In the year ended February 28, 1999, the Company entered into a joint exploration agreement with UEM Inc. UEM Inc. was a corporation owned 50% by Cameco Corporation ("Cameco") and 50% by AREVA on the Virgin River project located in the Athabasca Basin of northern Saskatchewan. Subsequently, UEM was dissolved and both Cameco and AREVA became equal partners (49% each) in the joint exploration agreement. Cameco is the operator of the project. The Company's wholly owned subsidiary, Coronation Mines Ltd. owns the remaining 2% of the project with the first right of offer to acquire up to 10% of the project and has been carried through to $10.0 million worth of exploration and development. Over $26.8 million has been spent on the project to date exploring for a large unconformity-type deposit that has resulted in the discovery of the Centennial Deposit. Cameco is the operator of the project.
The Centennial Deposit has been traced over 650 metres of strike length and has a minimum across strike width ranging from 10.0 metres to 52.5 metres. Approximately $8.9 million was reported by Cameco as having been spent on the 2009 and 2010 drill programs that were designed to follow up on the 2004 - 2008 drill results from the Centennial Zone.
The joint venture has approved a budget of $3.0 million for continued drilling on the Virgin River project for 2011, expected to commence in early June. The 2011 drill program will utilize two drill rigs on and immediately surrounding the current extent of the Centennial deposit with a focus on extending the deposit along strike to both the north and south. High grade U3O8 intersections of up to 298 GT have been intersected within the deposit. GT is defined as % grade U3O8 multiplied by thickness in metres.
A total of 8,562.6 metres were drilled in 2010 in five pilot diamond drill holes and in fourteen diamond drill directional off cut holes. A location map of the drill holes with GT values is available on the Company's website at www.FormationMetals.com. Results from the 2010 program included high-grade mineralization intersected in drill hole VR-040W2 (8.40% U3O8 over 9.0 metres) collared on Line ("L") 6+50N and drill hole VR029W2 (7.46% U3O8 over 13.2 metres) on L7+00N in the southern portion of the Centennial Deposit.
Drill holes VR-042-W1 and W4 returned assay results of 1.93% U3O8 over 8.3 metres and 0.15% U3O8 over 6.5 metres respectively. Initially interpreted to represent a separate zone of mineralization paralleling the Centennial Deposit to the east, the additional results obtained from the drilling of this mineralized structure remains inconclusive and further drill testing along strike is planned for the 2011 drill program.
Drilling was also successful in tracing the faulted quartzite controlling structure on the Centennial deposit along strike to the north of L13+00N and south of L6+00N. Drill hole VR-038W3, located on L10+00N, tested for the presence of an interpreted cross structure associated with the mineralization present on L10+50N where a previously drilled, single off cut diamond drill hole, VR-031W3, returned high grade uranium mineralization of 8.78 % U3O8 over 33.9 metres. Diamond drill programs from 2004 to 2010 on the Centennial Zone have resulted in 35 significant primary uranium intersections returning results greater than 10.0 GT (see table on the following page).
Significant diamond drill results greater than 10.0 GT from the Centennial Deposit (updated)
Note: Inductively Coupled Plasma - Optical Emission Spectroscopy Split assay results with core recovery intervals of less than 75% were replaced by shielded probe results.
Cameco has indicated they are exploring for a McArthur River style uranium deposit, and the Formation Metals' management is very encouraged with results to date.
All uranium assays were carried out by the Saskatchewan Research Council (SRC) of Saskatoon, Saskatchewan. Delayed neutron counting (DNC) and / or X-ray fluorescence spectroscopy (XRF) U3O8 check assays were completed on all split assay samples returning greater than 1.0% U3O8. The average of the check assays and the ICP-OES results were used in the calculations of grade thicknesses.
Mr. Eric (Rick) Honsinger, P.Geo., of Formation Metals Inc., is the Qualified Person who has reviewed and approved the information in this website with respect to the Virgin River Project based on an examination of the data submitted to the Company by the project operator Cameco Corporation.
General Location Map:
Drill Hole Location Plan Map:
