Resources Update

RNS Number : 3990J

Berkeley Resources Limited

30 March 2010

 



30 March 2010

BERKELEY RESOURCES LIMITED

RESOURCES INCREASED TO OVER 80 Mlbs of U₃O₈

at a 200 ppm cut-off

Berkeley Resources Limited is pleased to advise the completion of the initial Mineral Resource Estimates, reported in accordance with the JORC Code (2004), for the Salamanca Uranium Project in Spain.  New estimates for the Alameda and Villar Area deposits have increased total Mineral Resources within Berkeley's projects by 53% to over 80 Mlbs of U₃O₈ at a 200 ppm cut-off and over 100 Mlbs at a 100 ppm cut-off (see Table 1).

·    Mineral Resources within Berkeley's projects now total 81.2 million tonnes at 450 ppm for 80.4 Mlbs U₃O₈, with 32% in the Measured and Indicated categories.

·    Mineral Resources for the Alameda South Deposit total 18.5 Mlbs at an average grade of 458 ppm U₃O₈ including 49% Indicated Resources.

·    Mineral Resources for the Alameda North Deposits total 4.5 Mlbs at an average grade of 503 ppm U₃O₈. These Mineral Resources are all in the Inferred category.

·    Mineral Resources for the Villar Deposit (previously Esperanza) total 4.9 Mlbs at an average grade of 446 ppm U₃O₈. These Mineral Resources are all in the Inferred category.

·    Reverse circulation (RC) drilling to upgrade and extend the Mineral Resources at Palacios North, Sageras and Alameda South is due to commence in the June Quarter with updated Mineral Resource Estimates for these deposits completed thereafter.

·    Table 1 - Berkeley Projects Total Mineral Resources

Cut-off	Measured			Indicated			Inferred			Total
U3O8	T	U3O8	U3O8	T	U3O8	U3O8	T	U3O8	U3O8	T	U3O8	U3O8
(ppm)	(Mt)	(ppm)	(Mlb)	(Mt)	(ppm)	(Mlb)	(Mt)	(ppm)	(Mlb)	(Mt)	(ppm)	(Mlb)
100	9.2	306	6.2	30.8	355	24.1	108.5	299	70.9	148.5	311	101.2
150	7.7	341	5.8	23.9	423	22.3	76.2	374	62.5	107.8	382	90.5
200	5.6	403	5.0	18.9	491	20.5	56.6	441	54.8	81.2	450	80.4

Ian Stalker, Berkeley Resources MD commented "These latest figures confirm the quality of the Salamanca resources allowing us to push forward on our Feasibility Study to bring the Project back into production and to develop a production profile commensurate with such a quality resource base.  The substantial resources available encourage us to investigate increasing production beyond the present plant capacity of 2.1 Mlbs U₃O₈ per annum.

The 200 ppm cut-off applied to the Mineral Resource Estimates (Table 2) is a conservative approach and along with increasing mining production and throughput, offers the potential to improve operating costs from previous estimates."

Enquiries -       Managing Director:     Ian Stalker                   Tel:  [phone]

                        RBC Capital Markets: Martin Eales               Tel: [phone]

1.  MINERAL RESOURCE INVENTORY

Berkeley's Mineral Resources are located in 5 areas:  Águila, Alameda, Villar, Retortillo and Gambuta. 

Berkeley has previously advised Mineral Resource Estimates for the Retortillo, Águila and Gambuta Areas. Following the completion of the confirmatory drilling program at the Alameda Area (announced on the 18^th March, 2010), Mineral Resource Estimates for the Alameda South, Alameda North and Villar deposits have now been completed. A detailed breakdown of each deposit is presented in Table 2.

Berkeley's Feasibility Study is focussed initially on the Águila and Alameda areas, with possible extension to the Retortillo and Villar areas. These four areas form the Salamanca Uranium Project (the "Project").

