EX-96.1 3 ex_510257.htm EXHIBIT 96.1 ex_510257.htm

Exhibit 96.1

 

TECHNICAL REPORT
SUMMARY:ROUGHRIDER URANIUM
PROJECT, SASKATCHEWAN, CANADA

 

 

 

 

 

 

 

Prepared For
Uranium Energy Corp.

 

 

Date Issued: 25th April 2023

 

 

 

 

 

 

Report Prepared by

 

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SRK Consulting TRS Roughrider Uranium Project - Details

 

 

 

COPYRIGHT AND DISCLAIMER

 

Copyright (and any other applicable intellectual property rights) in this document and any accompanying data or models which are created by SRK Consulting (UK) Limited (“SRK”) is reserved by SRK and is protected by international copyright and other laws. Copyright in any component parts of this document such as images is owned and reserved by the copyright owner so noted within this document.

 

The use of this document is strictly subject to terms licensed by SRK to the named recipient or recipients of this document or persons to whom SRK has agreed that it may be transferred to (the “Recipients”). Unless otherwise agreed by SRK, this does not grant rights to any third party. This document may not be utilised or relied upon for any purpose other than that for which it is stated within and SRK shall not be liable for any loss or damage caused by such use or reliance. In the event that the Recipient of this document wishes to use the content in support of any purpose beyond or outside that which it is expressly stated or for the raising of any finance from a third party where the document is not being utilised in its full form for this purpose, the Recipient shall, prior to such use, present a draft of any report or document produced by it that may incorporate any of the content of this document to SRK for review so that SRK may ensure that this is presented in a manner which accurately and reasonably reflects any results or conclusions produced by SRK.

 

This document shall only be distributed to any third party in full as provided by SRK and may not be reproduced or circulated in the public domain (in whole or in part) or in any edited, abridged or otherwise amended form unless expressly agreed by SRK. Any other copyright owner’s work may not be separated from this document, used or reproduced for any other purpose other than with this document in full as licensed by SRK. In the event that this document is disclosed or distributed to any third party, no such third party shall be entitled to place reliance upon any information, warranties or representations which may be contained within this document and the Recipients of this document shall indemnify SRK against all and any claims, losses and costs which may be incurred by SRK relating to such third parties.

 

©SRK Consulting (UK) Limited         version: Jan 23

 

 

 

       
  SRK Legal Entity:    SRK Consulting (UK) Limited
       
  SRK Address:   5th Floor Churchill House
      17 Churchill Way
      Cardiff, CF10 2HH
      Wales, United Kingdom
       
  Date:   April 25, 2023
       
  Project Number:   UK31885
       
  Client Legal Entity:   Uranium Energy Corp.
       
  Client Address:   1030 West Georgia Street, Suite 1830
      Vancouver, British Columbia,
     

Canada, C6E 2Y3

       

 

 

 

31885 TRS Roughrider Uranium Project Final Docx April 2023  

 

 

 

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5th Floor Churchill House
17 Churchill Way
Cardiff CF10 2HH
Wales, United Kingdom
E-mail: enquiries@srk.co.uk
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Tel: + 44 (0) 2920 348 150
 

EXECUTIVE SUMMARY
TECHNICAL REPORT SUMMARY:ROUGHRIDER URANIUM
PROJECT, SASKATCHEWAN, CANADA

 

1

EXECUTIVE SUMMARY

 

This technical report summary (“TRS”) was prepared in accordance with the U.S. Securities and Exchange Commission (Regulation S-K Subpart 1300 (“S-K 1300”) and specifically Item 17 Code for Federal Regulations Parts 229, 230, 239 and 249) for Uranium Energy Corporation (“UEC”) by SRK Consulting (UK) Ltd. (“SRK”) on the Roughrider Uranium Project (the “Project”).

 

1.1

Property Description (Including Mineral Rights) and Ownership

 

The Project is located 7 km north, via gravel road, of Points North Landing, a service centre on Provincial Road 905, in the eastern Athabasca basin of northern Saskatchewan, Canada. The Project is an Exploration Stage Property within the 597-hectare mineral lease ML-5547, which is 100% held by UEC. The Project site comprises core logging, office, and storage facilities.

 

The uranium deposits at the Project were discovered in 2008 by Hathor Exploration Limited (“Hathor”) and were subsequently explored and studied in increasing detail until 2016.

 

1.2

Geology and Mineralization

 

The Project is located in the Athabasca Basin, a prolific uranium producing district, and comprises the Roughrider West Zone (“RRW”), the Roughrider East Zone (“RRE”) and Roughrider Far East Zone (“RRFE”) unconformity-related uranium deposits. The deposits occur at, and below, the unconformity between the overlying Athabasca group sandstones and conglomerates, and the Wollaston group orthogneisses. Uranium mineralization is localized by structures, adjacent to, and within graphitic meta-pelites. The mineralization is characterized by uraninite and lesser amounts of uranophane, and red to orange coloured oxy-hydroxillized iron oxides.

 

Uranium mineralization in the Athabasca basin, and the Project, is interpreted to form where oxidized uranium bearing fluids, presumably sourced from the Athabasca group, mix, at or near the unconformity with reduced fluids, or rock masses of the basement, Wollaston group. Uranium is reduced at the redox front where these conditions exist.

 

1.3

Status of Exploration and Development

 

Prospecting, airborne radiometric surveys, and lake sediment sampling for uranium in the Project area began in 1969. As a result of regional exploration work and targeting by various operators, significant uranium mineralization was discovered in 1978 at the Dawn Lake Project (east of the Project) and Midwest Lake (south of the Project). Exploration and drilling efforts around the project concentrated on an east-west trending conductor (indicative of graphitic gneisses of the Wollaston group), although no anomalous mineralization was intersected.

 

In 2006, Hathor acquired mineral lease, ML-5544 (now part of ML-5547). Drilling in 2008 intersected high-grade uranium mineralization, of the RRW deposit. In 2009 and 2011, the RRE and RRFE were discovered respectively. Based on the RRW and RRE deposits only, Hathor completed a preliminary economic assessment (“PEA”) in 2011.

 

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SRK Consulting TRS Roughrider Uranium Project - Executive Summary

 

 

Hathor was acquired by Rio Tinto Canada Uranium Corp. (“RTCU”) in 2011. RTCU continued to advance the Project through to 2016, completing substantial pre-development and environmental baseline work including dedicated geotechnical drilling, shaft vs. decline modelling, the establishment of hydrogeological monitoring wells, terrestrial and aquatic environmental assessments, heritage assessments, species at risk, and a conceptual reclamation plan. In 2013, RTCU submitted an Advanced Exploration Program (“ADEX”) proposal, to the Saskatchewan Ministry of Environment, that was intended to initiate an environmental impact study (“EIS”) review of the Project. No official determination was completed.

 

The Project comprises data from 665 drillholes, for a total of 228,185 m, drilled at the Project by Hathor and RTCU from 2007 to 2016. No exploration has been completed on the Project since 2016.

 

On October 17, 2022, UEC completed the acquisition of 100% of the Project from RTCU.

 

1.4

Mineral Resource Estimate

 

The Mineral Resource estimate (“MRE”) for the Project considers samples from 665 diamond drillholes completed on the Project between 2007 and 2016. All assays for uranium grade (U308 %) have been analysed by fluorimetry or ICP-OES by the Saskatchewan Research Council laboratory while bulk density measurements were taken by site operators. Bulk density samples have been measured by the site operators. Both U308 % and density analyses were subject to industry standard quality control and quality assurance procedures. Although the Qualified Persons (“QP”) was not able to personally witness the data collection procedures, as drilling and sampling activities ceased in 2016, based on the verification of the data and site visit observations, the QP is of the opinion that the data upon which the Mineral Resource is based has been collected in line with industry best practices and are reliable for the MRE presented in this TRS.

 

Geological models, that reflect key aspects including lithological, structural and mineralization domains were constructed by the QP and used to define the estimation domains to constrain the U3O8 % and bulk density estimates. A statistical and geostatistical study were completed on the samples within the estimation domains to determine appropriate estimation parameters. U308 % and bulk density estimates were validated using visual and statistical methods. The influence of very high U308 % grades were restricted using thresholds and dimensions specific to the local structural setting of each of the deposits.

 

Mineral Resources were classified by the QP into Indicated and Inferred categories considering the quantity and quality of data, geological and grade continuity, quality of the estimates, and experience of the QP with similar deposits.

 

The QP has estimated a reporting cut-off grade for the Project based on assumed costs for underground mining and commodity prices that provide a reasonable basis for establishing the prospects of economic extraction for Mineral Resources. These cost and price assumptions have been used to inform an optimisation process using the Deswik Stope Optimiser (“DSO”) software, which utilises the Mineable Shape Optimiser (“MSO”) and estimate a cut-off grade. Mineral Resources have been reported as diluted within the optimised shapes. Mineral Resources are reported exclusive of Mineral Reserves. There are no Mineral Reserves at the Project. The MRE for the Project is reported here by SRK with an effective date of January 1, 2023, in accordance with the S-K 1300 (ES Table 1).

 

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SRK Consulting TRS Roughrider Uranium Project - Executive Summary

 

 

ES Table 1:         Mineral Resource Statement for the Project, effective January 1,2023

 

                     

Contained U3O8

Metal

 

Mining

Scenario

Deposit

 

Classification

 

   

Tonnage

(kt)

   

GradeU3O8

 

   

Tonnes

 

   

M lbs

 

 

C&F

RRW

Indicated

    40     3.38     1,345     3.0  
   

Inferred

    11     3.64     384     0.8  

 

RRW

Indicated

    160     4.62     7,368     16.2  
   

Inferred

    68     6.06     4,140     9.1  
LHOS

RRE

Indicated

    -     -     -     -  
   

Inferred

    232     4.41     10,257     22.6  
 

RRFE

Indicated

    189     2.07     3,917     8.6  
   

Inferred

    48     3.26     1,567     3.5  

Combined RRW, RRE, and RRFE

 

 

Total

Indicated

    389     3.25     12,629     27.8  
   

Inferred

    359     4.55     16,349     36.0  

*Notes

1.) Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.

2.) Mineral Resources are reported exclusive of Mineral Reserves. There are no Mineral Reserves for the Project.

3.) Mineral Resources are reported on a 100% ownership basis.

4.) Mineral Resources are reported diluted within the MSO shapes based on a U308 price of US$56/1b of U308 and metallurgical recovery of 97%. Cut and Fill (“C&F”) and long-hole open stoping (“LHOS”) scenario cut-off grades are 0.52% U308 and 0.45% U308 respectively.

5.) The Mineral Resources were estimated by SRK, a third-party QP under the definitions defined by S-K 1300.The tonnage (presented in metric tonnes), grade (%), and contained metal (metric tonnes and imperial pounds) have been rounded to reflect the accuracy of the estimates

 

1.5

Conclusions and Recommendations

 

The QP has adhered to the regulations prescribed by S-K 1300 for all aspects of the preparation of the MRE presented in this TRS. In the absence of specific S-K 1300 requirements for particular aspects of the MRE preparation, the QP has considered the CIM Estimation of Mineral Resources & Mineral Reserves Best Practice Guidelines (November 29, 2019) and CIM Best Practices in Uranium Estimation Guidelines.

 

The QP has reviewed the data upon which the MRE is based and is of the opinion that the procedures and systems employed to collect and manage this information meet industry best practice. The QP is of the opinion that the supporting data are representative and adequately support the geological interpretations and estimates to the level of classification assigned.

 

The QP has considered the relevant economic factors and MSO shapes as a guide to identify those portions of the model to have prospects for economic extraction and select an appropriate Mineral Resource reporting cut-off grade. The reporting cut-off is used to constrain the MSO shapes, but the MRE is reported diluted within the MSO volumes.

 

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SRK Consulting TRS Roughrider Uranium Project - Executive Summary

 

 

The QP believes that the level of uncertainty has been adequately reflected in the classification of Mineral Resources for the Project. Sources of uncertainty that may affect the reporting of Mineral Resources include sampling or drilling methods, data processing and handling, geologic modelling, and estimation. The main controls on mineralization at Roughrider are interpreted from drill core observations and include interpretations of the structural and lithological controls. The interpretation of geometry of the structural framework, in which the mineralization has been modelled, has been interpreted by property scale structural trends, and is poorly supported by observed, oriented measurements. The continuity of relatively high U308 grades is a source of uncertainty in the estimates, where the QP has used the available data and experience from similar deposits to establish restrictions of distance over which relatively high grade U308 may be interpolated into the block estimates. The estimates of U308 grade and bulk density are particularly sensitive to these restrictions, and more so in volumes classified as Inferred Mineral Resources.

 

Furthermore, the MRE presented may be materially impacted by any future changes in the break-even cut-off grade, which may result from changes in mining method selection, mining costs, processing recoveries and costs, metal price fluctuations, or significant changes in geological knowledge.

 

The QP considers that Mineral Resources reported in the C&F scenario, which are adjacent to the unconformity where hydrogeological and geotechnical conditions are expected to be more challenging, are subject to increased uncertainty. In the event that these technical challenges could not be addressed, this material is at risk of not having prospects for economic extraction.

 

SRK has undertaken an initial assessment to support the disclosure of Mineral Resources, according to Item 17 Code for Federal Regulations Parts 229, 230, 239 and 249 of S-K 1300, specifically Section II, E, 4. The initial assessment comprises a qualitative evaluation of the technical and economic factors to establish the economic potential of the Project. As no conceptual or scoping level studies were available at the time of publication, SRK has relied on modified assumption sourced from recently published technical studies relating to underground uranium properties in the Athabasca Basin. These studies project significantly higher production rates than the currently assumed 100ktpa for the Project and as such the operating expenditure assumptions and other related assumptions have been factored to reflect this lower rate. Furthermore, it is important to note that significant additional technical work including the acquisition of additional site-specific data is required to advance the project to the next development stage as defined under S-K 1300, that being a Pre-Feasibility Study. Critical areas to be addressed in this regard will as a minimum include:

 

 

The determination of scope and scale of the Project and specifically whether the Project will support the development of a dedicated processing facility and associated infrastructure or be considered as a supplemental ore feed to an owner of third-party processing hub;

 

 

Securing additional site-specific technical data in respect of mining geotechnical data, hydrogeological data, metallurgical data, and geochemistry data;

 

 

Mining method selection and mine access options including ventilation and services requirements as well as development of a mine plan and production schedules;

 

 

Supporting infrastructure investigations including site selection for processing facilities and waste management facilities;

 

 

Establishing updated and current quotations for operating and capital expenditure assumptions; and

 

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SRK Consulting TRS Roughrider Uranium Project - Executive Summary

 

 

 

Initiation of Environmental and Social Studies to inform infrastructure site selection, address impact assessments and permitting requirements and specifically any negotiations with interested and affected parties. Furthermore, it is important to note the importance of the criticality of advancing the environmental and social assessment and CSNC licensing for the Project that may require between 48 and 72 months to complete.

 

To date no estimate for the expected timeline, funding or commencement thereof has been determined and as such SRK understands that the Company will initially focus on development of additional scoping level studies to refine the options for scope and scale such that these can be, if warranted, utilised to determine the engineering scope for a Pre-Feasibility Study. As such there can be no guarantee that the results of further technical studies will support the assumptions as incorporated into the initial assessments as reported herein or a positive decision to initiate and complete a Pre-Feasibility Study.

 

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SRK Consulting TRS Roughrider Uranium Project - Table of Contents

 

 

Table of Contents  
   
1 EXECUTIVE SUMMARY i
1.1 Property Description (Including Mineral Rights) and Ownership i
1.2 Geology and Mineralization i
1.3 Status of Exploration and Development i
1.4 Mineral Resource Estimate ii
1.5 Conclusions and Recommendations iii
2 INTRODUCTION 1
2.1 Background 1
2.2 Registrant for Whom the Technical Report Summary was Prepared 1
2.3 Terms of Reference and Purpose of the Report 1
2.4 Source of Information and Data 2
2.5 Details of Inspection 2
2.6 Qualified Person 2
3 PROPERTY DESCRIPTION 3
3.1 Coordinate System 3
3.2 Project Location 3
3.3 Mineral Lease 4
3.4 Mineral Rights 5
3.4.1 Mineral Claim and Mineral Lease 5
3.4.2 Surface Lease 6
3.5 Current and Future Permitting Requirements 6
3.5.1 Provincial EIA and Permitting 6
3.5.2 Federal Impact Assessment and Licensing 7
3.5.3 Decommissioning 8
3.5.4 Indigenous Engagement 9
3.5.5 Violations and Fines 9
3.5.6 Summary 9
3.6 Other Significant Factors or Risks 10
3.7 Royalties or Similar Interest 11
3.7.1 Uranium Crown Royalty 11
3.7.2 Roughrider Royalty 11
3.7.3 Corporation Capital Tax 12
4 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY 12
4.1 Topography and Elevation 12
4.2 Vegetation (and Habitats/Species of Conservation Importance)  13
4.3 Property Access 14
4.4 Climate and Length of Operating Season 15
4.5  Catchments and Water Resources 15
4.6 Availability of Infrastructure 15
5 HISTORY 16
5.1 Pre-Discovery 16
5.2 Discovery to Present 17
5.3 Historical Mineral Resource and Mineral Reserve Estimates 18
5.4 Historical Production 19
6 GEOLOGICAL SETTING, MINERALIZATION, AND DEPOSIT 19
6.1  Regional Geology 19
6.2 Local Geology 20

 

 

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6.2.1 Hearne Subprovince 20
6.2.2 Athabasca Group 21
6.2.3  Surficial Geology 21
6.3 Property Geology 21
6.3.1 Structural Geology 23
6.3.2 Mineralization  24
6.3.3  Alteration 27
6.4  Deposit Type  27
7  EXPLORATION 28
7.1 Exploration 28
7.1.1 2005 GEOTEM and Aeromagnetic Survey 28
7.1.2 2006 Logging of Historic Drill Core 28
7.1.3  2007 Aeromagnetic Survey 28
7.1.4  2007 Tempest and Magnetic Gradiometer Survey 28
7.1.5 Photo-Relogging 29
7.2 Exploration Drilling 29
7.2.1 Drilling Methodology and Procedures 30
7.2.2 Drillhole Surveys  32
7.2.3 Geophysical Surveys 32
7.2.4  Drill Core Logging 32
7.2.5 Drill Core Sampling 33
7.2.6 Core Recovery 35
7.2.7 Hydrogeologic Characterization 37
7.2.8 Geotechnical Characterization Background and Overview 41
8  SAMPLE PREPARATION, ANALYSES, AND SECURITY 49
8.1 Drill Core Preparation and Analysis 49
8.2 Specific Gravity Sample Preparation and Analysis 51
8.3 PIMA Sample Preparation and Analysis 51
8.4 Quality Assurance and Quality Control 51
8.4.1 Blanks 51
8.4.2  Duplicates 52
8.4.3 Certified Reference Materials (CRM) 55
8.4.4  SRC Internal QAQC Report  58
8.4.5 External Duplicates (Umpires)  59
8.4.6 Density Samples 61
8.4.7 Umpire Density Samples 62
8.5 Sample Security  62
8.6 SRK Comments 62
8.7 QP Opinion of the Adequacy of Sample Preparation, Security and Analytical Procedures  63
9 DATA VERIFICATION 63
9.1 Data Verification Procedures Applied by the QP 63
9.1.1 Collar Elevation vs DEM 63
9.1.2 Mineral Lease Location  64
9.1.3  Downhole Deviation and Orientation 64
9.1.4 Interval Table Checks 65
9.1.5  Lithology Logging Consistency 66
9.1.6 Assay Database vs Source Certificates  66
9.2 Site Visit  66
9.3  Limitations  66
9.3.1 Previous SRK QP Visits 66
9.4  QP Opinion of the Data Adequacy   67
10 MINERAL PROCESSING AND METALLURGICAL TESTING 67

 

 

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10.1 Metallurgical Testwork Program 67
10.1.1 Phase 1 Testwork 68
10.1.2 Phase 2 Testwork 68
10.1.3 Phase 3 Testwork  68
10.1.4 Phase 4 Testwork 68
10.2 Sample Selection 68
10.2.1 Phase 1 Samples 69
10.2.2 Phase 2 Samples 69
10.2.3 Phase 3 Samples 70
10.2.4 Phase 4 Samples  70
10.3  Metallurgical Testwork Results 71
10.3.1 Comminution Results  71
10.3.2  Leach Results 73
10.4 Project Process Description 75
10.5 Project Provisional Flowsheet 76
10.6 Qualified Laboratory  77
10.7 QP Opinion of the Data Adequacy   77
11  MINERAL RESOURCE ESTIMATES 77
11.1  Introduction 77
11.2 Key Assumptions, Parameters and Methods  77
11.2.1 Resource Estimation Procedures 77
11.2.2 Resource Database 78
11.2.3  Geological Models 78
11.2.4  Data Conditioning U308 Absent Values 82
11.2.5 Estimation Domain Statistics 88
11.2.6 Geostatistics 92
11.2.7 Search Neighbourhood Design 96
11.2.8  Estimation Methodology 98
11.2.9 Estimation Validation 98
11.2.10  Depletion and Reconciliation 103
11.3 Mineral Resource Classification 11.3.1 Introduction 103
11.3.1 Classification Considerations 104
11.3.2  Classification Design 105
11.3.3 Classification Application 106
11.4 Prospects of Economic Extraction for Mineral Resources 107
11.4.1 Cut-off Grade Estimation 108
11.4.2  Environmental, Social and Governance 112
11.4.3  QP Opinion on the Prospect of Economic Extraction 112
11.5 Mineral Resource Statement  112
11.6  Mineral Resource Uncertainty 113
11.6.1 Inferred Mineral Resources 113
11.6.2  Indicated Mineral Resources  114
11.6.3 Sensitivity to High-Grade Restrictions 115
11.6.4  Sensitivity to Reporting Cut-off 116
11.6.5 QP Opinion on the Level of Uncertainty 117
12 MINERAL RESERVE ESTIMATES 117
13  MINING METHODS 117
14 PROCESSING AND RECOVERY METHODS 118
15 INFRASTRUCTURE 118
16 MARKET STUDIES 118
17  ENVIRONMENTAL STUDIES, PERMITTING, AND PLANS, NEGOTIATIONS, OR AGREEMENTS WITH LOCAL INDIVIDUALS OR GROUPS  118

 

 

