Cameco Offers $520M for Hathor Exploration

Published on Saturday August 27 2011

Cameco Corp. has launched a hostile $520-million bid for junior miner Hathor Exploration Ltd. in an attempt to take control of one of the best uranium discoveries in Saskatchewan in years.

Saskatoon-based Cameco offered $3.75 a share in cash, which represents a premium of 40% over Hathor's closing price on Thursday.

Cameco said it reached out to Hathor last week in an attempt to strike a friendly deal, but launched the hostile bid after it failed to make progress.

Cameco covets Hathor's Roughrider project, a high-grade uranium deposit that was discovered in 2008. It has indicated and inferred resources of nearly 58 million pounds of uranium.

"The market has recognized the exceptional job Hathor has done with the Roughrider deposit and the company's other properties," Cameco chief executive Tim Gitzel said in a statement.

"Given our financial strength, development expertise, existing infrastructure and experience in the Athabasca region, we feel we are in a unique position to build on that success and further advance the Roughrider deposit."

The uranium market has been in a funk since the Fukushima nuclear disaster in March, and Mr. Gitzel has hinted that he may try and take advantage of the slump and pursue acquisitions. This is his first big move as CEO since taking over in July.

Hathor's stock shot up 46% by 10 a.m. Friday, with shares trading at $3.90, above the price offered in Cameco's bid, suggesting investors expect the negotiations are not over yet.

The offer is open for 60 days and requires a minimum tender of of two-thirds of Hathor shares.

The bid implies an enterprise value of US$8.70 per pound of contained uranium, Edward Sterck, an analyst with BMO Capital Markets, said in a note Friday.

This is a bargain compared to Russian company ARMZ's purchase of Australian Mantra Resources Ltd. earlier this year (priced at US$10 per pound) but is richer than China Guangdong Nuclear Power Group's proposed offer for South African Kalahari Minerals plc (priced at US$6.30 per pound), he said.

"Given the nature of the Athabasca deposits, 58 million pounds may not constitute critical mass for the Roughrider deposit, suggesting that Cameco sees upside potential to the current resource base and sees synergies with its existing operations."

The company has said the all-cash bid will be fully funded from existing funds. Mr. Sterck noted that as of June 30, Cameco had $346-million in cash on hand, suggesting it may have to liquidate some of its $873-million in short-term investments to make the Hathor purchase.

He maintains an Outperform rating on Cameco and a share price target of $28.00. Its stock was trading down about 2% at $21.55 Friday morning after markets opened.

Rob Chang, an analyst with Versant Partners, said the offer could also spark interest in the much smaller Fission Energy Corp., a uranium producer with a market capitalization of $50.4-million. Fission's Waterbury Lake "J-Zone" discovery is directly adjacent to Hathor's Roughrider deposit.

"We believe this bid from Cameco is the positive catalyst many have been waiting for to reignite interest in the uranium space," Mr. Chang said in a note Friday.

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Toro Energys Theseus Project Turns Into Major Uranium Discovery

Published on Sunday August 21 2011

Toro Energy (ASX: TOE) string of high grade results has confirmed the Theseus Prospect in Western Australia to be a large uranium mineralised system covering over 7.5 square kilometres.

To continue to unlock the significance of this discovery, Toro will now ramp up drilling targeting the definition of higher grade uranium zones.

Drilling highlights include:

- 4.46 metres at 837 ppm eU3O8 from 98.11 metres, including 1.54 metres at 1909ppm eU3O8;

- 9.02 metres at 619 ppm eU3O8 from 100.38 metres, including 1.46 metres at 2204ppm eU3O8; and

- 3.54 metres at 378 ppm eU3O8 from 105.63 metres, including 0.44 metres at 1469ppm eU3O8.

An air-core drilling campaign kicked off at the prospect earlier in the month, with 19 of the planned 60 holes having been drilled and gamma logged so far to total depths ranging from 103 metres to 210 metres, passing through a basement interface at roughly 125 metres.

What is so important for the discovery, is that twelve of the nineteen holes drilled so far report uranium intersections with grades above 100ppm eU3O8, and widths greater than 0.5 metres - pointing to an extensive system.