Table 2 - MINERAL RESOURCE INVENTORY (200 ppm U₃O₈ Cut-off)

Deposit	Resource	Tonnes	U3O8	U3O8	U3O8	Category	Estimated
Name	Category	(Mt)	(ppm)	(t)	(Mlbs)	(%)	By 1
	Indicated	8.6	480	4,133	9.1	49.1%
	Inferred	9.8	439	4,280	9.4	50.9%
Alameda South 2	Total	18.4	458	8,413	18.5	100.0%	AMC
Alameda North 2	Inferred	4.1	503	2,046	4.5	100.0%	BR
	Indicated	8.6	480	4,133	9.1	39.5%
	Inferred	13.9	458	6,326	13.9	60.5%
Alameda Area 2	Total	22.5	466	10,459	23.1	100.0%
Villar Area 2, 5	Inferred	5.0	446	2,239	4.9	100.0%	BR
	Measured	5.6	403	2,262	5.0	24.1%
	Indicated	5.1	470	2,415	5.3	25.7%
	Subtotal M+I	10.8	435	4,677	10.3	49.8%
	Inferred	11.8	400	4,715	10.4	50.2%
Águila Area 2, 4	Total	22.5	417	9,392	20.7	100.0%	AMC & BR
	Indicated	5.2	531	2,759	6.1	27.1%
	Inferred	14.7	505	7,431	16.4	72.9%
Retortillo Area 4	Total	19.9	512	10,190	22.5	100.0%	MS & BR
	Measured	5.6	403	2,262	5.0	7.0%
	Indicated	18.9	491	9,307	20.5	28.8%
	Subtotal M+I	24.5	471	11,569	25.5	35.9%
Salamanca	Inferred	45.4	458	20,711	45.6	64.1%
Uranium Project	Total	69.9	463	32,280	71.2	100.0%
Gambuta Area 4	Inferred	11.3	371	4,174	9.2	100.0%	MS
	Measured	5.6	403	2,262	5.0	6.2%
	Indicated	18.9	491	9,307	20.5	25.5%
	Subtotal M+I	24.5	471	11,569	25.5	31.7%
	Inferred	56.6	441	24,885	54.8	68.3%
Berkeley	Total	81.2	450	36,454	80.4	100.0%

1.    AMC = AMC Consultants(UK), MS = McDonald Speijers Consultants, BR = Berkeley Resources

2.    Berkeley has agreed to acquire 90% of the ENUSA State Reserves and any deposits therein by, inter alia, completing a feasibility study and paying €20m to ENUSA. For full details of the Agreement, see Berkeley's announcement dated 10 December 2008

3.    All figures are rounded, so differences may occur

4.    Previously reported Mineral Resources

5.    Villar Area previously referred to as Esperanza

2.  SALAMANCA URANIUM PROJECT

Berkeley's Feasibility Study process for the Salamanca Uranium Project commenced in May 2009, following Cabinet approval of the Co-Operation Agreement between Berkeley and ENUSA.  The Study objective is to assess the viability of restarting mining within the Salamanca State Reserves, based on a number of known uranium deposits.

Following successful completion of the Scoping Study, announced in December 2009, the Company has focused on the estimation of Mineral Resources based on historical exploration targets, as well as acquiring representative samples for a comprehensive program of metallurgical testing. This process has now been completed for the Águila Area, proximal to the Quercus processing plant and the Alameda Area, 12km to the west. Final Mineral Resource Estimates for the Feasibility Study, which are intended to upgrade resource categories, will be available later in 2010 after infill RC drilling and probing of additional ENUSA holes.

2.1  Geology

The largest accumulations of uranium within the Project area are hosted in an Upper Proterozoic to Lower Cambrian package of rocks called the Schist Greywacke Complex (SGC). The SGC and associated Hercynian granitic plutons form the basement which is unconformably overlain by continental sediments deposited during the Tertiary Alpine Orogeny. The cover sediments are unmineralised, but uranium mineralisation does occur within intragranitic veins.

