“The Anderson Project strengthens the Company’s pipeline of projects in development because of its large, defined resource estimate,” Amir Adnani, President and CEO of UEC, stated. “Our Company is the leading uranium player in Arizona with four quality projects, and Anderson is our flagship project there. Arizona is business and energy-friendly and operates three of the largest nuclear power plants in the United States , all of which have recently received their 20-year license extensions. We are starting the permitting process at Anderson now with the collection of data for environmental baseline studies.”
The uranium mineral resource estimate was based on a total of 202,707 meters of drilling from 1,464 holes, including drilling completed by Minerals Exploration Company (“MinEx”) (1,054 holes), Urangesellschaft U.S.A. Inc. (“UG”) (385 holes), and 25 holes drilled by Concentric Energy Corp. (“Concentric”) as of April 15, 2012 , the effective date for this estimate. The mineral resource estimate has been generated from drill hole sample assay results and the interpretation of a geologic model which relates to the spatial distribution of uranium in the deposit. Grade estimates are made using acceptable geostatistical methods with a nominal block size measuring 10 meters long, 10 meters wide and 2 meters in height. Resources have been classified by their proximity to sample locations and are reported in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum’s definition standards on mineral resources and mineral reserves.
The Anderson Project covers 9,852 acres (15.4 square miles) and is comprised of 459 contiguous, unpatented lode mining and placer claims and two Arizona State land sections. It is located in western Yavapai County approximately 75 miles northwest of Phoenix and approximately 180 miles from UEC’s Workman Creek Project. The northern section of the Anderson Project area holds the open-pittable resource and the adjacent southern section holds the underground resource.
This project has an extensive history. Sixty years ago, the property hosted a small-scale open pit mining operation which produced 10,758 tons of ore averaging 0.15% or 33,230 pounds of U3O8. Production ceased in 1959 when the Atomic Energy Commission terminated its ore purchasing program.
In the 1970s MinEx, a subsidiary of Unocal Corporation, and UG acquired the majority of the property. Since then over 1,400 exploration drill holes have been completed on the Anderson property, including 1,340 downhole gamma surveys and 5,596 chemical assays. Almost all of these were completed in the 1970s by MinEx on the property’s northern section and by UG on the southern section.
In the late 1970s the property was brought to the feasibility stage twice, however, by the early 1980s, global market events led both MinEx and UG to abandon their mineral claims in the Anderson property.
In 2001 Concentric staked the majority of this claim block, consolidating portions of the mineral claims held by both MinEx and UG. In 2006 Concentric conducted the first drill program on the Anderson property since the abandonment by MinEx and UG. A 25-hole drill program was completed to confirm the historical MinEx exploration database by “twinning” a significant number of former MinEx drill holes. A total of 24 rotary holes and one core hole, totaling 8,087 feet, were completed. No confirmation holes were drilled on the former UG portion of the property. In 2008 Concentric commissioned Mountain States Research & Development International, Inc. to complete a process engineering assessment, the results of which are presented in a report titled “Final Report Preliminary Process Engineering and Cost Estimates, Anderson Uranium Project, Yavapai County, Arizona.”
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