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17.1 Environmental Considerations 119
17.2 Social (Including Labour) Considerations 120
17.3  Governance Considerations  121
18 CAPITAL AND OPERATING COSTS 122
19 ECONOMIC ANALYSIS 122
20 ADJACENT PROPERTIES 122
20.1 Midwest Project 123
20.1.1  Midwest Main Deposit  123
20.1.2   Midwest A Deposit  124
20.2 Waterbury Project 124
20.2.1 The Heldeth Tile Deposit 124
20.2.2 Huskie Deposit  125
20.3  Dawn Lake Project 125
20.3.1 Zone 11, 11A, 11B and Zone 4 Deposits 125
21 OTHER RELEVANT DATA AND INFORMATION 125
22 INTERPRETATION AND CONCLUSIONS 126
23  RECOMMENDATIONS 126
24  REFERENCES  127
25 RELIANCE ON INFORMATION PROVIDED BY THE REGISTRANT 129
25.1 Market and Uranium Price 129
25.2 Environmental, Permitting and Social or Community Considerations 130
26 CERTIFICATE OF AUTHOR   131

        

LIST OF TABLES

 

ES Table 1: Mineral Resource Statement for the Project, effective January 1,2023 iii
Table 3-1: ML-5547 Boundary Points 4
Table 3-2: List of Permits as Provided by UEC 5
Table 5-1: Historical Mineral Resource Statement* for the Roughrider Uranium Deposit, Saskatchewan, November 29, 2010 (RRW) and, May 6, 2011 (RRE) 18
Table 7-1: Project Drilling Summary by Year, Company, and Deposit 29
Table 7-2: Key Geotechnical data categories relevant for rock quality classification rating systems. The status of the Project data elements is listed next to each category. 42
Table 7-3: Project Geotechnical Data Collection Sources 43
Table 8-1: Project U308% and U ppm CRMS 58
Table 8-2: Project density CRMs 61
Table 9-1: Collar Elevation versus DEM statistics by Deposit 64
Table 9-2: Drillholes Excluded from the Geological Model and MRE 65
Table 10-1: Phase 1 Testwork, Sample Characteristics 69
Table 10-2: Phase 2 Testwork, Sample Characteristics 70
Table 10-3: Phase 3 Testwork Composite Characteristics 70
Table 10-4: Phase 4 Testwork Composite Characteristics 71
Table 10-5: Phase 2 Comminution Results (RRW) 72
Table 10-6:  Phase 3 Variability Comminution Results 72
Table 10-7: Phase 4 Comminution Variability SPI Test Results 72
Table 10-8: Phase 4 Comminution Variability BWi Test Results 72
Table 10-9:  Project Non-Mineralised Composites — Comminution Measurements 73
Table 10-10: Summary of Phase 4 RR4 Composite Variability Leach Test Results 74
Table 11-1: Drillholes, U3O8 Samples and Sampled Metres in the Resource Area by Deposit 78
Table 11-2: Density Samples and Sampled Metres in the Resource Area by Deposit 78
Table 11-3: Final Estimation Domains and Coding by Zone and Mineralization Group 81

 

 

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Table 11-4: High-Grade Threshold Restrictions Desinged for the Estimate by Domain 87
Table 11-5: Uranium Metal Reductions Associated with the Application of High-Grade Threshold Restrictions in the Estimation Domains 88
Table 11-6:  Basic Statistics of U3O8 Composites by Domain 88
Table 11-7: Interpreted Domain Boundary Condition Matrix for the RRW domains 90
Table 11-8: Interpreted Domain Boundary Condition Matrix for the RRE domains 90
Table 11-9:  Interpreted Domain Boundary Condition Matrix for the RRFE domains 90
Table 11-10: Soft Boundary Condition Design with Associated Search Parameter Restrictions 90
Table 11-11: Modelled U3O8 Grade Cotinuity by Domain 95
Table 11-12: Sample Selection Parameters Employed in the Estimation by Domain 97
Table 11-13: Block Model Framework on page 126 of pdf 98
Table 11-14: Estimation Statistics by Domain and Estimation Step 99
Table 11-15: Mean Composite Grades Compared to the Mean Block Estimates (Density Weighted and Non-Weighted) 100
Table 11-16: Stope Optimization Parameters on page 138 of the PDF 108
Table 11-17: Assumptions for Prospects of Economic Extraction 110
Table 11-18: Mineral Resource Statement for the Project, effective January 1, 2023 112
Table 11-19: Metal Loss Sensitivity to the selection of High-Grade Search Restriction Radii. 115

 

LIST OF FIGURES

 

Figure 3.1: Project Location in Saskatchewan  3
Figure 3-2: Project Location 4
Figure 3-3: Known Heritage Sites near the Project site (BARR, 2013) 11
Figure 4-1: Plan view of the Project topography 13
Figure 4-2: Habitat areas as defined in ADEX (BARR, 2013) 14
Figure 6-1: Geological sketch map of the Athabasca Basin, after Raemakers et al., 2001  20
Figure 6-2: Stratigraphic Column of the Project 22
Figure 6-3: Long Section of the Project geological model (Section Location on Figure 6-6) 23
Figure 6-4:  Interpretation of macro-scale lineaments on a first vertical derivative ground magnetics image 24
Figure 6-5: Uranium mineralized drill core from MWNE-085 from 252.2 m to 258.1 m 25
Figure 6-6: Plan view of the Project Uranium Deposits 25
Figure 6-7: Cross Section W-W’ through the RRW Deposit 26
Figure 6-8: Cross Section E-E’ through the RRE Deposit 26
Figure 6-9: Cross Section FE-FE’ through the RRFE Deposit 27
Figure 7-1: Plan view of the Project drillhole collars by Company 30
Figure 7-2:  Drilling operations at the Project, A: Barge Mounted A5 Drill, B: Helicopter Transported A5 Drill, C: Skid Mounted A5 Drill 31
Figure 7-3: Recovery vs. U308% grade within modelled mineralization 35
Figure 7-4: Cross section of RRW modelled mineralization (red shaded solids) with drillholes coloured by recovery (legend inset upper right) and radiometric probing CPS trace (red lines) on the left of the hole trace and U308% geochemical assays right of the drillhole. 36
Figure 7-5: Contact analysis plot of recovery versus distance from the unconformity 36
Figure 7-6: Plan view (top) and long section looking north (bottom) of Hydrogeological holes drilled at the Project 38
Figure 7-7: Core recovery comparison relative to the RRW, RRE and RRFE areas 43
Figure 7-8: Interval logging data availability in each deposit area below the unconformity. Main geotechnical parameters (looking North). 44
Figure 7-9:  Distribution of logged structures. Upper image displays geology logging without geotechnical descriptions (Orange: geological structure logging, Green: Structural logging with orientation quality recorded). Lower image displays geotechnical logging with joint condition ratings. 45
Figure 7-10: Distribution of mineral infill in logged structures. Inferred strength increases from left to right 47

 

 

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Figure 7-11: Distribution of Logging IRS strength estimate and locations of PLT tests completed. 47
Figure 8-1: Blank sample results for fluorimetry (AQRFLR) and ICP-OES (SCUIOS) at SRC (U308%) 52
Figure 8-2: Field duplicate sample results for fluorimetry (AQRFLR -U308%) 53
Figure 8-3: Coarse reject duplicate sample results for fluorimetry (AQRFLR -U308%) 54
Figure 8-4: Pulp duplicate sample results for ICP-OES (SRUIOS - U308%) 55
Figure 8-5:  CRM plot for STD-BL5 analysed at SRC 56
Figure 8-6: CRM plot for STD-SRCUO2 analysed at SRC 57
Figure 8-7: CRM plot for STD-BL4A analysed at SRC 57
Figure 8-8: SRC internal BL5 CRM performance (Hathor samples 2007 to 2011) 59
Figure 8-9: External duplicate sample results for U308% (SRC vs SGS) 60
Figure 8-10: External duplicate sample results for DNC vs U308% (SRC vs SGS) 60
Figure 8-11:  Standard 01 Density CRM plot 61
Figure 8-12: External duplicate density sample results (Hathor vs SRC) 62
Figure 9-1: Cross section looking south-west at the modelled RRW high-grade layering features with respect to drilling orientation   65
Figure 10-1: Drill hole location for Metallurgical Test Programs  68
Figure 10-2: Conceptual Roughrider Flowsheet 76
Figure 11-1:  Cross section looking North at the Project lithological Model and drillholes coloured by logged lithology 79
Figure 11-2:  RRW mineralization model – view looking down at 50º to the north-northwest. 80
Figure 11-3: RRE mineralization model – view looking down at 37º to the north-northwest. 81
Figure 11-4: RRFE mineralization model – view looking down at 42º to the north. 81
Figure 11-5:  Measured specific gravity versus U308% grade; samples coloured by clay alteration intensity (legend inset upper-left from low clay 0 to intense clay 5) 83
Figure 11-6:  Measured specific gravity versus U300% grade, with samples coloured by Low and High Clay alteration groupings (legend inset upper-left). Regression curves for low clay (blue), high clay (orange), and all data (black) 83
Figure 11-7: Histogram of sample lengths in the estimation domains 84
Figure 11-8:  Log-histogram and Log-probability plots of U308% in the RRW High-Grade Layering group  86
Figure 11-9:  Log-histogram and Log-probability plots of U308% in the RRW High-Grade north-east group 86
Figure 11-10: Log-histogram and Log-probability plots of U308% in the RRW Low-Grade group  87
Figure 11-11:  View looking down at 50° to the north-northwest at the RRW mineralization model with U308% intercepts greater than 30% displayed 87
Figure 11-12: Contact analysis between layer-parallel veins and north-east striking veins (left) and between combined vein domains (layer-parallel = 1100, north-east striking = 1200) and the surrounding low grade domain at RRW  90
Figure 11-13:  3D view looking down to the northwest at High-grade layering vein 7 intersectiong high-grade northeast vein 1 at RRW.  The example shows the primary search ellipse and restricted soft-boundary search (able to include composites from high-grade northeast vein 1) implemented when estimating High-Grade Layering domain 7 at RRW. 91
Figure 11-14:  Experimental and modelled Domain (1100) in RRW. Down right), Semi-major directional right) variograms for the High-Grade Layeringhole (upper-left), Major directional (upper-(lower-left), and Minor directional (lower-right) 92
Figure 11-15: Experimental and modelled variograms for the High-Grade NE Domain (1200) in RRW. Downhole (upper-left), Major directional (upper-right), Semi-major directional (lower-left), and Minor directional (lower-right) 93
Figure 11-16: Experimental and modelled variograms for the Low-Grade Domain (1400) in RRW. Downhole (upper-left), Major directional (upper-right), Semi-major directional (lower-left), and Minor directional (lower-right) 94
Figure 11-17: Cross section in RRW looking east at 556140E through the estimated model. Block  101
Figure 11-18: Cross section in RRE looking east at 556435E through the estimated model. Block model and composites coloured by U308 grade. 101

 

 

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Figure 11-19: Cross section in RRFE looking east at 556555E through the estimated model. Block model and composites colored by U308 grade. 101
Figure 11-20: Swath plot and log-histogram of% U308 composites (Orange), density weighted block estimates (Black), and non-weighted estimates (grey) for RRW High-grade layering domain in the X, Y, Z directions  102
Figure 11-21: Swath plot and log-histogram of% U308 composites (Orange), density weighted block estimates (Black), and non-weighted estimates (grey) for RRW High-grade north-east domain in the X, Y, Z directions  103
Figure 11-22: Swath plot and log-histogram of% U308 composites (Orange), density weighted block estimates (Black), and non-weighted estimates (grey) forRRW Low-grade domain in the X, Y, Z directions  103
Figure 11-23: Cross section of the RRW block model coded by Mineral Resource classification, composites coloured by U308% grade 106
Figure 11-24: Cross section of the RRE block model coded by Mineral Resource classification, composites coloured by U308% grade  107
Figure 11-25: Cross section of the RRFE block model coded by Mineral Resource classification, composites coloured by U308% grade 107
Figure 11-26: Long Section looking north at the MSO shapes for LHOS and CAF for RRW, RRE, and RRFE 112
Figure 11-27: Diluted Block Model Quantities Grade Tonnage Curves for Indicated Mineral Resources. 116
Figure 11-28: Diluted Block Model Quantities Grade Tonnage Curves for Inferred Mineral Resources. 117
Figure 20-1: Plan view of the Roughrider deposit area of the eastern Athabasca 123

 

List of Technical Appendices

 

A

LIST OF POTENTIAL, PERMITS, APPROVALS AND AUTHORIZATIONS

A-1

 

B

ENVIRONMENTAL BASELINE STUDIES

B-1

 

GLOSSARY, ABBREVIATIONS, UNITS I

 

 

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TECHNICAL REPORT SUMMARY:ROUGHRIDER URANIUM
PROJECT, SASKATCHEWAN, CANADA

 

2

INTRODUCTION

 

2.1

Background

 

SRK Consulting (UK) Limited (“SRK”) has been requested by Uranium Energy Corporation (“UEC”, hereinafter also referred to as the “Company” or the “Client”) to prepare a S-K 1300 Initial Assessment for the Roughrider Uranium Project (the “Project”), located in Saskatchewan, Canada. UEC is a public company listed on the Securities and Exchange Commission (the “SEC”).

 

The Project is a uranium project located in the eastern Athabasca Basin of northern Saskatchewan, Canada, one of the world’s premier uranium mining jurisdictions. The Project occurs entirely within the 597-hectare Mineral Lease ML-5547, which is registered to Roughrider Mineral Assets Inc. (“RMA”), which is a wholly owned subsidiary of UEC. The Project is located approximately 13 km west of Orano’s McClean Lake Mill, near UEC’s existing Athabasca Basin properties. The Project was the flagship asset of Hathor Exploration Ltd. (“Hathor”), which Rio Tinto Canada Uranium Corp. (“RTCU”) acquired on December 1, 2011 for US$550 million (“M”). On October 17, 2022, UEC completed the acquisition of 100% of the Project from RTCU for a total acquisition cost of US$150M in cash and shares.

 

2.2

Registrant for Whom the Technical Report Summary was Prepared

 

This technical report summary (“TRS”) was prepared for UEC by SRK.

 

2.3

Terms of Reference and Purpose of the Report

 

With respect to technical submissions (“Technical Report Summary” as defined under item 601 of S-K 1300 defined below) relating to the Project, UEC will be specifically required to comply with Subpart 1300 of Regulation S-K (subpart 1300) hereinafter “S-K 1300” and specifically Item 17 Code for Federal Regulations Parts 229, 230, 239 and 249 effective 25 February 2019. S-K 1300 is regulated under the Securities Act of 1933 and the Securities Exchange Act of 1934.

 

The purpose of this TRS is to report Mineral Resources for the Project. The reporting standard adopted for the reporting of Mineral Resources included in this TRS is S-K 1300 which acts as both a reporting format for TRS and Mineral Resources which, at the effective date of implementation, was broadly aligned with the Committee for Mineral Reserves International Reporting Standards (“CRIRSCO”) reporting template. Accordingly, SRK also considers that the terms and definitions incorporated into S-K 1300 for Mineral Resource reporting to be broadly aligned with those adopted worldwide for market-related reporting and financial investments.

 

The effective date of this TRS is January 1, 2023.

 

References to industry best practices contained herein are generally in reference to those documented practices as defined by organizations, such as the Canadian Institute of Mining, Metallurgy, and Petroleum (“CIM”), or international reporting standards as developed by CRIRSCO.

 

This is the first TRS prepared for the Project - there is no previously filed TRS. The Project is an Exploration Stage Property, which is defined as “a property that has no Mineral Reserves disclosed”. There are no Mineral Reserves at the Project.

 

 

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2.4

Source of Information and Data

 

The information and data used to prepare the TRS have been provided by UEC or are available in the public domain. This TRS is based in part on internal Company technical reports, previous studies, maps, published government reports, Company letters and memoranda, and public information, as cited throughout this TRS and listed in the References Section (Section 24).

 

Reliance upon information provided by the registrant Company is listed in Section 25, when applicable.

 

2.5

Details of Inspection

 

A site visit to the Project was completed by the Qualified Person (“QP”) on March 14, 2023. The QP was accompanied on the site visit by the following key UEC staff:

 

 

Darcy Hirsekorn: District Geologist, Saskatchewan

 

 

James Hatley: Vice President Production, Canada

 

 

Nathan Barsi: District Geologist, Saskatchewan

 

 

Jamal Ghavi: Geologist, Saskatchewan and

 

 

Linda Frank: Office Manager

 

Through the course of the site visit, the QP reviewed drill cores (including sampled half-core) from 7 holes, two holes from each of the three Project deposits (Roughrider West Zone (“RRW”), Roughrider East Zone (“RRE”) and Roughrider Far East Zone (“RRFE”) and one non-mineralized hole. Characteristics of lithology, alteration and mineralization were checked and recorded from the reviewed cores. Specific mineralized intersections were checked with an RS-120 Super Scint (hand-held gamma scintillometer) to confirm the intensity of mineralization. The QP discussed specific alteration and mineralization characteristics observed in the core with the UEC geologists and how these key characteristics should be incorporated into the geological models and Mineral Resource estimate (“MRE”) for the Project.

 

At the time of the site visit, there were no active data collection activities. The last drillhole to be drilled, logged and sampled, was completed by RTCU in 2016. As a result, the QP was not able to observe active drilling and data collection activities. The QP was able to confirm, from the reviewed core intersections, that certain sampling procedures that have been documented by the previous Project operators, Hathor and RTCU, had in fact been followed, specifically radiometric scanning, half-core sampling, and secure storage. Chain of custody evidence was well preserved, with core box labels clearly visible and geochemical and bulk density sampling locations clearly marked in the core boxes. The Project camp was visited and included industry best practice core logging facilities.

 

2.6

Qualified Person

 

This TRS was prepared by SRK, a third-party firm comprising mining experts in accordance with S-K 1300 sub-section 229.1302(b)(1). UEC has determined that SRK meets the qualifications specified under the definition of Qualified Person in sub-section 229.1300. References to the QP in this TRS are references to SRK and not to any individual employed at SRK.

 

 

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3

PROPERTY DESCRIPTION

 

3.1

Coordinate System

 

All coordinates presented in this TRS are Universal Transverse Mercator (“UTM”) projection, unless otherwise specified. The Project is located within UTM zone 13N.

 

3.2

Project Location

 

The Project is located 7 km north of Points North Landing, a service centre on Provincial Road 905, in northern Saskatchewan, Canada. (Figure 3-1). The Project is approximately 440 km north of La Ronge, and 700 km north of Saskatoon. The Project located at the coordinates 556,545E and 6,466,820N UTM.

 

The Project camp, including the core logging and storage facilities, is on the shore of the northeast bay of McMahon Lake, and can be accessed by a short gravel road off the Provincial Road 905 (Figure 3-2).

 

a01.jpg

 

Figure 3.1:         Project Location in Saskatchewan

 

 

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b01.jpg

 

Figure 3-2:         Project Location

 

3.3

Mineral Lease

 

The Project comprises one Mineral Lease, ML-5547, registered to RMA, which is 100% held by UEC. ML-5547 was consolidated, from three individual and contiguous licenses, ML-5544, ML5545, and ML-5546 by RTCU on October 4, 2012. ML-5547 covers 597 hectares and is defined by the boundary points as listed in Table 3-1. ML-5547 was registered with the Saskatchewan Ministry of Energy and Resources on November 2, 2020, and is valid from March 20, 2021 for 10 years, expiring on March 20, 2031.

 

There is an annual expenditure requirement on ML-5547 of CA$14,925, or CA$25/hectare. The Project though currently has a credit of CA$122,692.95.

 

Table 3-1:               ML-5547 Boundary Points

 

Points

Easting

Northing

 

Points

Easting

Northing

A

558,533.541

6,465,868.353

 

N

555,945.856

6,466,763.272

B

558,536.000

6,465,765.000

 

0

556,464.000

6,467,254.000

C

558,434.000

6,465,795.000

 

P

556,704.000

6,467,530.000

D

558,034.000

6,465,651.000

 

Q

557,101.000

6,467,784.000

E

557,602.000

6,465,593.000

 

R

557,501.000

6,468,115.000

F

557,160.000

6,465,523.000

 

S

557,966.000

6,468,298.000

G

557,008.000

6,465,508.000

 

T

558,490.606

6,468,533.421

H

556,491.000

6,465,430.000

 

U

558,443.432

6,468,263.925

i

556,217.000

6,465,338.000

 

V

558,487.388

6,467,732.064

J

555,974.000

6,465,258.000

 

W

558,501.003

6,467,469.976

K

556,332.000

6,465,798.000

 

X

558,571.000

6,466,966.000

L

555,487.523

6,466,328.814

 

Y

558,696.000

6,466,088.000

M

555,352.000

6,466,414.000

 

Z

558,530.949

6,466,013.522

 

 

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3.4

Mineral Rights

 

Exploration and mining in Saskatchewan is governed by the Crown Minerals Act, the Mineral Disposition Amendment Regulations, 2012 and the Mineral Tenure Registry Regulations, and administered by the Mines Branch of the Saskatchewan Ministry of Energy and Resources. Mineral rights are owned by the Crown and are distinct from surface rights.

 

There are two key land tenure milestones that must be met for commercial production to occur in Saskatchewan:

 

 

1.

Conversion of a mineral claim to mineral lease, and

 

 

2.

Granting of a Surface Lease to cover the specific surface area within a mineral lease where mining is to occur.

 

The processes associated with these are described further below.

 

Several other permits, licences and approvals are required both for ongoing exploration and eventual operation for the Project to proceed. To carry out exploration at the Project a Surface Exploration Permit, Forest Product Permit, and Aquatic Habitat Protection Permit are required.

 

Table 3-2 indicates the permits currently in place for the Property. The Permits, like the Mineral Lease, are registered to RMA. UEC and RTCU have kept the Project permits current through the transition of ownership. Several of the permits include conditions relating to restrictions on development, health and safety, environmental protection, and restoration/closure of disturbed areas. Non-compliance with these conditions could lead to regulatory enforcement action.

