🕐12.08.09 - 10:42 Uhr

12 August 2009 - Sentinel Resource & Scoping Study



SUMMARY
.

Initial insitu Inferred Resource for the Church Deposit, the first area drill tested within the Sentinel Project in North Dakota USA, representing only 1/5 of the total prospective project area on PacMags 100% owned leases:
Cut-off Grade Wet Tonnes Dry Tonnes U3O8 (%) MoO3 (%)
50 ppm U3O8 3,439,000 2,353,000 0.0165 0.0221
200ppm U3O8 841,000 580,000 0.035 0.039 .

The Company believes that there is considerable upside in both grade and tonnes reported as the initial Resource estimate involved a conservative approach of inserting half below detection grades (0.0005% U3O8) for all un-assayed portions of the host lignite unit (601 of 1279 composite samples), resulting in a significant reduction in average resource composite grades (by 46% for uranium). .

Broader Exploration Target for the Companys current regional landholdings of between 3 to 6 million dry tonnes at grades of 0.05% to 0.1% U3O8 and 0.05% to 0.1% MoO3 (5 - 10 million pounds U3O8). .

Within the Church resource area only and based on the same drilling and modelling techniques as used for the uranium and molybdenum resource reported above, there is a germanium Exploration Target of:
Cut off Grade Wet Tonnes Dry Tonnes GeO2 (g/t) Tonnes GeO2 (median values)
25ppm GeO2 5.9Mt - 10.9Mt 4.0Mt - 7.5Mt 40 - 70 287
50ppm GeO2 2.4Mt - 4.3Mt 1.6Mt - 3Mt 50 - 100 171 .

Broader Exploration Target for the Companys total regional landholdings of 6 to 18 million tonnes of germanium rich lignite at grades of 65 to 100 g/t GeO2 (450 - 1350 tonnes GeO2). .

The uranium and molybdenum resources and the Exploration Targets are reported in accordance with the JORC code.

Upon further analytical check assay work, the germanium Exploration Target may be upgraded to resource status, but until that time the Exploration Targets remain conceptual in nature. .

Further drilling of regional targets is planned to expand the resource base, along with re-drilling of selected Church resource holes to test unassayed lignite sections to better establish grades. .

Development of initial process flow-sheets based on recent metallurgical testwork has allowed initial scoping level financial modelling that indicates a conceptual project that is operating cash flow positive under a range of scenarios: o Capex Range US$63 million (125k tpa uranium plant only) to US$105 million (250k tpa plant, uranium, molybdenum, germanium) o Results for a high-grade case* 250k tpa throughput, recovering uranium only providing net revenue of US$117/tonne, equal to US$30 million per annum free cash, cash cost of $24/lb U3O8 or ~ 3.5 years payback on capital.
Please find attached a copy of an announcement made today by PacMag Metals Limited (ASX-PMH).
Kind regards
Vivien Collins PA & Office Administrator
PacMag Metals Limited PO Box 1569 West Perth WA 6872 Lvl 2, 33 Ord Street West Perth WA 6005
p: (08) 9481 2997 f: (08) 9321 0070
e: w: www.pacmag.com.au
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