The SGC is affected by the 3 main phases of the Hercynian Orogeny and pre Hercynian deformation has also been recognised. Later Alpine movements rejuvenated earlier Hercynian structures as well as developing new fracture and breccia zones.

The complex was metamorphosed to lower green schist facies during the Hercynian, and well developed contact aureoles and small granitic dykes and sills are common around granite margins.

The deposits are associated with quartz sericite metapelites which are often carbonaceous. Structural preparation and rock competencies appear to have influenced deposit formation.  The official International Atomic Energy Association classification for the metasedimentary hosted deposits is Vein Type - Sub Type Iberian, originally formed by low temperature near surface hydrothermal processes. Variable local weathering effects influence the distribution of mineralisation, the degree of which varies between deposits. Disequilibrium has not been identified as a significant issue.

2.2  Alameda Area

The Alameda South and North deposits are located approximately 14km to the west of the Quercus Plant and have a combined total Mineral Resource Estimate of 22.5 Mt at 466 ppm for 23.1 Mlbs U₃O₈. 

Alameda South

The Alameda South deposit was discovered in the 1960's and subsequently drilled out on a 50m x 50m pattern using diamond drilling with chemical assays. The deposit extends from the surface down to 120m and covers and an area of 2km by 1.2km with relatively flat surface topography. Total Mineral Resources have been estimated at 18.4 Mt at 458 ppm for 18.5 Mlbs U₃O₈, including 49% in the Indicated category.

The historical drill hole database for the Alameda South deposit contains 400 diamond drill holes for a total of 40,000m.  The drill spacing is 50m x 50m over the majority of the deposit although this has been reduced to 35m x 35m over the main central zone of mineralisation.  All of the historical assay data consists of chemical assays which have been checked against the historical drill logs. Berkeley has completed a confirmatory diamond drilling program consisting of 19 holes in a series of traverses across the deposit.  The detailed results were recently announced (18^th March, 2010) with all of the Berkeley holes intersecting mineralisation consistent with the historical data.  The e-grades from the Berkeley drill holes were combined with the historical chemical assay data for use in the estimate.

Uranium mineralisation at Alameda South is hosted by a deformed sequence of regionally and thermally metamorphosed quartz sericite pelites. In addition, granitic sills and shallow dipping dykes were intruded after the main folding and metamorphism events followed by the uranium mineralisation.

Uranium mineralisation occurs in a complex network of moderately to steeply dipping brittle structures (veins, faults, fractures and along bedding contacts) as a result of a low temperature hydrothermal event.  The mineralised zones commonly have sharp boundaries, separating mineralised structures from poorly mineralised host rock, recent fracturing is partly responsible for this.

Mineralised domains are 50-200m wide in plan trend North and North-West and dip moderately-to-steeply West and South-West respectively.  The North-trending domain has a strike extent of approximately 800m and the North-West-trending domains have a cumulative strike of approximately 1,500m.  Within each of the domains, multiple mineralised zones have widths of up to 50m.  The depth to the base of mineralisation varies depending on how well developed the structures are that host the mineralisation.  In the North-trending part of the deposit which has a fault zone in the footwall, the mineralisation extends up to 120m below surface.  Elsewhere on the North-West-trending mineralised structures the mineralisation extends 60-70m below surface.

Berkeley's geological model is based on a broad outer envelope of mineralisation that captures the majority of the +100 ppm U₃O₈ grades.  It includes internal sub grade material in order to maintain geological continuity across drill sections.

Average bulk density values, derived from Berkeley drill core, were assigned to oxidised, transition and fresh blocks in the model. 

The Mineral Resource Estimate was undertaken by AMC Consultants (UK) using a block model configuration of 10m x 10m x 6m parent cells, with cells being permitted to split once in any direction where bounding surfaces are encountered.

