quakes99 wrote: Fission management talks 2017 drill strategy at PLS
A drill rig at Fission Uranium's Patterson Lake South (PLS) uranium project in Saskatchewan. Credit: Fission Uranium Posted By: Matthew Keevil January 31, 2017
VANCOUVER — Fission Uranium (TSX: FCU; US-OTC: FCUUF) is hoping to strike a fiscal balance between resource expansion and grassroots discovery at its Patterson Lake South (PLS) project in the Athabasca Basin. The company has an enviable capital position following an $82.2-million strategic investment from China’s state-owned CGN Mining in early 2016, but the volatile state of uranium markets demands a cautious approach to burn rates and project spending.
Fission is known for its prolific drill campaigns, however, and the market didn’t slow activity at PLS down too much last year.
Ross McElroy, Fission Uranium president and COO, at the Patterson Lake South uranium project. Credit: Fission Uranium
The company invested roughly $17 million in its Triple R deposit in 2016, and recently announced a $6.5-million winter program that will include 10,000 metres over 34 drill holes. Exploration work will follow-up on “multiple regional exploration targets” identified last summer, while delineation and expansion work will continue along the 2.6-km Triple R mineralized trend.
“We made the decision late last year that it was time to be more careful, and strategic, with our money,” explains CEO Dev Randhawa during an interview.
“We’re sticking with the budgets we came up with at the time, but in our conversations with CGN there is an acknowledgement that if we hit something impressive during exploration that we can increase spending. Now, if I can raise hard dollars at a share price I think is high enough we’ll definitely look at that opportunity as well,” he adds.
Fission’s efforts last year were largely focused on adding a pair of new zones to the Triple R story.
In late 2015, the company released a preliminary economic assessment (PEA) contemplating a $1.1-billion development that would produce 100.8 million lbs. U3O8 over a 14-year mine life. The study was underpinned by resources at the central R00E and R780E zones that total 2 million indicated tonnes grading 1.83% U3O8 for 81.1 million contained lbs., and 785,000 inferred tonnes averaging 1.57% U3O8 for 27.3 million contained lbs.
Since the PEA was released, however, Fission has discovered a pair of new zones that could materially change Triple R’s size potential.
The R840W zone currently marks the western edge of the 2.6-km trend, while the R160E zone represents a newly-defined eastern boundary. Fission will dedicate 19 holes of its current program to “growing and connecting the new high-grade zones” in order to fuel an update resource estimate and an upcoming pre-feasibility study (PFS).
Recent assay highlights from R840W include: 11 metres grading 10.03% uranium from 158 metres depth in hole 16-504; and 9 metres of 6.65% U3O8 from 141 metres depth in hole 16-512. Meanwhile, Fission reported the “highest-grade mineralization seen to date” R1620E in late October when hole 16-500 cut 9.5 metres of 13.56% U3O8.
“Last year the two new zones emerged as a really positive story for us,” continues president and COO Ross McElroy. “That dovetails well into what we’re looking to accomplish this year, which is basically focused on expanding the discoveries. The majority of the current program will be geared toward building up the guts of the deposit, which will underpin an economic update in the near-term. The main point to drive home is that the PEA really offered us a snapshot, but things are changing at a fast pace.”
The field camp Fission Uranium’s Patterson Lake South uranium project in Saskatchewan. Credit: Fission Uranium
Furthermore, Fission has earmarked 15 holes for regional exploration targets, including a “hot spot” around 600 metres due west of R840W zone. The target is highlighted by “extremely-altered rock” in drill core, and elevated pathfinder geochemistry. McElroy says the area “strongly resembles Triple R prior to discovery,” and that the company plans on completing “two or three” follow-up drill holes during the current work program.
“I think one thing that helps us stand out from the crowd in the uranium sector is that our mineralization begins roughly fifty metres from surface,” Randhawa adds. “And historically it’s the shallow deposits that get mined first. We don’t have water problems associated with the unconformity, which is a point we need to keep hammering home because the end of the day it comes down to one question: Will the deposit be economic?”
Drillers on a barge at Fission Uranium’s Patterson Lake South uranium project in northern Saskatchewan. Credit: Fission Uranium
Fission has traded within a 52-week window of 49¢ and 89¢, and gained nearly 20% over the first month of 2016 en route to an 81¢ per share close at the time of writing. The company reported roughly $61 million in cash at the end of November, and has 484.2 million shares outstanding for a $397-million press-time market capitalization.
“CGN is definitely interested in production, but from our point of view I’ve always maintained we’re looking at a seven to ten year timeline. We’ll continue to do baseline studies along the way and take all the steps, but our project has been growing so fast it’s hard to commit to a mine plan,” Randhawa concludes.
https://www.northernminer.com/news/fission-management-talks-2017-drill-strategy-pls/1003782903/