First Analytical Results for N?rke

RNS Number : 4850P

URU Metals Limited

02 October 2013

 



2nd October, 2013

URU Metals Limited

("URU" or "the Company")

First Analytical Results from Närke Uranium-Oil Project and

Appoints SGS Lakefield

The Director's of URU Metals Limited, (AIM:URU), the  base metals and uranium explorer and development Company, are pleased to announce the first analytical results of Source Rock Analysis/Rock Eval Pyrolysis Tests, Fischer Assay tests, and metals geochemistry from the Närke Oil-Uranium Project, located in Central Sweden. 

Highlights

·     Exceptionally high total organic content in the samples in the form of kerogen, ranging from 16.6 - 21.1 wt% TOC

·     Confirmed that the form of kerogen is Type II, favorable for oil extraction

·     Between 66.2 and 106.9 mg of hydrocarbons per gram of rock was extracted from cracking of kerogen, at a relatively low Tmax average temperature of around 420°C.

·     The samples from the K1 pit area returned the best S2 results, averaging 93.52 mg of hydrocarbons extracted per gram of rock.

Commenting upon the results, URU CEO Roger Lemaitre said, "URU is pleased with the first phase analytical results from our first samples collected at the Närke Project.  The hydrocarbon testing indicates that we may be able to extract much more oil than we previously thought possible, and suggests that the potential exists to produce gas hydrocarbons as well.

"Although we are still at an early stage of our exploration, initial results indicate that the Närke Project is likely to become an oil project with uranium as a by-product. We are looking forward to the results of our Preliminary Metallurgical Test program which will provide us with more clarity on whether the fundamentals of the project and whether it is economically viable."

Nine rock samples were collected from three abandoned small open pit quarries, two of which were located on the Kvarntorp #5 exploration license, and one from the Latorp #1 license.  One blank sample was inserted into the batch for quality control/quality assurance purposes. The Kvarntorp pits were excavated as part of the oil shale mining project conducted by the Swedish government from the 1940's to 1960's.

The Source Rock Analysis and RockEval pyrolysis tests showed that there is an exceptionally high total organic content in the samples in the form of kerogen, ranging from 16.6 - 21.1 wt% TOC and confirmed that the form of kerogen is Type II, considered favorable for oil generation.  The Alum Shales at the Närke Project are very immature, meaning that most of the hydrocarbons that could have be generated from these rocks currently remains trapped within the rocks, as only a minor amount of potential hydrocarbon has been released over time through natural geological processes. 

Most encouraging from the laboratory testing were the large amounts of hydrocarbons released during the second stage of the Rock-Eval pyrolysis test (S2 on the Rock-Eval table).  S2 measures the amount of hydrocarbons (both oil and gas) produced through the cracking of kerogen at temperatures between 300-600°C.  Between 66.2 and 106.9 mg of hydrocarbons per gram of rock were extracted from the cracking, at a relatively low Tmax average temperature of around 420°C.  The samples from the K1 pit area returned the best S2 results, averaging 93.5 mg of hydrocarbons extracted per gram of rock.

The three samples from the K1 pit on the Kvarntorp #5 license averaged a moisture-corrected Fischer Assay Method oil yield of 4.2 wt%, 123 ppm uranium (equivalent to 145 ppm U₃O₈), 440 ppm vanadium, and 172 ppm molybdenum.

The three samples from the K2 pit on the Kvarntorp #5 license averaged a moisture-corrected Fischer Assay Method oil yield of 2.44 wt%, 52 ppm uranium (equivalent to 61 ppm U₃O₈), 406 ppm vanadium, and 178 ppm molybdenum.

The three samples from the L1 quarry located on the Latorp #1 license averaged a moisture-corrected Fischer Assay Method oil yield of 4.2 wt%, 55.7 ppm uranium (equivalent to 65.7 ppm U₃O₈), 464 ppm vanadium, and 171 ppm molybdenum.

 Details from the individual samples can be observed in the attached tables.

Table 1 - Results of the Fischer Assay Tests - Närke Project

Location	Sample Number	As Received			Moisture Corrected
		Oil Received			Oil Yield
		wt%	l/t	gal/ton	wt%	l/t	gal/ton
Kvarntorp #5 Licence K1 Pit	SSOAB-K1-1	4.89	50.03	11.99	4.94	50.47	12.10
	SSOAB-K1-2	3.02	30.51	7.31	3.05	30.80	7.38
	SSOAB-K1-3	4.67	47.27	11.33	4.71	47.70	11.43
	AVERAGE	4.19	42.60	10.21	4.23	42.99	10.30
Kvarntorp #5 Licence K2 Pit	SSOAB-K2-1	3.17	32.27	7.73	3.20	32.62	7.82
	SSOAB-K2-2	1.82	18.40	4.41	1.83	18.58	4.45
	SSOAB-K2-3	2.27	23.14	5.54	2.29	23.38	5.60
	AVERAGE	2.42	24.60	5.90	2.44	24.86	5.96
Latorp #1	SSOAB-L1-1	3.82	38.49	9.23	3.85	38.83	9.31
Licence L1	SSOAB-L1-2	3.77	38.15	9.14	3.81	38.55	9.24
Pit	SSOAB-L1-3	3.19	32.04	7.68	3.22	32.35	7.75
	AVERAGE	3.59	36.23	8.68	3.63	36.58	8.77
Blank	SSOAB-L2-1	-0.43	0.00	0.00	-0.43	0.00	0.00