 

Future permitting processes expected to be required are summarised in Section 3.5

 

Table 3-2:         List of Permits as Provided by UEC

 

Name

Disposition

Type

Effective

Date

Expiry

Date

Holder
(Organization)

Parent

Disposition

Status

Reason

Created

On

0104668

Sand and

Gravel

4/1/20232

3/31/2024

RMA

10028363

Activated

10/19/2022

0104669

Sand and

Gravel

4/1/20232

3/31/2024

RMA

10016620

Activated

10/19/2022

0104670

Easement

4/1/20232

3/31/2047

RMA

10017136

Activated

10/19/2022

0104664

Industrial

4/1/20232

3/31/2024

RMA

10002692

Activated

10/19/2022

0104663

Foreshore

Installations

4/1/20232

3/31/2033

RMA

10016552

Waiting

Signature

10/19/2022

0104666

Foreshore

Installations

4/1/20232

3/31/2025

RMA

10016553

Activated

10/19/2022

0104665

Foreshore

Installations

4/1/20232

3/31/2033

RMA

10016554

Activated

10/19/2022

0104667

Miscellaneous

4/1/20232

3/31/2025

RMA

10016288

Activated

10/19/2022

 

3.4.1

Mineral Claim and Mineral Lease

 

A mineral claim does not grant the holder the right to mine minerals except for exploration purposes. Subject to completing necessary expenditure requirements, mineral claim credits can be accumulated for a maximum of 21 years. To ensure that mineral claims are kept in good standing in Saskatchewan, the claim holder must undertake the minimum exploration work on a yearly basis. The current requirements are CA$15/ha per year for claims that have existed for 10 years or less, and CA$25/ha per year for claims that have existed in excess of 10 years. Excess expenditures can be accumulated as credits for future years.

 

 

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A mineral claim in good standing can be converted to a mineral lease by applying to the mining recorder and having a completed boundary survey. In contrast to a mineral claim, the acquisition of a mineral lease grants the holder the exclusive right to explore for, mine, recover, and dispose of any minerals within the mineral lease. Mineral leases are valid for 10 years and are renewable. In the case of the Project, there is a mineral lease (ML-5547) and this has been renewed and is now valid to 2031 (Table 3-1).

 

The Project originally consisted of three contiguous mineral claims, S-107243 staked on January 30, 2004, and S-110759 and S-110760 staked on March 18, 2008, covering a total area of 543 hectares. Hathor carried out a legal survey of the property in 2010. On March 16, 2011, the three mineral claims were converted to mineral leases and these were subsequently combined into a single mineral lease (ML 5547). Due to minor modification to the eastern property boundary as a result of the legal survey and land tenure changes, the official size of the mineral lease is 598 ha. Mineral Resources for the RRE, RRFE and RRW are contained completely within the mineral lease.

 

3.4.2

Surface Lease

 

Land within the mineral lease, surface facilities and mine workings are considered to be located on Provincial lands and therefore owned by the Province. Hence, the right to use and occupy those lands is acquired under a surface lease from the Province of Saskatchewan. A surface lease is issued for a maximum of 33 years and may be extended as necessary to allow the lessee to operate a mine and/or plant and undertake reclamation of disturbed ground.

 

Co-ordinated between various provincial government ministries and industry, the leases address a range of issues to which mining companies must respond, including land tenure, environmental protection measures, occupational health and safety provisions, and socioeconomic benefits for residents of northern Saskatchewan. Beyond addressing business opportunities and other local benefits, each surface lease agreement also requires the company to negotiate a long-term Human Resource Development Agreement with the Ministry of Advanced Education, Employment and Labour. This plan must speak to efforts to recruit, train and hire northern workers. For mining projects, the surface lease is negotiated between the proponent and the provincial government following the completion of a successful environmental assessment.

 

Once the surface lease is negotiated, the Provincial approval to operate a Pollution Control Facility is issued; it describes commitments that must be met in terms of monitoring and reporting.

 

3.5

Current and Future Permitting Requirements

 

Should the Project proceed, either to advanced exploration or to full development, the necessary development and operational approvals will need to be obtained. A description of the key permissions expected to be required and the processes needed to obtain these are given below. This section is mainly based on information provided by Clifton Engineering Group Inc.(“Clifton”) (memo dated April 2023).

 

3.5.1

Provincial EIA and Permitting

 

For mining, a surface lease is required prior to work commencing on site. The surface lease will generally cover all areas predicted to be disturbed and accrues annual fees per hectare. Within the boundaries of the surface lease, the annual payments can vary as land is disturbed or reclaimed. Surface leases are coordinated through the Ministry of Government Relations, Northern Engagement Branch, and the Ministry of Environment (“MOE”), Lands Branch, and includes input from other government agencies where appropriate. While negotiations can start early, and in parallel with an environmental impact assessment (“EIA”) process, a precondition of the issuance of a surface lease is the successful outcome of the provincial EIA process. In Saskatchewan, the EIA and licensing process are sequential; the EIA process must be completed prior to issuance of specific leases, licenses and permits.

 

 

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Generally, all mining projects are deemed a Development’ as per Section 2(d) of the Saskatchewan Environmental Assessment Act. As it is assumed that the Province will determine the Project is a Development, UEC can elect to self-declare the Project as a Development. A Technical Proposal document and draft terms of reference (“TOR”) will need to be submitted to MOE, Environmental and Stewardship Branch (“EASB”) with a letter indicating that UEC would like to self-declare the Project as a Development. The TOR is submitted as a draft and would be finalized after incorporating comments from the Province, the Canadian Nuclear Safety Commission (“CNSC”) and Indigenous groups.

 

It will be incumbent on UEC to complete the work required for an EIA, including any delegated Duty to Consult engagement and consultation. While Clifton considers a federal Impact Assessment (“IA”) is not likely to be required, it recommends including elements of the federal process in a provincial EIA to aid in the federal CNSC licensing process, in accordance with Canada’s Nuclear Safety and Control Act (“NSCA” - see below).

 

Once an EIA is submitted and the provincial internal reviews are finished, the EASB will compile the comments and produce a Technical Review Comments (“TRC”) document. If there are deficiencies in the EIA, the proponent will be required to address them before the TRC document and the final EIA are placed into public review (generally for 30 to 60 days). When public review is complete, EASB will produce an EIA decision document for the Minister of Environment. While there are three outcomes possible (outright approval, approval with conditions or rejection), the potential outcome for a project that gets to this stage is approval of the EIA with conditions. With approval of the EIA, licensing and permitting can be completed.

 

While an EIA is in progress, the proponent can develop the surface lease application and other provincial licensing packages for review by the government. Provincially, the licensing is through the MOE, Environmental Protection Branch, which largely provides a one-window approach for mining project licensing on behalf of other branches and ministries. There will be other ministries and permitting required related to health and safety, labour, employment, and royalties. Overall, a number of permissions, of one form or another, are required to complete the Project, but when compared to the EIA process, they are rarely material to the schedule or budget if organized properly. Most ministries will indicate their interest and the need for any permits at the Technical Proposal and EIA review stages and those comments will come forward in the TRC.

 

3.5.2

Federal Impact Assessment and Licensing

 

The federal Impact Assessment Act (“IAA”) and the need to produce an IA can be triggered in two ways. The first is by triggering one of the activity thresholds in the Physical Activities Regulations (“PAR”), and the second is that the Project can be designated by the federal Minister of Environment and Climate Change (the “Minister”) in response to a request to designate the Project and a supporting recommendation from the Canadian Impact Assessment Agency (CIAA). With approximately 300 tonnes/day (“tpd”) of ore being mined and milled, the Project does not trigger Sections 20 to 23 of the PAR where a production or milling amount of >2500 tpd is the trigger. From recent experience, the CIAA will not likely refer a project for designation by the Minister if the CIAA is of the view the potential adverse effects within federal jurisdiction would be limited and managed through project design, mitigation measures, existing legislative frameworks, and there will not be adverse impacts to Indigenous peoples.

 

 

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Under the IAA (Section 43), the Minister must refer the IA of a designated project to a review panel (the “Panel”) if the project includes physical activities that are regulated under the NSCA. If a Panel is declared for a uranium project, there will be one CNSC-appointed member to the Panel. In general, a Panel would add about a year to the approvals process. The IA conducted by a Panel is the only IA the CNSC can use for the purpose of issuing the licence. The CNSC will conduct an environmental protection review (“EPR”) for the license application in accordance with its mandate under the NSCA to ensure the protection of the environment and the health of persons. The CNSC will follow the federal mandates with respect to Indigenous peoples and other initiatives such as Climate Change.

 

The CNSC and Saskatchewan MOE have historically worked closely together and the CNSC will have the ability to review the provincial EIA submitted by UEC. The regulators have recently demonstrated that they will cooperate in their review of projects despite the expiration of their cooperation agreement. In addition, the CNSC will act as a technical advisor and will be an active participant in the EIA process. However, the provincial EIA decision will be independent of the federal government.

 

UEC will need to initiate the NSCA licensing process to have early and meaningful discussions with the CNSC regarding the licensing process, engagement and consultation expectations, and the scope of the Project’s licensing. While the option of sequentially doing the provincial EIA and the CNSC licensing is available, the CNSC suggests doing these two distinct processes in parallel to save time. It is assumed that a successful outcome for the provincial EIA would be an important part of the CNSC’s EPR, which would be presented to the CNSC Tribunal as part of the licensing review. As in Saskatchewan, a positive environmental decision on the EIA is required prior to the CNSC approving any licensing packages. The CNSC’s licensing and oversight processes are done on a cost recovery basis through the Cost Recovery Fees Regulations.

 

While in-water work is not expected, as it will be an underground operation, there may be a need to engage with Fisheries and Oceans Canada (under the Fisheries Act) regarding a treated effluent discharge or pump stations for fresh water. Transport Canada authorization may be required if there are any in-water works with a potential to impact navigation (under the Canadian Navigable Waters Act) or headframes or ventilation shafts, in relation to the Points North airstrip, need to be registered (under the Canadian Aviation Regulations). The Metal and Diamond Mining Effluent Regulations to the Fisheries Act, in addition to any provincial requirements, will govern water quality and the monitoring of biological effects. Other federal legislation of importance to the Project will be compliance with the Species at Risk Act (e.g. woodland caribou) and the Migratory Birds Convention Act. It is not clear whether the proposed federal policy on biodiversity will have an impact on the Project, but if enacted, it could mean more biophysical offsets will be required for any disturbed ground.

 

3.5.3

Decommissioning

 

As part of the regulatory process, UEC will be required to develop a conceptual decommissioning plan for inclusion in the EIA that details the steps that will be taken to decommission facilities and reclaim the land at the end of the Project’s life. As part of the subsequent licensing, the conceptual plan is expanded into a more detailed Preliminary Decommissioning Plan (“PDP”) along with a cost estimate for implementation (“PDC”). The Company will be required to provide a surety or bond to cover the cost of carrying out the PDP. While salvage of some materials is likely, these cannot be considered in the PDC. The PDP and PDC are periodically reviewed and updated and can be scaled to reflect the current state of the Project. As operations progress, progressive decommissioning is encouraged as it lowers close-out liabilities, which, in turn, can reduce the amount of a surety bond, and often reduces the cost of disturbed-land lease fees.

 

At the end of the life of mine, closure is required to be done in accordance with the Section 22 of the Mineral Industry Environmental Protection Regulations, MOE’s Guidelines for Northern Mine Decommissioning and Reclamation (November 2008); Environmental Code of Practice for Metal Mines (2009); and, industry best management practices, such as those established by Mining Association of Canada. The Department of Mines would be responsible for closure of underground workings in terms of the Mines Regulations.

 

 

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In Saskatchewan, reclaimed land can be returned to the Crown under the Reclaimed Industrial Sites Act and the Reclaimed Industrial Sites Regulations, which establish an Institutional Control Program (“ICP”). The ICP is implemented once a decommissioned site has been deemed to be reclaimed in a stable, self-sustaining and non-polluting manner. The property is then transferred back to the Province for monitoring and maintenance. For this to happen, the proponent pays a calculated sum into the Institutional Control Monitoring and Maintenance Fund and the Institutional Control Unforeseen Events Fund; the government can seek redress from the proponent if the costs exceed the funds available.

 

3.5.4

Indigenous Engagement

 

For both the federal and provincial EIA and permitting/licensing processes, engagement and consultation with Indigenous groups are required. Engagement in Saskatchewan consists of the Crown’s duty to consult, a legal requirement, and interest-based engagement, which is essential to a project’s social license. Both levels of government have a duty to consult with Indigenous groups on any decision within their purview with the potential to affect Aboriginal or Treaty Rights. As the Project progresses through the regulatory process, several provincial and federal decisions will be made that must be informed by engagement and consultation. Implementation of the Crown’s duty to consult is guided by a combination of provincial and federal regulatory requirements and guidance documents (e.g. Section 35, The Constitution Act).

 

Although the duty to consult lies with the federal and provincial governments, the procedural aspects of the duty to consult are frequently delegated to the proponent to undertake. This often results in the proponent entering into engagement agreements with some Indigenous groups to do studies to identify any potential impacts to rights. The Company will be expected to meet with each potentially affected community to discuss engagement plans and an appropriate budget for the communities to complete the necessary meetings and studies. The engagement plan should include opportunities to inform Indigenous communities of the nature of the proposed activities, the potential impacts of the Project, and proposed mitigation strategies. The purpose is to receive feedback or information on current traditional land uses and potential impacts to Treaty and Aboriginal rights. UEC will be expected to work with the Indigenous communities to determine reasonable accommodations (e.g., an impact benefit or other agreement) to avoid, minimize, or mitigate adverse impacts to their rights.

 

UEC will be expected to demonstrate the extent of engagement through appropriate records and show how comments, concerns and traditional knowledge have been received and addressed within the EIA and licensing documents.

 

3.5.5

Violations and Fines

 

Subject to a formal legal due diligence, SRK has not been informed of any violations or fines associated with the Project.

 

3.5.6

Summary

 

Should the Project be developed, it is expected it will need to undertake additional environmental and social studies to build on the historical data collection undertaken by RTCU (which is now 10 years old) to prepare an EIA — a list of historical studies undertaken is presented in Appendix B. It is also recognised there are synergies between the environmental and engineering data gathering exercises (particularly for geochemistry, water and climate) and thus cost and schedule efficiencies can be achieved with careful planning. It is estimated the environmental and social assessment and CSNC licensing for the Project may require between 48 months and 72 months to complete.

 

 

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The variation in schedule will be a function of the complexity of the proposed Project, how it interacts with the environment and the level of public concern with the proposed Project. Therefore, the accuracy of the schedule can only be refined following the completion of pre-feasibility or feasibility level engineering studies and the findings of new engagement activities with Indigenous groups (recognising that historical engagement was done approximately 10 years ago — refer to Section 17).

 

The CNSC operates on a cost recovery basis that allows the agency to bill the proponent for each hour their staff dedicates to the Assessment process. This complicates the ability to accurately estimate the total costs of an EA. SRK and Clifton consider a reasonable estimate of the total costs associated with completing an EA for this Project, at this stage of its development, is in the order of CA$15M to CA$20M over the duration of the assessment and permitting process.

 

A comprehensive list (as identified by UEC) of the potential permits, approvals and authorizations required for the Project are summarized in Appendix A.

 

3.6

Other Significant Factors or Risks

 

In terms of ESG related factors, several issues or risks associated with accessing the land or obtaining the necessary permissions have been identified and are expanded upon in Section 16. Four relate directly to the mining lease area and are summarised below:

 

 

1.

According to the Advanced Exploration Program (“ADEX”) EIA (RTCU, 2014), there are no legally protected or internationally recognised habitat areas within the concession area. It is over 100 km to the nearest national parks, which are located to the northeast, northwest and south of the Project area.

 

 

2.

Several species of conservation importance occur in the area and would require further assessment as part of any future EA process.

 

 

3.

Heritage resources impact assessments were undertaken to support the ADEX PFS (BARR, 2013) and EIA (RTCU, 2014). The identified sites are shown in Figure 3-3. As a result of this work, the Heritage Conservation Branch (“HCB”) gave clearance for the ADEX project in 2012, but the ADEX EIA indicates that any further proposed development would have to be submitted to HCB for review.

 

 

4.

The uranium mining industry and the Government of Saskatchewan have focused significant effort towards obtaining a “social license” to operate in the Athabasca Basin region over the course of the past 40+ years. To this end many committees, working groups, partnerships and agreements have been formed between the uranium mining companies and Indigenous and non-Indigenous communities. SRK understands traditional rights to the Project area will be recognised as part of the surface lease agreements and Impact Benefit Agreements resulting from the proposed Project. Further information on relevant stakeholder groups and historical engagement with them is given in Section 17.

 

The QP is not aware of any other significant factors that may affect access to the Project, or UEC’s ability to continue exploration activities at the Project.

 

 

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a03.jpg

 

Figure 3-3:         Known Heritage Sites near the Project site (BARR, 2013)

 

3.7

Royalties or Similar Interest

 

The Project is subject to royalty payments to the government of Saskatchewan, via the “Uranium Crown Royalty” and through a private agreement with the Uranium Royalty Corporation (“URC”), the “Roughrider Royalty”, as well as Corporation Capital Tax. The application of these for the prospects of economic extraction are discussed further in Section 11.4.1

 

3.7.1

Uranium Crown Royalty

 

The Government of Saskatchewan approved a new uranium royalty system effective January 1, 2013. The uranium royalty system is enacted under the Crown Mineral Royalty Regulations, pursuant to the Crown Minerals Act. According to the system, each owner, or joint venture participant, in a uranium mine is a royalty payer. Individual interests of a royalty payer are consolidated on a corporate basis for the calculation of royalties applied to the royalty payer’s sales of uranium. The system has three components:

 

 

Basic royalty — 5% of gross revenue

 

 

Profit royalty — rates increase from 10% to 15% as net profit increases

 

 

Saskatchewan Resource Credit — a credit of 0.75% gross revenue

 

 

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The Profit Royalty is based on net profits, with a two-tier rate structure. It will apply at rates of 10% on net profits up to and including $22 per kilogram, and 15% on net profits above $22 per kilogram. The Basic Royalty is not deductible from Profit Royalty payable.

 

Profit is calculated based on recognition of the full dollar value of a royalty payer’s exploration, capital, production, decommissioning and reclamation costs.

 

The total royalty is calculated as follows:

 

Equation 3-1: Royalty Payment

 

Royalty Payment = Basic Royalty + Profit Royalty - Saskatchewan Resource Credit

 

3.7.2

Roughrider Royalty

 

The Project is subject to royalty payments through a private agreement, the “Roughrider Royalty”, with URC. The Roughrider Royalty is a 1.9701% net smelter return royalty payable pursuant to the interest that Uranium Energy Corporation or any of its subsidiaries, assignees or successors holds in the property.

 

3.7.3

Corporation Capital Tax

 

For resource corporations, the Resource Surcharge rate is 3.0% of the value of sales of all uranium produced in Saskatchewan.

 

4

ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY

 

4.1

Topography and Elevation

 

The approximate claim boundary for the Project is shown in Figure 3-2. It has a maximum north-south dimension of roughly 2.5 km, and a maximum east-west dimension of roughly 3 km. The claim area lies between approximately elevations of 477 and 502 m above mean sea level (“MASL”) (Figure 4-1). The predominant geology on site consists of glacial till underlain by water-bearing sandstone and the Western Churchill Province of the Archean Canadian Shield (“basement”) rocks.

 

Throughout the Project area, glacial landforms distinctly trend northeast arising from the retreating of glacial ice from the southwest to the northeast during the Quaternary period. The Project deposits are located on the flank of a glacial drumlin. Approximately 60% of ML-5547 is land, while the remaining is water/lakes.

 

Two aquifers transmit groundwater under the Project site. The shallow aquifer extends at most 30 m into the ground and transmits water parallel to surface drainage. The deep aquifer transmits water in a more complex manner based on local geography (SRK, 2011). The surface water level of South McMahon Lake is assumed to be approximately 478 MASL.

 

 

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Figure 4-1:         Plan view of the Project topography

 

4.2

Vegetation (and Habitats/Species of Conservation Importance)

 

The ADEX EIA (RTCU, 2014) was informed by environmental baseline data gathered by Canada North Environmental Services Limited Partnership between 2012 and 2014 (Section 3.5.1 and Appendix B). As such there is a reasonably good understanding of the Project context and its local and regional setting. The summary description of the vegetation, habitat and species of conservation importance presented below is extracted from these reports. SRK understands no further environmental baseline work has been completed subsequent to this.

 

The baseline studies included development of a habitat map (Figure 4-2) based on satellite imagery from 2011, which was ground truthed in the field (SRK considers an update to this would be needed to confirm if there have been changes in the last decade should the Project proceed). ML-5547 sits within the local study area. In terms of vegetation, five ecotypes (habitats) were identified based on tree canopy composition and wetland type:

 

 

Open/shrubby wetland;

 

 

Treed wetland;

 

 

Ribbed fen;

 

 

Jack pine-dominated conifer forest; and

 

 

Black spruce-dominated conifer forest.

 

According to the ADEX EIA (RTCU, 2014), of the 119 rare plant species potentially occurring in the Athabasca Plain ecoregion, five have been observed in the study area: leathery grape fern, few-flowered sedge, three-seeded sedge, hairy butterwort, and American Scheuchzeria. None of the species observed are listed on the federal Species at Risk Act or protected under the provincial Wildlife Act. No exotic and/or prohibited, noxious, or nuisance weeds as listed by the Saskatchewan Weed Control Act were observed during vegetation studies.

 

 

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Figure 4-2:         Habitat areas as defined in ADEX (BARR, 2013)

 

Database searches resulted in the identification of 11 federally listed wildlife species at risk or species with special conservation measures as potentially occurring within the study area. These include seven bird species and four mammals. Two bird species were detected in the study area that are listed federally as threatened: the olive-sided flycatcher and common nighthawk. Five bird species detected within the lease area and/or regional study area (“RSA”) have provincial activity setbacks including the bald eagle, osprey, northern hawk owl, Bonaparte’s gull, and common tern. Setback distances for common terns apply only to breeding colonies, and no colonies were observed. The four mammal species of conservation importance were the wolverine, little brown myotis (mouse eared bat), northern myotis, and boreal woodland caribou.

 

4.3

Property Access

 

The area around the Project is a well-developed mining area close to necessary infrastructure and resources. The property can be accessed by a 7 km gravel road, floatplane or helicopter from Points North Landing. Points North Landing is on Provincial Road 905 which is linked to the nearest sizeable population centre, La Ronge 440 km south, by Highway 102. There are several daily commercial airline services from Saskatoon to Points North Landing, and regular charter flights for Orano’s McLean Lake operation.