Greg Hall, managing director, added “We are excited and encouraged by the size, extent and grade of uranium mineralisation so far intersected.

"Toro’s systematic approach to defining the location of the higher grade uranium mineralisation in Theseus is key to ensuring the system is well defined before more closely spaced drilling is used to define a resource prepared in accordance with the JORC code.”

Importantly - the minimum extent of the system is now 5 kilometres by 1.5 kilometres, and open in all directions.

Geologically, Theseus is situated within an interpreted northerly trending palaeovalley broadly defined by previous drilling.

The prospect is part of Toro's wholly owned flagship Lake Mackay Project, located 650 kilometres west of Alice Springs but inside the Western Australia border.

Toro is also developing the advanced Wiluna uranium project which is further west in the state and scheduled for first production from late in 2013, pending government approvals.

Potential In-Situ Recovery

Toro has outlined the lithological and mineralogical association at Theseus saying that it is very similar to the 4 Mile and Beverley uranium deposits in South Australia which are currently being developed or are in production.

Both uranium deposits are amenable to In Situ Recovery (ISR) where slightly acidified water is pumped to depths of 150 metres through confined sand layers, extracting and transporting uranium to a surface processing plant.

The company added that similarities can also be drawn to operating ISR mines in the US and Kazakhstan where uranium mineralisation is mined by ISR techniques.

The geological environment and the consistency of the mineralised zones at Theseus, albeit at an early stage, supports the possibility of ISR extraction methods as a potential development scenario - although the development scenarios and economics remain undefined at this time.

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Uranium Mine Proposed Near Whyalla

Published on Friday August 12 2011

The mining company Uranium SA has applied to begin full scale trials at a proposed uranium mine site near Whyalla on South Australia's Eyre Peninsula.

The company wants a mining licence for its 225-hectare Blackbush deposit 20 kilometres south-west of Whyalla and three kilometres from Spencer Gulf.

Uranium SA says it hopes to confirm exploration results that showed considerable uranium deposits in the area. The company says if the application is successful,full-scale production could begin by the end of next year.

If approved, the project would be the latest major development in the area, with a deep-sea port, explosives factory and desalination plant already in the pipeline.

About 100 tonnes per year could be mined at the site if it reaches full production.

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Deep Yellow Confirms Ongolo Alaskite Project MS7 Discovery

Published on Tuesday August 09 2011

Deep Yellow (ASX: DYL) has received more wide high grade intercepts from reverse circulation (RC) drilling along the Ongolo-INCA trend in Namibia, which could potentially join up with the Ongolo resource area.

Chemical assays at the MS7 Prospect include 36 metres at 536 parts per million (ppm) uranium (U3O8) from 142 metres, and 44 metres at 506 ppm U3O8 from 38 metres.

The MS7 main mineralised zone is now 400 metres long and 200 metres wide. Drilling is continuing to test the potential that MS7 may ultimately join up with the Ongolo Alaskite Resource area.

A shallow very high grade intercept from RC drilling at the INCA FS Prospect has also intersected 22 metres at 1,195 ppm U3O8 from 32 metres.

Greg Cochran, Deep Yellow's managing director, said “Ongolo MS7 is starting to look more and more like the Ongolo Deposit, although it may be structurally simpler which works in our favour.

"In addition, the possibility that it could join up with Ongolo means that we may have discovered a much larger higher grade alaskite deposit.”

On May 12 Deep Yellow achieved a maiden Indicated and Inferred Mineral JORC Resource estimate for the Ongolo Alaskite deposit, totalling 6.9 million tonnes (Mt) at 410 parts per million (ppm) for 6.2 million pounds (Mlbs) uranium (U3O8) at a 275 ppm cut-off.

The MS7 alaskite discovery is located about 2 kilometres to the west of the Ongolo deposit. The main mineralised zone extends about 400 metres along the strike and is up to 200 metres wide.

Seven RC rigs and two diamond rigs are now drilling in the Omahola Project area. A number of mineralised holes at Ongolo, MS7 and INCA FS, which also had high-grade downhole gamma logging results are still in the process of being assayed.