Table 2 - Results of the Rock-Eval Tests - Närke Project

Location	Sample Number	Carbonate	Leco	Rock-Eval
			TOC	S1	S2	S3	Tmax	Production Index
		(wt%)	(wt% HC)	(mg HC/g)	(mg HC/g)	(mg CO2/g)	(°C)	(S1/(S1+S2)
Kvarntorp #5 Licence K1 Pit	SSOAB-K1-1	8.8	19.1	1.86	106.94	1.33	419	0.017
	SSOAB-K1-2	13.6	16.8	1.55	81.04	1.47	419	0.019
	SSOAB-K1-3	13.0	18.0	1.71	92.57	1.57	417	0.018
	AVERAGE	11.8	18.0	1.71	93.52	1.46	418.3	0.018
Kvarntorp #5 Licence K2 Pit 1	SSOAB-K2-1	7.1	17.5	1.66	76.2	2.49	417	0.021
	SSOAB-K2-2	9.1	16.6	1.49	66.22	2.19	420	0.022
	SSOAB-K2-3	9.8	17.0	1.61	68.55	2.35	420	0.023
	AVERAGE	8.6	17.0	1.59	70.32	2.34	419.0	0.022
Latorp #1 Licence L1 Pit	SSOABL-L1-1	2.4	18.1	1.85	79.27	2.42	421	0.023
	SSOABL-L1-2	4.3	21.1	1.9	91.94	2.37	422	0.020
	SSOABL-L1-3	2.7	20.8	2.09	94.29	2.31	421	0.022
	AVERAGE	3.1	20.0	1.95	88.50	2.37	421.3	0.022
Blank	SSOAB-L2-1	28.9	0.12	0.03	0.19	0.25	0	0.136

Where

S1	is the milligrams per gram of sample of hydrocarbons (not kerogen) present in the rock, liberated by heating up to 300 °C
S2	is the milligrams per gram of sample of hydrocarbons derived from kerogen during pyrolysis heating between 300-600 °C
S3	is the milligrams per gram of sample of carbon dioxide derived from kerogen during pyrolysis heating between 300-600 °C
Tmax	is the temperature at which the maximum amount of hydrocarbons derived from kerogen is released
Production Index	is the percentage of generated hydrocarbons removed from the rock during its geological history relative to the maximum amount of hydrocarbons the rock can generate

Table 3 - Results of the Geochemical Analysis - Närke Project

	Sample Number	V	Mo	U
Location	Detection Limit	2	0.05	0.05
	Units	ppm V	ppm Mo	ppm U
Kvantorp #5 Licence K1 Pit	SSOAB-K1-1	444	178	154
	SSOAB-K1-2	452	174	104
	SSOAB-K1-3	425	164	111
	AVERAGE	440.3	172.0	123.0
Kvantorp #5 Licence K2 Pit	SSOAB-K2-1	427	168	52.2
	SSOAB-K2-2	395	184	52.1
	SSOAB-K2-3	395	183	51.9
	AVERAGE	405.7	178.3	52.1
Latorp #1 Licence L1 Pit	SSOAB-L1-1	389	147	53.9
	SSOAB-L1-2	505	185	57.8
	SSOAB-L1-3	499	182	55.4
	AVERAGE	464.3	171.3	55.7
Blank	SSOAB-L2-1	46	1.23	2.85

Appointment of SGS Lakefield

URU's 100% subsidiary, Svenska Skifferoljeaktiebolaget, has signed a contract with SGS Laboratories to conduct early-stage metallurgical and oil recovery tests on approximately 200 kg of rock that will be collected from the Närke project in the next few weeks.  Oil recovery testing will be conducted at SGS's Burnaby lab and the metallurgical work completed at SGS Mineral Services, Lakefield.

The purpose of this Preliminary Metallurgical Test ("PMT") program is to determine whether there are technical and economic methods to extract oil, uranium, vanadium and molybdenum from the Alum Shales present on the property.  Further investment will be dependent on these results.

URU is currently in the process of acquiring the necessary approvals to collect these samples from the same historic open pits as the first samples were obtained.  Sample collection is planned for early October with results likely to be received in early March, 2014.