 

 

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4.4

Climate and Length of Operating Season

 

According to the ADEX PFS (BARR, 2014) the Project area has a climate that is a mid-latitude continental climate, with temperatures ranging from 32°C in the summer to -45°C in the winter. Winters are long and cold, with mean monthly temperatures below freezing for seven months of the year. Annual precipitation is about 500 mm per year, with half of that in the summer months. Winter snowpack averages 70 cm to 90 cm. Lake ice forms by mid-October and usually melts by mid-June. Field operations are possible year-round with the exception of limitations imposed by lakes and swamps and the periods of break-up and freeze-up (effectively drilling operations are possible from January to April and June to October).

 

According to Canada’s Changing Climate Report — In Light of the Latest Global Science Assessment (2022), which refers to the IPCCs AR6 report, there will be an increase in annual mean temperature in North America. They project that warming in Canada will be greater in the northernmost regions. Increases in mean annual precipitation is projected for several North American regions, including specifically where the Project site is located. According to Climatedata (https://climatedata.ca/), average temperature for the period 2021 to 2050 for Wollaston Lake, which lies 55 km to the southeast of the Project site, is expected to be -1.5 °C compared to -3.7 °C for the period 1971 to 2000. Changes in precipitation patterns and the possibility of increased variability in the amount and timing of rainfall and snowfall could result in more frequent and intense extreme weather events, such as floods and droughts.

 

4.5

Catchments and Water Resources

 

The Project straddles two distinct watersheds (which were characterised in terms of flow and quality during the ADEX EIA (RTCU, 2014):

 

 

The Smith Creek catchment, which flows north from the Project, entering Smith Bay on the south side of Hatchet Lake. At the time of the ADEX EIA (2014) there were no other industrial users discharging to the watershed, and the nearest commercial user of the watershed was an outfitting camp located near the north end of Hatchet Lake and potentially a winter commercial fishery within the lake; and

 

 

The Collins Creek catchment, which flows east from the area of the Project to Collins Bay of Wollaston Lake. Collins Creek receives the treated effluent from the McClean Lake uranium mill, which is located approximately 11 km east of the Project. The creek then enters Collins Bay (opposite the Rabbit Lake uranium mine and mill). A freshwater intake for the Rabbit Lake mine and mill is located within Collins Bay and treated effluent from the Rabbit Lake operation is discharged into Wollaston Lake.

 

4.6

Availability of Infrastructure

 

The Project benefits from being close to Points North Landing and the Provincial Road 905, both of which can be used for import of consumables and equipment. A road has been constructed to connect the Project site to the Provincial Road but will require further upgrade to facilitate development. The airstrip at Points North Landing or a dedicated airstrip would be used for ingress and egress of the workforce, which are likely be working on a fly-in-fly-out basis.

 

The Project will need to build its own administrative, maintenance, and operational support infrastructure on-site. This will include a fully serviced accommodation camp. The Project will need to generate heating and hot water, and other services such as water treatment, water supply and waste management. Study work (BARR, 2014) has established an overall conceptual layout.

 

 

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Typical infrastructure associated to under mining located at surface will also need to be constructed such as shaft and headframe, winding house, ventilation fans, backfill plant / concrete plant, and freeze plant.

 

The power demand from mining has previously been estimated at between 17 to 24 MW (BARR, 2014). Additional power will be needed for surface infrastructure. South of Points North Landing and approximately 15 km from the Project is the nearest national grid substation, which is understood to be operated by “Saskpower”. The substation is situated on the high voltage regional transmission grid between the Athabasca Hydroelectric System (23 MW capacity) and the Island Falls Hydroelectric Station (111 MW capacity).

 

Saskpower has previously been contacted regarding the potential to connect to the substation. However, at this stage, the capacity and current utilisation of the transmission system has not been studied and nothing has been confirmed or agreed. If there is not adequate capacity on the nearby high voltage power line, then an LNG-fired power plant or a Small Modular Reactor(s) (“SMR”) are likely to be the lowest life-of-mine (“LOM”) cost self-generation alternative options.

 

5

HISTORY

 

5.1

Pre-Discovery

 

Between 1969 and 1974, following the discovery of the Rabbit Lake uranium deposit in 1968 by Gulf Minerals Ltd., Numac Oil and Gas (“Numac”) held the large Permit Number Eight over the Midwest Lake (McMahon Lake) and Dawn Lake areas. Prospecting, airborne radiometric surveys and lake sediment sampling for uranium and radon were carried out in 1969 and 1972 (Forgeron, 1969; Beckett, 1972). At the time, Numac, in conjunction with their partners Esso Minerals and Bow Valley Industries, focused on the Midwest Lake area, located adjacent to the Project.

 

In 1976, Asamera Oil Corp. (“Asamera”) initiated the Dawn Lake project, located approximately 6 km southeast of the current Project. Asamera discovered the Dawn Lake 11, 11A, 11B, and 14 zones in 1978. In 1983, the Saskatchewan Mining and Development Corporation (“SMDC”), predecessor to Cameco Corporation (“Cameco”) became the operator of the Dawn Lake Joint Venture. By 1995, the Dawn Lake Joint Venture consisted of Cameco, Cogema Resources Inc. (now Orano SA (“Orano”)), PNC Exploration Canada Ltd., and Kepco Canada Ltd. (Jiricka et al., 1995). The Dawn Lake Joint Venture held the Esso North claim until it lapsed in 2003.

 

Early work by Asamera on the Esso North claim consisted of electromagnetic (“EM”) and aeromagnetic surveys in 1977, followed by airborne very low frequency (“VLF”) EM, magnetic and radiometric surveys in 1978 and 1979 by Kenting and Geoterrex, respectively. These surveys located an east-west trending conductor of moderate strength and a radiometric anomaly associated with a broad VLF-EM response on the eastern portion of the Esso North claim (Parker, 1982).

 

From 1978 to 1981, Turam, Vector Pulse EM, and VLF-EM surveys confirmed the east-west conductor as well as some weaker northeast trending VLF-EM conductors. The east-west conductor occurs just outside the western boundary of ML-5547. During this same period, Asamera drilled 21 holes on the Esso North claim (Parker,1982; Asamera, 1982). The first 10 holes, EN-1 to EN-10, were drilled across the projected northeast strike extent of the Project. These holes are located within ML-5547 (formerly lease ML-5544) and penetrated basement rock for an average length of 25 m.

 

The other eleven holes were drilled on the main east-west striking conductor. Results, however, were discouraging; the highest radioactivity was encountered in drillhole EN-14 with 590 counts per second (“cps”) on a radiation detector. Basement lithologies intersected in drillholes included Archean granitoid, pegmatite, migmatite, and rare pelitic gneiss. Some evidence of structural disturbance and alteration was observed in the Athabasca sandstone intersected in drillholes EN-14, EN-15, and EN-16. Parker (1982) recommended relogging of the drill core to determine if any structural features had been missed. Only EN-14 and EN-15 are collared within ML-5547.

 

 

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In 1984, SMDC carried out Time Domain EM (“TEM”) on the Esso North claim and completed two additional holes (Roy et al., 1984). Drillhole EN-18 targeted a weak TEM conductor near the east-west conductor. Results of this hole were negative. Drillhole EN-19 targeted a weak northeast trending TEM conductor. It intersected faulting and alteration in the Athabasca sandstone, but no other interesting features, and ended in pegmatite. Drillholes EN-18 and EN-19 are located within ML-5547.

 

Exploration on the Esso North claim was dormant until 1995 (Jiricka et al., 1995), when Cameco resurveyed the area with TEM and located both the east-west conductor and the weak northeast striking conductor. The latter target was tested by one hole, EN-20; it intersected faulted and altered sandstone but no significant radioactivity. The basement consisted of granite, pegmatite, as well as minor pelitic and psammitic gneiss. Radioactivity of up to 379 cps occurred in the basement, but the cause of the conductor was not found. Hole EN-20 is located within lease ML-5547.

 

In 1996 one drillhole, EN-21, was completed that targeted the east-west conductor. This conductor is located just west of ML-5547. No conductive material was intersected, and the basement lithology was granite. Anomalous lead values present were attributed to heavy minerals in the sandstone. The lower 40% of the sandstone column was bleached (Jiricka et al., 1996).

 

Under an agreement dated September 10, 2004, between Roughrider Uranium Corp. (“Roughrider”) and Bullion Fund Inc. (“Bullion Fund”), Roughrider earned a 90% interest in claim S-107243 (and six other claims that became part of Roughrider’s Russell South property) by paying Bullion Fund an aggregate of CA$200k cash. Bullion Fund retained a 10% carried interest. On August 10, 2006, Roughrider became a wholly owned subsidiary of Hathor. A 1.9701% net smelter return on ML-5544 (now part of ML-5547) was payable to original Roughrider shareholders.

 

On April 12, 2007, Terra Ventures Inc. (“Terra”) announced that it had closed a deal with Bullion Fund to acquire an 8% carried working interest in seven claims comprising 56,360 acres in two separate projects located in the Athabasca Basin, Saskatchewan, of which 90% of the remaining 92% working interest was held by Hathor. One of the claims was S-107243. Terra’s interest was to be carried in all respects through to the completion of a feasibility study and the public announcement that the claims will be put into commercial production. Terra paid CA$2.3M to acquire the interest and also paid a finder’s fee of CA$69,000.

 

On March 24, 2008, Terra announced that it had closed its agreement with Bullion Fund to purchase Bullion Fund’s remaining 2% of Hathor’s carried working interest in the Project. This purchase increased Terra’s holding to a 10% carried working interest through to the completion of a feasibility study and the public announcement that the claims will be put into commercial production. The consideration paid by Terra to acquire this interest was CA$2.5M and 3M shares of Terra.

 

5.2

Discovery to Present

 

RRW was discovered by Hathor during the winter drilling program of February 2008. A hydrothermal clay alteration system was intersected in drillhole MWNE-08-10, while high-grade uranium mineralization (5.29% U3O8) over a core length interval of 11.9 m) was intersected in drillhole MWNE-08-12.

 

RRE was discovered during the summer drilling program in September 2009. Hydrothermal alteration was intersected in a number of earlier drillholes during the summer program. High-grade uranium mineralization (12.71% U308 over a core length interval of 28 m) was intersected subsequently in drillhole MWNE-10-170.

 

 

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A third zone, RRFE, was discovered during the winter drilling program in February 2011. The discovery drillhole intersected 1.57 % U3O8 over core length of 37.5 m.

 

On April 18, 2011, Hathor and Terra announced that they had executed a binding letter agreement pursuant to which Hathor would acquire, in an all-share transaction, all of the issued and outstanding shares of Terra. On May 9, 2011, Hathor and Terra announced that they had executed a definitive plan of arrangement agreement (the “Arrangement”) to complete the previously announced merger. The result of the Arrangement was consolidation of 100% ownership of the Project. On August 2, 2011, Terra received approval from 96% of votes cast at a special meeting of its shareholders held in Vancouver. On August 4, 2011, Terra received final approval from the Supreme Court of British Columbia to complete the Arrangement. On August 5, 2011, Hathor and Terra announced the completion of the Arrangement and Terra became a wholly owned subsidiary of Hathor.

 

On December 1, 2011, Rio Tinto announced that it was successful in acquiring Hathor, through a wholly owned Canadian subsidiary, RTCU. On January 11, 2012, RTCU acquired all remaining Hathor common shares making RTCU 100% owners of the Project. After acquiring the Project, RTCU continued to advance the Project, completing substantial pre-development and environmental baseline work including dedicated geotechnical drilling, shaft vs. decline modelling, the establishment of hydrogeological monitor wells, terrestrial and aquatic environmental assessments, heritage assessments, species at risk, and a conceptual reclamation plan.

 

In July of 2013, RTCU submitted an ADEX proposal for consideration to the MOE. The program was intended to initiate the EIS review of the Project, with the Project intended to provide direct data related to the ore and mine development design. The application was partially through the EIS review process, but no official determination was completed.

 

On October 17, 2022, UEC completed the acquisition of 100% of the Project from RTCU for a total acquisition cost of US$150M in cash and shares.

 

5.3

Historical Mineral Resource and Mineral Reserve Estimates

 

There are no Mineral Reserves at the Project. There are no historical Mineral Resources reported using the definitions from S-K 1300. The historical Mineral Resources discussed in the following paragraphs were classified in accordance with the definitions for Mineral Resources in the CIM Definition Standards for Mineral Resources and Mineral Reserves.

 

Mineral Resources for the Project were previously estimated by Scott Wilson RPA Inc., with an effective date of September 1, 2009. Using a cut-off grade of 0.06% U308, Indicated Mineral Resources were reported at 116,000 tonnes at 2.57% U3O8 for 6.58M lbs of U3O8 and Inferred Mineral Resources were reported at 83,000 tonnes at 3.00% U3O8 for 5.47M lbs of U308.

 

The last publicly disclosed historical MRE for the Project was completed by SRK (Table 5-1), with an effective date of November 29, 2010 (RRW) and, May 6, 2011 (RRE). Mineral Resources were estimated for the RRW and RRE deposits only, as the RRFE deposit had not been adequately explored at the time.

 

Table 5-1: Historical Mineral Resource Statement* for the Roughrider Uranium Deposit, Saskatchewan, November 29, 2010 (RRW) and, May 6, 2011 (RRE)

 

Deposit

Category

Tonnage (kt)

Grade
U308%

Metal
U308 (Mlbs)

RRW

Indicated

394.2

1.98

17.2

Inferred

43.6

11.03

10.6

 

RRE

Inferred

118.0

11.58

30.1

 

Total

Indicated

394.2

1.98

17.2

Inferred

161.6

11.43

40.7

 

*CIM Definition Standards have been followed for classification of Mineral Resources. The cut-off grade of 0.05% U308 for RRW and 0.40% U308 was for RRE. U308 price of US$80/1b U308 and metallurgical recovery of 98% assumed. Reasonable prospect for economic extraction assumes open pit extraction for RRW and underground extraction for RRE. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. Totals may not add correctly due to rounding.

 

 

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5.4

Historical Production

 

There is no historical production at the Project.

 

6

GEOLOGICAL SETTING, MINERALIZATION, AND DEPOSIT

 

6.1

Regional Geology

 

The Roughrider project, comprising the RRW, RRE and RRFE deposits occurs in the Athabasca Basin, which covers over 85,000 km2 in northern Saskatchewan and north-eastern Alberta. The saucer-shaped basin contains a relatively undeformed and unmetamorphosed sequence of Mesoproterozoic clastic rocks known as the Athabasca Group Figure 6-1). These rocks lie unconformably on the basement rocks. The basement rocks consist of Archean orthogneisses, which are overlain by, and structurally intercalated with, the highly deformed supracrustal Palaeoproterozoic Wollaston Group (Annesley et al., 2005).

 

The Athabasca Basin is elongated along an east-west axis and straddles the boundary between two subdivisions of the Western Churchill Province. The Rae Subprovince to the west and the Hearne Subprovince to the east. The subprovinces are separated by the northeast trending Snowbird Tectonic Zone, locally known as the Virgin River-Black Lake shear zone in the area of the Athabasca Basin.

 

The Hearne Craton beneath the eastern Athabasca Basin comprises variably reworked Archean basement, which is dominated by granitic domes and foliated to gneissic granitoid rocks with infolded outliers of Paleoproterozoic metasedimentary rocks. The structural and tectonic regime of the area has been influenced strongly by collisional tectonics between the Hearne and Superior Cratons during the early Proterozoic Trans-Hudson Orogen, which occurred approximately 1.9 billion years ago (“Ga”) to 1.77 Ga.

 

Prior to deposition of the Athabasca Group, rocks of the Rae and Hearne Provinces that would later form the basement of the basin rocks experienced a lengthy period of weathering and non-deposition. Consequently, the basal Athabasca stratigraphy is underlain by a regolith of deeply weathered, hematite-stained basement. In places, the preserved regolith can reach a thickness of up to 50 m, but typically less than 10 m.

 

Unconformably overlying the basement rocks is the late Mesoproterozoic Athabasca Group consisting mainly of fluvial clastic sedimentary rocks, which are about 1,400 m thick in the central part of the basin (Ramaekers, 2001). The Athabasca Group comprises eight formations, although in the eastern Athabasca Basin, the Manitou Falls Formation is the only formation present. It is subdivided into four units, from bottom to top, designated MFa to MFd. Lithologies are dominated by fine to coarse-grained, partly pebbly or clay-intraclast-bearing quartz arenites. Minor conglomerates, mudstones, and dolostones also occur.

 

 

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Apart from faulting and local folding associated with thrusting, the Athabasca Group strata are undeformed and unmetamorphosed. Age dating of zircons and diagenetic fluorapatite (SGS, 2003) indicate an age of sedimentary deposition around 1.77 Ga, post-dating the Trans-Hudson Orogeny (circa 1.9 Ga to 1.77 Ga).

 

a06.jpg

 

Figure 6-1:         Geological sketch map of the Athabasca Basin, after Raemakers et al., 2001

 

6.2

Local Geology

 

6.2.1

Hearne Subprovince

 

Four important lithostructural domains have been identified in the Hearne Subprovince: the Eastern Wollaston Domain, Western Wollaston Domain (“WWD”), Wollaston-Mudjatik Transition Zone (“WMTZ”), and Mudjatik Domain (“MD”) (Annesley et al., 1997; Annesley et al., 2005). The basement rocks within the Project are part of the WMTZ. The WWD and WMTZ host all currently producing uranium mines in the area, as well as several other significant uranium occurrences. Certain lithologies, coupled with the deformational history of some domains, have had a strong influence on the location of the Athabasca unconformity-type uranium deposits.

 

The basement rocks in the Project area are structurally complex, comprising steeply dipping Wollaston Group rocks interfingering Archean granitic to granodioritic orthogneisses. Interpretations of aeromagnetic data suggest that several Archean granitic domes dominate the basement geology.

 

Model ages from the orthogneiss indicate a crustal history beginning as early as 3.6 Ga with extensive crust development approximately 2.92 Ga. Pelitic to psammitic supracrustal rocks and mafic granulites, minor quartzites, calc-silicates, marbles and ultramafic rocks, as well as rare oxide, silicate and sulphide facies iron formations occur in narrow arcuate bands throughout, defining the dome-and-basin pattern. In the east, most of these supracrustal remnants have been correlated with the Wollaston Supergroup. Metamorphic grades range from upper amphibolite to granulite facies (Annesley et al., 2002; SGS, 2003).

 

 

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Away from the RRW, RRE, and RRFE deposits within the Project area, the reddish to greenish paleoweathering profile immediately below the sub-Athabasca unconformity is variable in its development but typically extends to a depth of 10 m to 35 m. It comprises a thin (less than 1 m) zone of bleached rock that is typically illitic to kaolinitic in composition. Immediately beneath is a zone of variably developed hematite alteration (red zone). This is separated from the lowermost alteration zone, the chlorite-altered green zone, by a transitional red-green zone, which is a combination of hematite and chlorite alteration. Within the RRW, RRE, and RRFE deposits, the paleoweathered regolith is overprinted and obliterated by hydrothermal alteration. In some cases, however, a ghost clay signature of the kaolinitic zone is still evident.

 

6.2.2

Athabasca Group

 

The property is underlain by 195 m to 215 m of sandstone belonging to the Manitou Falls Collins Member (“MFc”) and Bird Member (“MFb”) of the Athabasca Group. The Read Formation (“MFa”) is missing. The MFc can reach a thickness of 70 to 100 m and is composed of a fine-grained, homogeneous, beige to maroon sandstone. The MFb member ranges from 100 m to 130 m in thickness and comprises a heterogeneous mix of sandstone, pebbly sandstones and conglomerates. The conglomerates include a distinctive “Marker Conglomerate” that can be correlated regionally. The basal conglomerate is not ubiquitous throughout the property; in places immediately overlying the RRW, RRE, and RRFE deposits it may be absent. Typically, in the Project area, the unconformity is approximately 196 m to 221 m below the surface.

 

6.2.3

Surficial Geology

 

The Athabasca Basin and surrounding areas bear the strong imprint of Quaternary glaciation. During the Pleistocene Epoch, the northern half of Saskatchewan was scoured by the Laurentide ice sheet that was generally moving in a south-westerly direction. Glacial erosion of the less resistant sandstone of the Athabasca Basin resulted in an increased sediment load in the ice. Consequently, the glacial drift cover is much more extensive and thicker over the basin than the rest of the shield region (SGS, 2003).

 

The surficial geology within the property is characterized by portions of two low drumlins trending in a northeast direction. The drumlin tops are approximately 20 m to 50 m above local lake surface. The glacial deposits are composed generally of a sandy till that contains primarily reworked Athabasca sand grains, cobbles and boulders.

 

No outcrops have been observed on the property. Drilling has encountered overburden depths between 9 m and 12 m. Near the Project, McMahon Lake has a water depth of between 5 m and 12 m.

 

6.3

Property Geology

 

The RRW, RRE, and RRFE deposits occur in the basal part of the Wollaston Group of the WMTZ. The basement is structurally complex, comprising steeply dipping Wollaston Group rocks dominated by garnet- and cordierite-bearing pelitic gneisses with subordinate amounts of graphitic pelitic gneisses and psammopelitic to psammitic gneisses, and rare garnetites. The pelitic gneiss varies from equigranular to porphyroblastic in texture. The porphyroblasts vary in size up to centimetre-scale and normally comprise red almandine rich garnets when fresh. The gneisses have been intruded by syn- to post-peak metamorphic felsic pegmatites, granites, and microgranites of Hudsonian age. These rocks locally contain up to 400 parts per million (“ppm”) of primary uranium.

 

 

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Proximal to mineralization, graphite in graphitic pelitic gneisses has been consumed by alteration and mineralization; distal to mineralization, the graphite appears to be discontinuous. These two features may help explain the absence of basement-hosted graphitic conductors at the Project.

 

Hydrothermal calc-silicate alteration of the orthogneisses is present locally. The alteration is interpreted to be post-peak metamorphism in age and is probably related to the introduction of the Hudsonian felsic rocks. The sandstone and basement rocks have been subjected to several episodes of brittle deformation, including the brittle reactivation of older ductile shear zones.

 

The primary lithologies at the Project comprise:

 

 

Overburden

 

 

Manitou Falls Formation:

 

 

o

MFC (Collins Member, sandstone)

 

 

o

MFBU (Bird Member Upper, sandstone)

 

 

o

MFBMC (Bird Member Marker Conglomerate)

 

 

o

MFBL (Bird Member Lower, sandstone)

 

 

o

MFBascon (Basal Conglomerate)

 

 

Wollaston Supergroup:

 

 

o

WOLF (Felsic Pelitic Gneiss)

 

 

o

WOLM (Mafic Pelitic Gneiss)

 

 

o

WOLG (Graphitic Pelitic Gneiss)

 

The stratigraphic column for the Project and an example long section are presented in Figure 6-2 and Figure 6-3, respectively.