Sample uranium grade statistics were calculated and population characteristics analysed for each of the mineralised zones. High grade top cuts were determined for each zone and applied to the sample composites to reduce the affect of extreme outlier values. Variographic analysis was successfully completed for two mineralised zones and parameters were derived using multi-structure spherical models. Uranium grades were estimated from 2m sample composites, using Ordinary Kriging for the two mineralised zones and inverse distance squared weighting for the remaining zones. Grade interpolation into parent cells was conducted under hard-bounded zonal control, using mostly 40m x 40m x 5m search ellipsoids aligned in the average plane orientation of each zone.

The Mineral Resource classification was based on confidence levels for criteria such as data density and interpreted grade continuity. Indicated Resources were restricted to estimated blocks within the central part of the deposit where the drilling density is 35m x 35m (or less) and the grade continuity is very good.   An Inferred category was assigned to those blocks where the drilling density was 50m x 50m or greater.

The Mineral Resource Estimates in Table 2 are all reported using a 200 ppm U₃O₈ cut-off grade.  However, the Scoping Study pit optimisation study indicated that a cut-off grade closer to 150 ppm should be considered.  The impact of assuming various cut-off grades at Alameda South is illustrated in Table 3 below.

Table 3 - Alameda South Mineral Resource Estimate

Cut-off	Indicated			Inferred			Total
U3O8	Tonnes	U3O8	U3O8	Tonnes	U3O8	U3O8	Tonnes	U3O8	U3O8
(ppm)	(Mt)	(ppm)	(Mlb)	(Mt)	(ppm)	(Mlb)	(Mt)	(ppm)	(Mlb)
100	11.9	389	10.2	16.0	326	11.5	27.8	353	21.7
150	10.1	435	9.7	12.7	378	10.6	22.8	403	20.3
200	8.6	480	9.1	9.8	439	9.4	18.4	458	18.5

                      All figures are rounded, so differences may occur

A 30 hole RC drilling program to commence in the June Quarter is planned to test the lateral and depth potential identified in the recent diamond drill program and to increase confidence in areas previously drilled at lower density.  It is anticipated that the majority of the Inferred Resource will be upgraded following this program and an updated resource statement will be announced at the end of the June quarter. 

Alameda North

The Alameda North deposits consist of 3 separate zones extending north from Alameda South over a distance of 3.5 km along the granite contact.   All of the Mineral Resources have been classified as Inferred and total 4.1 Mt at 503 ppm for 4.5 Mlbs U3O8.  A breakdown of the individual deposits showing the number of holes drilled is included in Table 4.

Table 4 - Alameda North Mineral Resource Estimates (200 ppm U₃O₈ Cut-off)

Deposit	No. Drill	Total	Category	Tonnes	U3O8	U3O8	U3O8
	Holes	Metres		(Mt)	(ppm)	tonnes	Mlb
Zone 2	49	2,568	Inferred	1.2	472	566	1.2
Zone 19	118	6,927	Inferred	1.1	492	523	1.2
Zone 21	107	6,588	Inferred	1.8	531	952	2.1
	274	16,083	Total	4.1	503	2,042	4.5

           All figures are rounded, so differences may occur

The historical drill hole database for the Alameda North deposits contains 274 diamond drill holes for a total of 16,000m (see Table 4).  The drill spacing at all 3 deposits is approximately 35m x 35m and all of the historical assay data consists of chemical assays. The mineralisation has been interpreted within an envelope of +100 ppm U₃O₈ although sub grade material has been included in order to maintain geological continuity across drill sections.  A block model with a cell size of 10m x 10m x 5m (vertical) was constructed with original chemical assay data composited to 2m after applying a top cut of 5,000 ppm U₃O₈ to reduce the effect of extreme outlier values. Blocks were estimated using Ordinary Kriging with a minimum of 5 samples required to interpolate a grade into a block.  An average bulk density of 2.7 was used based on the Berkeley density measurements taken at Alameda South.

The Mineral Resource Estimate was classified as Inferred as Berkeley has not done any confirmatory drilling in this area.  However, all of the historical drilling was undertaken at the same time as the Alameda South historical drilling where Berkeley has completed the confirmatory diamond drill program.

