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The Patterson Lake region of Saskatchewan has become the target of a staking rush following a series of excellent drill results on the Patterson Lake South property, which is held by Alpha Minerals and Fission Energy.
The potential for the next McArthur River or Cigar Lake uranium discovery has ignited a competitive staking rush outside the southern boundary of Saskatchewan’s prolific Athabasca Basin. In recent weeks, the Patterson Lake region has been the target of a land package grab that has seen several juniors and individuals staking claims following a series of excellent drill results on the Patterson Lake South (PLS) property reported by 50/50 joint venture partners Alpha Minerals (TSXV:AMW) and Fission Energy (TSXV:FIS).
The Patterson Lake region hosts two significant structural elements: the Patterson Lake Conductor Corridor and the Dirksen Corridor, said Alpha Minerals President and CEO Ben Ainsworth in a phone interview with Uranium Investing News. The Patterson Lake Conductor Corridor runs northeast from the PLS property up to the west side of Alpha’s wholly-owned claims and through Hook Lake, a joint venture project between Purepoint Uranium (TSXV:PTU), Cameco( TSX:CCO,NYSE:CCJ) and Areva (EPA:AREVA). The Dirksen Corridor is a fertile series of conductors that head from the Forest Lake area on the PLS ground through to the Purepoint JV ground to what’s known as the Dirksen showing.
On Monday, Alpha Minerals and Fission Energy reported initial assay results from the first hole drilled on the R390E zone during the ongoing winter drill program at the PLS property. Mineralized intersections for drill hole PLS13-038 returned broad zones of uranium mineralization including 34.0 meters at 4.92-percent U3O8, 12.4 meters at 12.38-percent U3O8,and 0.5 meters at 35.1-percent U3O8 in the upper uranium zone; and 17.5 meters at 0.96-percent U3O8, and 5.5 meters at 2.07-percent U3O8 in the lower uranium zone. The news sent Alpha Minerals’ stock price surging over 12 percent to close at $4.92 per share. Fission also saw significant gains on the day, posting gains of more than 11 percent to close at $1.20 per share.
“The PLS property has the three critical factors we look for: the grades are good and there is potential for better; the depth is shallow compared to most other deposits in the basin; and it’s thick. That’s the force behind the staking rush,” David Talbot, senior mining analyst at Dundee Securities, told Uranium Investing News.
The mineralization discovered in the drill holes at PLS is located about 50 meters below the surface (Hathor Exploration’s (TSX:HAT) Roughrider starts at 250 meters below surface), which bodes well for the economics of any potential mining activity on the property — less overburden cover to remove and fewer capital costs.
Some market followers, including Gold Stock Trade editor Jeb Handwerger, have pointed to the recent run-up in Alpha Minerals’ share price as evidence resource investors are still confident in the long-term fundamentals of the uranium sector. Since the effective date of the company’s name change (formerly ESO Uranium) and consolidation of shares on November 2nd, 2012 the stock has experienced an eye-popping 400 percent increase at a time when other junior’s in the sector, not to mention the industry as a whole, are struggling to raise cash.
Search for source of uranium boulder train prompts staking rush
The staking boom’s initial spark came in November of last year when Alpha Minerals and Fission Energy announced the discovery of a high-grade, shallow-depth uranium boulder field on the PLS property. At the time Ainsworth called it “the most significant discovery of new mineralization in the southwest Athabasca Basin area since Cluff Lake and Shea Creek.”
By the looks of the area’s staking activity over the last few months there are those who believe the most significant discovery is yet to come: finding the Archean basement rocks that were the source of the high-grade boulder field at PLS. Even Fission and Alpha have separately staked additional claims in the region.
“They’ve discovered the largest anomalous uranium boulder field in the Athabasca Basin so far,” said Talbot. “There has to be a source for those boulders and that’s why everyone is so excited.”
Ainsworth said the boulder field at PLS is different than those commonly found in the Athabasca Basin. “What we are looking at is a terminal moraine where the boulders are being piled up as if they dropped off the end of a conveyor belt made by the ice pushing southwest of the property,” he explained. “That may have contributed a bit to the size of the field and the size of the boulders, which is spectacular. The boulder train has a clear north south elongation to it and so some people think the source could be to the north and some to the south.”
New players entering the emerging uranium district
Junior resource companies and individuals have been staking claims adjoining or in close proximity to the PLS property in the hopes that they may find the source of the boulder field, or at the very least significant mineralization. Besides Alpha Minerals and Fission Energy, the plays with the strongest potential for further major discoveries include Forum Uranium (TSXV:FDC), NexGen Energy and the Purepoint (21 percent)/Cameco (39.5 percent)/Areva (39.5 percent) joint venture.
