PROJECTS

IVANA PROPERTY

Highlights

  • Surficial deposit with resource of 19.1 million pounds of U3O8 (23.9 million tonnes averaging 363 ppm U308 at a 100 ppm uranium cut-off in the Inferred Category, NI 43-101)
  • Hosted by loosely consolidated sediments from surface to 24 metres depth; it is expected that resources would be extracted via open-pit methods
  • Metallurgical and beneficiation test work in progress to provide additional data for an initial Preliminary Economic Assessment in 2018
  • The Ivana deposit remains open for expansion
  • Additional resource potential exists in the Ivana area - 25km anomaly with near-surface uranium mineralization within unconsolidated sediments

Current Program

On March 5, 2018 Blue Sky reported the first resource estimate for the Ivana deposit, as shown in Table 1 below. Results from ongoing metallurgical studies and preliminary beneficiation studies are expected by the end of the first quarter. This data will contribute to a Preliminary Economic Assessment (PEA) for the Ivana deposit, which is expected to be completed before the end of the year.

The arcuate (“C”) shape of the Ivana deposit (see Figure 1 below) is believed to represent a preserved sector of a regional mineralized redox-front, which often include more than one deposit. Therefore, follow-up drilling programs will test for lateral extensions to the currently defined deposit, as well as previously recognized local targets identified by airborne and hand-held radiometric surveys and geological modeling.

Table 1. Mineral Resource Statement for the Ivana Deposit, Amarillo Grande Project, February 28, 2018

The reader is cautioned that mineral resources, which are not mineral reserves, do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported Inferred resources are uncertain in nature and there has been insufficient exploration to classify these inferred resources as Indicated or Measured, and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured category.

Inferred Resources – Base Case at 100 ppm Uranium cut-off grade
Zone Tonnes
(t)
U
(ppm)
V
(ppm)
U3O8
(ppm)
U3O8
(%)
Contained U3O8
(lb)
Upper 3,200,000 132 131 156 0.016 1,100,000
Lower 20,700,000 335 105 395 0.040 18,000,000
Total 23,900,000 308 109 363 0.036 19,100,000

Notes to Table 1:

  1. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.
  2. The Mineral Resources in this estimate were not constrained within a conceptual pit shell owing to the shallow nature of the deposit (0 to 24 m) and blocks above cut-off being reasonably contiguous.
  3. The 100 ppm uranium cutoff grade is based on operative costs of $12/t, a price of $50/lb U3O8, and a process recovery of 90%. A density of 1.84 was applied.
  4. It is reasonably expected that the majority of Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.
  5. The resource was estimated within distinct zones of elevated uranium concentration occurring within the host sediments. Vanadium is associated with uranium and is estimated within the same zones. There is no indication that Vanadium occurs outside of the elevated uranium zones in the Ivana deposit area in sufficient concentrations to justify developing estimation domains focused on Vanadium.

The mineral resource estimate in Table 1 has been prepared by Bruce M. Davis, FAusIMM, BD Resource Consulting, Inc., and Susan Lomas, P.Geo., Lions Gate Geological Consulting Inc. who are both independent Qualified Persons as set forth by National Instrument 43-101 (“NI 43-101”). The overall effective date of this resource estimate is February 28, 2018. For additional details on the resource estimate and methodology please refer to the original news release dated March 5, 2018. A NI 43-101 Technical Report supporting disclosure of this mineral resource and containing additional details will be filed by Blue Sky on SEDAR within 45 days of the press release.

Location and Access

The Ivana group of properties covers over 118,000 hectares. It is the southernmost property along the 140 kilometre NW-SE trend that contains a series of airborne radiometric anomalies. The project has year-round access through a well-maintained gravel road, and is in a semi-arid area with low rainfall and population density.

Discovery History

Ivana was the third discovery area in the district. In April, 2010, Blue Sky was granted a special airborne geophysics license covering 2.265 million hectares that included all of the prospective areas for uranium in the San Jorge sedimentary basin of Rio Negro Province. The license allowed Blue Sky to fly high-resolution airborne radiometric and magnetic surveys. Blue Sky was given the exclusive right to acquire new exploration licenses on the targets identified in the survey. The Ivana property was acquired to cover several of the anomalies found in this survey.

A follow-up ground radiometric survey confirmed a >25 kilometre-long anomaly caused by uranium mineralization on or near surface. Field programs included prospecting, geological mapping, sampling/testing of hand pits, auger & shallow rotary drill holes, and a 2,023 metre diamond drill program comprised of 11 holes. Much of this work was funded through a joint venture with the multi-national uranium company, Areva.

Starting in 2017, field work at Ivana included two phases of reverse circulation (“RC”) drilling of 427 shallow holes totaling nearly 6,500 metres. A summary of drill results can be found here. The drilling programs resulted in the reporting of the first resource estimate for the project as shown in Table 1 above.

Figure 1. Ivana drill holes Grade x Thickness diagram highlighting the arcuate shape of the deposit.

Geology & Mineralization

At Ivana the basement and remnants of the Cretaceous Neuquen Basin sediments are overlain by middle Tertiary aged tuffaceous sands of the Chichinales Formation and coastal marine sediments of the Gran Bajo del Gualicho Formation, both interbedded. The Chichinales Formation is a potential target for sandstone-hosted uranium deposits. It is in turn overlain by Pliocene to Quaternary sands and gravels. Arid conditions that prevailed during much of Pliocene and later time led to the development of extensive soil development, creating trap sites for superficial uranium concentration.

The Ivana deposit displays characteristics of surficial-type and sandstone-type “roll front” uranium-vanadium deposits. Mineralization at Ivana includes primary coffinite and uraninite, in pore spaces of poorly-consolidated sandstones and conglomerates, in addition to peripheral secondary carnotite, which occurs interstitially to and coats pebbles and clasts in loosely consolidated sandstones and conglomerates.

The deposit is characterized by two stacked zones of uranium mineralization, the upper zone and the lower zone. The two zones occur together through most of the deposit but there are localized areas where only one zone is present. The upper zone averages 2.7 metres in thickness, with a maximum of 10 metres, while the lower zone has a maximum of 20 metres and has an average thickness of 6.2 metres. Plan view of the modelled Ivana deposit can be found here.