Over $12M of prior exploration with existing uranium resource in emerging uranium district
Saskatoon, SK, November 22, 2013 – AZINCOURT URANIUM INC. (“Azincourt” or “the Company“; TSXV:AAZ) a Saskatoon based uranium exploration company, announces that it has entered into definitive share purchase agreements dated November 20, 2013 with each of: (a) Cameco Corporation (TSX: CCO) and its wholly-owned subsidiary Cameco Global Exploration Ltd. (“Cameco”); and (b) Vena Resources Inc. (TSX: VEM) (“Vena”) for the acquisition of 100% of the issued shares of Minergia S.A.C. (“Minergia”) a private Peruvian company (the “Acquisition”). Minergia owns 100% of the rights and interests in the advanced stage Macusani and early stage Muñani uranium exploration projects in the Puno department of south-eastern Peru covering a combined area of 14,700 hectares (the “Projects”).
- Azincourt to purchase 100% of Minergia from Cameco and Vena for total consideration of $2 million in cash and Azincourt shares.
- Over $12 million spent by Minergia on project exploration work between 2007-2011.
- Minergia has defined 18 million lbs U3O8 current mineral resources (measured and indicated) and 17 million lbs U3O8 inferred,to September 2011.
- Exploration and processing work by Minergia and others in the Macusani region suggests potential for future low cost production.
- Additional targets exist on the projects and Azincourt is committed to advancing the resources, targets and to developing the Macusani region.
- Vena’s Chairman and CEO, Juan Vegarra to join Azincourt board as an independent director.
Macusani Project Highlights
- Advanced-stage 4,900 hectare project
- October 2011 NI 43-101 compliant report calculated* in-place U3O8 resources of:
- 5.7 million pounds in the measured category
- 12.5 million pounds indicated
- 17.4 million pounds inferred
- $12 million of prior exploration work
*Cut-off of 90.72 ppm (0.18 pounds/ton)
Muñani Project Highlights
- Early-stage 9,600 hectare project.
- Uranium mineralization identified in both sandstone and intermediate volcanic rock outcrops.
- Detailed airborne surveys and ground prospecting complete.
- Initial drill targets already established and prioritized.
Ted O’Connor, the Company’s President and CEO, stated “Based on the work by Minergia and others in the region, we believe the Macusani region has tremendous exploration up-side. In particular, the uranium resources already identified have the future potential to be developed as open pit, acid heap leach operations with low capital and operating costs. This forms part of Azincourt’s plan to acquire strong projects and in-ground uranium resources now in order to capitalize on the future uranium market turnaround and complements our excellent Athabasca Basin PLN Joint Venture project with Fission Uranium.”
Macusani Project Key Details
More than $12,000,000 of exploration work has been conducted at the 4,900 hectare project. This includes 37,958 metres of exploration drilling in 232 diamond drill holes targeting anomalies generated through systematic scintillometer surveying. Five individual target areas were drilled with the bulk of the drilling concentrated on the Tantamaco prospect.
The Macusani uranium deposits are hosted in the uppermost Yapamayo member of the Quenamari volcanics, a series of peraluminous alkaline ignimbritic rhyolite to rhyodacite extrusive volcanic rocks up to 500 m thick. The Pliocene Quenemari volcanics (ca. 6-21 Ma) filled a distinct caldera-like graben approximately 40 km’s in diameter to form a present day plateau. All known uranium deposits and most uranium occurrences are located near the northeastern edge of the caldera, exclusively in the Yapamayo member.
Mineralization at the Macusani project consists primarily of yellowish-green hexavalent (U+6) minerals autunite and meta-autunite. Mineralization occurs within brittle fractures and disseminated into the host volcanic rocks. Disseminated mineralization also forms discrete subhorizontal lenses within certain Yapamayo member volcanic flow units.
Muñani Project Key Details
The Muñani project covers an area of 9,600 hectares. Minergia has completed regional and detailed scintillometer prospecting and Alpha Cup radon surveys over the project area as well as detailed geological mapping, sampling and limited trenching. Uranium mineralization has been found in both sandstone and intermediate volcanic rock outcrops on the project. The Muñani project has never been drill tested, but targets have been established and prioritized for future drilling.
Proposed Acquisition of Minergia S.A.C
Under the terms of the separate Share Purchase Agreements, the Company has agreed, subject to the satisfaction of certain conditions precedent to acquire each of Cameco’s and Vena’s 50% of the issued capital of Minergia in exchange for consideration of C$1,000,000 payable to each of Cameco and Vena as follows:
(i) C$750,000 worth of common shares of the Company, being 2,525,252 common shares (the “Consideration Shares”) calculated based on the volume weighted average trading price of the Company’s common shares on the TSX Venture Exchange (the “Exchange”) for the 10 trading days immediately prior to signing of the Share Purchase Agreements; and
(ii) C$250,000 in cash.