 

a07.jpg

 

Figure 6-2:         Stratigraphic Column of the Project

 

 

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a08.jpg

 

Figure 6-3:         Long Section of the Project geological model (Section Location on Figure 6-6)

 

6.3.1

Structural Geology

 

All structural orientations referred to in this TRS are in the format of dip°/dip direction°.

 

Macro-scale geophysical, geological and structural modelling suggests that the Project is crosscut by a large number of structures. The two main structures to note are:

 

 

1.

An east-west striking, north-dipping fault (approximately 75°/010°) with a reverse sense of slip and a maximum throw of approximately 20m.

 

 

2.

A north-east striking, northwest-dipping fault (approximately 55°/295°) with ambiguous throw, possibly suggesting strike-slip movement. This is locally referred to as the ‘Midwest Trend’, that hosts the Midwest and Midwest A uranium deposits on the adjacent mineral leases, to the south of the Project.

 

The crosscutting relationship between these two faults is also unclear, suggesting that they were likely active at the same time. The north-up apparent reverse sense of movement on the east-west fault suggests sinistral movement on the north-east fault if they were both active in the same kinematic regime, which is the same sense of movement as inferred for north-east structures at Wheeler River (Pope, 2012).

 

The magnetic images support this interpretation, with two major project to regional scale magnetic lineaments parallel to the east-west and north-east striking faults (Figure 6-4). However, it is probable that the magnetic lineaments are caused by larger-scale precursor basement features rather than the low-displacement faults themselves.

 

 

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The other project-scale feature which is important to mineralization is the WOLG lithology of the Wollaston Group, which forms the core of the larger WOLM. Uranium mineralization in the Project deposits is proximal to the WOLG, though not necessarily within it. The WOLG is also a useful marker horizon and modelling it has assisted in defining the orientation of layering in each deposit. Layering orientation varies; however, it has an average project-scale orientation of approximately 60°/000°. Given the apparent reverse sense of displacement on the steeper east-west striking fault, layering is well oriented for reactivation in shear or possibly mixed-mode extension depending on the local stress orientation at failure. The WOLG also appears to be sinistrally offset by the north-east striking fault, which supports the interpreted kinematics of this fault. Any offset of the WOLG by the east-west striking fault is ambiguous due to the limited drilling data in the hanging wall of the fault.

 

a09.jpg

 

Figure 6-4:         Interpretation of macro-scale lineaments on a first vertical derivative ground magnetics image

 

6.3.2

Mineralization

 

Uranium deposits in the Athabasca Basin can be broadly subdivided into two styles: unconformity-hosted (occurring at or above the unconformity) and basement-hosted. The Project is characterized by basement hosted mineralization, which is typically hosted in faults (often referred to as veins when hosting mineralization) which must have been open to hydrothermal fluid flow at the time of mineralization and thus were likely active at some stage post basin formation.

 

Uranium mineralization at the Project is highly variable in thickness and style in all zones. High grade uranium mineralization occurs primarily as structurally controlled, medium- to coarse-grained, semi-massive to massive pitchblende with what has been termed worm-rock texture, and texturally complex redox controlled mineralization. This high-grade uranium mineralization is intimately associated locally with lesser amounts of red-to-orange coloured oxy-hydroxillized iron oxides. Yellow secondary uranium minerals, probably uranophane, are present locally as veinlets or void-filling masses within the high-grade primary mineralization (Figure 6-5).

 

Lower grade mineralization occurs as either disseminated grains of pitchblende, fracture-lining, or veins of pitchblende. Galena occurs in a number of habits and is variably present in the uranium mineralization. The lead is presumed to have formed from the radioactive decay of uranium. Veinlets of galena are up to 5 mm thick and either crosscut massive pitchblende, as anhedral masses (less than 1 mm in size) interstitial to the massive pitchblende, or as fine-grained, sub-millimetre-scale disseminated flecks of galena omnipresent throughout mineralized drill core. In all cases, the galena appears to have formed later than the uranium mineralization.

 

Mineralization is in general terms, mono-metallic (uraninite) in composition. In the RRW deposit, visible, crystalline nickel-cobalt sulph-arsenides are present locally. At the RRE and RRFE deposits, the presence of nickel-cobalt sulph-arsenides is rare. The exact relationship of these elements to uranium is variable and still unclear at this time. However, unlike many unconformity-type uranium deposits in the Athabasca Basin, variable amounts of copper mineralization are present within the Project deposits.

 

 

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The zones of uranium mineralization at the Project vary in size and depth below the unconformity:

 

 

1.

RRW - is 200 m long and up to 50 m wide, and occurs at the unconformity down to approximately 50 m below the unconformity (Figure 6-6 and Figure 6-7);

 

 

2.

RRE - is 100 m long and up to 50 m wide, and occurs from 20 m below the unconformity down to approximately 120 m below the unconformity (Figure 6-6 and Figure 6-8; and

 

 

3.

RRFE - is 75 m long and up to 50 m wide, and occurs from 100 m below the unconformity down to approximately 220 m below the unconformity (Figure 6-6 and Figure 6-9).

 

a10.jpg

 

Figure 6-5:         Uranium mineralized drill core from MWNE-085 from 252.2 m to 258.1 m

 

a11.jpg

 

Figure 6-6:         Plan view of the Project Uranium Deposits

 

 

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a12.jpg

 

Figure 6-7:         Cross Section W-W through the RRW Deposit

 

a13.jpg

 

Figure 6-8:         Cross Section E-E through the RRE Deposit

 

 

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a14.jpg

 

Figure 6-9:         Cross Section FE-FE through the RRFE Deposit

 

6.3.3

Alteration

 

Strong alteration has been intersected in the Athabasca sandstone and in the highly deformed basement rocks. Alteration within the overlying Athabasca Group includes intense bleaching, limonitization, desilicification and silicification, hydrothermal hematization, and illitic argillization. None of the primary hematite in the sandstone is preserved within the zone of bleaching and alteration.

 

Away from the RRW, RRE, and RRFE deposits, the background dominant clay species within the Athabasca sandstone is the regional dickite assemblage; within the Project, it is illite. However, the extent and intensity of the alteration in the Athabasca sandstone at the RRE is less than that above the RRW. In contrast, however, the illite abundance in the sandstone above the RRFE, the deepest of the three zones, is the stronger than at seen above either the RRE or RRW. Consequently, this variation cannot be simply due to the deeper depth of mineralization at the RRE. Currently, drilling has not identified the cause of the illite alteration patterns observed at the RRE deposit.

 

In basement rocks, alteration extends to at least 180 m below the unconformity and up to 115 m laterally away from the known mineralization. It varies in strength, ranging from weak to intense where massive clay has completely replaced the protolith. Clay alteration is predominantly white to pale green in colour and illitic in nature and extends downward into the Archean rocks. Hematite alteration within the basement rocks is spatially restricted in distribution and is commonly associated with high-grade mineralization. The hematite is variably altered on a local scale to a limonitic iron oxide.

 

6.4

Deposit Type

 

The deposits of the Project are interpreted to be Athabasca unconformity-associated uranium deposits, or some variant thereof. Two end-members of the unconformity-associated uranium deposit model have been defined (Quirt, 2003). A sandstone hosted egress-type model (one example is the Midwest A deposit south of the Project) involves the mixing of oxidizing sandstone-hosted brine with relatively reduced fluids from the basement in the sandstone. Basement-hosted, ingress-type deposits (one example is the Rabbit Lake deposit) formed by fluid-rock reactions between an oxidizing sandstone brine and the local wall rock of a basement fault zone. Both types of mineralization and associated host-rock alteration occur at sites of basement—sandstone fluid interaction where a spatially stable redox gradient, or front, was present. Although either type of deposit can result in high grade pitchblende mineralization with up to 20% pitchblende, they are not physically large.

 

 

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Egress-type deposits tend to be polymetallic (uranium-nickel-cobalt-copper-arsenic) and typically follow the trace of the underlying graphitic pelites and associated faults along the unconformity. Ingress-type, tend to be mono-minerallic uranium deposits, and can have more irregular, structurally controlled geometry.

 

The RRW, RRE, and RRFE deposits at the Project are interpreted to be ingress types, although minor sections of the RRW mineralization does extend above the unconformity and the mineralization is polymetallic compared to the RRE and RRFE deposits.

 

7

EXPLORATION

 

7.1

Exploration

 

This sub-section summarizes the exploration work completed at the Project, other than exploration drilling, which is summarized in Section 7.2. Exploration work conducted at the Project includes a number of geophysical (EM, magnetic, gravity, seismic and resistivity) surveys completed by a number of different contractors between 2005 and 2009 and relogging of available historical drill core in 2006 by Hathor.

 

7.1.1

2005 GEOTEM and Aeromagnetic Survey

 

Fugro Airborne Surveys (“Fugro”) completed a 124-line kilometre airborne electromagnetic (GEOTEM) and aeromagnetic survey of the Project area (ML-5544) in 2005 (Robertshaw, 2006). The survey did not detect any graphitic-type basement conductors within the Project area. Three weak and short electromagnetic conductor segments, thought to represent fault zones extending through the Athabasca Group sandstone, were identified.

 

7.1.2

2006 Logging of Historic Drill Core

 

In the fall of 2006, Hathor relogged available historic drill core from the Project. Detailed lithogeochemical and clay speciation studies of the historic drill core were also undertaken. These data were invaluable in identifying drill target areas.

 

7.1.3

2007 Aeromagnetic Survey

 

Goldak Airborne Surveys carried out an 850-line km tri-axial aeromagnetic survey in 2008. This survey provided a high-quality product with sufficiently broad coverage to assess the geological and structural setting of the Project, in relation to significant nearby features such as the uranium deposits of the adjacent Midwest Joint Venture (“MWJV”) owned by Orano (69.16%), Denison Mines (25.17%), and OURD (Canada) Co., Ltd. (5.67%). Within the MWJV property, prominent structures trend 30°, 50°, and 95° (Robertshaw, 2008).

 

7.1.4

2007 Tempest and Magnetic Gradiometer Survey

 

Fugro completed a 395-line km airborne EM (“TEMPEST”) and magnetic gradiometer survey in 2007. The survey was aimed at identifying sandstone alteration features using an early time EM channel data. Results showed a 1 km wide region of early channel conductivity that coincided with a group of anomalies from ground resistivity surveys, including a low resistivity zone that is interpreted to identify the hydrothermal alteration associated with the Project deposits.

 

 

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7.1.5

Photo-Relogging

 

During a series of site visits by G. Broadbent and A. Pope (of RTCU) in 2012 and 2013, it was suggested that the felsic basement units originally logged as granitoid gneisses were actually semi-pelitic gneisses, concordant with the mafic pelitic gneisses rather than a series of complex, metamorphosed granitoid intrusions. These observations were consistent with other deposits in the Athabasca Basin, particularly in the Cameco logging scheme. A former Cameco geologist, T. Perkins, was contracted by RTCU in 2013 and suggested that all crucial holes be re-logged according to the Cameco logging scheme.

 

A photo re-logging program was completed in April 2014 by contract geologists from Big Rock Exploration. The scope of re-logging program was focussed on drillholes within the immediate RRW, RRE, and RRFE deposit areas. Regional exploration holes were not re-logged at this time. The results of this re-logging did not change the overall interpretation of the deposit. In general, rocks previously logged as granitoid gneisses were re-logged to Arkosic and Semipelitic gneisses. The more mafic units were easier to distinguish visually and were rarely changed from the original logs.

 

A number of difficulties were noted by the contractors during the re-logging program associated with the intense alteration of the rocks. Alteration near the unconformity, referred to as paleoweathering, often obscures original texture and mineralogy, making it difficult or impossible to accurately identify the original lithology. Hydrothermal alteration also overprints texture and mineralogy, particularly in close proximity to mineralization. Seeing the core in person lends some degree of confidence in the interpretation of the protolith but can be quite challenging when logging by photos.

 

7.2

Exploration Drilling

 

Exploration drilling data available at the Project has been collected through multiple phases of drilling, by Asamera (1978), Hathor (2007 to 2012) and Rio Tinto (2012 to 2016) totalling 665 drillholes for 228,184.9 m (Table 7-1 and Figure 7-1). In addition to drill phases focussed on defining uranium mineralization at RRW, RRE, and RRFE, a significant amount of drilling has been completed through the Project area testing various targets (termed “RECON” in Table 7-1).

 

Table 7-1:         Project Drilling Summary by Year, Company, and Deposit

 

Year/Company

RECON

RRE

RRFE

RRW

Total

Holes

Metres

Holes

Metres

Holes

Metres

Holes

Metres

Holes

Metres

1978

Asamera

10

10

2,347.7

2,347.7

2

2

473.0

473.0

2

2

502.5

502.5

   

14

14

3,323.2

3,323.2

2007

3

906.0

           

3

906.0

Hathor

3

906.0

           

3

906.0

2008

Hathor

12

12

4,461.0

4,461.0

       

30

30

11,571.2

11,571.2

42

42

16,032.2

16,032.2

2009

Hathor

37

37

11,002.9

11,002.9

6

6

2,446.0

2,446.0

   

119

119

38,413.4

38,413.4

162

162

51,862.3

51,862.3

2010

Hathor

   

72

72

20,016.0

20,016.0

13

13

4,323.9

4,323.9

80

80

21,426.6

21,426.6

165

165

45,766.5

45,766.5

2011

Hathor

12

12

4,703.2

4,703.2

21

21

5,476.1

5,476.1

48

48

17,815.3

17,815.3

4

4

1,252.3

1,252.3

85

85

29,246.9

29,246.9

2012

Hathor

Rio Tinto

7

3

4

3,686.4

1,602.4

2,084.0

4

 

4

954.0

 

954.0

28

1

27

13,465.2

456.0

13,009.2

   

39

4

35

18,105.5

2,058.4

16,047.2

2013

Rio Tinto

75

75

33,578.1

33,578.1

7

7

1,862.0

1,862.0

12

12

4,144.2

4,144.2

1

1

396.0

396.0

95

95

39,980.2

39,980.2

2014

Rio Tinto

47

47

17,305.9

17,035.9

1

1

477.4

477.4

10

10

4,344.0

4,344.0

   

58

58

22,127.2

22,127.2

2016

Rio Tinto

2

2

834.8

834.8

           

2

2

834.8

834.8

Grand Total

205

78,825.9

113

31,704.5

113

44,595.0

234

73,059.5

665

228,184.9

 

 

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b03.jpg

 

Figure 7-1:         Plan view of the Project drillhole collars by Company

 

7.2.1

Drilling Methodology and Procedures

 

All drilling at the Project has been completed using diamond coring method. Procedures for data collection were developed and implemented by Hathor and adopted by Rio Tinto in 2012, with minor adjustments and additions. The procedures used through all drilling campaigns are well documented in standard operating procedures and manuals.

 

Diamond drilling at the Project has been completed using primarily Zinex A5 Diamond drills, and to a lesser extent, Longyear LF-70 drills. These drilling rigs have depth capabilities of 600+ m. The drills were configured depending on the drilling location and season. Winter drill programs utilize drills mounted on metal skids to allow mobilization between drill collar sites. Summer drill programs have utilized a combination of skid-mounted, helicopter-portable and barge-based drill rigs (Figure 7-2). Both the skid-mounted and helicopter-portable rigs can complete drillholes ranging in dip from vertical to 45°. In contrast, the barge-based drill rig is limited to vertical holes. Only drilling at the RRW deposit employed barge-based drill rigs due to the location under South McMahon Lake.

 

 

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Wireline coring tools were used in all cases, with the majority of coring completed at NQ (47.0 mm diameter) and HQ (63.5 mm diameter). NQ-sized holes were cased NW into bedrock and drilled NQ to depth, HQ-sized holes were cased HW and drilled HQ sized to depth. In rare instances, for example hole MWNE-10-607, NQ-sized holes were reduced to BQ-sized (36.5 mm diameter) holes due to encountering severely bad ground.

 

RRW and RRFE is drilled on generally 10 m spaced sections, and 10 m to 15 m spacings on section for RRW and RRFE respectively. RRE is drilled at slightly wider, 10 m to 20 m spacings. Vertical and inclined drillholes have been used to target the mineralization in each zone, although the vast majority of holes are steeper than 70°. Drilling has largely been designed to intersect the mineralized zones at an angle roughly perpendicular to the local mineralization trend, although, due to the complex structural framework at each deposit, intersection thicknesses are rarely true thickness (Examples in Figure 6-7 to Figure 6-9).

 

All mineralized and non-mineralized holes within the vicinity of the RRW, RRE, and RRFE deposits were cemented from bottom to top. The top 30 m of all non-mineralized holes outside the deposit areas are cemented as per Saskatchewan MOE regulations.

 

a16.jpg

 

Figure 7-2:         Drilling operations at the Project, A: Barge Mounted A5 Drill, B: Helicopter Transported A5 Drill, C: Skid Mounted A5 Drill

 

 

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7.2.2

Drillhole Surveys

 

Holes are located on a grid and collar sites are surveyed by differential GPS using NAD83 and UTM Zone 13. Land-based drillhole locations are marked with a tagged picket.

 

Downhole surveys were completed either with, or a combination of, Reflex EZ-Shot or a Reflex Gyro instrument. The Reflex EZ-shot is a single point instrument and is used to obtain dip and azimuth measurements at 21 m intervals down the hole with an initial test taken 6 m below the casing and a final test at the bottom of the hole.

 

The Reflex Gyro is a continuous multi-point instrument, which is not affected by magnetics and allows measurements to be made through the casing. It is used to obtain dip and azimuth measurements at 3 m intervals through the casing and at 5 m through the rest of the hole and a final test at the bottom of the hole. The reflex Gyro system was employed starting in the winter of 2010.

 

7.2.3

Geophysical Surveys

 

At the completion of each drillhole, downhole radiometric surveys were performed down the drill string at a speed of 15 m per minute down the hole and 5 m per minute up the hole using a Mount Sopris winch and Matrix logger interface board.

 

Unmineralized or weakly mineralized holes were surveyed using a single crystal (Sodium Iodide, or Nal) gamma probe that included the following tools: SN169, SN276, SN439, SN3858, SN4171, SN4172 and SN4178. Holes with an estimated uraninite content greater than 3% were surveyed with a downhole triple (one Nal and two Geiger-Mueller tubes) gamma probe that included the following tools: SN3705, SN4484, SN3877 and SN4410.

 

The Saskatchewan Research Council (“SRC”) provides downhole calibration test pit facilities in Saskatoon, Saskatchewan, for the calibration of downhole gamma probes. These test pits consist of four variably mineralized holes with maximum grades of 0.61%, 0.30%, 1.35%, 4.15% uraninite. The probes used for the surveys were calibrated at the SRC test pit facility and allow for grade thickness estimates to be made from the instrument readings and grade estimates equivalent to U308 (“eU3O8”) to be calculated.

 

However, it must be noted that, in general, no calibrations were available for high-grade mineralization (more than 5% U308) as Hathor and RTCU were not able to maintain an open, cased hole in such material and the highest grade SRC test pit available is 4.15% U308. Consequently, no eU3O8 grades are generally reported.

 

eU3O8 values were used to guide drilling and sampling operations only. Only U308 chemical assays have been used to construct the mineralization models and inform the grade estimates supporting the MRE reported here.

 

7.2.4

Drill Core Logging

 

At the drill rig, the core was removed from the core barrel by the drillers and placed directly into wooden core boxes. Individual drill runs were identified with small wooden blocks, onto which the depth in metres was recorded. The core was transported either by the drill contractor or company personnel to the fenced core-logging facility (the Project Core Camp) on the Project’s property.

 

All drill core logging and sampling was conducted by Hathor or RTCU personnel. As per health and safety protocols, and to avoid any radioactive cross-contamination, all core boxes were scanned with a hand-held scintillometer to assess whether they were “hot” or “cold” in nature upon arrival at the Project Core Camp. The definition of “hot” core boxes are those that yield an “in-box” reading of greater than 500 cps. At this point, hot core was placed directly into the “hot shacks” and cold core (less than 500 cps) was placed in “cold shacks”.

 

 

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Geologists logged the hot and cold drill cores by recording their observations in a database. The logging included observations of radioactivity, lithologies, mineralization, alteration, friability, maximum grain size in the sandstone, fracture density, structural information, core loss/recovery, and a descriptive log of the core. Upon completion of each drillhole, the data was transferred into the master database. All core trays were marked with aluminium tags as well as felt-tip marker.

 

All mineralized core was carefully scanned with a hand-held Gamma Radiation Detector (Exploranium GR-110G or RS-120 Super SCINT) by removing each piece of drill core from the ambient background, noting the most pertinent reproducible result in cps, and carefully returning it to its correct place in the core box. These data, in conjunction with the downhole gamma probe data were used to guide split-sampling.

 

After selection of the intervals to be split-sampled, an aluminium tag or a hexagonal plastic core marker with the same number was stapled into the core box at the beginning of the sample interval.

 

Detailed photographic records of each drillhole were kept. All drillholes were photographed from just above the marker conglomerate (approximately 160 m vertical depth below surface) to the end of the drillhole prior to sampling. Mineralized sections were additionally photographed with the sample tags in place prior to split sampling.

 

7.2.5

Drill Core Sampling

 

To determine the content and distribution of uranium, and other major, minor and trace elements, as well as clay minerals (alteration), several types of samples are routinely collected from drill core from RRW, RRE and RRFE, including:

 

 

Composite geochemical samples of sandstone and basement rocks;

 

 

Systematic split geochemical samples of mineralized (radioactive) drill core;

 

 

Point geochemical samples of basement rock;

 

 

Dry specific gravity (“SG”) samples; and

 

 

Clay alteration species (PIMA) samples.

 

All geochemical core samples are tracked by two-part SRC ticket books. One tag goes with the sample for assay and the other tag is kept with the geologist’s records.

 

Composite Geochemical Samples

 

Hathor and Rio Tinto collected a suite of composite sandstone samples down the entire sandstone column from each drillhole. From the top of the sandstone column to a downhole depth of approximately 180 m, the sandstones were sampled by 10 m composite chip samples. For the next 20 m, a total of 4 m to 5 m samples were collected, and for the final approximately 10 m up to the unconformity (approximately 210 m vertical depth below surface), 1 m to 2 m composite samples were taken. Immediately below the unconformity, a 1 m composite sample was collected from the paleo-weathered material.

