Uranium Resources, Inc. (NASDAQ: URRE) announced the completion
of a new Technical Report on the mineral resources at its Cebolleta
Project in New Mexico. Based on the quantity and quality of the
in-place, non-reserve inferred mineralized material of 5.6 million short
tons at an average uranium grade of 0.17%, the report recommends that
the Company advance the Cebolleta Project to a Preliminary Economic
Assessment or scoping level study.
The Cebolleta Project’s Technical Report adheres to the Canadian
Institute of Mining, Metallurgy and Petroleum Standards (Canadian
Standards) for reporting mineral resources and reserves, which are
internationally accepted, and has been prepared according to the
standards of Canadian National Instrument 43-101 (NI 43-101). The report
is available on the Company’s website: www.uraniumresources.com,
under Projects/ New Mexico/ Cebolleta.
Christopher M. Jones, President and Chief Executive Officer of URRE
said, “We are excited about the findings of this Cebolleta Technical
Report and believe that this advances the project towards the next stage
of a Preliminary Economic Assessment.”
Mr. Jones continued, “We achieved a major milestone for our Company by
completing the Cebolleta Technical Report about eight weeks ahead of
schedule. In addition, we now expect to issue a total of four Technical
Reports on our New Mexico projects in 2014, one more than our previous
goal of three reports, with the addition of the Juan Tafoya Project
Technical Report due to be completed in June 2014. We expect to deliver
on reports for Roca Honda around mid-year 2014 and Churchrock by the end
of 2014. Our corporate geological team is making meaningful progress
with the external, independent Qualified Persons in preparing the
Technical Reports, all of which will be prepared consistent with NI
43-101 standards.”
Located in Cibola County, approximately 45 miles northwest of
Albuquerque, New Mexico, the Cebolleta Project is wholly controlled by
URRE and sequenced in the Company’s long-term path to production
planning and is the Company’s third largest uranium project behind the
Churchrock and Nose Rock projects in terms of tons of material. The
non-reserve mineralized material for Cebolleta shown in Table 1 below
was classified as “Inferred Resources” according to the Canadian
Standards and best practice guidelines for estimation of mineral
resources. Investors are cautioned that the requirements and terminology
of NI 43-101 and the Canadian Standards differ significantly from the
requirements and terminology of the SEC set forth in the SEC’s Industry
Guide 7, and that inferred resources have a great amount of uncertainty
as to their existence and as to whether they can be mined legally or
economically. It cannot be assumed that all or any part of the inferred
resources will ever be upgraded to a higher resource category. See
“Cautionary Note Regarding References to Resources and Reserves” below.
The Cebolleta Project covers approximately 6,700 acres of leased
privately-owned mineral and surface rights near the eastern end of the
prolific Grants Mineral Belt, which is one of the largest known
concentrations of sandstone-hosted uranium deposits in the world. Within
the project area there are several uranium deposits located in the
Jackpile sandstone unit of the Jurassic-age Morrison Formation, which
hosts several of the uranium deposits of the Grants Mineral Belt. The
Cebolleta property is the site of the historic L-Bar uranium mine and
mill of Sohio Western Mining and the adjoining St. Anthony uranium mine
of United Nuclear Corporation.
The estimate on non-reserve inferred mineralized material at the project
was based upon more than 600 conventional rotary and core drill holes
generally completed on spacings of 100 to 200 feet. The Cebolleta
Technical Report recommended going forward with “confirmation drilling”
with the objective of raising the confidence levels of a significant
portion of the mineralized material to the “Indicated Resources”
category. Another recommendation in the Technical Report was to drill
and develop an initial resource model and estimate for the historic St.
Anthony mine area. Deposit block models were constructed to achieve
three dimensional representations of the distribution of uranium grades,
as well as three dimensional distributions of the geology controlling
the mineralized zones. Block grades were determined using an inverse
distance power of two method.
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Table 1: In-Situ, Non-Reserve, Inferred Mineral Resources for
the Cebolleta Project (100% URRE)
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Cutoff Uranium Grade
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Tons
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Uranium Grade
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Deposit
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(%)
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(short)
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(%)
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Area I-II-V
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0.08
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4,564,000
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0.173
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Area III
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0.08
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998,000
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0.162
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Footnotes to the above table
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1.