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Northern Minerals(Uranium) Ltd Targets Rare Earths Production Within 5 years

Published on Thursday August 04 2011

In the race to produce rare earths outside China, which supplies most of the world's output of the metal elements used in high-tech, Australian explorer Northern Minerals (NTU.AX) could be the next hot play.

Northern Minerals unveiled encouraging drilling results from its Browns Range project in Western Australia last week, where it said it found a high proportion of two of the heavy rare earths elements that are in tightest supply.

That sets it apart potentially from the two companies outside China producing rare earths elements, Lynas Corp (LYC.AX) and Molycorp Minerals (MCP.N), which mostly have light rare earths elements.

Northern Minerals was particularly excited about its find as the geology shows it should be able to produce a concentrate relatively easily, cheaply and quickly.

"We're looking for ways to bring this to market as soon as possible," Managing Director George Bauk told Reuters in an interview on Tuesday, noting it was looking to produce in five years rather than 10-15 years for typical projects.

The Browns Range project could be developed for about one-tenth the typical billion dollar cost of a rare earths project, as the company plans to sell the elements in concentrate rather than building an expensive processing plant, he said.

"The industry needs this product as soon as possible. If we spent a lifetime trying to crack it ourselves, we may miss a critical window of opportunity," he said.

With its bigger proportion of the heavy rare earths elements dysprosium and yttrium, Northern Minerals is not in competition with Lynas and Molycorp, Bauk said.

"They're definitely exposed to the right end of the spectrum," said David Brennan, an analyst at Daiwa Securities.

Moves by China to restrict production of heavy rare earths elements, partly due to environmental concerns, have sent prices for dysprosium, used in magnets for wind turbines, mobile phones and hybrid cars, rocketing to $2,840 (1,744.36 pounds) per kilogram from $400 per kg at the beginning of 2011.

Yttrium, used to make phosphors used in energy efficient lighting, TV screens and computer displays, has nearly doubled in price to $179 per kg over the same period.

Lynas produces just 44 tonnes of dysprosium out of 22,000 tonnes a year of rare earths produced, while Molycorp has none.

Another advantage of the Browns Range find is that it has about one-quarter the radioactivity that Lynas has, well below detectable levels, which should make any project there less controversial than other rare earths projects.

"There's no current issues that we can perceive," Bauk said of the radioactivity.

Lynas owns 7.9 percent of Northern Minerals, and the company's top 10 owners own 50 percent of the stock.

Its shares last traded down 3 percent at A$0.80, valuing the group at A$137 million. It hit a three-month high of A$0.90 last week.

Daiwa's Brennan said financing was becoming easier to secure funds for rare earths projects, but if there was any kind of credit freeze, new projects would need to find other sources of funding, such as joint ventures with buyers.

Bauk said the company was already talking to potential off-takers for the project, including Japanese companies whom he declined to name, and said those rare earths elements buyers would be one potential source of funding for the project.

With A$7.7 million cash on hand, the company has ample funds for its drilling plans this year at Browns Range and its John Galt prospect before it goes into feasibility studies.

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Significant Progress Made On The Acquisition Of The Hansen Uranium Deposit

Published on Tuesday August 02 2011

Black Range Minerals Limited (ASX:BLR) is very pleased to advise that all conditions precedent pertaining to the definitive agreement, executed with STB Minerals LLC ("STB") earlier this year, to acquire its 51% interest in the Hansen Uranium Deposit in Colorado, USA, have been satisfied.

This is an important milestone for the Company as the owners of the surface rights over the Hansen Uranium Deposit have now explicitly approved mining of the deposit. Furthermore the ownership of the deposit (51% STB - 49% NZ Minerals LLC ("NZ")) has been categorically and indisputably resolved.

The Hansen Uranium Deposit itself hosts JORC Code compliant indicated and inferred resources totalling:

28.4 Mt at 0.064% U3O8 for 39.4 million pounds of U3O8.

This deposit is located immediately adjacent to the Company's Taylor Ranch Uranium Project. Combined these two projects host JORC Code compliant indicated and inferred resources of:

68.9 Mt at 0.060% U3O8 for 90.9 million pounds of U3O8.

The Company now has the exclusive rights to acquire 100% of the minerals rights on approximately 13,000 acres at these Projects.

