Western Uranium Corporation
TSX VENTURE : WUC

Western Uranium Corporation

March 07, 2011 08:30 ET

Western Uranium's Meryllion Minerals Acquires Option to Purchase the Providencia Silver Copper Prospect

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 7, 2011) - Western Uranium Corporation (TSX VENTURE:WUC) ("the Company") is pleased to announce that its wholly owned subsidiary , Meryllion Minerals Corporation ("Meryllion"), has acquired an option to purchase the Providencia silver-copper prospect located in the Puna of northwestern Argentina.

The property comprises mineral concessions amounting to 3 000 hectares situated 4 200m above sea level and some 260 km by good road from San Salvador de Jujuy, the capital of the Jujuy Province. It has access to gas pipelines, power lines, railroad, as well as highway access to Chile relatively close by. The focus of the project is the La Providencia silver deposit which was discovered in 1969 and which between 1986 and 1997 produced some five million ounces of silver from ore grading between 400 g/t and 500 g/t Ag.

The deposit is hosted by Plio-Pleistocene, poorly consolidated, continental sediments, consisting of sandstones and conglomerates preserved in an 18 km-long pull-apart basin within a basement of Ordovician clastic sediments; this basin hosts a number of occurrences of what have previously been interpreted as redbed-type copper (silver) mineralization. At the main La Providencia workings, mineralization occurs in poorly consolidated conglomerate units. Mineralization can be traced by mine workings (shallow pits) and drilling for at least 900m in a north-south direction and is open to the north where it disappears under younger unmineralized sedimentary cover. Mineralization is also open to the east where it has been traced for some 400m in gently dipping units.

The property has received the attention of a number of companies, including St Joe's, Shell, and Peñoles. More recently, Cardero Resources completed a program of exploration which included limited drilling of both diamond and RC holes. While most of their work was concentrated on the concessions surrounding the mine, three RC holes were completed at the mine. Hole PR-RC-03 collared within the northern part of the South Pit at La Providencia intersected 1 710 g/t Ag at 218m and 1 675 g/t Ag at 222m down the hole. Mineralization at La Providencia thus appears to be open along strike, laterally, and at depth, and Meryllion believes that there is excellent potential to further define large tonnage, open-pitable resources in the near surface environment as well as higher grade mineralization at depth.

Under the terms of the option agreement, Meryllion has the right to acquire a 100% interest in the property by making an initial payment of USD 50 000 with additional escalating option payments amounting to USD 1 000 000 over the next 60 months. The exercise fee is USD 950 000 if less than 50 million ounces of resources have been delineated (as defined by a third-party, independent consultant), or USD 1 950 000 if more than 50 million ounces of silver are defined. 

The property is subject to an NSR of 1.5% with Meryllion having the option to buy out the royalty. Meryllion is, in addition, committed to exploration expenditures of USD 50 000 and USD 100 000 in the first and second years respectively.

ABOUT MERYLLION

Meryllion Minerals is a 100% owned subsidiary of Western Uranium with the charter to conduct mineral exploration in South America with a primary focus on precious and base metals. Meryllion also has an option to purchase a 100% interest in the Cerro Amarillo copper-gold porphyry deposit located in Mendoza Province, Argentina. Meryllion operates under the direction of Dr. Willem Fuchter, a PhD geologist with extensive international experience.

ABOUT THE COMPANY

Western Uranium Corporation is a mineral exploration company with properties in Argentina, Nevada, and New Mexico and an earn-in agreement with Renaissance Gold Inc. for the Baza gold-copper project in Spain. The Company has its head office and executive management team in Vancouver, Canada; and its technical team is based in Reno, Nevada.

On behalf of the Board of Western Uranium Corporation

R. Edward Flood, Chairman

The TSX Venture Exchange has neither approved nor disapproved of the contents of this press release. Neither the TSX Venture Exchange nor its Regulation Services Provider (as such 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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