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The quantity and grade of reported inferred resources in this
estimate are uncertain in nature. There has been insufficient
exploration to verify these inferred resources as an indicated or
measured mineral resource and it is uncertain if further exploration
will result in upgrading them to an indicated or measured mineral
resource category.
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2.
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Mineral resources are not mineral reserves and do not have
demonstrated economic viability. There is no certainty that all or
any part of the mineral resources estimated will be converted into
mineral reserves.
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3.
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The lower cut-off grade was ascertained using a price of $50.00 per
pound for uranium, underground mining costs at $60.00 per ton and
milling plus G&A costs at $16.50 per ton. Tons were rounded.
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4.
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The mineral resources are effective as of March 24, 2014.
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The inferred mineral resources were lower than the Company’s legacy
mineral estimate reported in the Company’s recent Form 10-K for 2013 as
6.7 million tons at an average uranium grade of 0.18%, due to the more
conservative parameters applied in this new Technical Report, including
capping the uranium grade and using minimum thickness criteria.
The Cebolleta Technical Report estimated that the drilling, modeling and
initial metallurgical and geotechnical study for a Preliminary Economic
Assessment over a nine-to-12 month period would cost approximately $1.7
million. URRE holds an Exploration Permit from the State of New Mexico
for drilling at Cebolleta. The Company is evaluating the Technical
Report recommendations and expects to make a decision on commencing any
Preliminary Economic Assessment work by the end of 2014 in conjunction
with the Technical Report results for Churchrock, Juan Tafoya and Roca
Honda.
The Cebolleta Technical Report was prepared by Allan V. Moran of Tucson,
Arizona and Frank A. Daviess of Golden, Colorado, both independent
Qualified Persons as defined by NI 43-101. The report is available on
the Company’s website: www.uraniumresources.com,
under Projects/ New Mexico/ Cebolleta.
About Uranium Resources
Uranium Resources, Inc. was incorporated in 1977 to explore, develop and
recover uranium. Uranium Resources controls minerals rights encompassing
approximately 206,900 acres in the prolific Grants Mineral Belt in New
Mexico, which holds one of the largest known accumulation of
sandstone-hosted uranium deposits in the world. The Company has two
licensed processing facilities and properties in Texas, and an NRC
license to recover up to three million pounds of uranium per year using
the in situ recovery (ISR) process at certain properties in New Mexico.
The Company acquired these properties over the past 25 years, along with
an extensive uranium information database of historic drill hole logs,
assay certificates, maps and technical reports for the Western United
States.
Cautionary Statement
This news release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements are subject to risks, uncertainties and assumptions and are
identified by words such as "expects," "estimates," "projects,"
"anticipates," "believes," "could," and other similar words. All
statements addressing operating performance, events or developments that
the Company expects or anticipates will occur in the future, including
but not limited to statements relating to the resources included in the
Cebolleta Technical Report, which consists solely of inferred resources,
the timing, cost and results of any PEA or scoping level study regarding
the Cebolleta Project, the timing or occurrence of production at the
Company’s properties, future improvements in the price of uranium, the
completion of technical reports for the Company’s New Mexico properties,
additions of reserves or acquisitions, and the Company’s mineralized
material are forward-looking statements. Because they are
forward-looking, they should be evaluated in light of important risk
factors and uncertainties. These risk factors and uncertainties include,
but are not limited to, the fact that NI 43-101 reports describe various
types “resources” which are not recognized by the SEC; inferred
resources are the lowest standard of resource allowed under NI 43-101
standards and may not qualify as “mineralized material’ under SEC staff
positions; “reserves” are defined differently by the SEC and under NI
43-101 standards; the Company's ability to raise additional capital in
the future; spot price and long-term contract price of uranium; the
outcome of negotiations with the Navajo Nation; the Company's ability to
reach agreements with current royalty holders; operating conditions at
the Company's projects; government and tribal regulation of the uranium
industry and the nuclear power industry; world-wide uranium supply and
demand; maintaining sufficient financial assurance in the form of
sufficiently collateralized surety instruments; unanticipated
geological, processing, regulatory and legal or other problems the
Company may encounter; and other factors which are more fully described
in the Company's Annual Report on Form 10-K, Quarterly Reports on Form
10-Q, and other filings with the Securities and Exchange Commission.
