Mkuju River Project
Mkuju River is an in situ recovery uranium development project located in southern Tanzania, about 470 km southwest of Dar es Salaam. The Mkuju River project is owned by Mantra Tanzania Limited, a wholly owned subsidiary of Mantra Resources Pty Ltd. (formerly Mantra Resources Ltd.), an Australian registered corporation in which Uranium One has a minority interest. The remaining shares in this company are owned by Uranium One’s 51% shareholder, JSC Atomredmetzoloto (“ARMZ”). Uranium One has an option, valid until June 7, 2013, to purchase from ARMZ the remaining interest in Mantra Resources Pty Limited.
Uranium One is the operator of the Mkuju River Project, and has committed to provide funding for the project through a loan agreement with Mantra guaranteed by ARMZ.
Operations
Current activity at the Mkuju River Project is focused on licensing and permitting. An application for a special mining license has been submitted to the Tanzanian authorities. At its 36th session in St. Petersburg from June 24 to July 6, 2012, the UNESCO World Heritage Committee approved an application by the Tanzanian Government for a minor adjustment to the boundary of the Selous Game Reserve removing the Mkuju River Project and an adjacent buffer zone from the Selous Game Reserve World Heritage Site.
In the meantime, additional exploration work on the project is being conducted in the area of the expected special mining license, and a definitive feasibility study relating to the project is being prepared.
Mineral Resources and Mineral Reserves
The following table sets out the mineral resource and mineral reserve estimates for the Mkuju River project as at September 27, 2011.
|
MKUJU RIVER PROJECT (as at September 27, 2011) |
Ore (000s tonnes) |
Grade (% U) |
Tonnes U |
Grade (%U3O8) |
U3O8 (000s lbs) |
||
|
Resources |
100% |
100% |
13.9% |
|
100% |
13.9% |
|
|
Measured |
80,300 |
0.026 |
21,270 |
2,959 |
0.031 |
55,298 |
7,692 |
|
Indicated |
59,300 |
0.025 |
14,617 |
2,033 |
0.029 |
38,001 |
5,286 |
|
Measured and Indicated |
139,600 |
0.025 |
35,888 |
4,992 |
0.030 |
93,300 |
12,978 |
|
Inferred |
42,500 |
0.024 |
10,041 |
1,397 |
0.028 |
26,104 |
3,631 |
Notes:
(1) Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Inferred Mineral Resources have a great amount of uncertainty as to their existence and as to their economic feasibility. Under no circumstances can it be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher Mineral Resource category or converted to Mineral Reserves.
(2) The foregoing Mineral Resource and Mineral Reserve estimates are taken from the report titled “NI 43-101 Technical Report on the September 2011 Resource Update, Mkuju River Project, Located in Tanzania, Africa” dated December 15, 2011 prepared for Uranium One by CSA Global (UK) Ltd., and are subject to the methods, parameters, assumptions, qualifications and procedures which are set out in such report. For a complete description of such methods, parameters, assumptions, qualifications and procedures, reference should be made to the full text of the foregoing report, which is available for review on SEDAR under Uranium One’s profile located at the following website: www.sedar.com. Mineral Resources and Mineral Reserves are reported in accordance with Definition Standards on Mineral Resources and Mineral Reserves adopted by the Council of the Canadian Institute of Mining, Metallurgy and Petroleum and National Instrument 43-101 – Standards of Disclosure for Mineral Projects promulgated by the Canadian Securities Administrators.
(3) The second column for “Tonnes U” and “U3O8” represents the portion of total Mineral Reserves and/or Mineral Resources notionally attributable to Uranium One’s equity interest in the joint venture through which the property is owned in the percentage indicated in this column.