Rose Petroleum plc

NI 43-101 Resource Report, Wate Uranium Breccia Pipe, Arizona, USA.

25-May-2010

NI 43-101 Resource Report, Wate Uranium Breccia Pipe, Arizona, USA.

VANE Minerals today announces that SRK Consulting (U.S.) Inc. ("SRK"), has completed its NI 43-101 technical report on the Wate uranium breccia pipe in northern Arizona. The project is within the VANE-Uranium One Exploration U.S.A. Inc. (U1) joint venture (JV) in which the Company's wholly-owned subsidiary, VANE Minerals (US) LLC, holds a 50% interest.

A full version of the report prepared by SRK consulting can be found on the company website, link: http://www.vaneminerals.com/investor/downloads

Summary of Report

  • The Wate Pipe has uranium mineralization verified by VANE drilling, and a historically determined potential of 1.1 to 2.4 million contained pounds U3O8. Current resources for the Wate Pipe stand at 44,000 tons grading 0.80% eU3O8, for 696,000 contained pounds U3O8. The Wate Pipe is similar to breccia pipes that have been mined.
  • The table below lists the resources estimated by SRK for each zone and the total for all zones at a cutoff of 0.15% eU3O8.  All resources are classified as Inferred, by CIM definitions. The cutoff grade of 0.15% eU3O8 is based on a statistical break from essentially non-mineralized to the major population of mineralization (≥ 0.15% eU3O8); and the simple estimate that 0.15% equates to 3 pounds(lbs)  U3O8 per ton, and at a uranium price of $40/lb, 0.15% eU3O8 would have an in-place value of $120 per ton. That value has a reasonable potential for economic extraction by underground mining methods.
Wate Breccia Pipe Inferred Resource,
0.15% eU3O8*cutoff.
Zone
eU3O8%
Tons
Tons eU3O8
Pounds eU3O8
1
0.38
11,000
43
87,000
2
0.72
4,000
28
57,000
3
1.11
4,000
45
89,000
4
0.95
24,000
232
463,000
Total
0.80
44,000
348
696,000
 
  • The drillhole database is composed of 21 historical drillholes and 8 drillholes completed or re-logged by VANE since 2008. The total of 29 drillholes sum to 48,868 ft of drilling. VANE’s 8 drillholes total 12,607 ft. VANE re-opened/re-logged two holes, WT-5 and WT-7 and has new information, as significant mineralized intercepts from logging, in 4 of the 8 new VANE holes. Unfortunately, at this time VANE does not have access to the original mineralization information from historical drillholes, including WT-5 and WT-7 for comparison with VANE’s re-entry and re-logging of those holes; but there is no reason to expect anything other than a good correlation.  
  • The resource stated in this report represents only a portion of the historically defined resource tonnage, yet the average resource grades of the current resource and the historically reported numbers are similar. This provides a level of confidence, that upon VANE obtaining additional drilling information, the total tonnage and contained pounds of uranium should be similar to that reported historically.
  • Breccia pipes are the highest-grade uranium deposit types in the United States, with average grades of around 1% U3O8 and with total production from 1 million pounds (Mlbs) to more than 6 Mlbs of U3O8. The breccia pipe district of northern Arizona produced approximately 23 Mlbs of U3O8 prior to the decline of uranium prices in the mid 1980s. Individual pipes have been known to contain more than 5 Mlbs of U3O8 at an average grade of about 1% U3O8. Ore is mined from open stopes that are usually accessed by declines or vertical shafts. Most of the uranium ore that was produced from the breccia pipes was trucked from the mine sites to the White Mesa Mill located in Blanding, Utah. On March 21, 2005, Denison Mines announced their intention to resume processing at White Mesa. There is currently an estimated combined resource of 13 Mlbs of U3O8 in several breccia pipes in northern Arizona that are awaiting production decisions. On June 14, 2006, Denison announced plans to reopen the Arizona 1 breccia pipe mine north of the Grand Canyon. Production from the Arizona 1 mine commenced in late 2009, with ore being trucked to the White Mesa mill.
  • All of the breccia pipe properties controlled by VANE, including the Wate Pipe, show typical characteristics of mineralized breccia pipes. These commonly include one or more of the following criteria: inwardly dipping Kaibab Limestone strata that is frequently overlain by maroon-red Moenkopi Formation suggesting depressions or collapse breccia, elevated radiation that is two or more times background, evidence of mineralization such as secondary iron or copper minerals, and less commonly alteration in the form of bleaching of normally iron-bearing rocks.
  • VANE’s exploration program has been carefully planned to be selective of potential known breccia pipes, and has been executed in a manner that minimizes land holding costs. The exploration concepts and approach are appropriate for the targets.
  • VANE’s exploration strategy to acquire limited site-specific lands and drill targets based on limited surface data, is a valid approach, given VANE’s level of knowledge of Arizona uranium-bearing breccia pipes. Typically, there is little to no surface expression of uranium mineralization on breccia pipe targets. The VANE program is one of identification of prospective pipe targets, followed by shallow drilling to define pipe geometry, and deep drilling to test favorable stratigraphy in the pipes for uranium mineralization – a well-planned and focused exploration program.
 
Operational Update

VANE and its JV partner, U1, plan to take the project forward by drilling additional holes, as per the recommendations in the report. This is expected to not only increase the compliant resources but also upgrade them from Inferred to Indicated which, in turn, following a positive outcome of a preliminary feasibility study, will convert the status to Probable Mineral Reserves.

The drill rig is expected to commence operations today, Wednesday the 26th of May with 2 to 5 holes planned. The location of the drill holes is based on the knowledge gathered from both the historical and recent holes drilled by VANE.

As mentioned previously, we are proceeding with the State of Arizona Mineral Lease application, which will allow us to further develop the resource/reserve from underground drilling assuming this round of drilling delivers what we expect.

Upon completion of the holes on WATE, the drill rig will be moved to the Miller Pipe to further explore that project where two historical holes contained plus 1% U3O8 intervals, with the goal of defining an additional ore body. VANE previously completed two holes on the project with both having deviated out of the pipe prior to reaching the mineralized horizon.

Allan V. Moran, Principal Geologist, and Frank Daviess, Associate Principal Resource Geologist, both with SRK Consulting (U.S.) Inc., are independent Qualified Persons as defined by NI 43-101, and prepared the current resource estimate. Kristopher K. Hefton, Chief Operating Officer VANE Minerals (US) LLC, BSc Geology, who meets the criteria of a qualified person under the AIM Rules - Guidance for Mining, Oil and Gas Companies, has reviewed and approved the technical information contained within this announcement. Uranium One Exploration U.S.A. Inc. expressly disclaims any responsibility for the contents of this press release or its compliance with law.

Kris Hefton, COO, commented:  “The SRK report, complete with an NI43-101 resource, demonstrates that the Wate project has the high-grade characteristics typical of mined breccia pipes. The advantage of such projects to companies like VANE is that breccia pipes have a small mining footprint and high-grade uranium can be rapidly extracted from the mining area. With our project partner, Uranium One, we shall now enter the final phases of predevelopment work at Wate.”