Southern Uranium reports on potential at Jungle Dam, Ridgeback

Southern Uranium (ASX: SNU) has reported on progress at various projects around Australia in the quarter including the Jungle Dam iron ore prospect on the Eyre Peninsula.

Drilling has elevated shallow haematite potential in the 3km long Central Target Zone at Jungle Dam with Magnetic detailing planned to refine targets in another 11km of strike potential.

Drilling has been delayed by access negotiations at the Ridgeback iron oxide copper-gold-uranium (IOCGU) targets on northern Yorke Peninsula. Gravity surveying has added six new targets with another IOCGU prospective trend identified on the tenement.

The East Eyre Peninsula IOCGU project has Infill soil sampling completed over 9 targets. First pass surveying has commenced on the Yalanda Hill JV area.

Airborne electromagnetic survey maps have rolled front uranium potential at Charleston South in the Mullaquanna region of Eyre Peninsula.

The company has cash resources of A$2 million as at 31 March 2010.

SNU Managing Director John Anderson said, “Our concept of uranium copper gold silver and iron potential extending in a prospective corridor across the Yorke and Eyre Peninsulas is paying off. Southern Uranium now has a wealth of diverse target opportunities in this highly prospective region of the Gawler Craton."

"These are the Hillside-style IOCGU targets at Ridgeback, multiple copper-gold-uranium and silver-gold targets developed by our innovative geochemical approach on Eyre Peninsula and the Jungle Dam iron ore targets in the same geological unit that contains One Steel’s Middleback deposits 50km to the east."

"We have also now identified roll front uranium potential in our southern Eyre Peninsula tenement along interpreted extensions to the Mullaquanna trend of recent discoveries made by a neighbouring explorer."

"The company is looking forward to strengthening its financial capacity to develop these exciting prospects,” Anderson added.

Financial

As foreshadowed in the company's half yearly financial report, Southern Uranium is considering available fund raising alternatives to fully realise the potential of their portfolio of projects.

Southern uranium anticipate making appropriate announcements as matters progress.

Business Development

Southern Uranium is taking the opportunity to develop new IOCGU projects on the northern Yorke Peninsula. The preparation of the Ridgeback Hillside-style IOCGU targets revealed other targeting opportunities in the Moonta-Bute district, some of which will be amenable to the transfer of the company’s soil geochemical tactics from Eyre Peninsula.

These opportunities are being pursued through pegging and new joint ventures. Consequently a Joint Venture agreement was entered into with Destiny Stone Australia Pty Ltd for Southern Uranium to acquire 85% interest in all minerals except dimension stone and industrial minerals under Exploration Licence 3922.

An Exploration Licence “Paskeville” was also applied for in the Bute-Kainton area to secure another IOCGU-prospective trend although this is contested by another application and will be awarded by a standard government panel process.

Business Development Manager Alex Thin resigned during the period to take up another corporate role.

Tenements

Full annual renewals were obtained for the Rum Jungle EL24867 and Calvert Hills EL24837 tenements in the Northern Territory.

Streaky Bay EL3512 in the central Gawler Craton was relinquished during the period as offering no further IOCGU potential.

EXPLORATION PROJECTS

IRON OXIDE COPPER GOLD URANIUM (IOCGU) PROJECTS Gawler Craton SA

Ridgeback Prospect, Northern Yorke Peninsula Project SA (100% Southern Uranium)

Exploration Licence 4278 covers at least 30km of the interpreted northern extensions of the Pine Point Fault Zone (PPFZ) that hosts the new copper, gold and uranium discoveries at Hillside (Rex Minerals Ltd) about 60km south of the tenement.

The prime Ridgeback targets are two magnetic anomalies similar to the Hillside signatures.

Results from past drilling, although not testing the targets, show nearby alteration and copper mineralisation that further enhance the potential of the targets to be associated with iron oxide, copper, gold and uranium deposits at relatively shallow depths of 350m – 450m depth to top.

During the quarter, modelling of the new airborne magnetic data collected in December confirmed the similarity of the Ridgeback magnetic targets with the magnetic signature of the Hillside deposits when the latter was adjusted to a depth equivalent to that anticipated for the Ridgeback targets.

A detailed gravity survey delineated six new gravity targets with IOCGU potential. These are
closely associated with the Ridgeback magnetic targets and with apparent structural patterns consistentwith the Prominent Hill analogy.

An application was made for Round 6 Collaborative drill funding from the SA Government. The drilling of the Ridgeback magnetic targets is delayed while we continue access negotiations with the relevant landowners, await the collaborative funding decision from the government and assess the priorities and access to the additional targets provided by the new gravity data.

