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Uranium Exploration Model Confirmation: What Could be Ahead in 2008

By George Bell

Uranium exploration is undoubtedly a complicated business for sure. However, it is a very lucrative business, when done correctly. With the spot price of uranium 94% above the February 2006 price, the industry has seen a surge in companies looking for the precious energy commodity.

But many are not sitting on legitimate claims…and those that are, know that the exploration process is tedious and lengthy. However, for the companies that truly are exploring within legitimate claims, shareholders could see huge gains in the years to come.

And UNOR Inc. could be exactly one of the companies that make many investors very happy… Right now, the company is in an outstanding position to potentially have the biggest year yet, especially with 2007 geophysical results showing the significant possibility of ‘pathfinder veins’ confirming the company’s exploration models.

Clarifying “Models”

The term ‘exploration model’ can be a little confusing at first, thus, we will attempt to paint a clearer picture here. To shed some light on the issue, take a moment and imagine the world of American football: no two games are the same. The overall concept will always remain the same, but as every team has different strengths, each game is it’s own animal. In a game where a team has a bold running game, the competitors must prepare themselves beforehand, to stop the ground movement of the ball. When a team contains many dexterous receivers, the opposing defense must focus on shutting down the receivers from being open. Thus, we see that for each of the two aforementioned football games, the defensive ‘strategies’ are different for each.

The same applies to uranium exploration; however, instead of using the term strategy, we call it a ‘model.’ Models are the approach used to identify and locate uranium within a certain geological setting, something that changes with virtually every deposit.

With this in mind, one of the most important parts of a solid uranium exploration company is a tenured geology team that understands the geology where the company is looking. Without a solid team of experienced geologists, exploration efforts are virtually futile.

However, UNOR not only shares in Cameco’s vast technical knowledge (due to Cameco’s 19.5% ownership in UNOR), but also has worked tirelessly to build its own team of industry experts. In fact, UNOR’s team has over XX years of experience, something unheard of for most junior uranium exploration companies. And right now, UNOR’s team could be on the verge of a major unconformity-related uranium deposit, perhaps as soon as this year.

Unconformity-Related Uranium Deposits

Canada is home to the largest ‘high grade’ uranium deposits/mines in the world. An example of one of the these mines is Cameco’s McArthur River, which is presently the largest uranium producing mine in the world. In 2006, the mine supplied18% of total global production.

For the most part, these Canadian mega-mines all have similar geology, called unconformity-related deposits. The Uranium Information Centre states, “Unconformity-related deposits constitute approximately 33% of the World Outside Centrally Planned Economies Area (WOCA)'s uranium resources and they include some of the largest and richest deposits.”

In a nutshell, unconformity-related uranium deposits occur in a basin (imagine a massive bowl underneath the surface) and are the product of the Mid-Proterozoic age. For those who like technical details, unconformity-related deposits are described as, “Uranium minerals, generally pitchblende and coffinite, occur as fracture and breccia fillings and disseminations in elongate, prismatic-shaped or tabular zones hosted by sedimentary/metasedimentary rocks located below, above or across a major continental unconformity.” 1

The essential information here is unconformity-related deposits make up some of the largest, high grade uranium mines in the whole world. And UNOR is specifically targeting these types of massive, high-grade deposits, a unique facet of Canada’s geology.

The Three Basins

In Canada, there are three massive basins, made up of unconformity-related geological settings. They are the Thelon basin, the Athabasca basin and the Hornby Bay basin. All of Canada’s uranium production currently comes from the Athabasca and Thelon basins, located in Saskatchewan. However, in the past, the third and final of these basins, the Hornby Bay basin (located in Nunavut), was not explored, mostly due to the northern location and rugged terrain.

However, the Hornby Bay basin has the same geological setting as the Athabasca and Thelon basins, and thus, holds an extremely high probability of possessing massive deposits similar to McArthur River. And at present, UNOR is the largest claim holder in the Hornby Bay basin, where it has been ardently exploring for uranium since 1996.

Radioactive Results

Here’s where the story gets interesting. During the 2007 drilling season, the company’s geophysical drilling results indicated several ‘showings’ (radioactive signals, indicating potentially massive uranium deposits) confirming the company’s exploration models.

Again, UNOR’s models specifically target massive, high grade deposits similar to McArthur River. At the current moment, the company is waiting for core samples (from 2007 drilling) to come back from the Saskatchewan Research Council, which is one of the most respected independent labs in the entire world.

Should the core samples authenticate the geophysical results already delivered, the occurrence would also confirm the company’s exploration models. In short, after many years of exploration, the company could be on the verge of uncovering a McArthur River type deposit, perhaps in the 2008 drilling season.

It’s important to understand that in the world of uranium exploration, nothing is for sure. UNOR is not stating that a McArthur River type deposit actually exists within the company’s claims, however, with 2007 geophysical results providing strong evidence of radioactivity, the company could be on the eve of a major discovery this year.

Over the past year, UNOR’s share price has fallen without bold news of a discovery, which is certainly understandable. After all, Wall Street certainly isn’t the most patient place on earth. However, for those who understand that UNOR is extremely financially healthy, 19.5% owned by Cameco, and potentially on the verge of a major discovery, the upcoming year could possibly be very rewarding. For investors with patience, UNOR could be just the right place in 2008.

1 UNCONFORMITY-ASSOCIATED U, I16. McMillan, R. H.
http://www.empr.gov.bc.ca/Mining/GeolSurv/MetallicMinerals/MineralDepositProfiles/profiles/i16.htm