Perth, May 11, 2006 AEST (ABN Newswire) - The Directors of Polaris Metals NL (ASX: POL) and Washington Resources Limited (ASX: WRL) are pleased to announce their intention to combine their highly prospective uranium assets, forming a new dedicated uranium company to be funded through an initial public offering ("IPO") and new listing on the ASX.
The new company, Northern Uranium Ltd ("Northern Uranium"), will be granted uranium rights by Polaris and Washington in tenements held by them in Western Australia (WA) and the Northern Territory (NT). The priority focus will be on tenements covering more than 8,500km2 consolidated by Polaris and Washington along the WA-NT border in the Granites-Tanami area (Gardiner-Tanami Super Project).
Northern Uranium Ltd to raise A$4 - $6 million to progress advanced projects Hartleys Limited, appointed as exclusive broker to the proposed Northern Uranium IPO, has been engaged on a best endeavours basis to raise between $4 million and $6 million to fund exploration on Northern Uranium's highly prospective uranium package. Subject to regulatory approval, it is the intention that shareholders of Polaris and Washington will receive a priority entitlement to participate in the uranium IPO.
Commenting on the proposal, Polaris' Managing Director Mr Kevin Schultz said, "Northern Uranium will hold a number of very exciting uranium projects. In particular, the 8,500km2 Gardiner-Tanami Super Project which attracted interest from a number of majors in the 1980s. Drilling at that time on prospects in the Gardiner Range area confirmed that primary uranium mineralisation is present in the system.
"The geology at Gardiner-Tanami area shows similarities to that of the Athabasca Basin in Canada, which hosts the world's highest grade uranium deposits, including Cameco's 160,000 tonnes uranium McArthur River deposit grading 25% U3O8.
"Capital raised from the proposed listing will fund new exploration employing modern methods on Gardiner-Tanami and Northern Uranium's other uranium assets.
"The listing of Northern Uranium will enable Polaris and Washington to more rapidly advance their uranium projects within a dedicated and focused company, and will provide investors an opportunity to gain direct exposure to one of the few accessible regions worldwide with similar geology to the Athabasca Basin," Mr Schultz added.
Uranium Projects
On 17 November 2005, Polaris and Washington jointly announced their intention to pool their interests in the Gardiner-Tanami Super Project. The parties have subsequently announced the execution of Heads of Agreement for the joint venture and the agreement in principle to expand this relationship and inject rights to a broad range of prospective uranium projects into Northern Uranium.
Northern Uranium will be granted rights to explore for uranium on the following projects:
Gardiner-Tanami Super Project
- Substantial land package totalling some 8,500km2 consolidated along the WA-NT border;
- Geological setting similar to the Athabasca Basin, Canada, host to world's highest grade unconformity-type uranium deposits;
- Previous drill hole assays up to 4.65% uranium (in 0.44m averaging 1.73%) at "Don's Find" on a WA tenement in close proximity, confirming primary mineralisation present in the system;
- Westward extension of the fault zone hosting "Don's Find", and the extensive "Diva Prospect", also in WA, offer potential for immediate drilling;
- "Area 20 Prospect" (in Gardiner-Tanami NT tenements) noted for secondary uranium minerals and rock chip samples from costeans assaying up to 1.5% uranium.
Denison Range Project, WA
- Situated 10km west of the Gardiner-Tanami Super Project, and conceptually targeting Olympic Dam-style copper-gold-uranium mineralisation. Kurundi Project, NT
- 1950s uranium prospect ("Munadgee") on the western boundary of the project area with a cross-cut off one of the shafts assaying 0.82% U308 over 1.2m;
- Conceivably an unconformity-style uranium target area with some similarities to Kintyre in the Rudall River area, W.A.
Wallal Project WA
- Large Canning Basin sandstone uranium ("roll-front") target area. Lake Barlee Project WA
- New exploration licence over Yeelirrie-style calcrete uranium target, 200km north of Southern Cross (exploration for Lake Maitland and Yeelirrie-style uranium deposits).
Exploration Plans
The advanced status of the 1980s exploration on targets such as Diva and Area 20 Prospect, and current work by the Polaris-Washington joint venture on granted tenements at Denison Range and Kurundi, will allow Northern Uranium to focus on the definition of drilling targets immediately on listing. Drilling is expected to be possible within the first six months, and to be carried out concurrently with systematic programs using geophysics to locate likely sites of buried high-grade uranium deposits.
Timetable of the Issue
Further details on the structure and timetable of the issue, the priority arrangements for Polaris and Washington shareholders to subscribe for shares in Northern Uranium and the composition of the Board will be announced when finalised.
Contact
Kevin Schultz
Polaris Metals
08 9481 3030
Adrian Griffin
Washington Resources
08 9485 0755
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