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Message: Dundee Report Feb. 12, 2010 : 1.91% U3O8 over 10.5m including 13.87% over 1m
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Dundee Report Feb. 12, 2010 : 1.91% U3O8 over 10.5m including 13.87% over 1m

posted on Feb 13, 2010 06:30PM

http://www.fission-energy.com/i/pdf/FIS021210.pdf

Conclusion: Initial composite assay results from the discovery hole (WAT10-63A) confirm our expectations that recently announced scintillometer results indicate high grade uranium at Fission's Waterbury JV. This hole is located just 140m along strike from Hathor Exploration's (HAT-V: C$1.81, BUY, C$4.00 target) 12 MM lb Roughrider deposit. We believe that Fission's 'J Zone' is the westward extension of Roughrider.

This news is viewed as positive and investors are beginning to take notice. FIS rose 12% on this update and is now up 205% since the first scintillometer results were announced only 17 days ago. We expect that the stock will continue to gain support as this story becomes more widely known by the market and our geological understanding develops.

We believe that Fission's chances of extending mineralization will improve as drills step out along strike from the cluster of tightly spaced holes currently being drilled. Unconformity deposits are often cigar shaped, and while drilling north-south across the cigar is necessary to define width, drilling along the axis of the cigar is ultimately the goal. We see prime exploration ground from Fission's discovery hole for about 60 to 80m eastward along strike towards the Fission-Hathor boundary. While past drilling achievements are no sure indication of future success, and there is no assurance that mineralization along trend is continuous, mineralization and alteration at Roughrider is stronger and thicker. We suspect there is good potential that results from Fission's zone may improve in that direction, assuming continuity.

Meanwhile, tracing the zone westward along strike becomes important. Consultants for Hathor believe that Roughrider zone is hosted within a slice Wollaston Group rocks that has been thrust southwards up onto the Midwest Dome, and bounded to the north by another wedge of older rocks. It is currently unknown the extent the Wollaston group westward onto Fission's property. However, a resistivity low trends across Fission's property for ~3km, and these geophysical anomalies are historically meant to signal alteration plumes overlying high grade mineralization in the Athabasca. We expect the geological picture to improve quickly as drilling proceeds and continue to watch this story closely.

  1. Assays outline two intervals.
  3. Assays correlate well with previous scintillometer readings
  5. Mineralization remains open in all directions.
  7. Expect frequent exploration updates.
  9. Elevated scintillometer readings a positive indicator for uranium.
  10. Further comforted by two years of experience at Roughrider, we may also begin to assume that there is little disequilibrium at Waterbury (no imbalance between uranium content and the radioactivity emitted by a given volume of that mineralized rock) and begin to trust scintillometer readings as a positive indicator for uranium. This should come as little surprise as high grade unconformity style mineralization isn't prone to disequilibrium. This imbalance is more prevalent in sandstone-hosted deposits within an aquifer that undergoes oxidation-reduction changes over time. We caution investors not to link scintillometer readings directly to uranium grades, but only as an indicator that uranium minerals are present. These assays were reported from only the second hole of a 20 hole, 7,500m winter drill program. The initial discovery hole -63A still has outstanding base metal and gold assays. Holes -64 to -66 have been logged and samples have arrived at the lab. The company expects a two to three week turnaround for assays. Holes -67 to -69 are completed and in various stages of geotechnical logging and sampling. Hole -70, the ninth of the project is underway, targeting the zone a mere 15m to the west along strike of hole -63. These assays, combined with high scintillometer readings from nearby holes, are beginning to show continuity. However this continuity passes from basement rocks at unconformity to more than 15m into the basement rocks in the four holes for which scintillometer results have been reported. The bigger picture shows that uranium mineralization can now be traced for about 450m along a 070-trend or near east-west strike. Fission's J Zone lies 140m west of Hathor's Roughrider deposit, which in turn, lies 200m west of Hathor's 170 Zone. All three zones are currently being drilled by the pertinent operator (Photo 2). (Table 1). These higher grade intervals occur within a 29m wide zone of elevated scintillometer results what occur just below the unconformity. Only composites, not individual assays were provided. Fission only reported intercepts that exceeded 3m width and graded 0.05% U3O8. Basement mineralization was confirmed in hole WAT10-63A. An interval of 1.91% U3O8 over 10.5m was identified starting at 226m depth (Photo 1). This includes 13.87% over 1m. Another intercept of 0.16% over 4m between 211.5 and 215.5m is located higher in the hole but still below the unconformity.

    Dundee Securities Corporation from time to time publishes reports on securities for which it does not and may not choose to provide continuous research coverage. Such reports are published as Ideas of Interest.

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