Should one or more of these risks or uncertainties materialize, or
should any of the Company's underlying assumptions prove incorrect,
actual results may vary materially from those currently anticipated. In
addition, undue reliance should not be placed on the Company's
forward-looking statements. Except as required by law, the Company
disclaims any obligation to update or publicly announce any revisions to
any of the forward-looking statements contained in this news release.
Qualified Persons
Dean T. “Ted” Wilton, CPG-7659, Chief Geologist and Vice President of
Uranium Resources, is a Qualified Person under Canada National
Instrument 43-101. Mr. Wilton supervised the preparation of the
scientific and technical information regarding this project for this
news release. In addition, the technical information regarding this
project for this news release was also reviewed by Allan V. Moran,
CPG-9565, of Tucson, Arizona and Frank A. Daviess, SME RM-0742250, of
Golden, Colorado, both independent Qualified Persons as defined by NI
43-101, who prepared the NI 43-101 Technical Report on Resources for the
Cebolleta Project. A description of the key assumptions, parameters and
methods used to estimate the non-reserve mineralized material in
inferred resources and data verification procedures and a discussion of
the extent to which the estimates may be affected by any known
environmental, permitting, legal, and other relevant factors, are
contained in the Cebolleta Technical Report, which is available on the
Company’s website.
Cautionary Note Regarding References to Resources and Reserves
Investors are cautioned that the requirements and terminology of NI
43-101 and the CIM Standards differ significantly from the requirements
and terminology of the SEC set forth in the SEC’s Industry Guide 7 (“SEC
Industry Guide 7”). Accordingly, the Company’s disclosures regarding
mineralization may not be comparable to similar information disclosed by
the Company in the reports it files with the SEC. Without limiting the
foregoing, while the terms “mineral resources,” “inferred resources,”
“indicated resources” and “measured mineral resources” are recognized
and required by NI 43-101 and the CIM Standards, they are not recognized
by the SEC and are not permitted to be used in documents filed with the
SEC by companies subject to SEC Industry Guide 7. Mineral resources
which are not mineral reserves do not have demonstrated economic
viability, and investors are cautioned not to assume that all or any
part of a mineral resource will ever be converted into reserves.
Further, inferred resources have a great amount of uncertainty as to
their existence and as to whether they can be mined legally or
economically. It cannot be assumed that all or any part of the inferred
resources will ever be upgraded to a higher resource category. Under
Canadian rules, estimates of inferred mineral resources may not form the
basis of a feasibility study or prefeasibility study, except in rare
cases. The SEC normally only permits issuers to report mineralization
that does not constitute SEC Industry Guide 7 compliant “reserves” as
in-place tonnage and grade without reference to unit amounts. In
addition, the NI 43-101 and CIM Standards definition of a “reserve”
differs from the definition in SEC Industry Guide 7. In SEC Industry
Guide 7, a mineral reserve is defined as a part of a mineral deposit
which could be economically and legally extracted or produced at the
time the mineral reserve determination is made, and a “final” or
“bankable” feasibility study is required to report reserves, the
three-year historical price (or in certain circumstances, a contract
price) is used in any reserve or cash flow analysis of designated
reserves and the primary environmental analysis or report must be filed
with the appropriate governmental authority. The Company discloses
non-reserve mineralized material that is considered too speculative
geologically to be categorized as reserves under SEC Industry Guide 7.
Estimates of non-reserve mineralized material are subject to further
exploration and development, are subject to many risks and highly
speculative, and may not be converted to future reserves of the Company.
Investors are cautioned not to assume that all or any part of such
non-reserve mineralized material exists, or is economically or legally
extractable. Mineralized material that is not reserves does not have any
demonstrated economic viability.
Copyright Business Wire 2014