Payment of additional consideration to STB and NZ

With all conditions precedent satisfied, in accordance with its definitive agreements with STB and NZ, the Company has made payments comprising US$1 million cash and US$1.25 million worth of shares in Black Range (30,585,140 shares) to STB and a further US$1 million cash and US$1 million worth of shares (27,996,857 shares) to NZ.

Transfer of 24.5% interest in the Hansen Uranium Project to Black Range Minerals Limited

          Having made the above mentioned payments to NZ, NZ will now irrevocably transfer 50% of its mineral rights (for a net 24.5% interest in the Hansen Uranium Project), to Black Range. The Company has the exclusive right to acquire NZ's remaining 24.5% interest in the Hansen Project by bringing it to production and making an additional payment of US$2 million in cash and US$2 million in shares.

The Company also has the exclusive right to acquire STB's 51% interest in the Hansen Project at any time in the next six years by completing certain work programs and by making additional staged payments. These comprise:

(i) US$1.25 million of shares in 6 months;

(ii) US$2 million in cash and US$7.5 million in shares at any time in the next six years. If this payment is not made within the next 3 years then in order to extend its option to acquire STB's 51% interest for a further 3 years the Company is required to pay an additional US$1 million in cash and US$1 million in shares.

Update of Previous Feasibility Study

A 10-12 diamond core-hole drilling program is progressing well at the Hansen Project. The purpose of this program is to acquire additional technical data so that the previous feasibility studies, which were undertaken on the Deposit during the early 1980s, can be updated.

A decision on the best development path for the project will then be made.
Background - Hansen/Taylor Ranch Uranium Project

The Hansen Uranium Deposit was discovered in 1977 and fully permitted for mining in 1981. The global uranium market subsequently collapsed and mining never eventuated.

More than 1,000 holes were drilled and three feasibility studies completed to evaluate the Hansen Deposit previously.

The Company now holds a direct 24.5% equity interest in the Hansen Uranium Project that covers approximately 3,500 acres and includes the Hansen and Picnic Tree Uranium Deposits. It also holds the exclusive right to secure the remaining 75.5% interest in this Project area, together with a 100% interest in a further 9,500 acres at the Taylor Ranch Uranium Project, which is located immediately adjacent to, and north of, the Hansen Project.

When applying a 0.025% cut-off grade, the JORC Code compliant indicated and inferred resource for the combined Hansen/Taylor Ranch Uranium Project comprises:

68.9 Mt at 0.060% U3O8 for 90.9 million pounds of U3O8

The high-grade and robust nature of the mineralisation at the Hansen/Taylor Ranch Project is demonstrated when applying a 0.075% cut-off grade to the resource calculation. The JORC Code compliant indicated and inferred resource for the combined Hansen/Taylor Ranch Uranium Project then comprises:

16.6 Mt at 0.120% U3O8 for 43.8 million pounds of U3O8

The combined Hansen/Taylor Ranch Uranium Project is one of the largest uranium projects within the USA - which as a nation is the largest consumer of uranium in the world. With domestic mines within the USA producing less than 10% of the uranium consumed in the country on an annual basis, the development of such a large and strategic asset should be regarded highly.

Black Range continues to advance feasibility and environmental studies at the Hansen/Taylor Ranch Uranium Project as quickly as possible.

For the complete Black Range announcement including tables and figures, please refer to the following link:
http://media.abnnewswire.net/media/en/docs/ASX-BLR-551920.pdf

About Black Range Minerals Limited

Black Range Minerals Limited (ASX:BLR) is an Australian Stock Exchange-listed company focused on growth through acquisition, exploration and development of resources projects.

The Company is focused on advancing the high-grade Taylor Ranch/Hansen Uranium Project in Colorado, USA towards production.

The 100% owned Taylor Ranch Uranium Project contains JORC Code compliant indicated and inferred resources of more than 60 million pounds of U3O8. Immediately adjacent is the Hansen Uranium Project, which the Company recently secured exclusive rights to acquire a 100% interest in. The combined assets comprise one of the largest uranium projects within the USA.

The Company is constantly assessing other investment opportunities, including the acquisition of additional quality projects in the resources sector.

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