Energy Fuels Re-Files NI 43-101 Technical Reports as Required by Ontario Securities Commission Disclosure Record Review
28 January 2009 - 1:00AM
Marketwired Canada
On September 23, 2008, Energy Fuels ('EFR') (TSX:EFR) was notified that the
Company had been randomly selected by the Ontario Securities Commission ('OSC')
for an issue oriented review of its continuous disclosure record. At the request
of the OSC, the Company has amended and re-filed the five NI 43-101 Technical
Reports filed by Energy Fuels in 2008 addressing the classification of resources
at the Whirlwind, Energy Queen, Willhunt, Torbyn, and Farmer Girl properties.
The principal impact of the changes to these Technical Reports is a reduction of
the total "Inferred Resource" category for all five properties combined to 2.34
million pounds U3O8 and 7.88 million pounds V2O5 contained in tonnages and at
grades detailed in the table below:
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AMENDED INFERRED RESOURCES
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U3O8 V2O5
---- ----
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Tons Grade Lbs. Grade Lbs.
---- ----- ---- ----- ----
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Whirlwind Area
--------------
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Whirlwind 255,700 0.22% 1,200,000 0.70% 3,900,000
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Crosswind 120,700 0.25% 500,000 0.81% 1,600,000
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Far West 25,000 0.20% 100,000 0.65% 324,000
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Utah Sec. 16 35,700 0.23% 200,000 0.65% 648,000
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Sub-Total 437,100 0.23% 2,000,000 0.72% 6,472,000
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Energy Queen 32,900 0.34% 222,000 1.43% 943,000
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Willhunt 0 0 0
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Torbyn 27,600 0.22% 120,000 0.80% 442,800
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Farmer Girl 0 0 0
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TOTAL 497,600 2,342,000 7,857,800
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This is a reduction of about 1.2 million lbs. of inferred U3O8 resource and
about 5.4 million lbs. of inferred V2O5 resource from the values originally
reported. The Measured and Indicated Resources originally reported remain
unchanged.
Drilling recommended in the original 43-101 technical reports and completed in
2008, will result in an overall increase in the measured and indicated resource.
Much of that increase will come in areas originally classed as "Inferred
Resource" by EFR, but removed from the Inferred category in the amended reports
after the OSC's review of EFR's disclosure compliance with 43-101 and CIM
resource definitions.
Specific disclosure issues raised by OSC and addressed by Energy Fuels'
amendments included:
1.) "Diluted to Mining Thickness"
There was confusion regarding dilution at our properties. OSC interpreted the
Technical Reports to mean that EFR would be extracting a full seven feet of
material in all of our mining and had therefore significantly understated mine
dilution.
The uranium deposits in the Salt Wash Member of the Morrison Formation in the
Uravan Mineral Belt are typically thin (1 to 4 ft. thick mineralized layers).
Each report was amended to include a discussion of the "split-shooting" or
"resuing" mining method which is necessary and customary in Uravan Mineral Belt
uranium mines (both historic and current). In this expanded explanation, EFR
corrected and clarified the original statement "...7.0 feet, the assumed minimum
mining thickness" by discussing 7.0 feet as the minimum stope height necessary
to advance the stope. This, coupled with the description of split-shooting
(blasting and hauling ore and waste from the same face with two, separate
operations), clarifies the one foot of waste incorporated in the phrase "diluted
to mining thickness" in the resource estimates.
2.) "Cut-Off Grade"
OSC requested justification for the various cut-off grades used in the reports.
Language has been added to each report, especially as footnotes in the resource
estimate tables (Tables 17-1, 17-2, etc.) to help clarify the U3O8 cut-off used.
The U3O8 cut-off grade is subjective. It varies from mine to mine and can even
vary within the same mine for several reasons, including: a.) the greater than
average thickness of some lower-grade blocks; b.) the location of a lower-grade
resource block- relative to planned development drifts accessing higher-grade
blocks, or the resulting lower mining costs for accessing lower-grade individual
blocks in certain locations; and c.) blocks where the known V2O5 grades are much
higher than the average, historic district V2O5:U3O8 ratio.
3.) "Grade/Thickness Cut-Off"
OSC requested clarification on our method for selecting polygons that meet
minimum cut-off grades and when they applied a uniform 7 foot mining thickness,
they felt that many of EFR's resource blocks would not meet cut-off.
EFR does not use a Grade/Thickness (GT) cut-off for the same reasons discussed
in Item 2. above. The fact that EFR resource estimates include two metals
instead of just uranium is most significant. A possible method to address this
issue in future reports could be a "net smelter return" per block based on
recovered values of both metals.
4.) "Geologically Inferred Resource"
OSC pointed out that this term is prohibited under 43-101 and 2005 CIM
standards, and further indicated skepticism as to the validity of much of the
inferred resource reported by EFR in the original Technical Reports.
EFR and the Qualified Persons ('QP's') examined each report and have reworded
and expanded the individual reports concerning Inferred Resource estimates vs.
Exploration Targets. Each amendment focused on evaluating each previously
defined Inferred area to see if the methodology was correct and if terminology
required a change to meet the CIM Standards and definitions, or, if the
available data was not sufficient to meet the CIM definition of "Inferred".
Additional information (mention of known mineralized holes, expanded discussions
of sandstone channels, trends, and favorable characteristics and estimated tons
and grades) was added to the reports for the areas believed to qualify as
Inferred Resources. Where this type of validating information was too sparse,
the QP agreed with the OSC and changed the areas to Exploration Targets. These
evaluations and changes (and subsequent discussions of draft versions of the
amended reports with OSC) have resulted in the individual amended technical
reports.
5.) Other Terminology and Presentation Issues
OSC requested clarification of the nature of the resource estimate at Willhunt
(historic vs. current), the use of proper CIM resource categories, the
presentation of resource summaries in tabular rather than text form, and
specifically instructed that EFR refrain from referring to potential mine
production as "ore" because of the economic feasibility implication attached to
that term. EFR amended all the Technical Reports to comply accordingly.
Stephen P. Antony, P.E., a Qualified Person as defined by National Instrument
43-101, has reviewed and approved the content of this press release.
Energy Fuels Inc. is a Toronto-based uranium and vanadium mineral development
company actively rehabilitating and developing formerly producing mines. With
more than 40,000 acres of highly prospective uranium and vanadium property
located in the states of Colorado, Utah and Arizona, the Company has a full
pipeline of additional development prospects. Energy Fuels, through its
wholly-owned Colorado subsidiary, Energy Fuels Resources Corporation, has
assembled this property portfolio along with a first class management team,
including highly skilled technical mining and milling professionals based in
Lakewood and Nucla, Colorado and Kanab, Utah.
This news release contains certain "Forward-Looking Statements" within the
meaning of Section 21E of the United States Securities Exchange Act of 1934, as
amended and "Forward Looking Information" within the meaning of applicable
Canadian securities legislation. All statements, other than statements of
historical fact, included herein are forward-looking statements and forward
looking information that involve various risks and uncertainties. There can be
no assurance that such statements will prove to be accurate, and actual results
and future events could differ materially from those anticipated in such
statements. Important factors that could cause actual results to differ
materially from the Company's expectations are disclosed in the Company's
documents filed from time to time with the British Columbia, Alberta and Ontario
Securities Commissions.
George E.L. Glasier, President & CEO
Energy Fuels (TSX:EFR)
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