EnCore Energy posts Alta Mesa uranium drill results, Texas

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EnCore Energy Corp. [TSXV, NASDAQ-EU] released the highest-grade drill results to date since drilling activities restarted from the Alta Mesa project in south Texas. These results significantly exceed the cutoff grade thickness requirements for In-Situ Recovery (ISR) of uranium. The company also reports that work to advance the Alta Mesa Uranium Central Processing Plant and Wellfield towards production is advancing on schedule.

Highlights: Drilling from Alta Mesa’s Production Area Authorization (PAA) provides results that range up to a grade thickness of 8.4 with a maximum thickness of 13.5 feet. The cutoff grade thickness for ISR in South Texas is generally accepted to be 0.3 with grade thickness being the relevant factor in determining reasonable prospects for economic extraction.

The Alta Mesa ISR Uranium Central Processing Plant (CPP) upgrades and refurbishments are advancing on schedule for the planned early 2024 resumption of uranium production.

Initial production from Alta Mesa’s PAA-7 wellfield will have a total of 59 production wells with 36 extraction wells and 23 injection wells that form the startup production patterns. 57 of these are completed with the last two wells scheduled for completion over the next few days. The wells are being prepared for connection to the pipeline to the CPP.

Production from the wellfield at Alta Mesa will be increasing as additional production patterns are completed following the initial 59 wells and duplicate the process used for the initial Alta Mesa startup in 2005. Drilling and well installation for the follow-on production patterns is already well underway and will continue as CPP capacity is reached.

As previously reported, uranium production from the Rosita Uranium CPP, which commenced in November 2023 and has completed its first shipment of uranium, continues to maintain expected production levels.

Paul Goranson, CEO, stated: “We are extremely pleased with the drilling results from Alta Mesa. Cutoff grade thickness for ISR operations in Texas are generally 0.3 GT for economic extraction. With drilling returning a significant number of g/ts in production delineation holes in excess of 3.0 with a high of 8.4, we are becoming increasingly optimistic that our contained uranium will exceed estimates contained in the 2023 technical report that cited GTs averaging 0.59 to 0.68 for each of the specific ore horizons. Indeed, we are confirming higher grade portions of the mineralized zone than initially estimated from broader spaced drilling as proposed in the 2023 technical report. Having directed the initial development and operation of Alta Mesa for a private company in 2005, I have observed that this project has historically consistently exceeded expectations. We look forward to returning Alta Mesa to production in the coming weeks.”

Wellfield delineation drilling began in spring 2023 at the Alta Mesa Project PAA-7 along a previously defined ore body consisting of stacked roll fronts. The NI 43-101 Technical Report dated January 19, 2023 stated that PAA-7 contains 1.292 million pounds U3O8 indicated resources and 0.175 million pounds U3O8 inferred resources with an average grade thickness (GT is defined as grade multiplied by intercept thickness) ranging from 0.59 to 0.68 g/t using a 0.3 g/t cutoff.

At the Alta Mesa Uranium CPP, EnCore has met most of the key objectives for the refurbishment of the processing circuits necessary for the planned early 2024 restart.

Within PAA-7, EnCore is installing injection and production wells in the wellfield and has completed installation of the electrical transmission lines necessary for initial start-up and the pipelines to connect the wellfield to the Alta Mesa CPP.

The wellfield drilling operations, which commenced in March 2023, are advancing rapidly with 126 holes drilled since the previous update. In total, 571 drill holes have been completed through March 8 th, 2024. There are currently six drill rigs in full operation at Alta Mesa, with contracts anticipated for additional rigs expected at site by the end of March 2024.

Over 140 holes have been cased or are scheduled to be cased with an additional 75 holes under review by geological staff for possible casing.

Significant Alta Mesa wellfield drilling results included 5.5 feet of 0.196% U3O8, 4.5 feet of 0.667% U3O8, 13.5 feet of 4.197% U3O8, 10.5 feet of 3.567% U3O8. See original press release for complete assays.

The Alta Mesa CPP and Wellfield hosts a fully licensed and constructed ISR uranium plant, located on 200,000+ acres of private land in the state of Texas. Alta Mesa will be EnCore’s second producing location. On February 23, 2024, the company concluded the sale of a 30% interest in the Alta Mesa Project to Boss Energy Limited [ASX-BOE; OTCQX-BQSSF], a leading Australian emerging ISR uranium producer, to form a joint venture managed by EnCore.

Consideration received was US$60 million plus an additional US$10 million as a placement into EnCore’s shares. The proceeds from this sale will enable EnCore to accelerate its production timelines across its entire pipeline of production targeted assets.

Total operating capacity at the Alta Mesa CPP is 1.5 million lbs. U3O8 (uranium) per year with an additional drying capacity of more than 0.5 million lbs. U3O8. The Alta Mesa CPP historically produced nearly 5 million lbs. U3O8 between 2005 and 2013, when full production was curtailed as a result of low uranium prices.

The Alta Mesa CPP is EnCore’s third fully licensed production facility, along with the Rosita CPP and Kingsville Dome CPP, all located in the business-friendly state of Texas. There are only 11 licensed and constructed uranium production facilities in all of the United States.

Alta Mesa CPP’s operations are located on private land, with 100% of minerals privately owned, and in a supportive jurisdiction with primary regulatory authority residing with the State of Texas.

The Alta Mesa CPP utilizes well-known ISR technology to extract uranium in a non-invasive process using natural groundwater and oxygen, coupled with a proven ion exchange process, to recover the uranium.

Alta Mesa and Mestena Grande mineral resources stand at 6,996,000 tons grading 0.120% U3O8.

Uranium production commenced at EnCore’s licensed and past-producing South Texas Rosita Central In-Situ Recovery (ISR) Uranium Processing Plant (CPP) in November 2023 with work underway for a planned Q2/2024 restart of uranium production at its licensed and past-producing South Texas Alta Mesa CPP.

EnCore solely utilizes ISR for uranium extraction, a well-known and proven technology co-developed by the leaders at EnCore Energy. ISR extracts uranium in a wellfield using natural groundwater and oxygen, coupled with a proven ion exchange process, to recover the uranium.

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