf.

To view the photo associated with this Press Release, please visit the following link: http://www.marketwire.com/library/20101207-u3o8imgcapLG.JPG.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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