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In-situ recovery amenability indicated by Company's initial aquifer test;
Historic mineralized trends established by Anschutz Corporation in 1980s;
247,000-acre project holds large-scale potential with similar mineralization and geological setting as the Company's ISR projects in South Texas
NYSE Amex Equities Exchange Symbol -
UECCORPUS CHRISTI, TX,
May 12 /PRNewswire-FirstCall/ - Uranium Energy Corp (NYSE-AMEX: UEC, the "Company") is pleased to announce that, effective
May 11, 2011, the Company has entered into a Share Exchange Agreement (the "Agreement") with a
Nevada company (the "Vendor") whereby the Company is acquiring a Paraguayan company which holds a 100% legal and beneficial interest in two unencumbered prospecting permits covering 247,000 acres located in the area of Coronel Oviedo,
Paraguay (the "Property"), subject to a gross overriding royalty.
The total purchase price for the Paraguayan company is the issuance of 225,000 restricted common shares in the capital of the Company.
The Company has also agreed to pay the Vendor a royalty interest in the amount of one and one-half percent (1.5%) of the gross proceeds received by the Company in connection with any uranium which is produced and sold from mineral interests in the Property. The Company also has the exclusive right and option at any time to acquire one-half percent (0.5%) of the aggregate royalty interest for
US$500,000. The Vendor has granted the Company a right of first refusal to acquire all or any portion of the remaining one percent (1.0%) royalty interest.
Amir Adnani, President and CEO, stated, "The Company's primary focus remains on our production and near-term production projects in South Texas. At the same time, we are committed to identifying new and potentially exceptional opportunities with scale in
the United States and abroad. The Coronel Oviedo Property is located in stable and business-friendly
Paraguay, is geologically very similar to the
South Texas uranium belt and is anticipated to be ISR-amenable as initially indicated through our pump-test studies. This opportunity profile is an excellent fit for our technical team who has a distinctive track record of discovering and advancing sandstone-hosted uranium deposits. Share dilution to acquire the project is far below 1%, and we plan to commence exploration immediately."
The Property, covering over 247,000 acres in central
Paraguay, was subject to extensive uranium exploration between 1976 and 1983 by Anschutz Corporation of
Denver, Colorado, and by Crescent Resources Corp. between 2006 and 2008. Most of the uranium occurrences in this environment are "roll-front" type mineralization similar to deposits currently being produced by low-cost in-situ recovery (ISR) methods in
Texas, the western
Central Asia and
Australia. The work by Anschutz and Crescent was centered on a large belt of Permo-Carboniferous age continental sandstones that represent the western flank of the
Parana Basin. According to the Geological Survey of
Brazil or CPRM, these same sandstones within the Brazilian section of the
Parana Basin contain numerous uranium occurrences including the Figueira Mine that hosted 19 million pounds of U3O8 according to published government reports.
Between 1976 and 1983, Anschutz Corporation, with joint venture partners Korea Electric Power and Taiwan Power Company, spent approximately
US$30 million evaluating an area covering over 6.2 million acres of prospective ground in central and eastern
Paraguay. This work consisted of airborne radiometric and magnetic surveys, detailed geological mapping, and ground geophysical and geochemical surveys, which narrowed down the areas of interest. This work was followed by regional-scale drilling at initially 9-mile spacing, drilled across inferred host trends.
Anschutz identified the Property as prospective towards the end of their regional program. In total, approximately 28 widely spaced drill holes were drilled on the Property, and of these, 17 drill holes showed significant uranium values, with the best being 6.2 feet of 0.153% U3O8 at a starting depth of 785 feet. The drilling also identified three mineralized fronts, and a 75 mile-long fault structure which appears to have been the source of the gases that localized the concentration of uranium, again very similar to a
South Texas-type uranium depositional model.
From 2006 to 2008, the Property was optioned to Crescent Resources. During this period, a total of 24 holes were drilled and logged in the southern portion of the Property, offsetting mineralized holes drilled by Anschutz. According to Crescent's 2008 NI 43-101 Technical Report, of the 24 holes drilled, a total of 14 had a grade-thickness (GT) product (in feet) equal to or greater than 0.30GT. GT values equal to and above 0.30 are typically considered producible under ISR production methodology. The best hole reported by Crescent intersected 0.062% U3O8 over 13.5 feet. The Crescent and Anschutz drilling identified an open-ended mineralization area characterized by tabular mineralization similar to that found at the Company's Goliad Project. The known uranium mineralization on the Property intersected by the past drilling is at depths between 450 and 750 feet. Crescent dropped the option on the Property in 2008.