URU has also signed an agreement with Golder Associates UK, to provide a preliminary operating and capital costs estimates based on the laboratory results to assist the Company in making a decision whether or not to proceed to the resource definition stage after the PMT.

Non-Core Niger Operations Closed

Over the past year, URU has been rebalancing its portfolio of assets.  With the addition of the Närke Oil-U Project in Sweden, the Nueltin Gold-Uranium Project in Canada, and our continued involvement in the SAN Nickel Joint Venture in South Africa, the Company has three significant projects that are poised to increase shareholder value as we continue to invest in their development. 

URU believes that all of our current resources should be steered towards the development of these three projects.  For the past year, URU has been actively searching for a partner to share the risk of exploration on our Niger uranium assets, and have even contemplated an outright sale of our Niger subsidiary to several parties.  Unfortunately, since this extensive search has failed to yield any potential partners or purchasers, the Company has decided to close its Niger operations effective immediately, and our existing exploration licenses will be returned back to the Niger Ministry of Mines as soon as possible.

Background information on Närke Project

Sweden is one of the world's most favourable mining jurisdictions.   Between 1941 through 1966, a Swedish government-owned company produced 62 tonnes of uranium (134,500 lbs) and established an oil-recovery plant on the Närke Project, which recovered approximately 159,100 m³ of petroleum (1 million barrels) and 418,400 m³ of fuel oil (2.6 million barrels) from approximately 50 million tonnes of mined rock.

The Alum shale is world renown as being one of the world's largest repositories of metals, particularly uranium.  Perceived uranium resources within the Alum Shales are generally believed to be larger than most of the combined uranium resources from the producing global uranium districts.  Although an economic recovery of uranium from the Alum Shale has not yet been developed at today's uranium prices, technological advances in oil and uranium recovery the last decade make this project potentially viable.

URU's focus will be on reducing risk by proving that a co-recovery extraction process can be developed using existing technologies before incurring significant investment into proving up uranium and oil mineral resources and reserves.

Historic drill holes testing the Alum Shale on the existing licenses were completed by previous explorers, indicating that good thickness of uranium and oil-bearing Alum Shale are present across all the mineral licenses being acquired by URU.

About the various analytical techniques

The Fischer assay is a standardized laboratory test for determining the oil yield from oil shale to be expected during conventional shale oil extraction. A 100 gram oil shale sample crushed to <2.38 mm is heated in a small aluminum retort to 500 °C (930 °F) at a rate of 12°C/min (22°F/min), and held at that temperature for 40 minutes. The distilled vapors of oil, gas, and water are passed through a condenser and cooled with ice water into a graduated centrifuge tube, and subsequently analyzed.

Source Rock Analysisinvolves multiple tests to measure the total organic carbon (TOC), percent carbonate and RockEval pyrolysis which provides a measurement of free hydrocarbons (S1), kerogen content (S2), carbon dioxide associated with organic matter (S3) and temperature of maximum S2 peak (Tmax). From these data a range of kerogen quality and oil yield indexes can be calculated.

Geochemical Analysis was completed using SGS Mineral Services, Lakefield's GE ICM40B - Multi-Acid (4-Acid) Digestion technique, under which samples are first weight upon receipt and crushed using SGS's CRU22 process, under which the entire sample is crushed until 75% of the material passes a 2 mm screen.  Following crushing, a 250 g split is taken from the larger sample and pulverized until 85% of the material passes 75 microns.   The resulting sample is digested using a combination of HCl (hydrochloric acid), HNO3 (nitric acid), HF (hydrofluoric acid) and HClO4 (perchloric acid). A combination of ICP-AES AND ICP-MS Package (49 Elements) was used to determine the concentrations of Mo (1-10,000ppm), U (0.05-10,000ppm), V (2-10,000ppm), Ni (2-10,000ppm). 

ICP-AES is a technique under which the digested sample is ionized with inductively coupled plasma.  Nitrogen or dry compressed air is used to 'cut' the plasma at a specific spot. One or two transfer lenses are then used to focus the emitted light on a diffraction grating where it is separated into its component wavelengths in the photodetectors in an optical spectrometer which measures the intensity specific wavelength(s) attributable to each particular atomic element involved on an array of semiconductor photodetectors.  The intensities each wavelength can be used to determine the concentration of a particular element. 

Additional information regarding the Närke Project can be found on the Company's website at www.urumetals.com.

-Ends -

 Contact details:

URU Metals Limited Roger Lemaitre, CEO	+ 1 416 892 2870
WH Ireland Limited (Nominated Adviser and Broker) Adrian Hadden James Bavister	+ 44 207 220 1666
Ribeiro Communications Ana Ribeiro	[phone]

 

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