Aricheng Alpha is the first in a group of targets to be drilled in the recently announced scout drilling campaign, which aims to establish the potential size of the Kurupung uranium district. Geologically similar albitite-hosted deposits elsewhere in the world typically contain resources in the 50 to 130 million pound range. The successful intersection of a uranium-bearing structure at Aricheng Alpha, a new target identified purely through geophysical data, marks a fundamental advancement in U3O8 Corp’s ability to predict the location of potentially new mineralized zones, thereby leading to greater efficiencies in its exploration of the Kurupung.

“Although uranium mineralization at Aricheng Alpha is masked by up to fifty metres of soil, we were able to recognize the potential of that area through its geophysical characteristics,” said Dr. Richard Spencer, U3O8 Corp’s president and chief executive officer. “To hit good uranium mineralization in the first holes drilled in a new target bodes well for our ability to use geophysics to identify additional mineralized areas. Aricheng Alpha is the sixth structure to contain consistent uranium mineralization in the Kurupung district and adds to our pipeline of targets awaiting infill drilling with the potential to increase our resource base.”

Aricheng Alpha

U3O8 Corp. identified Aricheng Alpha as a target exclusively based on its geophysical characteristics. Substantially all the uranium-bearing structures drilled to date in the Kurupung Batholith are located in weakly magnetic areas. By analogy with these mineralized structures, the Aricheng Alpha target lies at a point along a weakly magnetic fault where it intersects a second, poorly magnetic zone. This cross point coincides with the intersection of northwest- and northeast striking VLF-EM (Very Low Frequency Electromagnetic) anomalies that define relatively high electrical conductivity.

Uranium mineralization at Aricheng Alpha is associated with a northeast-trending structure along the prominent weakly magnetic feature described above. The mineralization is associated with veinlets and breccias within a zone of albite-chlorite-hematite-calcite alteration that is essentially non-magnetic. Outside of the albite-dominated alteration zone, the country rock is a moderately magnetic, coarse-grained monzonitic granite that has a mineral assemblage of albite, K-feldspar, quartz, actinolite and magnetite. The mineralized sheet-like breccia zone at Aricheng Alpha strikes northeast and dips to the northwest at approximately 75°. Further drilling will be required to establish the width and plunge direction of the higher-grade mineralized shoot at Aricheng Alpha.

Potential quantity and grade are based on drill results that define the approximate length, thickness, depth and grade of the target, but are considered conceptual in nature. To date, there has been insufficient exploration drilling to define a mineral resource in the Aricheng Alpha structure, and it is uncertain if further exploration drilling will result in a mineral resource being defined in this structure.

Pipeline of Uranium-Bearing Structures

Aricheng Alpha is the sixth structure in the Kurupung Batholith in which U3O8 Corp’s drilling has shown consistent uranium mineralization and adds to the pipeline of targets ready for infill drilling and subsequent potential resource estimation. Aricheng South and Aricheng North were the first two structures to have National Instrument 43-101 resources defined, and mineralization remains open on both structures with opportunity for resource growth upon further drilling. The mineralized structures at Aricheng West and Accori North C are ready for additional infill drilling to achieve the drill density required before advancing to potential resource estimation. Accori South and Aricheng Alpha are positioned for Phase II drilling to determine the extent of uranium mineralization, which if results are positive, would warrant further drilling to move towards possible resource estimation.

Geophysical Targeting Techniques

U3O8 Corp. has significantly advanced its targeting techniques in the Kurupung district beyond the methods originally used by Cogema in the early 1980’s. New and untested targets, such as Aricheng Alpha, are being identified for scout drilling using the integration of three geophysical methods from data sets that cover the entire district. The principal geophysical targeting tools are magnetics and VLF-EM, while radiometric data, which are easily masked by soil, humus, vegetation and water, are used as a secondary tool.

Magnetic Data Delineate Demagnetized Faults – The Kurupung Batholith consists of homogeneous granitic rock that should have a relatively uniform magnetic signature. Instead, airborne magnetic data show the batholith consists of uniformly magnetic areas that are separated by corridors of low magnetism. Substantially all of the consistently uranium-bearing structures drilled by U3O8 Corp. to date lie within these weakly magnetic corridors. Measurements on drill core from these areas show that the magnetism of the granite decreases sharply in faults that contain uranium. Therefore, U3O8 Corp. is using the magnetic data to trace out where demagnetized faults are located in the batholith as corridors of potential uranium mineralization. Although the selection of targets takes into account that only parts of the demagnetized faults may contain uranium, exploration drilling of some of these new targets may fail to identify uranium mineralization.

Conductive Zones in VLF-EM – VLF-EM surveys carried out in the field over areas that have been drilled by U3O8 Corp. show that uranium-bearing shoots are located where slightly conductive zones intersect, or coincide with, demagnetized fault zones evident in the magnetic data. Therefore, U3O8 Corp. is using the VLF-EM data to identify points where conductive zones cut the magnetite-deficient faults as new targets for scout drilling.