 

 

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In the case that mineralization or very strong alteration reached the sandstone column, this sampling approach was superseded by the collection of systematic split samples. All composite samples were sent to the SRC laboratory for preparation and assaying.

 

Split Samples

 

Hathor and RTCU assayed all the cored sections through mineralized intervals. Sampling of the holes for assays was guided by the radiometric logs and readings from a hand-held scintillometer. Initial drillholes (up to MWNE-08-19) were sampled using variable sample lengths between 0.2 m and 1.0 m. All drillholes after MWNE 08-19, were sampled using either 0.5 m or 1.0 m sample lengths. In areas of extreme core loss sample intervals may extend locally to 3 m.

 

Barren samples were taken to shoulder both ends of mineralized intersections. Shoulder sample lengths were at least 1 m on either end but may be significantly more in areas with strong mineralization. All cores were split with either a handheld wheel-type splitter or a hydraulic core splitter according to sample intervals marked on the core. One half of the core was preserved in the box for future reference and the other half was bagged, tagged, and sealed in a plastic bag. The bags of samples for geochemical or clay analyses were placed in large plastic pails and sealed for shipping. Bags of mineralized samples were sealed for shipping in metal or plastic pails depending on their radioactivity. Mineralized samples were shielded by placing non-mineralized or weakly mineralized samples around the inner margins of the pail.

 

Point Samples

 

Point samples, normally 10 cm to 15 cm in length, were taken: selectively through the paleoweathering profile; systematically at 3 m or 5 m intervals through altered basement rock which is not split-sampled; and selectively through fresh basement rock. This sampling aids in the identification and understanding of background metal distribution.

 

Specific Gravity Samples

 

In winter 2009 (MWNE 09-43A onwards), a process to determine the dry SG on un-split core samples from various host rocks and mineralization styles was instituted. These samples were dried for four days in storage at the core logging shacks. Dry SG was determined by the water immersion methodology. Dried core pieces were weighed, wrapped in plastic film, which was heated to make tight seal around the core, and then weighed suspended in water.

 

For mineralized core, dry SG was determined for 50 cm core lengths to correspond to the sample interval. Between one and three 50 cm core lengths were selected for every 10 m of mineralized core. For unmineralized core, dry SG was determined for 10 cm core lengths roughly every 20 m throughout each drillhole.

 

Locations of each density sample were marked in the boxes to avoid core mix ups while measurements are taken. Prior to each measurement of the unknown samples, three in-house standards were measured and checked to ensure results were within +/-1% of the expected value of the standards.

 

PIMA Sampling

 

For the determination of clay alteration species in the sandstone column, Hathor (2007 to 2011) collected samples for analysis using the PIMA analyzer. Throughout the sandstone section, a 2 cm to 3 cm chip sample of core was collected every 5 m or 10 m. Near the unconformity, the sample interval was shortened as needed. PIMA samples were also collected as needed throughout the altered basement rocks, normally at 3 m or 5 m intervals.

 

 

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7.2.6

Core Recovery

 

The mineralized rock at the RRW, RRE, and RRFE deposits is predominantly highly altered basement gneisses. Locally, the core can be broken and blocky, but recovery was generally good with recovery of 95%, 96%, and 99% within the modelled mineralized volumes for the RRW, RRE, and RRFE respectively.

 

There are localized intervals of up to 10 m with only 80% recovery. Intervals where core loss was greater than 50% over 3 m runs were rare. There is some evidence that higher-grade intervals are more prone to lower than average recovery, although this is supported by very few samples (Figure 7-3). SRK have investigated the few instances of very high grades (>15% U308) and low recovery (<80%) by reviewing the downhole radiometric survey information corresponding to these intervals and found the grade values are supported by high-value radiometric data, suggesting that the intervals are indeed high-grade (Figure 7-4).

 

In general, the recovery within the Wollaston group basement rocks is relatively high compared to the Manitou Falls formation. There is a notable Project-wide decrease in recovery at the unconformity associated with increased alteration (Figure 7-5). This decrease in recovery at the unconformity does not affect the modelled mineralization but is indicative of the decreased rock quality.

 

Due to the high rate of core recovery within the mineralized zones, SRK considers the chemical assays to be unbiased in relation to the drilling recovery. In rare cases, some mineralization may have washed out during the drilling process. In instances of high-grade mineralization with poor recovery, close correlation of the downhole radiometric data and the observed chemical analyses was observed which provides confidence in the tenor of mineralization whilst recognizing there may be some differences in absolute values.

 

a17.jpg

 

Figure 7-3:         Recovery vs. U308% grade within modelled mineralization

 

 

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Figure 7-4:         Cross section of RRW modelled mineralization (red shaded solids) with drillholes coloured by recovery (legend inset upper right) and radiometric probing CPS trace (red lines) on the left of the hole trace and U308% geochemical assays right of the drillhole.

 

a19.jpg

 

Figure 7-5:         Contact analysis plot of recovery versus distance from the unconformity

 

 

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7.2.7

Hydrogeologic Characterization

 

Background and Overview

 

The Project deposits, as with many other uranium deposits in the Athabasca Basin, are hosted around and below an unconformity between the Athabasca Group and the underlying basement rocks (metasediments and granites). The hydrogeological stratigraphy of the Athabasca Group is relatively well understood from nearby operations and is characterized by highly water-bearing sandstones and conglomerates. Furthermore, the unconformity between the Athabasca Group and the underlying basement rocks itself is also a high permeability conduit for inflow.

 

These units have typically previously been either avoided or isolated from the main mining areas using ground freezing by other mine operators in the basin. The use of ground freezing in this geological scenario is well established and has been effectively implemented on similar uranium deposits in the area such as Cigar Lake as well as McArthur River, both operated by Cameco. The Cigar Lake mine was flooded in 2006, prior to the adoption of ground freezing in this region, when mining encountered unmanageably high inflows within basement rocks near the unconformity.

 

Type and Appropriateness of Hydrogeological Testing and Sampling

 

Hydrogeological investigations at the Project began with RTCU in July 2012 and continued to 2016. Hydrogeological characterization was undertaken by way of drilling and packer testing at six locations in and around the RRE and RRFE deposits as well as adjacent to the deposits (Figure 7-6). Single-well packer tests were performed within the Athabasca Sandstone and underlying basement rock over 75 intervals at seven hole locations. Test interval lengths ranged from around 22 m to 45 m with three longer interval tests (up to 121 m) completed in the deeper basement rock at the shaft exploration hole.

 

Multilevel vibrating wire piezometers (with up to six pressure transducers per string at depths of between 290 mbql and 444 mbgl) together with nested standpipe piezometers (three monitoring intervals per location installed within each of the Athabasca Sandstone, unconformity, and within the crystalline basement rock) were installed at six locations.

 

Ongoing monitoring during by RTCU (2012 to 2016) included water level measurements and water quality sampling from the monitoring wells on a quarterly basis as well as continuous water level monitoring from the vibrating wire piezometers recorded twice daily. No monitoring has been undertaken in the unconsolidated (overburden) deposits. Quality control (“QC”) and quality assurance (“QA”) procedures for water quality sampling were not provided to SRK.

 

SRK considers the scope of hydrogeological testing, monitoring and sampling to be appropriate for the current level of study. However, coverage of the hydrogeological studies is focussed on the RRE and RRFE deposits. RRW deposit lies underneath a lake which has prevented installation of instrumentation or hydrogeological testing in this area to date. It is understood that RTCU had planned to potentially explore RRW with angled holes drilled from the shore of the lake but this was not completed. Furthermore, no hydrogeological characterization of the shallow unconsolidated (overburden) deposits have been undertaken at the Project site. This was planned to be undertaken prior to shaft sinking and has not completed. Finally, no hydrogeological studies have been undertaken with respect to a potential tailings storage facility area and this will need to be addressed as the Project advances.

 

RTCU identified the possibility that groundwater samples may be impacted by cement grout in the exploration holes, resulting in unrepresentatively high pH values. This calls into question how representative groundwater samples collected to date may be of the formation groundwater chemistry. This will need further investigation and likely additional confirmatory groundwater sampling. Regardless, ongoing baseline groundwater chemistry monitoring will be required going forwards at the site to adequately confirm baseline groundwater characteristics.

 

 

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a20.jpg

 

Figure 7-6:         Plan view (top) and long section looking north (bottom) of Hydrogeological holes drilled at the Project

 

Results and Interpretation

 

Packer testing in the Athabasca Sandstone (generally excluding the basal conglomerate, which was tested with the unconformity and some basement rock) resulted in a geometric mean hydraulic conductivity of 3E-7 m/s. This result compares favourably with other nearby deposits such as the Midwest Project to the south of the Project. It should be noted, however, that when considering risk of sudden inflows to the underground mine, geometric mean hydraulic conductivity may not be the best indicator of risk. Rather, an estimate of the 90th percentile hydraulic conductivity is more relevant in this case. SRK has only been provided with the summary reports and not the underlying raw permeability data collected and therefore cannot comment on the range and statistical distribution of hydraulic conductivity results. This is a material limitation as it limits the QP’s ability to comment on the risk of the mine intersecting low frequency, high permeability geological structures that are a key driver behind sudden inrush.

 

Testing in the crystalline basement rock, away from the Project deposits, produced a geometric mean hydraulic conductivity 2E-8 m/s (i.e., one order of magnitude lower than the Athabasca Sandstone). Geometric mean hydraulic conductivity in the altered crystalline basement rocks associated with the Project deposits was 2E-9 m/s (i.e., one order of magnitude lower than that of the unaltered crystalline basement rock and two orders of magnitude lower than the Athabasca Sandstone). Packer testing results showed that the permeability of the basement rock tends to be higher away from the altered zones, which are more clay rich and less fractured.

 

 

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Testing performed across the unconformity (including the basal conglomerate) showed a geometric mean hydraulic conductivity very similar to the Athabasca Sandstone. It is understood that RTCU were planning to undertake additional packer testing over shorter intervals, isolating the basal conglomerate, in order to get a better estimate of the specific hydraulic properties of this unit but SRK understand that this was not completed.

 

In the absence of any hydrogeological testing within the unconsolidated overburden, RTCU considered the hydraulic conductivity data from the nearby Midwest Project where the overlying sandy tills and alluvial sands indicate a permeability of between around E- 6 m/s and E-5 m/s (i.e. 1 to 2 orders of magnitude higher than the Athabasca Sandstone).

 

Initial studies by RTCU suggested that the bedrock hydrogeological unit is unconfined but recommended further testing to confirm. This observation is based on a lack of strong vertical hydraulic gradients observed in the monitoring wells. These observations require further confirmation as they are critical to the understanding of risk of inflows from the Athabasca Sandstone into a potential underground mine. Horizontal hydraulic gradients, from the data collected, have also been relatively inconclusive and variable. Vibrating wire piezometer data collected between 2012 and 2013 shows a general decline in water levels during this period of up to 1 m, likely indicating equilibration to some extent with the surrounding formation, but also showing a slight seasonal variation of up to 1 m. Analysis of the data collected to date has been fairly high level and more in-depth detailed analysis of hydrogeological data was recommended by RTCU in 2014 and is still required.

 

Groundwater Modelling and Inflow Estimation

 

Based on the documents provided for SRK to review, limited analysis of hydrogeological data collected to date has been undertaken and no numerical groundwater modelling has been completed. Estimates of groundwater inflows to a potential mine were produced in support of the 2011 PEA (SRK, 2011) based on similar nearby deposits and hydrogeological data from the wider Athabasca Basin and not on site-specific data.

 

Water Management Infrastructure Considerations

 

Ground freezing is included in the 2011 PEA (SRK, 2011) designs around the mineralized zones prior to level development and production. This concept is based on knowledge from nearby similar deposits and would need to be validated for the site-specific conditions by way of additional geothermal and hydrogeological studies as the Project progresses. Dedicated freezing drifts would be required on the perimeter of the mineralized zones from where freezing holes can be drilled. Brine is then circulated through these holes at low temperatures until the surrounding rock mass is frozen. Residual groundwater inflows into the underground mine with ground freezing barriers in place were expected to be relatively low.

 

In the RRE and RRFE deposits there is no mineralization above the unconformity, and Mineral Resources are within the basement rocks, 20 m and greater below the unconformity. Any freezing requirements for these deposits is anticipated to be limited to volumes adjacent to the unconformity. Freezing would be required to access mineralization within the basement rocks adjacent to the unconformity. This volume, within 20 m of the unconformity, is discussed in Section 11.4 as a cut and fill mining scenario.

 

In the RRW deposit, a portion of mineralization is located above the unconformity. To recover this, there would likely be a requirement for a more complex arrangement of freezing to extend well above the unconformity, including at least one freeze drift located in the lower Athabasca sandstones. SRK has not reported mineral resources above the unconformity for the Project.

 

 

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Expected inflows can be considered in terms of routine or average groundwater inflows as well as non-routine or unexpected significant inflows due to intersection of unforeseen high permeability preferential flow zones. Estimates of both types of inflows are important and should be considered separately for dewatering infrastructure design purposes. For example, unexpected nonroutine inflows would be managed through standby pumping capacity and contingency sump storage whereas a duty system should be designed for efficient pumping of the ongoing average inflows.

 

Study Level and Suitability

 

SRK consider the work undertaken to date to be generally suitable for an advanced exploration stage. Hydrogeological characterisation work undertaken would likely be sufficient to inform a Scoping Study or potentially a Pre-Feasibility study design for the RRE and RRFE deposits. However, there are gaps in the following aspects of hydrological studies undertaken to date:

 

 

Hydrogeological characterisation in and around the RRW deposit;

 

 

Regional baseline groundwater and surface water monitoring and characterization studies as well as a water impact assessment in support of environmental studies;

 

 

Hydrogeological characterization of the shallow unconsolidated (overburden) deposits; and

 

 

Hydrogeological characterization for a potential tailings storage facility area.

 

In terms of engineering design, the 2011 PEA (SRK, 2011) provides outline designs and costs for required water management infrastructure, including ground freezing requirements, with some notable gaps including water treatment infrastructure requirements. SRK are not aware of any work to advance the design and costing beyond a PEA level.

 

Key Risks, Limitations and Recommendations

 

There is an ongoing risk to the Project of connection between future mine workings and the Athabasca Sandstone, unconformity, or the overlying surface water system. This could take place either through connection with a geological structure or via exploration drillholes. The risk of hydraulic connection has been investigated to some degree at RRE and RRFE deposits through packer testing and VWP installation but not at RRW deposit. Therefore, further hydrogeological test work is required at RRW, likely piggybacked onto future resource or geotechnical drill programs in this area, noting that the overlying lake will complicate the logistics to some extent. Further work is also required to characterise the shallow unconsolidated (overburden) deposits.

 

The risk of water impacts from the Project have not been fully evaluated to date. Baseline groundwater and surface water monitoring (level, flow and chemistry) will need to be restarted and expanded to adequately confirm baseline conditions. Early data from this program should inform regional characterization studies and a water impact assessment. These studies should include the area around a potential tailings storage facility area. Groundwater sampling to date may have been impacted by cement grout in exploration holes, calling into question their representativeness. This will also need further investigation and likely additional confirmatory groundwater sampling.

 

Hathor and RTCU have described that the exploration drillholes have been surveyed and grouted. However, RTCU noted that drillhole seals could fail and suggest that drillhole collar security measures should be implemented (if developing underground), as are used successfully at other underground uranium operations in Saskatchewan. SRK agrees with this risk and recommendation and notes that an ongoing system of recording, surveying and grouting all exploration drill holes should be implemented.

 

 

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Any water that is discharged by the Project to the environment will require treatment through a water treatment plant. Only limited initial work has been done by RTCU on the water balance to define water disposal and treatment requirements and this will require further work as the Project progresses. This is a notable gap as it could represent a significant cost aspect of the Project. Further work is required to better define the site water balance both in terms of flow and quality in order to design and cost a suitable water treatment plant.

 

7.2.8

Geotechnical Characterization Background and Overview

 

A factual appraisal of the geotechnical data and the rock mass characteristics of the three deposit areas is provided. Each deposit area is very well drilled, but each has a varying quantity and quality of the recorded geotechnical parameters, with cognisance that the project is at the early conceptual study level.

 

This report section is limited to the above and does not give a detailed description (or constitute design) of:

 

 

The stability and dimensions of minable stopes;

 

 

The need for pillars and/or backfill support;

 

 

The optimal location for mine access excavations and their respective standoff distance;

 

 

The vertical opening placement and dimensions; or

 

 

Comment on the sequence of excavation to manage ground control risk and optimise extraction.

 

Data Collection Approach

 

Geotechnical data is collected explicitly as well as drawn from other data sets collected by Hathor and RTCU. In the RTCU Acquire system, there are several logging interfaces utilised for the geotechnical data appraisal in this document. Relevant data used to inform this early-stage understanding of the rock mass characteristics includes:

 

 

Core recovery with total core and solid core recorded;

 

 

Geotechnical domain (Interval) logging sheet with various geotechnical parameters to enable rock quality rating calculations, but with varying degrees of completion;

 

 

Point Structure logging sheet in three separate data sources;

 

 

Point Load Testing (PLT) strength index; and

 

 

Lithology, Alteration, and major structures logging data.

 

SRK has assessed the extent and suitability of the current geotechnical logging compared to the key categories in data collection to derive the calculated ratings in the four most common rock mass classification rating systems. These are listed in Table 7-2 with an initial snapshot of the status of the current data in the Project deposit areas, which is expanded in Table 7-3.

 

 

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Table 7-2:         Key Geotechnical data categories relevant for rock quality classification rating systems. The status of the Project data elements is listed next to each category.

 

Category

Parameters

Classification System

Status of Rough Rider

Geotechnical Data set

Beniawskis RMR

(1989)

Barton Q (1974,

2002)

Laubscher MRMR (1990)

Laubscher IRMR (2000)

Domain
Logging
Point
Logging

Intact rock

Strength

UCS

x

x

x

x

Logged

Partial testing

Open Fracture

Frequency

RQD

x

x

x

-

Partial testing

-

FF/m

x

-

x

x

Extensive

Logging

-

Joint sets

x

x

x

x

Partial testing

-

Open Joint

Strength

Roughness

x

x

x

x

Limited to

RRFE

Limited

Infill Strength

x

x

x

x

Limited to

RRFE

Limited

Joint Alteration

x

x

x

x

Limited to

RRFE

Limited

Cemented Joints

Quantity Strength

CJ/m

-

-

-

x

Partial Logging

-

CJ Strength - - - x Partial Logging -

Adapted from: Jakubec & Esterhuizen 2007 Use Of The Mining Rock Mass Rating Classification: Industry Experience

 

 

The Nature and Quality of the Sampling Methods

 

Geotechnical data generated from the logging and core testing are listed in Table 7-3. This table includes a qualitative rating of the amount of data available, as required for geotechnical characterisation. Some parameters are not complete in the geotechnical domain logging which inhibits explicit calculation of rock quality ratings in common industry classification systems. This is further described in later report sections, as well as suggestions on how to manipulate these various data sets in order to allow for rock quality calculation.

 

 

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Table 7-3:         Project Geotechnical Data Collection Sources

 

Drillhole

Logging/Testing Data

Deposit Area

Data file name

 

West

East

Far East

 

Recovery

Yes

Yes

Yes

rrdr_CoreLoss_Friability rrdr_GtechRecovery

Point structure

Yes

Yes

Yes

rrdr_dhd_pstr

rrdr_GtechPointDetail

StructureOrientedCH

Geotechnical Domain

 Intervals

Incomplete parameters for rock quality ratings

 

IRS Strength

>80% drillholes

 

RQD

1 drilhole

7 drillholes

>80% drillholes

rrdr_GtechDomain

Open Joint Count

>80% drillholes

 

Joint Condition

Not logged

Not logged

9 Drillholes

 

Point Load Tests

1 drillhole

2 drillholes

>15 drillholes

rrdr_GtechPointLoad

 

Geotechnical Data Distribution

 

An initial indication of the relative competency between the RRW, RRE and RRFE deposit areas is shown by the core recovery in Figure 7-7. The RRFE deposit area appears to be in a higher competency rock mass, with further depth from the unconformity, and the dominant host rock type being WOLG. The RTCU geotechnical domain logging information is more extensively collected in the RRFE area, therefore, this data set is more relevant to this deposit only.

 

Elements of the data collection (GeotechDomain) logging format and the distribution across the three deposits are shown in Figure 7-8. Generally, data availability is greatest for the RRFE deposit, and only one drillhole with geotechnical data is available for the RRW deposit (Figure 7-8). Hathor and RTCU logging manuals describe that RQD should be collected at the core recovery logging stage, however, this data is not present in the supplied database exports. Only solid and total core recovery measurements are present.

 

  a21.jpg

 

Figure 7-7:         Core recovery comparison relative to the RRW, RRE and RRFE areas

 

 

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  a22.jpg

 

Figure 7-8:         Interval logging data availability in each deposit area below the unconformity. Main geotechnical parameters (looking North).

 

Logged Structural Data

 

There is a reasonable amount of structural logging in the vicinity of the three deposit areas, where feature type and infill mineral type is recorded. Structural point logging is available across three types of logging files:

 

 

Geological logging with logged structures;

 

 

Logged structures with core orientation and confidence rating; and

 

 

Logged structures with feature conditions including open, cemented, and sheared categories and geotechnical rating of the joint condition (planarity, roughness, and infill strength).

 

There is an opportunity, from existing core, to more comprehensively log the joint condition within the geotechnical logging table. The existing version of the logging template included this field as ‘read only’ which has resulted in only sporadic recording of infill type and condition (see Figure 7-8). Based on the available data, SRK infers that there are insufficient geotechnical parameters collected at the logging stage to facilitate the calculation of rock quality rating (Q or RMR).

 

In summary, the three separate data sets of logged structures are valuable to the Project. The logging of the features for geological purposes has been completed in more drillholes than the geotechnical characterization logging of structures. These two data sets have the potential to be combined to identify similar joint orientations, in similar rock type to then infer joint condition ratings. The inferred data can be verified by select core inspection of fracture surfaces. The combined data set can then have a confidence rating applied to each logged point and applied to geotechnical characterization.

 

 

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  a23.jpg

 

Figure 7-9:         Distribution of logged structures. Upper image displays geology logging without geotechnical descriptions (Orange: geological structure logging, Green: Structural logging with orientation quality recorded). Lower image displays geotechnical logging with joint condition ratings.

