NexGen Energy's Aggressive Step-out Drilling a Success

Wednesday saw NexGen Energy (TSXV:NXE) put out another set of encouraging results from the ongoing 2015 summer drill program at its Rook I property in the Athabasca Basin. All five holes “returned substantial mineralization with significant step-outs at Arrow.”
The strike lengths of the high-grade cores in both the A2 and A3 shears in the Arrow zone have now been tripled to 300 metesr and 295 meters, respectively. What’s more, the radioactivity found in the five holes was off scale.
Highlights from drilling at the southwest extension include hole AR-15-48c3, which intersected 170.5 meters of total composite mineralization, including 13.2 meters of off-scale radioactivity (>10,000 to >61,000 cps) within a 530.5-meter section. Another highlight is hole AR-15-51, which hit 160.25 meters of total composite mineralization, including 8 meters of off-scale radioactivity (>10,000 to 47,000 cps) within a 462.5 meter section.
Respectively, the two drill holes represent 55-meter and 100-meter step outs from the best hole to date, AR-15-44b.

Aggressive step-out drilling

These aggressive step-out holes means the Arrow zone now covers an area of 645 meters by 215 meters, with the vertical extent of mineralization beginning from 100 to 920 meters. The zone remains open in all directions and at depth.
Speaking about the results, NexGen Energy’s vice president of exploration and development, Garrett Ainsworth, said, “[o]ur bold objective that contemplated 50, 100, and 200 meter step-outs to the southwest of the A2 and A3 high grade cores have resulted in wide zones of mineralization across both shears with all three of these step-outs encountering off-scale radioactivity. We are very pleased to be witnessing such strong continuity of mineralization, and consistent growth with these aggressive southwest step outs.”
Rob Chang, senior analyst at Cantor Fitzgerald, is also impressed with the results, and noted that NexGen Energy remains his firm’s top pick.
“Athabasca Basin deposits are typically small in size and as such step out drilling of mineralized zones generally are about 15 meters from a mineralized hole,” Chang said in a research note. “NexGen aggressively stepped out 55 meters, 100 meters, and 210 meters from its best hole (AR-15-44b) and have hit wide intercepts of composite mineralization that includes notable lengths of “off-scale” radioactivity. As a result the A2 and A3 shears have tripled in strike length.”

Drill results a positive for resource estimate

Chang also said that assays for these holes will ultimately have a very positive impact on the firm’s resource estimate. NexGen expects to put out the estimate by Q1 2016, and Chang said that given the assay results to date, Cantor Fitzgerald is forecasting a resource of 114.9 million pounds of U3O8 at an average grade of 0.89 percent.
However, according to NexGen Energy CEO Leigh Curyer, there is still a significant amount of additional drilling to perform before the company can even begin to understand the full scale of the Arrow zone.
“The team is obviously excited as to the implications that this latest batch of results has on the size and future growth of the Arrow zone. These holes have tripled the length of the A2 and A3 high grade cores. The drilling methodology of wide step outs continues to intersect significant mineralization. The footprint demonstrates Arrow is a large continuous system of mineralization in both the A2 and A3 shears and is open in all directions,” Curyer said in Wednesday’s release.
Dundee Capital Markets analyst David Talbot also sees Wednesday’s results as intriguing, and said in his own note that the announcement is “perhaps NexGen’s most important press release since it reported high grade within AR-15-44b.”
“Our focus isn’t as much on the grade and thicknesses of the hits, as to the location of the intercepts themselves,” Talbot explained. “To have four successful intercepts along strike at such wide step-outs, measuring 50 meters, 55 meters, 100 meters and 210 meters to the southwest from hole -44b, makes a strong statement. It shows how extensive the shears are, it demonstrates the large potential to allow migrating mineralizing fluids pass, and it provides an opportunity to deposit high grades.”
Five drill rigs continue to turn at the Rook I property as part of NexGen’s $9-million, 25,000-meter summer drill program, which began on June 8.
At end of day Wednesday, NexGen Energy’s share price was up 8.82 percent, closing at $0.74. Year-to-date the company is up 94.74 percent.
 
Securities Disclosure: I, Kristen Moran, hold no direct investment interest in any company mentioned in this article.
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Drill Tracker Weekly: NexGen Drills Best Interval to Date at Arrow Zone