Uranium Resources (LON:URA) is “extremely encouraged” by the latest drilling results from the Mtonya uranium project in Tanzania.
Ongoing drilling at the project is generating both high grade and wide intercepts, which the company said suggests potential for excellent in-situ recovery.
The drill results unveiled by the comany today included intersections of one metre grading 397 parts per million (ppm) uranium, four metres at 460 ppm uranium and 329 ppm uranium across 3.8 metres.
Uranium Resources noted that three holes have intercepted previously unknown roll-fronts in Tier 1, which is interpreted to occur at depths of 150 to 220 metres.
“We have intersected considerably higher grades and greater thicknesses than we have achieved before and discovered Tier 1 roll-fronts,” said managing director of Uranium Resources Alex Gostevskikh.
“These results also further confirm our geological model of multiple stacked roll-fronts of uranium mineralisation and we expect these shallower drill targets to generate a new dynamic in our exploration programme going forward.”
Three drill rigs are currently operating at Mtonya and forth rig is expected to be deployed by end of June. To date, eighteen diamond drillholes have been completed totalling 5,400 metres.
The company has previously said that the results of the 2011 drilling campaign at Mtonya and recent mineralogical studies suggested similarities with the well-known sandstone-hosted roll-front uranium deposits of Kazakhstan and the US.
Uranium Resources hopes the 2012 drill programme will significantly extend the known mineralisation and allow it to complete a maiden resource estimate in 2013.
Broker WH Ireland said earlier this year that the Mtonya project could be company making if it proves to be similar to Uranium One’s Nyota deposit, which is also located in Tanzania.
Investors cheered the update, sending shares in Uranium Resources up 7.5 percent to 2.5 pence per share by 9:20 am, giving it a market cap of £18.65 million.