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Blue Sky makes significant new uranium-vanadium discovery at Amarillo Grande Project, Argentina

Published 18 September 2017

Blue Sky Uranium has reported Phase I Extension reverse circulation (RC) drilling results for the Ivana target and the Phase I results from the remainder of the Amarillo Grande uranium-vanadium project, in Rio Negro Province, Argentina.

At the Ivana target, RC drilling on the eastern flank of the previously-reported Phase I drilling area has defined astrongly mineralized corridor that extends more than 2 kilometres in a northeast direction, is between 200 and >400 metres wide, up to 20 metres thick, and is open to expansion to the southeast and to the north. This largely continuously mineralized zone includes a higher-grade core zone over one kilometre in length, which includes drill intercepts of up to 3,136 ppm U3O8 over one metre (AGI-0100). Strong uranium grades are also present within the interpreted southeastern extension (942ppm U3O8 over one metre in AGI-0124); and, the northern extension (817ppm U3O8 over one metre - AGI-0138).

Highlights include:

  • 1,861 ppm U3O8 over 3 m

           - within 405 ppm U3O8 over 20 m in AGI-0100

  • 1,410 ppm U3O8 over 1 m

           - within 571 ppm U3O8 over 6 m in AGI-0120

  • 942 ppm U3O8 over 1 m

          - within 575 ppm U3O8 over 3 m in AGI-0124

  • 877 ppm U3O8 over 1 m

          - within 423 ppm U3O8 over 7 m in AGI-0119

  • 835 ppm U3O8 over 1 m

         - within 447 ppm U3O8 over 6 m in AGI-0137

  • 814 ppm U3O8 over 1 m

         - within 570 ppm U3O8 over 5 m in AGI-0099

  • 647 ppm U3O8 over 1 m

         - within 420 ppm U3O8 over 5 m in AGI-0131

"These results represent a significant new uranium-vanadium discovery," stated Nikolaos Cacos, Blue Sky President & CEO. "We have always held the belief that Blue Sky's Amarillo Grande project, covering 269,000-hectares, has district-wide potential for uranium-vanadium discovery - and these results confirm that. We thank our technical team, led by Guillermo Pensado, and our shareholders for their patience and perseverance."

Most of the uranium-vanadium found to date at Ivana and elsewhere on the Amarillo Grande property has consisted of carnotite mineralization in a surficial deposit type setting. Examples of surficial uranium deposits include Langer Heinrich in Namibia, which has Proven and Probable ore reserves and stockpiles with an average grade of 471 ppm U3O8 and in in the 9 months ending in March 2017 had C1 unit cash costs of US$17.51/lb U308. In some of the recent strongly mineralized holes at Ivana, potentially primary mineralization was observed and the deposit style appears to include more characteristics of sandstone-type deposits. Sandstone deposits represent approximately 18% of world uranium resources, with grades of typically 0.05 to 0.35% U. These deposits are a leading source of uranium production in Kazakhstan, the USA and Niger.

The Company has commenced additional geophysical surveys and RC drilling to expand the strongly mineralized corridors identified to date at Ivana. Metallurgical testwork is also progressing.

Drill Program Technical Summary:

The 269,000-hectare (~665,000 acre) Amarillo Grande project spans a 140-kilometre long trend along which a number of areas of uranium-vanadium mineralization have been identified. From northwest to southeast there are three primary outcropping target areas named Santa Barbara, Anit and Ivana. This Phase 1 and Phase 1 extension RC drilling program included a total of 3,730 metres of RC drilling in 256 holes. A complete list of weighted average intervals >30ppm U308 in all holes, as well as hole location data can be viewed at website.

The majority of holes are vertical and, as such, reported mineralized intercepts are believed to approximate true thickness.

Ivana Target

The first 98 holes from Ivana were previously reported in the Company's news release dated June 19th, 2017. Based on the first set of results, a follow-up program was designed, including additional electrical tomography (ET) geophysical surveying and 60 RC drill holes totaling 858 metres, to further define an area with elevated uranium-vanadium on the eastern flank of the previously-drilled area. Overall, approximately two-thirds (104) of the 158 holes at Ivana returned intervals of at least one metre of more than 30 ppm U3O8 and grades ranged as high as 3,136 ppm over 1 metre. The mineralized area now covers approximately 3,400 metres x 1,300 metres with depths to 23 metres, including higher-grade zones. Map 3 shows drill holes with collars coloured by intercept grade and grade x thickness (U3O8 x m) contours:

Along Line 9 between holes AGI-053 and AGI-102 the continuous mineralized corridor extends over approximately 2 kilometres with mineralized thicknesses ranging between 3 and 20 metres. Along the line of holes which parallels Line 9, 200 metres to the northwest, the strongly mineralized corridor has been defined between holes AGI-058 and AGI-133. These holes extend over approximately 1.5 kilometres, with mineralized intervals ranging in thickness from 3 to 12 metres.

The mineralized corridor remains largely open to extension to the southeast and potentially connects with the >1000 grade x thickness area defined by holes AGI-124 & 137 on the eastern flank of the currently drilled area, also is open to expansion. The mineralized corridor is potentially also open to expansion to the north, from holes AGI-156 to AGI-138. The mineralization along this trend of holes is more variable and includes intervals of 7 metres of 255 ppm U3O8 and 171 V2O5 (AGI-138) including a single interval of one metre of 816 U3O8 and 205 V2O5. Drill hole highlights from the follow-up Phase I drilling at Ivana are provided.

The follow-up program provided new information that has resulted in the geological team updating the deposit model reflecting characteristics of sandstone-type and surficial-type uranium-vanadium mineralization. Higher-grade mineralization is believed to be related to fluvial medium-to-coarse sandstones and conglomerates within an ancient deltaic braided stream environment that lies unconformably over granitic basement. Uranium-vanadium mineralization at Ivana occurs primarily in the form of carnotite, a uranium vanadate, however in some of the higher-grade areas potentially primary mineralization was observed. Additional geophysical surveys and RC drilling to define the expansion potential of mineralized corridors is ongoing at Ivana and metallurgical testwork is also progressing on material from Ivana.

Anit Target

Drilling at Anit included 83 holes for a total of 1170 metres, with the deepest holes drilled to 20 metres. A map of the drill holes can be found at: website. The program was designed to audit previous exploration results as well as test adjacent areas for extensions to mineralization. The program successfully confirmed the spatial correlation of the previously recognized mineralized zones. Out of 83 holes drilled, 53 returned intervals with at least one metre of more than 30 ppm U3O8. This area is particularly well-mineralized in vanadium with 55 of the holes returning intervals of at least one metre of 500 ppm V2O5, with values reaching as high as 3,411 ppm (0.34% in AGA-049). Drill hole highlights are provided.

Integrating the results of the 2017 RC drilling with the previous pit sampling, trench sampling and aircore drilling data is ongoing and is aimed at refining future infill and step-out drilling plans.

Santa Barbara Target

This was the first drill program at this target area and was considered a scouting program. Fifteen holes were drilled ranging from 4 to 25 metres length, for a total of 312 metres. Values of uranium and vanadium were low in all holes; this target area represents the lowest priority for follow-up work.

Source: Company Press Release