Xcite Resources options Athabasca uranium projects from Eagle Plains
Xcite Resources Inc. [CSE-XRI] has entered into six individual option agreements with Eagle Plains Resources Ltd. [TSXV-EPL] whereby Xcite may earn an up-to-80% interest in six uranium projects totalling 5,905 hectares in close proximity to Uranium City, northern Saskatchewan.
Chris Cooper, Xcite’s chairman of the board, commented: “We are pleased to enter the world’s best uranium district with a premier portfolio of properties that have demonstrated high-grade surface showings with a strong potential for a world-class discovery. This transaction will lead us to the forefront of the energy metal arena and allow our shareholders to capitalize on the emerging uranium market.”
Tim Termuende, PGeo, president and CEO of Eagle Plains, commented: “We are excited to partner with Xcite to accelerate the exploration of the Uranium City projects. Considering the rich production history of many of the individual projects, we welcome the opportunity to conduct modern exploration methods combined with continually advancing geological understanding of the genesis and controls of uranium mineralization known to exist there.”
Athabasca basin history and mineralization: The Beaver River, Black Bay, Don Lake, Gulch, Larado and Smitty projects are located in the Beaverlodge district near Uranium City in the Lake Athabasca region of Saskatchewan. Occurrences of uranium mineralization are abundant in the region and have been explored and documented since the 1940s. The Beaverlodge camp was the first uranium producer in Canada, with historic production of approximately 70.25 million pounds of triuranium octoxide between 1950 and 1982, from ore averaging 0.23% U3O8. The two largest producers were the Eldorado Beaverlodge (Ace-Fay-Verna) and the Gunnar uranium mine. Since the early nineties, limited uranium exploration work has been conducted in the Beaverlodge area.
Beaverlodge-style uranium deposits host structurally controlled, high-grade mineralization in veins and breccia fills within basement rocks. Mineralization often occurs at geological contacts and consists of structures filled with hematite, chlorite and graphite associated with pitchblende (an ore mineral of uranium).
Beaver River (1,455 hectares): Four Saskatchewan Mineral Deposit Index (SMDI) occurrences; grab samples from VIC uranium-copper-nickel occurrence (SMDI 1553) returned from trace values up to 27.62% U3O8, 36.30% U3O8 and 29.70% U3O8 (AF 74O05-0051); mineralized zone approximately 1,097 metres in length (AF 74O05-0066).
Rock chip samples at SMDI 1994, 800 metres southeast of VIC occurrence, returned U3O8 values of 29.89% over 29.2 cm, 18.09% over 15.2 cm and 3.09% over 60.9 cm (AF 74O05-0077).
Black Bay (1,114 hectares): Six SMDI occurrences; Black Bay uranium mine (SMDI 1296) discovered in 1953; mineralization developed in three main shoots discovered along a strike length of approximately 152.4 metres (500 feet) and a downdip distance of 731.5 metres (2,400 feet); 1,355 tons produced at 0.17% U3O8.
Grab samples from the drill core at Bluegrass U zone (SMDI 1295), located 600 metres northwest of Black Bay mine, returned 16.74% U3O8 and 9.64% U3O8 at a depth of 12.8 metres.
Don Lake (524 hectares): Six Saskatchewan Mineral Deposit Index occurrences; discovered in 1950 by Eldorado Mining and Refining; drilling at Don Lake A, B and C zones (SMDI 1393) returned values of 10.7% U3O8 over 0.3 metres in DDH No. 23 and 2.14% U3O8 over 0.67 metres in DDH No. 6 from a sheared and brecciated granite (AF 74N10-0422); zone mineralization continuous over approximately 213 metres.
Gulch (1,685 hectares): 20 km southwest of Uranium City; four SMDI occurrences; uranium mineralization associated with the regional Black Bay structure; 1953-1957 underground development at Gulch uranium mine (SMDI 1221) outlined 11 mineralized shoots; 1954 trenching at Lucy (SMDI 1223) returned values from below detection to up to 0.37% U3O8 over 3 metres.
Duvex Oils and Mines radioactive zones (SMDI 1224) grab samples returned values from trace up to 2.23% U3O8. Last documented work in 2015 concluded that anomalous uranium mineralization was structurally controlled similar to the past-producing Gulch uranium mine and further work, including deeper drilling, was recommended for the property.
Larado (245 hectares): 10 km south of Uranium City along Saskatchewan Provincial Highway 962; three SMDI occurrences; Larado uranium mine (SMDI 1228) saw extensive underground development and production from 1953 to 1960; structurally controlled uranium mineralization associated with graphite and pyrite.
Pitchie uranium zone (SMDI 1229) is located 850 metres southwest of the Larado mine; main zone uranium mineralization exposed on the surface for 91 metres; historical work includes approximately 50 diamond drill holes, the majority of which were less than 100 m in length.
Smitty (849 hectares): two SMDI occurrences; in 1954 became the first privately owned uranium producer in Canada with mineralized material shipped to the nearby Eldorado mill.
The above results were taken directly from the SMDI descriptions and assessment reports filed with the Saskatchewan government.
Xcite may earn an 80% interest in each individual property by completing $3.2-million in exploration expenditures, issuing 750,000 common shares of Xcite and making cash payments to Eagle Plains of $55,000 over four years. Upon Xcite fulfilling the terms of any or all of the earn-in agreements, an 80/20 joint venture will be formed, with Eagle Plains retaining a carried interest in all expenditures until delivery by Xcite or its assigns of a bankable feasibility study. During the option earn-in period, Xcite will be appointed as operator, and Eagle Plains will manage the exploration programs under the direction of a joint technical committee. The projects are owned 100% by Eagle Plains, which will retain an underlying 2% net smelter return royalty on each of the properties.