 

An indication of the infill mineral logged for structures across the deposit areas is shown in Figure 7-10 (An interpretation of weak to strong is inferred from left to right in these charts). Clay is dominant in all areas and more resistant minerals (Quartz and carbonate fill) are not logged in the RRW but present in the RRFE deposit.

 

 

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Figure 7-10:         Distribution of mineral infill in logged structures. Inferred strength increases from left to right

 

 

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Strength Testing

 

Point load test (“PLT”) testing was performed by RTCU during the period 2012 to 2016, which is mostly available for drillholes in the RRFE deposit area and further east. Limited testing is available for RRE and RRW deposit areas (Figure 7-11). The procedure to enter the test values is clear and to industry standards. Both diametral (load applied along the core length) and axial (load applied normal to core length) tests are performed which accounts for anisotropy in the rock types if it exists.

 

Currently, there have been no samples sent for laboratory strength testing to assess the material strength and elastic constants, therefore it is not yet possible to translate the PLTs to estimated UCS strength.

 

The inference of strength variation is derived from the logging index (IRS_Hardness) as this is the more abundant data set, where this has then been cross-referenced with the PLT data (where available).

 

  a25.jpg

 

Figure 7-11:         Distribution of Logging IRS strength estimate and locations of PLT tests completed.

 

Rock Quality Rating

 

With the availability of some, but not all, parameters in each logged interval, the rock quality rating cannot be calculated throughout. This is only possible in the RRFE area and for approximately 50% of the logged intervals. Therefore, at this stage of the study, no calculated rock quality can be presented with confidence from the logging data.

 

However, the whole database of logged information is valuable and useful. The parameters can be manipulated from the different sources of logging (extracted and merged downhole). The merged files can be verified by core photos and core inspection checks. This will establish the rating/value of the respective input parameters to allow for the calculation of rock quality. New drilling will require an update of the geotechnical logging systems to remove the ambiguity and uncertainty of what to be logged. Controls must be put in place to ensure logging effort is valuable to the Project. This includes automatic logging controls to ensure no numerical error, or demand a parameter entry where required, as well as quality control procedures.

 

 

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Geotechnical Characterization

 

A preliminary geotechnical evaluation was conducted for the 2011 PEA (SRK, 2011) to assess and characterize the rock mass of the RRW and RRE. Based on this limited evaluation, general geotechnical domains were defined and input recommendations for mine design were provided based on these domains. SRK notes that the majority of the geotechnical information described in the previous sections was not available for this evaluation, and the rock mass characterization was largely based on visual review of core photos and lithological logging information.

 

Four rock mass domains were defined in this evaluation and summary descriptions of rock mass quality conditions:

 

 

1.

Sandstone Domain: The Sandstone Domain contains the sandstone/conglomerate units above the Unconformity. Variability is anticipated to be low with generally Fair to Good rock mass quality prevailing (intact rock strength estimated at 60 MPa to 120 MPa).

 

 

2.

Unconformity Domain: The Unconformity Domain encompasses a zone of ground approximately 20 m either side of the regional unconformity surface where ground conditions are interpreted to exhibit a wider variability compared to the surrounding Sandstone and Basement Domains. An increased frequency of core loss, percent clay, and rubble is observed in all lithological units.

 

 

3.

Basement Domain: The Basement domain encompasses the rock mass outside the interpreted High-Risk Domains including meta-sediments, and granitic gneiss. Similar to the Sandstone Domain, variability is expected to be low, with predominantly Fair to Good rock mass conditions with rock strength in the range of 80 MPa to 150 MPa by field index estimation.

 

 

4.

High-Risk Domain: Weaker and more friable zones should be expected in close proximity to major structures and mineralization. Based on core photo reviews of clay alteration and visual estimation of rock mass quality, an RMR <30 (poor conditions) has been used to define this domain.

 

As an update to the 2011 descriptions, the review of data for this TRS indicates that the RRFE is in the relatively better-quality rock mass of the Basement Domain.

 

Ground Control Comments

 

An early indication of anticipated ground control (support and improvement) is provided by SRK. Based on this preliminary evaluation, considering the conditions expected in the High-Risk Domain, lateral development at 5 m by 5 m, with a common ground control regime of 2.4 m long rebar rock bolt reinforcement, welded mesh and shotcrete surface support to the floor is considered appropriate by industry experience in similar conditions. The Basement domain, expected to be less fractured and has a higher strength rock mass with Fair — Good conditions, will require the same reinforcement (2.4m long rock bolts) with either mesh or shotcrete and to 1.5-3 m from the floor. However, the long-term degradation potential of the rock types after excavation (by water and air weathering) will require assessment and suitable long-term ground control regimes designed.

 

Spans greater than this 5 m by 5 m dimension (horizontally and vertically) should be supported with pattern cable bolts (commonly 6 m in length) in addition to the primary ground support listed above.

 

Due to the likely presence of water, some level of cover grouting will be required for all lateral development within sandstone (if required), and within the basement rocks within 20 m vertical depth beneath the unconformity. This may be designed as pre-grouting or post-grouting methods.

 

 

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Recommendations

 

As described in the 2011 PEA (SRK, 2011), SRK considered that these assumptions were preliminary in nature and further data and study are required to understand the mine scale fault structures, rock mass characterization, and potential hydrogeological connectivity.         The number of drillhole intercepts have increased, as well as improvements in the types of logging data and methods of data collection since the 2011 PEA. This improved data set (2012 to 2016) has provided increased geotechnical and PLT testing data concentrated in the RRFE deposit area.

 

The system of data capture requires improvement to allow for valid geotechnical parameter collection and allow for the calculation of rock quality. Major structures are to be identified and characterised by engineering geological descriptions. Hydrogeological connectivity needs to be measured in structures and in the rock mass where mine access and production excavations are likely to be designed. Borehole televiewer tools are recommended to qualify the in-situ conditions of major structures and fractured zones, calibrate the spacing of real and open joints, and characterize zones of no core recovery. This will benefit the geotechnical and hydrogeological appraisal of the Project.

 

8

SAMPLE PREPARATION, ANALYSES, AND SECURITY

 

Drill core from the Project was logged, marked for sampling, split, bagged, and sealed for shipment by Hathor and RTCU personnel at their secure, fenced core-logging facility on the property. All samples for U308 assay were transported by land, in compliance with pertinent federal and provincial regulations by Project personnel. The sample containers were transported directly to the Geoanalytical Laboratories of the SRC located in Saskatoon.

 

The Geoanalytical Laboratories of the SRC are unique facilities offering high quality analytical services to the exploration industry. The laboratory is accredited ISO 9001 by the Standards Council of Canada for certain testing procedures including those used to assay samples submitted for the Project. The laboratory is licensed by the CNSC for possession, transfer, import, export, use and storage of designated nuclear substances by CNSC Licence Number 01784-1-09.3. As such, the laboratory is closely monitored and inspected by the CNSC for compliance. The SRC laboratory is independent of Hathor and RTCU.

 

Non-mineralized samples for routine geochemical investigation were shipped to the Geoanalytical Laboratories of the SRC by ground transport. Samples for PIMA clay analyses taken by Hathor were shipped to a consultant, Mr. Ken Wasyliuk of Northwind Resources Ltd., Saskatoon, by ground transport.

 

Analytical data results were sent electronically to Hathor and RTCU. These results were provided as a series of Adobe PDF files containing the official analytical results and a Microsoft Excel spreadsheet file containing only the analytical results. Upon receipt of the data, the electronic data was imported directly into the master drillhole database. During the import process, all values reported below detection limits were converted to half the detection limit of that element. Hard copies of the assay certificate were mailed to Hathor and RTCU exploration offices in Saskatoon.

 

8.1

Drill Core Preparation and Analysis

 

All core samples, including Composite Geochemical, Split, and Point samples were prepared by SRC. SRC performs the following sample preparation procedures on all samples submitted to them.

 

On arrival at SRC, samples were sorted into their matrix types (sandstone or basement rock) and according to radioactivity level. The samples were prepared and analyzed in that order.

 

 

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Sample preparation (drying, crushing, and grinding) was done in separate facilities for sandstone and basement samples to reduce the probability of sample cross-contamination. Crushing and grinding of radioactive samples yielding more than 2,000 cps was done in another separate CNSC-licensed radioactive sample preparation facility. Radioactive material was kept in a CNSC-licensed concrete bunker until it could be transported by certified employees to the radioactive sample preparation facility.

 

Sample drying was carried out at 80°C with the samples in their original bags in large low temperature ovens. Following drying, the samples were crushed to 60% passing 2 mm using a steel jaw crusher. A 100 g to 200 g split was taken of the crushed material using a riffle splitter. This split was then ground to 90% passing 150 mesh using a chromium-steel puck-and-ring grinding mill for mineralized samples or a motorized agate mortar and pestle grinding mill for all non-mineralized samples. The resulting pulp was transferred to a clear plastic snap-top vial with the sample number labelled on the top.

 

All grinding mills were cleaned between sample runs using steel wool and compressed air. Between-sample grinds of silica sand were performed if the samples were clay-rich.

 

Prior to the primary geochemical analysis, the sample material was digested into solution using several digestion methods. A “total” three-acid digestion on a 250 ml aliquot of the sample pulp using a mixture of concentrated HF/HNO3/HC104 acids to dissolve the pulp in a Teflon beaker over a hotplate; the residue, following drying, was dissolved in 15 ml of dilute ultrapure HNO3. A “partial” acid digestion, on a two-gram aliquot of the sample pulp, digested using 2.25 ml of an eight-to-one ratio of ultrapure HNO3 and HCI for one hour at 95°C in a hot water bath and then diluted to 15 ml using deionized water.

 

For fluorimetric analysis of uranium (also known as “AQRFLR”), an aliquot of either total digestion solution or partial digestion solution was pipetted into a platinum dish and evaporated. A NaF/LiK pellet was placed on the dish and the sample was fused for three minutes using a propane rotary burner and then cooled to room temperature before fluorimetric analysis.

 

Another digestion method used was a sodium peroxide fusion in which an aliquot of pulp was fused with a mixture of Na202 and NaCO3 in a muffle oven. The fused mixture was subsequently dissolved in deionised water. Boron was analyzed by inductively coupled plasma optical emission spectrometry on this solution.

 

With each batch of samples run, SRC inserts, at a minimum, a duplicate from the batch and a QC standard of its own. For analytical QC purposes, Hathor and RTCU inserted one field duplicate for approximately every 10 m of sampled interval. This frequency equates to one duplicate for every 20 samples. Prior to Winter 2010, all field duplicates were quarter core in size, and since winter 2010 all field duplicates were half core in size.

 

One blank sample per drillhole was inserted. After standard sample preparation, SRC analyzed the samples by several analytical methods depending on the characteristics of each sample:

 

 

Up to 2012, split samples, both mineralized and non-mineralized, from within the mineralized section were assayed for pitchblende using SRC accredited fluorimetry (ISO/IEC 17025) U308-method (code U308). In 2012 SRC changed their ore-grade U308 method from a fluorimetry determination to an ICP-OES determination. All Hathor mineralised samples were analysed by fluorimetry, with select samples between 2007 and 2009 being reanalysed by ICP-OES. The ICP-OES method employed by SRC was ISO/IEC accredited and used for all split samples by RTCU from 2012 to 2016;

 

 

All split samples were additionally analyzed using inductively-coupled plasma optical emission spectrometry (“ICP-OES”) (partial and total digestion; method code ICP-1), plus boron;

 

 

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Select split samples were analyzed for gold, platinum, and palladium by conventional fire assay procedures and axial inductively coupled plasma spectrometry finish on 15 g sub-samples (method code AU5); and

 

 

Non-radioactive, non-mineralized samples were analyzed using ICP-OES (partial and total digestion; method code ICP-1) and/or inductively coupled plasma mass spectrometry (“ICP-MS”) (partial and total digestion; method code ICPMS 1), plus boron.

 

All samples are archived at SRC’s laboratory for two calendar years (pulps inside and rejects outside), unless any specific instructions have been provided by Hathor or RTCU. SRK are not aware of the current location of the pulps and rejects.

 

8.2

Specific Gravity Sample Preparation and Analysis

 

This is described in Section 7.2.5.

 

8.3

PIMA Sample Preparation and Analysis

 

There is no sample preparation involved for the samples sent for clay analyses.

 

8.4

Quality Assurance and Quality Control

 

The Project has had a robust QA/QC process in place between 2007 and 2016. This includes the insertion of blanks, duplicates (field, coarse rejects and pulps) throughout the period and certified reference materials (“CRM”), from 2012 to 2016, inserted into the assay sample stream sent to SRC. CRMs were only inserted into the assay stream by RTCU, in 2012 after the acquisition of the project. Prior to this, Hathor relied on SRC internal QA/QC procedures in regards to CRM analysis. Both Hathor and RTCU undertook density analysis, monitored by three CRM samples, and undertook a limited umpire verification of the density samples. SGS Lakeland was used at the external (“umpire”) laboratory.

 

A representative set of graphs and tables related to SRK QA/QC analysis is presented below in each section.

 

8.4.1

Blanks

 

Blank samples have been included in the sample stream since 2007. The composition of the blank material is unknown but is referred to as a field blank. In total 5,066 blank samples have undergone either fluorimetry or ICP-OES U308% analysis and the blank insertion rate has been calculated to be 27%, which has been derived from the total number of U308 assays. The total number of blanks may possibly contain internal SRC blanks as well as other blanks, as seven different types of blanks are denoted in the QA/QC data provided to SRK without confirmation of their origin. Furthermore, the assay date associated with the blank samples is believed to be related to the upload date and not the actual analysis date, which is why some samples analysed pre-2013 report with a 2013 date.

 

In reviewing the blank analysis data, SRK has applied a 5X detection limit threshold, specific for U308%. Samples that plot above this threshold are determined as failed samples, only three of the Project samples report above this or even above 2X the detection limit for any of the seven different blanks analyzed (Figure 8-1).

 

 

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Figure 8-1:         Blank sample results for fluorimetry (AQRFLR) and ICP-OES (SCUIOS) at SRC (U308 %)

 

8.4.2

Duplicates

 

The precision of sampling and analytical results can be measured by re-analysing a portion of the same sample using the same methodology. The variance between the original and duplicate result is a measure of their precision and/or internal variability. It should be noted that in the duplicate database there are eight category types. Although SRK’s analysis has only focused on field duplicates (FP), coarse rejects (C) and pulp duplicates (LR), this understanding is based on the supporting data provided. However, it is not clear what the other codes (D, I, P, PLC and S) refer to, though only 30 samples of these were analysed by SRC using fluorimetry. This low number of samples (30) is unlikely to influence SRK’s opinion derived from the analysis of the duplicate data. Furthermore, the assay date associated with the duplicate samples is believed to be related to the upload date and not the actual analysis date, which is why some samples were analysed in a pre-2013 report with a 2013 date.

 

An RTCU review of the QA/QC samples in 2013 identified that SRC did not undertake regular grind sizing test and only —68% of samples passed through a -106pm sieve. They stated that “a greater percentage passing -106pm would increase sample homogeneity and therefore reproducibility of analytical results”, which SRK agrees with, though based on the result presented below this is not considered a material issue to the MRE and will likely only impact relatively very low-grade samples (<1000 ppm).

 

Field Duplicates

 

Field duplicate samples have been included in the sample stream since 2007. These duplicates were originally quarter core but switched to half core post winter 2010. The field duplicate samples are denoted by “FP” in the Project QA/QC database. Initially, the core was split by hand, though this was later replaced by a hydraulic splitter in 2013. SRK is unable to determine which samples were half core and quarter core field duplicates due to the lack of analysis date stated in the database. The insertion rate has been calculated to be 10%, which has been derived from the total number of U308 (fluorimetry and ICP-OES U308%) assays.

 

 

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In order for SRK to analyse the performance of the field duplicates appropriately, SRK has calculated the percent mean difference between each sample and plotted these on the graphs for use as threshold values (Figure 8-2) along with 10% error lines. Samples that fall outside of the 10% threshold limits are determined to be failed samples. SRK has not included samples that report below the detection limits as these can result in large percentage differences and are not true representations of the mean percentage between samples at varying U308 grade ranges.

 

As expected, the duplicate results show a wider range of variation than the other duplicate types inserted into the sample stream, but still show reasonably good repeatability (Figure 8-2) and good correlation between the original and duplicate sample above. The field duplicates report correlation coefficients typically in excess of 0.9. The same degree of correlation and repeatability was identified across all grade ranges.

 

  a27.jpg

Figure 8-2:         Field duplicate sample results for fluorimetry (AQRFLR -U308 %)

 

Coarse Duplicates

 

Coarse reject samples have been included in the sample stream since 2007. These are produced at the initial crushing stage at SRC and are denoted by C in the Project QA/QC database. The insertion rate has been calculated to be 5%, which has been derived from the total number of U308 (fluorimetry and ICP-OES U308%) assays.

 

In order for SRK to analyse the results of the field duplicates appropriately, SRK has calculated the percent mean difference between each sample and plotted these on the graphs for use as threshold values (Figure 8-3) along with 10% error lines. Samples which fall outside of the 10% threshold limits are determined to be failed samples.

 

As expected, these duplicate results show a higher degree of correlation than the field duplicates inserted into the sample stream, with an excellent repeatability (Figure 8-3) and a high degree of correlation between the original and duplicate sample. The coarse duplicates report correlation coefficients typically in excess of 0.99.

 

 

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Figure 8-3:         Coarse reject duplicate sample results for fluorimetry (AQRFLR -U308 %)

 

Pulp Duplicates

 

Pulp duplicates samples are collected at the final stage of sample preparation and have been included in the sample stream since 2007. These are denoted by LR in the Project QA/QC database. The insertion rate has been calculated to be 6%, which has been derived from the total number of U308 (fluorimetry and ICP-OES U308%) assays.

 

SRK has calculated the percent mean difference between each sample and plotted these on graphs to determine sample failures. The results for the pulp duplicates show a very high degree of repeatability and correlation between the original and duplicate sample, with a correlation coefficient typically in excess of 0.99 (Figure 8-4). As expected, these duplicate results show a higher degree of correlation between the original and duplicate sample than the field duplicates and ever so slightly more than the coarse rejects inserted into the sample stream.

 

 

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Figure 8-4:         Pulp duplicate sample results for ICP-OES (SRUIOS - U308%)

 

8.4.3

Certified Reference Materials (CRM)

 

According to the data provided to SRK, Hathor did not insert any CRMs into the sample stream. Instead, they relied upon the internal CRMs inserted by SRC, at a rate of 1 in 20 (Section 8.4.4). This is industry standard for uranium projects in the Athabasca basin, since it would require procurement and storage of radioactive material at the site.

 

SRK’s analysis of the CRMs is primarily based on samples inserted into the sample stream by RTCU, all CRMs assay results for U308 (%) and U (ppm) were analysed using ICP-OES (no CRMs are reported as being analysed by fluorimetry).

 

In total 20 CRMs were inserted into the sample stream since 2013, though this data is believed to be related to the upload date and not the analysis date. Only five report ICP-OES U308 % results, as shown in Table 8-1, the table also denotes the very low failure rate for each CRM where data is available. The U308% grade range covered by the 5 CRM is representative of the majority of the grade distribution, except at the very high-grade end of the distribution (above 10% U308%). SRK notes that SRC internal CRM include expected values up to 87.5% U308% (8.4.4). The other 15 CRMs were used to monitor Mo and Se and U, with the latter in low ppm concentrations. SRK’s analysis has mainly focused on the 5 CRMs which were used to monitor U308% for the reasons described below. The insertion rate has been calculated to be 25%, which has been derived from the total number of U308 (ICP-OES U308%) assays.

 

Nine CRMs provided in the database do not have accompanying standard deviation or certified mean values and therefore SRK was unable to analyse these in any detail. However, none of these report U308% assays analysed using fluorimetry or ICP-OES. Six of the other CRMs have low (ppm) levels of U, these all were noted to perform within a reasonable degree, though in some cases multiple different U (ppm) analysis were undertaken and it is not clear as to why this was implemented. Overall, the 15 CRMs which did not analyse U308% generally report U assays below 5ppm and only one of these report U grades of —112 ppm, all of which would be well below the modelling cut-off considered to support the MRE.

 

 

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Figure 8-5 to and Figure 8-7 are examples of U308 CRM performances at different grade ranges. SRK notes that the reported U308 CRM grades for the entire dataset are generally similar to the certified values normally reported within the three standard deviations. This indicates that there is no significant under or over reporting of values (suggesting high accuracy and precision). No sample switches were identified by SRK.

 

  a30.jpg

Figure 8-5:         CRM plot for STD-BL5 analysed at SRC

 

 

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Figure 8-6:         CRM plot for STD-SRCUO2 analysed at SRC

 

  a32.jpg

Figure 8-7:         CRM plot for STD-BL4A analysed at SRC

 

 

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Table 8-1:         Project U308% and U ppm CRMS

 

CRM Name

No of Sample

submitted

U3O8%

Analysed

U ppm

Analysed

Certified

Mean

% Failed

samples

(outside 3SD)

STD-DCB01

19

 

No

 

Yes

N/A

0%

STD NIST-983-1Y

136

N/A

0%

STD NIST-981-1Y

132

N/A

0%

STD DS9

131

N/A

0%

STD ASH-1

66

N/A

0%

S5

4

N/A

0%

ASR316

11

N/A

0%

DCB01

227

N/A

0%

QFIR-S5

49

N/A

0%

STD-BL2A

48

 

Yes

 

No

0.502%

0%

STD-BL3

46

1.23%

0%

STD-BL4A

62

0.151%

0%

STD-BL5

31

8.42%

0%

STD-SRCU02

10

1.64%

0%

STD-CAR110

341

 

No

 

Yes

3198 ppm

0%

CAR110

200

3335 ppm

0%

ASR1

15

2.5 ppm

0%

ASR2

15

2.5 ppm

0%

ASR209

298

2.5 ppm

0%

ASR109

394

0.28 ppm

0%

 

 

8.4.4

SRC Internal QAQC Report

 

Since Hathor had not incorporated CRM in their QAQC program, and relied on SRC inserted CRMs, RTCU requested SRC provide a report detailing their internal QAQC procedures for all samples analysed between 2007 and the RTCU acquisition of the project in 2011. SRC prepared a document entitled “SRC Geoanalytical Laboratories. Hathor Exploration Ltd. Sample Report.pdf” to describe SRC’s internal procedures from the moment the samples arrive at the laboratory, through to SRC Internal QAQC analysis as well as providing the accompanying QAQC charts, all of which have been reviewed by SRK. The following paragraph summarizes SRC’s analysis of the QAQC results.