Both NexGen and the Purepoint JV have properties that are adjacent to PLS on the northeast of the boulder train while Forum’s claims lie to the southwest. “Those to the northeast following the boulder train arguably have the better claims, but those to the south also have potential for EM conductors to continue south and host mineralization as well,” explained Talbot. “Forum has picked up those claims because they have that belief.”
Forum Uranium announced in January of this year the staking of the three claims collectively known as the Clearwater claims, which have had historical lake sediment sample returns showing uranium mineralization, according to Talbot. The company’s February 8th news release states the northernmost claim, which lies immediately to the southwest of PLS, “is interpreted to be on strike with the fertile conductive trend that hosts the newly discovered high-grade uranium mineralization on the Patterson Lake South project.” The company plans to conduct EM surveys to determine the extent and location of graphitic conductors on the project in addition to a detailed boulder survey to search for any boulder fields similar to that found on the PLS property.
NexGen is in the process of a reverse takeover of Clermont Capital (TSX:XYZ.P) which is scheduled to close in the first quarter of this year. The company’s Rook 1 property hugs PLS to the northeast up ice from the PLS boulder train and some the EM conductors found at PLS continue onto their claims. “Untested conductors on the Rook I property lie directly on strike and 3km to the northeast of the mineralized intercepts reported by Fission Energy,” states a December 13, 2012 news release.
Purepoint, which signed the joint venture agreement with Cameco and Areva late last year, operates the Hook Lake project for which a NI 43-101 compliant technical report was filed in November. The joint venture has also acquired some additional claims following the discovery at PLS. Some of those claims are adjacent to the PLS property up ice of the boulder train to the northeast.
Other junior resource companies staking claims in the Patterson Lake region recently include CanAlaska Uranium (TSX:CVV), Yellowjacket Resources (TSXV:YJK), Skyharbour Resources (TSXV:SYH), Ashburton Ventures (TSXV:ABR) and Canadian International Minerals (TSXV:CIN).
In January, CanAlaska announced it had acquired three claim groups totaling 6,687 hectares in the Patterson Lake area. One of the claims shares a border with the PLS property to the northwest of the discovery area. The company is searching for a joint venture partner to participate in exploring the claims, according to the news release.
In February, Yellowjacket announced it had signed an agreement to acquire a large land package totaling approximately 329,500 acres, 90 percent of which are in the Patterson Lake region. The main parcel of land lies to the south of the PLS discovery, and is directly contiguous with the additional claims wholly-owned by Fission as well as Forum and NexGen. Last week, the company announced it had entered into an agreement to acquire an additional 8 claim groups totaling 61,452 acres contiguous with the previously announced claims. The acquisitions make Yellowjacket the largest claim holder in the Patterson Lake region.
On March 14, Ashburton Ventures acquired two claims in the Patterson Lake region totaling 1,237 hectares. The smaller of the claims (147 hectares) is contiguous to the northern boundary of PLS and the larger claim is located to the southwest of the PLS discovery about 25 km from the boundary. The second claim “covers an area of historic Geological Survey of Canada lake sediment samples that range from 3.9 ppm Uranium to 7.69 ppm Uranium,” according to the press release. The company plans to examine and compile all available historic and related mineral exploration data associated with the acquired properties with a goal toward designing and implementing 2013 uranium exploration work programs on the properties.
Last week, Skyharbour Resources acquired five uranium properties totaling 197,000 acres. On Monday, the company reported the acquisition of an additional 191,000 acres to the land package. Skyharbour has about $1 million in the treasury and plans to examine and compile all available historic and related mineral exploration data associated with the claims in anticipation of uranium exploration work programs to begin this year. Two of these claims are to the north of the PLS project, above the Clearwater project and Alpha Minerals’ additional claims and the two are to the south below and bordering Yellowjacket’s claims. Skyharbour’s Wheeler Project in the eastern flank of the Athabasca Basin has three uranium showings on the property; grab sample assay values range from 10 ppm to 0.495-percent U3O8.
Also last week, Canadian International Minerals acquired a 100-percent interest in 20 claims totaling 25,225 hectares in the Patterson Lake region. “The claims were staked for their proximity to the PLS discovery and interpreted favourable geology for the occurrence of PLS style uranium mineralization,” states the press release. “CIN is presently acquiring further claims in the area and the technical and geological details of those and current properties will be released once completed.”
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Alpha Minerals and Canadian International Minerals are clients of Investing News Network. This is not paid-for content.