In my role as corporate development director for Cameco, I spent most of the last ten years travelling the world evaluating uranium projects. It was this experience that led Azincourt’s Board of Directors to offer me the role of CEO. Put simply, they saw a depressed uranium market as the perfect opportunity to acquire top notch projects at low cost and wanted the right CEO to follow through.  

Last Friday (November 21) we announced our first such acquisition (you can find the press release here). We have entered into definitive share purchase agreements with Cameco and Vena Resources for the acquisition of 100% of the issued shares of Minergia – a private Peruvian company. 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. 

Low discovery cost, even lower acquisition cost. For those of you not familiar with the Macusani region of Peru: it is a rapidly emerging uranium district and for good reason. Minergia put $12m of exploration activity into the Macusani project and by 2011 they had built up a considerable resource for discovery costs of just $0.40/lb. We, in turn, have acquired this resource for $0.06/lb.  

Great geology makes for great economics. What makes the Macusani project exciting, aside from our extremely attractive acquisition price? Economics and geology. The catch phrase is that mining is all about grade. The reality is that, like any other part of the resources sector, it’s actually about economics. Specifically, how much it costs to get your pounds out of the ground. In the case of Macusani, the geology involved gives us a real edge because this mineralization leaches very well and that means low production costs.  

43-101 Resource and more pounds to be found. I’ve included the highlights of the 43-101 below and what’s more, analysis of survey and drill results provides very strong evidence that there is more uranium to be found. 

  • 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

*Cut-off of 90.72 ppm (0.18 pounds/ton) 

Future plans. What are we going to do with the acquisition? We’ll be announcing more on this subject as we move forward but for now I can tell you that we are planning a comprehensive exploration program for the Macusani project in 2014 and will also carry out surveys and geophysics at the Muñani project in the same period. 

I recommend you check out the press release and also the Macusani and Muñani project pages. Please get in touch with any questions and be sure to follow us on LinkedIn and Twitter to keep up to date with the latest Azincourt news. 

Ted O’Connor, CEO of Azincourt Uranium


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