Aura Energy's Häggån Project uranium resource doubles to 631m lbs, 3rd largest undeveloped resource

Aura Energy (ASX: AEE) has recorded another expansion in uranium resource at the Häggån Project in Sweden - from 291 to 631 million pounds of uranium - which ranks the deposit in the top three largest undeveloped uranium resources in the world.

The resource calculation undertaken by independent resource consultants, Hellman & Schofield Pty Ltd (H&S) included for the first time, the western section of the core permit area.

What is even more significant is that even after the resource upgrade at Häggån Project, the potential for further resource expansions is strong given drilling that has been used in this resource statement covers only 15% of Aura Energy’s permit areas at Häggån.

The resource also renders the Häggån Project a major depository of valuable co-metals. The Project contains 580,000 tonnes of nickel and also 383,000 tonnes of molybdenum, both important metals used in the steel industry.

On a global scale these are also exceptionally large resources.

The vastness of the resource has caught Aura Energy's managing director Bob Beeson by surprise, "when we designed the drilling programme last year we anticipated good results but this outcome has substantially exceeded our expectations.”

The Häggån Project forms part of a large uranium field in Central Sweden. The uranium occurs with molybdenum, nickel, vanadium and zinc in black shales. The shales form a near continuous sheet throughout the part of the project that Aura has drilled, with thicknesses ranging between 20 metres and more than 250 metres.

Managing director, Bob Beeson said, "This resource upgrade demonstrates the vast size of the uranium mineralisation in the Häggån Project. The mineralisation occurs as a thick, flat lying sheet of multi-metal mineralisation and further major resource upgrades are anticipated.”

Based on all of the Häggån assays data to date, H&S has established a total resource estimate for the deposit reported in accordance with the JORC (Joint Ore Reserves Committee) Code and Guidelines.
H&S has used the method of ordinary block kriging to estimate grade and tonnage and considers that the drilling density and assay quality is of a standard that qualifies the estimate as an Inferred Resource.

Aura recently reported highly encouraging initial results from the second phase of its bioleach testwork on the Häggån deposit. This testwork is aimed at proving up a low cost extraction process.

• Chemical analysis and testwork have demonstrated that the mineralisation is acid-generating, facilitating metal leaching
• First small-scale column leach tests have indicated up to 75% uranium extraction
• In addition, significant extraction s of other metals has been achieved:
• Nickel up to 65%, zinc to 60% and molybdenum to 25%
• There is considerable scope for increasing these extractions, for example, by crushing to finer size.

Work on optimising uranium recoveries and mining scoping studies continues and will expand to include the new resource areas.

Analysis
The resource upgrade to 631 million pounds of uranium is massive and underlies the under-valuation of Aura Energy on an EV/Resources basis against its peers. Add in the co-metals of 580,000 tonnes of nickel and also 383,000 tonnes of molybdenum, and the value of the project relative to Aura Energy's valuation looks out of sync. While the uranium sector has had its challenges, the Häggån deposit also contains significant molybdenum, nickel, vanadium and zinc in black shales. By any order, the resources at Häggån are exceptional.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/18831/aura-energys-hggn-project-uranium-resource-doubles-to-631m-lbs-3rd-largest-undeveloped-resource-18831.html