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TABLE OF CONTENTS Feb 3 - 9, 2014 Volume 99 Number 51 - 0 comments

Forum Uranium hopes 2014 will be a breakout year

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By: Trish Saywell

For a pint-sized explorer and developer with a market capitalization of $11 million and $4 million in cash, Forum Uranium (TSXV: FDC; TSX: FDCFF) has grand plans for its projects in Saskatchewan and Nunavut. But then the company also has some big-name geologists and geoscientists on its team — Ken Wheatley, vice-president of exploration, and Boen Tan, chief geologist — who have discovered uranium deposits in the Athabasca basin that hold more than 300 million lb. uranium oxide (U3O8). Their goal: to make a high-grade uranium discovery in 2014.


The Vancouver-based company has spent $30 million on exploration and development over the last decade, and has five drill-ready projects that are either 100% owned or co-owned with major uranium companies.


It plans to kick off the first quarter of 2014 with a 3,000-metre drill program at its flagship Clearwater project. The 100%-owned project is beside Fission Uranium’s (TSXV: FCU; US-OTC: FCUUF) Patterson Lake South (PLS) discovery, and Forum has set aside $900,000 to drill.


The company staked 99.1 sq. km on trend along the southwest border of PLS in late 2012, and followed up with prospecting, airborne magnetic, electromagnetic and radiometric surveys, as well as radon and gravity surveys. The work has generated 11 drill targets on the northernmost part of the claim.


“When the PLS discovery was made in November 2012, there was a staking rush,” recalls Richard Mazur, Forum Uranium’s president and CEO. “We had done our homework and as soon as the ground became open, we staked it immediately to the southwest of PLS, and on the same structural trend.” 


At the time, Saskatchewan had just computerized its staking system, Mazur says. “There must have been hundreds of people waiting to push that button and stake that ground, but we were fortunate enough to get it,” he says. “We like to say it came down to the fastest finger in the West.”


Forum Uranium’s projects in Saskatchewan are located near the known limits of the Athabasca basin.


On the northwest edge of the basin is the Northwest Athabasca joint-venture project, in which Forum and NexGen Energy (TSXV: NXE) jointly hold a 64% stake, and Cameco (TSX: CCO; NYSE: CCJ) and Areva own 23.5% and 12.5%.

Forum is the operator, and plans to spend $1 million on exploration with its joint-venture partners there this year. So far $5 million has been spent on the project, which is Forum’s most advanced. The property hosts the shallow, sandstone-hosted Maurice Bay uranium deposit, which has a historic, non-compliant National Instrument 43-101 resource of 600,000 tonnes grading 0.6% U3O8 for 1.5 million contained lb. U3O8.


Early last year, Forum completed a 3,500-metre drill program at the joint venture. Drilling in Zone A — north of the Maurice Bay deposit — returned a 3-metre intercept grading 1.34% uranium oxide (U3O8) at shallow depths, and it remains open along strike northwest and southeast. At the Otis West target, south of the Maurice Bay deposit, drilling encountered 40 metres of uranium mineralization, including a 24.5-metre-wide zone grading 0.21% U3O8, with higher-grade intercepts of up to 1.8% U3O8 over half a metre.


Mineralization has been traced for 50 metres along strike and remains open to the east. Forum believes drill core from Otis West is of a similar style to Rio Tinto’s (NYSE: RIO; LSE: RIO) Roughrider deposit in the basin.


“We’ve made some significant uranium discoveries there that we’ll be following up on this year,” Mazur says, who spent 10 years as a uranium-exploration geologist in Saskatchewan, Nunavut, Yukon, Ontario, Quebec and the Maritime provinces for Pan Ocean Oil. “Historic drilling never went deep into the basement rocks, and our premise is to discover basement-style uranium deposits similar to PLS. We have strong indications of that style of basement-hosted mineralization. We’ve just got to find the sweet spot.”


On the northeastern part of the basin, north of Areva’s McClean Lake mill, is Forum’s Henday project, a joint venture between Rio Tinto (60%) and Forum (40%). The partners will be spending $150,000 on an airborne magnetic and electromagnetic survey later this year. Forum describes the property as being on the Midwest trend, host to the Midwest Lake deposit owned by Areva and Denison Mines (TSX: DML; NYSE-MKT: DNN) and Rio Tinto’s Roughrider.


On the southeastern part of the basin is Forum’s 100%-owned Key Lake Road project, which lies along the major shear zone that divides the Wollaston domain from the Mudjatik domain. The shear zone is near the Key Lake, Millennium, McArthur and Cigar Lake deposits. Forum says it is looking for shallow basement-hosted deposits, like at Rabbit Lake–Eagle Point, Millennium and PLS.


Beyond Saskatchewan, Forum owns 100% of the North Thelon project in Nunavut. North Thelon surrounds Kiggavik, a project owned by Areva (65%), privately held Japan–Canada Uranium (33%) and Korea’s Daewoo (2%), which has a resource of 133 million lb. U3O8 at a grade of 0.54% U3O8. North Thelon also borders Cameco’s discoveries at Qavvik, Tatiggaq and Ayra.

Limited drilling at North Thelon in 2008 and 2011 delineated four major targets with intense alteration and elevated uranium that appear similar to Kiggavik and Cameco’s properties, Forum says. 


While uranium prices remain depressed and Japan has yet to restart its nuclear reactors, Mazur is upbeat about the sector and the prospect of higher uranium prices. “The Japan restart has taken a lot longer than most of us thought it would, but I do believe we’ll see Japan reactors come back online, and that will help drive demand higher,” he says. “And with the end of the Highly Enriched Uranium Agreement between Russia and the U.S., there will be a supply crunch for buyers.”


Mazur points to the recent $50-million bought-deal financing by Uranium Participation (TSX: U) as a sign that the sector could be on the verge of a turnaround. “There are investors out there buying at these prices because they anticipate that uranium prices are going to go higher, and they want to buy when prices are cheap,” he says. “It’s a good sign, and it bodes well for an increase in uranium prices in 2015.”  

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Boen Tan (left), chief geologist, and Richard Mazur, president and CEO of Forum Uranium, examine an outcrop in Saskatchewan's Athabasca basin. Credit: Forum Uranium
Boen Tan (left), chief geologist, and Richard Mazur, pr...
Samples from a radioactive intersection in basement rocks at the Otis West target, just south of Forum Uranium's Maurice Bay deposit. Credit: Forum Uranium
Samples from a radioactive intersection in basement roc...

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