NexGen launches uranium drilling at SW1
Figure 1: SW1 Property and Rook I Property with Similar Geophysical Signatures.
NexGen Energy Ltd. [NXE-TSX, NYSE] on Monday said it has launched a maiden exploration drilling program on its SW1 property in the Athabasca uranium basin in northern Saskatchewan.
SW1 is approximately 10 kilometres northwest of the company’s flagship Rook 1 property where the company is developing one of the world’s largest uranium deposits. Rook 1 hosts the high-grade Arrow deposit, which is estimated to contain an indicated resource of 256.6 million pounds of uranium oxide contained in 2.89 million tonnes of 4.03% uranium oxide (U3O8), according to a resource update and prefeasibility study announced on November 5, 2018.
The estimate includes a high-grade core of 181 million pounds, contained in 0.46 million tonnes, of grade 17.85% uranium oxide.
On top of that is an inferred resource of 91.7 million pounds of uranium oxide contained in 4.84 million tonnes, grading 0.86% uranium oxide, the company has said.
On Monday August 26, NexGen said exploration at SW1 will consist of a minimum of 4,000 metres if drilling. The program is scheduled to begin in early September, the company said in a press release. It will utilize two drill rigs and is designed to test the highest priority anomalies, analogous to those at the Arrow Deposit, for uranium mineralization that has been highlighted by geophysical surveys and analysis of historical drilling.
NexGen shares were unchanged at $1.59 and trade in a 52-week range of $1.52 and $3.31.
NexGen says it has the most significant land position in the southwest Athabasca Basin where it holds over 259,000 hectares. NexGen is backed by one of Asia’s wealthiest investors, Li-Ka-shing
The SW1 property is situated on the western limb of a regional fold structure with the Patterson Lake Uranium Corridor and Arrow deposit situated on the eastern limb. Historical drill core shows that the area contains similar host rocks as the Arrow Deposit.
Due to this geophysical affiliation, NexGen commissioned the same airborne geophysical techniques that led to the discovery of the Arrow Deposit in February, 2014. A VTEM survey defined several discrete and disjointed conductive corridors on the property, similar to what was seen at Arrow.
NexGen said development of the property has led to high-confidence targets that are prime for focused exploration through drilling.
“We look forward to the SW1 maiden drill program commencing after completing an extensive geophysical analysis of the area over the past five years,” said NexGen CEO Leigh Curyer.
Uranium exploration juniors like NexGen are not getting much help from the underlying uranium price, which has defied predictions that is about to recover from the impact of the 2011 Fukushima disaster. Before a powerful earthquake and tsunami disabled three reactors at the Fukushima nuclear plant in Japan, spot uranium was priced at US$72.63 a pound.
But the spot uranium price has been trading recently at just under US$25 a pound.