Uranium Resources, Inc. (NASDAQ: URRE) today announced that it has completed an agreement to explore 53,500 acres in Kenedy County, Texas, for three years, with an option to lease the acreage for uranium production.
The lease would have a primary term of eight years after lease commencement.
“Now that we have secured this lease, our attention is on completing a final exploration agreement with Cameco Resources so that we can begin the evaluation of the property for the presence of an economically recoverable uranium ore body.”
Don Ewigleben, President and CEO of URI, commented, "This acquisition marks an important next step in our strategy to build our resource base in Texas, and ultimately maximize production in South Texas. While this is a green field exploration site, the property appears to be an excellent prospect with potential for one or more uranium deposits that can be produced by in-situ technology based on previous water sampling tests we completed from existing wells on the site."
The property is located within the prolific South Texas uranium district which has been a major producer of uranium for half a century. Situated near uranium mining operations which produce from the Goliad Formation, the property also hosts several oil and gas fields and is bisected by a major depositional channel system. These provide the geologic, stratigraphic, and geochemical components for uranium deposition and water-saturated host sand with good rock permeability. Locally, water samples taken from a number of wells on the property contain levels of uranium or uranium decay products that indicate anomalously high concentrations of uranium in nearby rock.
The lease option agreement requires a minimum exploration obligation of one hundred exploration wells or $1.0 million investment in the first year, an additional two hundred exploration wells or $1.5 million investment in the second year and, in the third year, an additional two hundred exploration wells or $2.0 million investment. Investment or drilling in excess of the minimum requirement in any year counts toward the following year's requirements.
Mr. Ewigleben continued, "Now that we have secured this lease, our attention is on completing a final exploration agreement with Cameco Resources so that we can begin the evaluation of the property for the presence of an economically recoverable uranium ore body."
URI announced on November 4, 2010, that it signed a non-binding letter of intent with Cameco Resources, a subsidiary of Cameco (NYSE: CCJ), for a three-phase exploration program that will be funded by Cameco Resources with an option for a production joint venture.
Source: Uranium Resources, Inc.