IRON ORE Eyre Peninsula SA

Jungle Dam Prospect, Wilcherry Hill district

Southern Uranium’s prior drilling of IOCGU targets at Jungle Dam, delineated by gravity and soil geochemistry, had intersected greater than 30% Fe as magnetite, haematite and goethite in several holes.

The intersections occur within magnetic units that extend from the Hercules deposit for about 14km into Southern Uranium’s ground. The iron formations are equated with the Middleback iron formations that host the One Steel iron ore operations 50km to the east of Jungle Dam.

During the quarter, 710m of new reverse circulation percussion drilling was undertaken in nine holes tospecifically target the iron ore potential. Four holes intersected iron formation while the remaining holes failed to reach the target iron formation due to geological and drilling reasons.

The successful intersections showed the Central Target Zone of about 3km length has shallow potential for haematitic zones starting within 10 metres from the surface and with possible widths of more than 45 metres and depth extents of 70m above the targeted magnetite iron formation.

Preliminary assays are expected in mid-May. Detailed magnetic mapping is required before further drilling can be accurately placed to test the other 11km length of iron ore potential.

ROLLFRONT URANIUM PROJECTS, SA

Charleston South, Eyre Peninsula

The southern portion of Moonabie EL3552 at the south end of the Eyre Peninsula tenements
contains the western edge of the Pirie Basin about 60km southwest of the recent Mullaquanna uranium discoveries by Uranium SA Ltd.

An airborne electromagnetic (AEM) survey was flown across the tenement area in January by neighbours Stellar Resources Ltd. who provided Southern Uranium with the data.

This shows conductive sediments that are prospective traps for roll front uranium at about 120m depth over a wide area.

The prospective sediments lie within a sub-basin delineated by past drilling by an earlier uranium explorer.

The new AEM data will be compared with the past drilling to reassess the uranium potential in the context of new revelations for the setting of the Mullaquanna discoveries.

UNCONFORMITY URANIUM PROJECTS Northern Territory

Calvert Hills Joint Venture Project (Southern Uranium 75%;Uranium West 25%)

The project under tenement EL24837 is situated 100km west of the Westmoreland uranium field and has similar geological and structural ingredients for shallow-covered unconformity–style uranium deposits.

Southern Uranium has identified prospective locations similar to the Westmoreland setting but under cover by integrating modern geophysical techniques. Southern Uranium earned to 75% interest during the quarter.

A review of the recent drilling and regional data identified five areas with the highest uranium and vanadium potential including the new Vanadis vanadium prospect. These will be prospected and mapped during the coming dry season. The priority will be establishing a drill strategy for the Vanadis prospect.

Rum Jungle Joint Venture Project, Northern Territory (Uranium West Ltd 100%; Southern Uranium earning to 50%)

The project covers the basal unconformity and prospective northeast structures in the area between, and not including, the Browns and Mount Fitch deposits.

During the quarter, the airborne electromagnetic data collected collaboratively with Geoscience Australia during 2009 was interpreted and prospective structures were identified for possible drill testing during 2010.

VOLCANIC-HOSTED URANIUM PROJECT

Pandanus West Joint Venture, North Queensland (Epsilon Energy 40%; Southern Uranium 60%)

The project covers two areas of historic uranium prospects and regional extensions with potential for Ben Lomond-style volcanic-hosted deposits. The only drilling was undertaken during the 1970’s with a number of uranium intersections reported including the best intersection of 10m @ 0.53% U3O8.

The assay results for the December drilling were disappointing with the best result of 13m @158ppm U including 6m of 258ppm U in PWRC09 under the Hat 2 target. The intersected uranium mineralisation is considered secondary and may be remobilised from a deeper primary target that is being assessed.

A regional review of all target possibilities including gold was undertaken over the wet season with 13 potential targets proposed for field assessment during 2010.

Mount Brown Joint Venture, North Queensland (Mantle Mining Corporation 100%; Southern Uranium earning to 51%)

The Project area is located immediately to the east of the Pandanus West joint venture. The tenement package covers geology with potential for volcanic-hosted uranium deposits as exampled in the region at Ben Lomond and Maureen.

Under the same regional review as for Pandanus West, 14 potential targets for uranium and other metals were identified for field assessment.

SEDIMENT-HOSTED PROJECTS

Toolebuc Project, Cloncurry-Boulia Districts, Queensland (Southern Uranium 100%)

The aim of the project is to secure the most prospective parts of the uraniferous Toolebuc Formation where groundwaters draining the Eastern Succession basement are likely to form roll front-style deposits in reduced palaeochannel sediments.