2.3  Villar Area

The Villar Area is located 10km north of Alameda and 14km north-west of the Quercus Plant.  The Area has been extensively explored since the 1960's but still contains a number of untested radiometric anomalies.  A small historical underground mine was developed at the Villar Deposit but only limited mining activity was undertaken.  

Berkeley airborne radiometrics have confirmed the potential of the area and show that the Villar Deposit is located on a strong radiometric anomaly that extends to the south-west and links up with the Barquilla prospect where Berkeley drilled 7 diamond holes in 2008.   An Inferred Mineral Resource of 5.0 Mt at 446 ppm for 4.9 Mlbs U₃O₈ has been estimated.

Lithologies are similar to the Águila Area with host rocks consisting of fine grained metasediments that have undergone contact metamorphism associated with the Villar del Ciervo-Bañobarez batholith which limits the mineralisation to the north.  Mineralisation is associated with a north east-south west oriented fracture systems and occurs over an area of 1.5km by 1.3km.

The Villar historical drill hole database contains 163 (10,000m) diamond drill holes with associated chemical assays and 336 roto percussion drill holes (23,000m) with down hole e-grades. A proportion of the drill holes do not have any assay data or have unsampled intervals so these were all assigned a zero grade. The drill spacing is typically 40m x 40m roto-percussion holes which have been infilled with diamond drilling to 20m x 20m in the main mineralised areas. The mineralisation has been interpreted within an envelope of +100 ppm U₃O₈ intersections and a number of flat lying zones were identified extending from the surface down to 40 metres.  A block model with a cell size of 10m x 10m x 2m (vertical) was constructed with original chemical and e-grade assay data composited to 1m after applying a top cut of 5,000 ppm U₃O₈ to reduce the effect of extreme outlier values. Blocks were estimated using Ordinary Kriging with a minimum of 5 samples required to interpolate a grade into a block.  An average bulk density of 2.7 was applied, based on the Berkeley density measurements taken in other areas.

The Mineral Resource Estimate was classified as Inferred as Berkeley has not done any confirmatory drilling on this deposit although a number of Berkeley diamond holes drilled at the Barquila Prospect confirmed the nearby historical data.

3.  SUPPLEMENTARY RESOURCE INFORMATION

The uranium grades reported in this release that are annotated with a sub-prefix "e" are reported as uranium equivalent grades derived from down-hole gamma ray logging results and so they should be regarded as approximations only. 

The Berkeley drill holes were logged with a GeoVista total count gamma tool. The gamma tool was calibrated in Adelaide at the Department of Water, Land and Biodiversity Conservation in calibration pits constructed under the supervision of CSIRO. The various calibration factors were calculated by David Wilson BSc MSc MAusIMM from 3D Exploration Ltd based in Perth, Western Australia. 

These Mineral Resources Estimates are presented in accordance with the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resource and Ore Reserves" (JORC Code). 

The information relating to the Mineral Resource Estimates have been compiled by Berkeley Resources team of geologists and consulting geoscientists. 

All Mineral Resource Estimate totals have been reported at a 200 ppm U₃O₈ cut-off unless otherwise stated.

Mr Chris Arnold (MAUSIMM) conducted the estimates for the Alameda South deposit.  Mr Arnold is the Principal Resource Consultant with AMC Consultants (UK), a member of the AusIMM, and a geologist whose career includes more than 20 years relevant experience in resource estimation.

Mr Ross Corben (MAUSIMM) conducted the estimates of the Alameda North and Villar deposits.  Mr Corben is currently a Senior Project Geologist with Berkeley Resources and is a geologist with more than 15 years relevant experience in resource estimation.

A full version of this announcement including images can be downloaded from Berkeley's website at www.berkeleyresources.com.au.

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr. Ross Corben, who is a Member of The Australian Institute of Mining and Metallurgy and an employee of Berkeley Resources Limited. Mr. Corben has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr. Corben consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

 

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