The Consideration Shares to be issued to both Cameco and Vena will be subject to a statutory hold period of four months and one day from the date of their issuance. In addition, the Consideration Shares issued to Vena will be subject to voluntary resale restrictions for a period of one year from the date of issuance, following which Vena’s Consideration Shares will become freely tradable as to 15% of the Consideration Shares on the 12 month anniversary of their issuance and an additional 15% on each of the 15th, 18th and 21st and 24th month anniversaries of their issuance with the remaining 25% on the 27th month anniversary of the issuance date.
The Acquisition is at arm’s length and no finder’s fee is payable in relation to the Acquisition.
The parties’ obligations to complete the Acquisition are subject to the satisfaction of standard conditions precedent including:
- the receipt of all necessary approvals of the Exchange and all other regulatory authorities and third parties to the Acquisition;
- the Company completing all necessary due diligence on Minergia and the mineral concessions making up the Projects; and
- the receipt of legal opinions from Peruvian counsel as to certain corporate matters relating to Minergia and the Projects.
Summary of the Macusani Project
The following is a summary of the Macusani Project is based upon a NI 43-101 compliant report authored by Henkle & Associates, entitled “Updated Technical Report of the Macusani Uranium Exploration Project”, dated October 25, 2011 and addressed to Vena, which was filed in November 2011 under Vena’s SEDAR profile.
The Macusani Project contains partially drill defined uranium deposits, and is comprised of nine non-contiguous mineral concessions covering a combined total area of 4,900 hectares. The Project is located approximately 650 kilometres southeast of Lima and about 230 kilometres by road north of the city of Juliaca. Access to the Project is from the Interoceanico Highway (“IH”), a tarred road that passes about 11 kilometres, directly to the east of Minergia’s exploration camp. The Company’s exploration camp is located in the pueblo of Isivilla, near the center of the Project area. Access from the IH, to the concessions is via a network of gravel roads, all of which are passable by a two-wheel drive vehicle.
Uranium in the Macusani Project Area is hosted in ignimbritic volcanic rhyolites, and is found in both fractures and as disseminated crystals within distinct mineralized zones. Mineralized zones are correlatable as distinct strata/elevation related zones, from drill hole to drill hole, much as a supergene blanket is in a copper deposit. To date, five separate prospects have been defined containing potentially economic mineralization in both Level A and Level B rock units within the Macusani Project area.
Little exploration activity had taken place on the Macusani Project prior to Vena’s involvement in 2006. In 2006, Vena commenced scintillometer prospecting, radon and surface outcrop sampling over various IPEN (“Instituto Peruano de Energia Nuclear”, an agency within the Peruvian Ministry of Energy and Mines) uranium showings.
The total amount of drilling at the Macusani Project area since 2006 is 232 core holes for a total of 37,958 m. A breakdown of drill statistics for each of the prospects within the Project Area is shown in the following table:
|PROSPECT||# CORE HOLE||METRES DRILLED|
|Tantamaco||128 core holes||23,287 m|
|Nueva Corani||57 core holes||6,961 m|
|Isivilla||27 core holes||3,597 m|
|Tuturumani||11 core holes||2,484 m|
|Calvario Real||9 core holes||1,629 m|
|TOTAL||232 core holes||37,958 m|
Based upon drilling and assaying to date, the report writer calculated the following resource estimate over the five drilled prospects making up the Macusani Project:
The Minergia projects have not seen active exploration drilling for the past two years and have been on care and maintenance due to depressed uranium market conditions. Azincourt is working with the existing Minergia team and Vena to develop a meaningful program and budget to restart active exploration work in Peru. The 2014 plans will include completing the necessary community agreements and all required permitting work to recommence diamond drilling of existing targets on the projects.
Concurrently with the completion of the Acquisition, the Company intends to appoint Mr. Juan Vegarra as an independent director. Mr. Vegarra is a founder and the Chairman and CEO of Vena Resources Inc. Mr. Vegarra is a native of Peru and continues to foster his significant base of contacts within both the Peruvian government and the mining industry. Prior to his appointment as Chairman and CEO of Vena Resources in 2003, Mr. Vegarra enjoyed a successful career as a Microsoft executive. He holds an engineering bachelor degree from the University of Maryland as well as an MBA from the University of Washington.
The technical information in this news release has been prepared in accordance with the Canadian regulatory requirements set out in National Instrument 43-101 and reviewed on behalf of the company by Ted O’Connor, P.Geo. President and CEO of Azincourt Uranium Corp., a qualified person.
The TSX Venture Exchange has in no way passed upon the merits of the proposed Acquisition and has neither approved nor disapproved the contents of this press release.
About Azincourt Uranium Inc.
Azincourt Uranium Inc. is a Canadian based resource company specializing in the strategic acquisition, exploration and development of uranium properties and is headquartered in Vancouver, British Columbia. Its common shares are listed on the TSX Venture Exchange under the symbol “AAZ”.
ON BEHALF OF THE BOARD OF AZINCOURT URANIUM INC.
Ted O’Connor, CEO and President
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This press release includes “forward-looking statements”, including forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Azincourt. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. Such forward-looking information represents management’s best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially.
For further information please contact:
Dwane Brosseau – Investor Relations
Direct: 604 662 4955