 

SRC inserted CRM at a rate of 1 in 20 into the sample stream. In total, seven CRMs were employed by SRC, covering a range of grades from 0.026% U308 to 87.5% U308. An example of one of SRC’s CRM plots is shown in Figure 8-8. Additionally, SRC also inserted pulp duplicates into the sample stream at a rate of 1 in 40. Hathor specifically requested that 1 in 20 samples analysed should be a split replicate. Prior to releasing the assay results to Hathor, an SRC senior scientist reviewed the performance of their internal QAQC samples. If for any reason a failure, or any issues were identified with any samples then the batch or sub-group associated with the problematic sample was reanalysed and a corrective action report was produced describing the issue and corrective measure taken.

 

 

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Overall, the performance of the SRC QAQC samples was within acceptable tolerances for U308%. SRK notes that some of the other minor analytes show a slight positive bias, though the majority of these samples fall within the three standard deviation failure lines. The potential bias, in these other elements, is not considered material to the Mineral Resource estimate and they are not reported in the Mineral Resource statement.

 

SRC also compared fluorimetry vs ICP-OES for a subset of samples, which shows a reasonable degree of continuity between sample pairs.

 

  a33.jpg

 

Figure 8-8:         SRC internal BL5 CRM performance (Hathor samples 2007 to 2011)

 

8.4.5

External Duplicates (Umpires)

 

The external duplicate samples are collected at the final stage of sample preparation and sent to the umpire laboratory (SGS Lakeland) for either U308% analysis or delayed neutron counting (“DNC”). SRK calculated the insertion rate to be 4.9% for U308% analysis (fluorimetry) and 12% for the DNC analysis, this is believed to be related to the Hathor submitted data only. It should be noted that SRK found 86 umpire samples (SGS certificate) with a 2013 time stamp, though none of the sample ID’s matched the assay database and so no further analysis of these were conducted. SRK recommends that the Company try to source the umpires sample submitted post RTCU ownership and review these, though given all other QA/QC types performed well the lack of these umpire samples is not considered material to the MRE.

 

SRK has calculated the percent mean difference between each sample and plotted these on graphs to determine sample failures (Figure 8-9 and Figure 8-10) along with 10% error lines.

 

The results for the external duplicates analysed using U308% and DNC show a high degree of repeatability (Figure 8-9 and Figure 8-10) and a high degree of correlation between the original and duplicate samples analysed at the two different laboratories. The correlation coefficient is in excess of 0.99, with only two samples falling outside the 10% error limits for the U308% vs DNC, which is not considered material to the MRE.

 

 

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  a34.jpg

 

Figure 8-9:         External duplicate sample results for U308% (SRC vs SGS)

 

  a35.jpg

Figure 8-10: External duplicate sample results for DNC vs U308% (SRC vs SGS)

 

 

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8.4.6

Density Samples

 

Both Hathor and RTCU verified their density results using three standards. Each of the three standards were measured for each drillhole from which density samples were measured. Density samples from the core were not measured until the results of the standard measurements were confirmed to pass.

 

It should be noted that the three density standards all report similar certified means between 2.65 t/m3 and 2.69t/m3, as shown in Table 8-2, which also shows the low failure rate for each CRM.

 

Figure 8-5 is an example of one of the density CRM performances. SRK notes that the densities reported for the entire dataset are generally similar to the certified values, normally within the three standard deviations, though a few samples do report outside this range. SRK was informed that density samples which fall outside the three standard deviations were reanalysed by both Hathor and RTCU before proceeding with further measurements. Overall, there appears to be no significant under or over reporting of density values suggesting high accuracy and precision.

 

  a36.jpg

Figure 8-11:         Standard 01 Density CRM plot

 

Table 8-2:         Project density CRMs

 

CRM Name

No of Sample

Analysed

Certified Mean

density (t/m3)

% Failed samples

Standard 1

371

2.655

2%

Standard 2

371

2.669

2%

Standard 3

368

2.693

1%

 

 

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8.4.7

Umpire Density Samples

 

Twenty density samples were sent to SRC for verification purposes. This is believed to be related to the Hathor analysis only, as it was undertaken in 2010. It is not known if these relate to exact sample analysed by Hathor or whether these are quarter or half core field duplicates.

 

SRK has calculated the percent mean difference between each sample and plotted these on graphs to determine sample failures (Figure 8-9).

 

The results for the external density duplicates show a moderate to high degree of repeatability (Figure 8-9) and a moderate to high degree of correlation between the original and duplicate samples analysed, with a correlation coefficient typically of 0.79. However, given the low sample population, it is difficult to make any meaningful conclusions, though it does appear that the Hathor density values slightly under report compared to the SRC values.

 

  a37.jpg

Figure 8-12: External duplicate density sample results (Hathor vs SRC)

 

8.5

Sample Security

 

Drill core samples from the Project were logged, marked for sampling, split, bagged and sealed in drums for transport within a fenced core-logging facility on the property. The sealed drums were transported by road directly to the SRC laboratory in Saskatoon. Samples were traced by their unique sample ID, which was marked in the boxes from which they were taken and have accompanied the sample through preparation, analysis, and addition to the master assay database.

 

8.6

SRK Comments

 

SRK has undertaken a review of the assay and geology database during the MRE procedure. Field duplicate data typically show a less well-defined correlation (assay repeatability) compared to coarse reject and pulp duplicates due to the nature of sampling (core splitting by hand and hydraulic) and possible inhomogeneity of the mineralisation itself. This underlines the necessity to rely on multiple sample data points to ensure sufficient averaging when estimating block model grades to overcome random sampling errors present in individual grade values. RTCU mentioned that the U308 suite ore-grade U308 analysis method has a relatively high detection limit and produces poorly reproducible results below 1000ppm. SRK does not consider this a material issue, as the lowest modelling cut-off is a factor of 10 times higher than this limit.

 

 

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The lack of CRMs inserted into the sample stream by Hathor (2007 to 2011) is common practice for uranium exploration in the Athabasca basin and is not considered material to the Mineral Resource estimate presented in this TRS. In the opinion of SRK, the QA/QC monitoring and analysis completed by SRC during this period demonstrates that the U308 analyses are appropriate for the use in the estimate.

 

In the future, SRK recommends that the company insert CRMs with a more variable U308% grades (3%, >10%) and density values (1.8 t/ ni3 and 2.2 t/m3) in order to better reflect the mineralisation grades and density observed in the drillhole statistics.

 

8.7

QP Opinion of the Adequacy of Sample Preparation, Security and Analytical Procedures

 

The QP has reviewed the data upon which the MRE is based, and is of the opinion that the procedures and systems employed to collect and manage this information meets industry best practice. SRK considers that the QA/QC results demonstrate acceptable levels of accuracy and precision at the laboratories. The QP is of the opinion that the supporting data are representative and adequately support the geological interpretations and estimates to the level of classification assigned.

 

9

DATA VERIFICATION

 

9.1

Data Verification Procedures Applied by the QP

 

The QP was provided with the drillhole database for the Project in a series of Microsoft Excel comma delimited files (“CSV” format). Before use in the geological modelling and Mineral Resource estimation, a series of verification checks were conducted, including:

 

 

Collar Elevation versus Digital Elevation Model (“DEM”);

 

 

Verification of Mineral Lease location;

 

 

Downhole deviation and orientation;

 

 

Interval table checks — gaps, overlaps, out of range, and missing samples;

 

 

Lithology Logging consistency; and

 

 

Assay database versus source certificates.

 

9.1.1

Collar Elevation vs DEM

 

Final drillhole collar locations have been surveyed by the Hathor and RTCU teams using the Trimble GeoExplorer 2008 Series differential global positioning system (“DGPS”). The DGPS has decimetre scale accuracy. The QP has compared the DGPS collar elevations versus the lidar DEM for the Project. All collar coordinates, surveyed with the DGPS, used in the MRE are very close to the lidar DEM elevation, with the mean distance being less than 1 m (Table 9-1).

 

SRK set the elevations of two drillholes, 16RR0871 and 16RR0872, to the DEM elevation as the database contained only the planned coordinates for these holes.

 

 

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Table 9-1:         Collar Elevation versus DEM statistics by Deposit

 

Deposit

Distance from Collar Survey to DEM Surface (m)

Minimum

Maximum

Mean

RRW

0.24

0.96

0.93

RRE

0.00

1.30

0.48

RRFE

0.00

0.80

0.30

 

 

9.1.2

Mineral Lease Location

 

The QP independently reviewed and exported the boundary points of ML-5547 from the Mineral Administration Registry System, an electronic registry managed by the Government of Saskatchewan for issuing mineral dispositions. SRK confirmed the location, area, and ownership information of ML-5547 that was provided by UEC. ML-5547 fully encapsulates the mineralisation boundaries modelled, and the MRE reported in this TRS.

 

9.1.3

Downhole Deviation and Orientation

 

The QP visually reviewed the downhole traces of all drillholes used in the MRE to both check for unreasonable deviations of drillholes and drillholes that may be poorly oriented with respect to the local mineralization.

 

There were no drillholes identified with visually erroneous downhole survey information, although there were numerous holes drilled at the RRW deposit with orientations that were near parallel to the interpreted mineralization trend (Figure 9-1). After careful consideration, the QP has chosen to exclude 22 drillholes due to poor intersection angles (Table 9-2). These holes were collared from the shore of South McMahon Lake, before barge drilling commenced. Additionally, due to the collar location and target (RRW) the holes were drilled at relatively shallow dip (down to -45 °), which meant that the casing being set in overburden was up to 40 m, resulting in the first downhole survey of each hole being somewhat deeper than 40 m (as the deviation survey tool is magnetic and must be clear of magnetic influences, like casing). The result of the poor drilling angle and questionable starting deviation surveys result in uncertainty in the spatial location of the holes and therefore have been excluded from the MRE.

 

 

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  a38.jpg

Figure 9-1:         Cross section looking south-west at the modelled RRW high-grade layering features with respect to drilling orientation

 

Table 9-2:         Drillholes Excluded from the Geological Model and MRE

 

Drillhole Name

MWNE-08-030

MWNE-08-042

MWNE-08-037

MWNE-09-140

MWNE-08-031

MWNE-09-085

MWNE-08-038

MWNE-09-146A

MWNE-08-032

MWNE-09-132

MWNE-08-039

MWNE-09-148

MWNE-08-033

MWNE-09-133A

MWNE-08-040

MWNE-09-151

MWNE-08-034

MWNE-09-134

MWNE-08-041

MWNE-09-510

MWNE-08-035

MWNE-09-137

   

 

 

9.1.4

Interval Table Checks

 

All drilling data supporting the geological models and MRE was provided in CSV format files. The QP has imported these into modelling software, which have standard verification tools for checking and resolving issues such as overlapping or duplicate intervals, missing intervals, out of range values, and sample depth greater than the depth of the collar file among others. No significant issues were detected in the verifications.

 

Due to the nature of the sampling process, samples are only taken where scintillometer readings indicate mineralization. Gaps in the sampling are therefore present and must be treated appropriately. Since gaps have been identified as effectively barren, the QP has set the value of U308% to 0.0001% for all gaps.

 

 

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9.1.5

Lithology Logging Consistency

 

The geological model for the Project was prepared using the downhole lithology logging (as described in Section 11.2.3). During the construction of the model, the QP made the following observations about the consistency of lithological logging:

 

 

MFBMC, MFBASCON, and WOLG units are consistently logged and result in adjacent holes regularly confirming contact locations, resulting in reliable modelled contacts; and

 

 

MFC, MFBU, MFBL, WOLF and WOLG are less consistently logged and require some interpretation, including exclusion of some logged contacts from the models and less reliable modelled contacts.

 

The QP notes that the WOLG and MFBASCON are the two most important lithological features for the Project, since the WOLG is associated with localization of uranium mineralization, and the MFBASCON location marks key hydrogeological and geotechnical conditions.

 

9.1.6

Assay Database vs Source Certificates

 

SRK has checked the source laboratory assay certificates associated with the 2007-2016 drilling. In total, SRK reviewed 137 samples (equivalent to 0.7% of the U308% ore-grade assay database) across five years (2008-2013) and identified no material issues or discrepancies between the drillhole assay file and laboratory certificates.

 

9.2

Site Visit

 

The QP completed a site visit in March of 2023, the details of which are described in Section 2.5.

 

9.3

Limitations

 

The QP was not directly involved in the exploration drilling, logging and sampling programs that formed the basis for collecting the data used to support the geological model and MRE for the Project.         During the site inspection, the QP reviewed drill core from seven holes representing intersections from each of the three Project deposits. The QP was able to observe that certain sampling procedures were in fact being followed, specifically radiometric scanning, half-core sampling, and secure storage. Chain of custody evidence was well preserved, with core box labels clearly visible and geochemical and bulk density sampling locations clearly marked in the core boxes.

 

The QP has relied upon a detailed review of the 2007 to 2016 data and supporting documentation to ensure the resulting database, upon which the MRE is based, is reliable.

 

The QP notes that verification of the Project data, collected up to 2011, was completed from 2010 to 2011 by a previous QP (Section 9.3.1).

 

 

9.3.1

Previous SRK QP Visits

 

The qualified person for the previous, November 29, 2010 (RRW) and May 6, 2011 (RRE) Mineral Resource, SRK Consulting (NA) Ltd. (“SRKNA”), completed verifications of the Project data. In summary, during SRKNA’s September 13 to 14, 2010 site visit, all aspects that could materially impact the Mineral Resource evaluation were reviewed with Hathor staff. SRKNA reported that it was provided full access to all relevant Project data available at the time. SRKNA was able to interview exploration staff to ascertain exploration procedures and protocols. Drillhole collars were reported to be clearly marked with stakes inscribed with the borehole number on aluminium Dymo labels. No discrepancies were found between the location, numbering or orientation of the holes verified in the field and on plans and the database examined by SRKNA at the time.

 

 

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The QP notes that the Company confirmed that the procedures in place at the time of SRKNA’s site visit were continued until drilling and sampling concluded in 2016.

 

9.4

QP Opinion of the Data Adequacy

 

The QP has verified the data provided, including collar, survey, downhole logging and sampling and analytical data. The QP was provided unlimited access to this data by UEC during the course of the study. The QP was not able to personally witness the data collection procedures as drilling and sampling activities ceased in 2016. Based on the verification of the data and site visit observations, the QP is of the opinion that the data upon which the MRE is based has been collected with industry best practices and are reliable for the MRE presented in this TRS.

 

10

MINERAL PROCESSING AND METALLURGICAL TESTING

 

Hathor engaged Melis Engineering Ltd. (“Melis”) as metallurgical consultants from 2008 onwards to manage a series of testwork programs carried out by SGS at their Lakefield facility in Ontario, Canada on samples from the Project. When RTCU completed acquisition of the Project in late 2011, Melis and SGS were retained to continue with the testwork program.

 

SGS completed four phases of metallurgical testwork between 2008 and 2012 on samples from the RRW (phases 1-3) and the RRFE (Phase 4) deposits of the Project. In 2012, during the fourth phase of testwork, the program was truncated, and the full schedule was never completed.

 

The test programs originally included comminution tests, atmospheric leach tests, solvent extraction uranium recovery tests, yellowcake precipitation, resin loading and elution test, tailings preparation, effluent treatment and environmental analyses.

 

Samples for the tests were taken from exploration drill core (Phase 1 and 2) and later from dedicated drillholes made specifically for the purpose of collecting samples for metallurgical testwork.

 

10.1

Metallurgical Testwork Program

 

The Project is located in the eastern Athabasca Basin uranium district of northern Saskatchewan. This is an established area for mining and extraction of uranium bearing minerals that currently supplies around 20% of the world’s uranium. With a number of historic and operating mines in the area, the initial testwork program focused on the two proven flowsheets in use in the area for the extraction of Uranium:

 

 

Heated Agitated Leaching, and

 

 

Low Pressure Oxygen Acid Leaching.

 

Initial testwork, Phase 1, was carried out on samples from RRW, which were the samples available at the time. This is typical for projects, but as understanding of the mineralization develops with increased data, a program of testwork needs to be developed that will inform decisions about the choice of flowsheet, type of equipment required, and the forecast performance level of the final plant design.

 

Once the flowsheet is developed, it is normal to run continuous pilot or mini-plant scale programs over prolonged periods to simulate the full flowsheet including all internal recirculating streams. Finally, testwork, using the preferred flowsheet, should be carried out on a wider range of ore types to determine what degree of variability there will be in the plant performance on different ore types.

 

 

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The testwork program conducted to date for the Project took place in four phases:

 

10.1.1

Phase 1 Testwork

 

Phase 1 testwork, using early-stage drill core, to establish levels of uranium recovery from the two established flowsheets in use in the eastern Athabasca area.

 

10.1.2

Phase 2 Testwork

 

More extensive metallurgical testwork to cover ore characterization for selection of crushing and grinding equipment. Confirmation of the previous levels of recovery by leaching as well as leach optimisation tests to reduce reagent use. Downstream uranium recovery testwork by solvent extraction and testing on waste neutralization streams.

 

10.1.3

Phase 3 Testwork

 

Variability testwork on a wide range of composites synthetically composited from two purpose drilled holes.

 

10.1.4

Phase 4 Testwork

 

Testwork carried out on samples from RRFE to examine similarity to the previously investigated RRW samples.

 

10.2

Sample Selection

 

Key to any testwork program is that the samples tested should be representative of the mineralization. Drillhole locations for the samples used for the four phases of testwork are shown in Figure 10-1.

 

As the testwork campaign was curtailed, the dispersal of the drillhole locations is limited and cannot be said to adequately represent the entire Project. Specifically, samples for the RRE (East Zone) were collected, but never tested (shown as “Untested” in Figure 10-1).

 

  a39.jpg

Figure 10-1: Drill hole location for Metallurgical Test Programs

 

 

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10.2.1

Phase 1 Samples

 

Phase 1 testwork was carried out on three composite samples that were prepared by taking core intervals from the following drillholes:

 

 

1.

DDH MWNE-08-12

 

 

2.

DDH MWNE-08-24

 

 

3.

DDH MWNE-08-28

 

 

4.

DDH MWNE-08-30

 

 

5.

DDH MWNE-08-32 and

 

 

6.

DDH MWNE-08-33

 

The characteristic of the composite is presented in Table 10-1.

 

Table 10-1:         Phase 1 Testwork, Sample Characteristics

 

Phase 1 Project Test Composites — Key Element Analysis

Analyte

Unit

Composite No. 1

Composite No. 2

Composite No. 3

U3O8

%

6.11

2.68

0.62

As

%

0.052

0.15

0.0065

Co

%

0.022

0.021

0.0036

Cu

%

0.077

0.12

0.042

Mo

%

0.24

0.071

0.17

Ni

%

0.025

0.066

0.0078

Pb

%

1.98

0.085

0.045

Se

%

0.0029

0.0016

<0.0001

V

%

0.40

0.16

0.30

Zn

%

0.046

0.018

<0.004

Au

g/t

1.05

0.23

0.48

Ag

g/t

34

3.1

12

 

 

10.2.2

Phase 2 Samples

 

The Phase 2 testwork was carried out on composite samples formed from intersections of a single purpose drillhole MWNE-09-85 from RRW. The characteristics of the composites are presented in Table 10-2.

 

 

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Table 10-2:         Phase 2 Testwork, Sample Characteristics

 

Phase 2 Roughrider Test Composites — Key Element Analysis

Analyte

Unit

Comp

RR2

Comp

PG

Comp DM

Comp WRM

Comp PE

U3O8

%

3.30

0.19

0.81

16.5

0.11

As

%

0.035

0.0075

0.017

0.080

0.035

Mo

%

0.062

0.022

0.090

0.120

0.015

Se

%

<0.004

<0.004

<0.004

<0.004

<0.004

V

%

0.13

0.089

0.20

0.19

0.067

 

 

10.2.3

Phase 3 Samples

 

Phase 3 variability testwork was carried out on over 600 kg of purpose drilled core samples from the RRW, drillholes (DDH MWNE-09-171 and MWNE-09-172). The characteristics of the composites are presented in Table 10-3.

 

Table 10-3:         Phase 3 Testwork Composite Characteristics

 

Phase 3 Project Test Composites - Key Element Analysis

Analyte

Unit

Comp

RR-A

Comp

RR-B

Comp

RR-C

Comp

RR-D

Comp

RR-E

Comp

RR-F

Comp

RR-G

Comp

RR-H

Comp

RR3

U3O8

%

0.047

0.25

2.29

0.25

0.55

0.13

17.4

0.083

1.40

As

%

0.032

0.056

0.098

0.033

0.068

0.091

0.55

0.025

0.088

Co

%

0.006

0.013

0.03

0.0069

0.013

0.039

0.056

0.0079

0.016

Mo

%

0.027

0.083

0.075

0.017

0.088

0.32

1.6

0.014

0.014

Ni

 

0.046

0.036

0.05

0.015

0.03

0.032

0.72

0.013

0.058

Se

%

<0.006

<0.006

<0.006

<0.006

<0.006

<0.006

<0.024

<0.006

<0.006

V

%

0.14

0.39

0.49

0.13

0.12

0.60

0.62

0.02

0.30

 

 

10.2.4

Phase 4 Samples

 

Phase 4 samples were collected from a purpose-drilled hole (DDH MWNE-11-718) in RRFE of the Project. Five variability composites and one overall composite, representing the RRFE mineralization, have been prepared for testing. The characteristics of the composites are presented in Table 10-4.

 

 

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Table 10-4:         Phase 4 Testwork Composite Characteristics

 

Phase 4 Roughrider Test Composites - Key Element Analysis

Analyte

Comp RR4

Comp MG

Comp UG

Comp LPG

Comp GG

Comp PG

U308

2.72

2.38

2.78

15.6

4.50

1.83

As

0.0135

0.0169

0.0025

0.135

0.0039

0.0181

Co

0.0023

0.0017

0.0008

0.021

0.0010

0.0033

Cu

0.0177

0.0053

0.0021

0.0162

0.0062

0.0469

Fe

2.83

1.85

7.34

1.54

1.46

2.06

Mo

0.0156

0.0270

0.0085

0.0390

0.0172

0.0106

Ni

0.0112

0.0153

0.0017

0.0902

0.0057

0.0112

Pb

0.153

0.131

0.094

1.77

0.461

0.120

S

0.0611

0.0528

0.0100

0.270

0.0425

0.0978