GTI’s drill data acquisition places Lo Herma on uranium resource fast track

GTI has scored a coup with the securing of about $15m in historical drill data for its newly staked Lo Herma project in the uranium-rich Powder River Basin, Wyoming.

Importantly for the company, the drill logs for 1,445 holes – representing about seven times the number of holes it has drilled to date in the entire state – demonstrate sandstone hosted uranium mineralisation with economic potential and could allow for the definition of an Inferred Resource at the project, within the next few months, without further drilling.

Not only could this save GTI Energy (ASX:GTR) the time and money it would otherwise have been required to invest in the project to achieve this milestone, it also sets the stage for more advanced exploration.

Adding more uranium pounds at a time when sentiment towards the energy metal has shifted all the way into positive territory is also likely to be welcome.

Not bad for an investment of just US$950,000 ($1.44m).

“We are delighted that we have secured a comprehensive historical drilling data package for the Lo Herma Project,” executive director Bruce Lane said.

“The project area was extensively drilled during the 1970’s and we estimate that it would cost GTI around $15 million and take a number of drilling seasons to replicate.

“The data will vastly improve our understanding of the project and is likely to dramatically accelerate progress towards reporting a uranium resource at Lo Herma – we believe that an inferred JORC mineral resource estimate may be reported at Lo Herma, without drilling, before the end of June this year.”

He added that this will in turn set the stage for verification drilling during the Wyoming summer.

Rich historical data

The 3,500 hectare Lo Herma project is located within about 80km of five permitted In Situ Recovery (ISR) uranium production facilities, including Cameco’s Smith Ranch-Highland ISR facilities which are just 16km away and is the largest uranium production site in the state.

Given its proximity to these uranium plants and the Powder River Basin’s known prospectivity for the metal, it shouldn’t be surprising to learn that the project area was the subject of previous exploration.

The data acquired from an independent third party covers 1,800 holes (1,445 pertaining to the Lo Herma area) drilled by Pioneer Nuclear, in joint venture with Texas Gulf between 1970 and 1980.

It includes downhole geophysical and lithological logs with geophysical probe calibration for all logs along with some gamma calculation records and some downhole deviation drill hole deviation data.

Drill maps with historical claims are also included along with a single report by Pioneer Nuclear into the ground water hydrology that includes maps showing the projected water table for the C1, C2, & C3 mineralised horizons.

While any resources estimated from this data initially would be reported in the Inferred category, subsequent verification through re-logging or twinning the holes could allow for the classification of higher confidence resources based on drill spacing and continuity.

Placement to fund future plans

The company is carrying out a placement of 260 million shares priced at 0.9c each to raise $2.34m to fund development and exploration of Lo Herma.

It will issue placement subscribers with one free attaching listed GTRO option for every two shares subscribed and stated that is is considering offering existing shareholders the opportunity to participate in a pro-rata rights entitlement offer.

Next steps

GTI has started converting the data to a modern electronic database by scanning and digitising the drill logs before converting it into equivalent U₃O₈.

The geophysical logs will also be correlated with the lithological information to separate the 1/2 foot data into correlatable mineralised horizons while the drill maps will be scanned and digitised to estimate drill hole coordinates and digital elevation models.

It will then carry out field verification by surveying a representative number of the drill holes before carrying out a drill verification program, including coring and analyses to determine disequilibrium conditions.

This program is also expected to incorporate a hydrological investigation of the project focusing on the hydrostatic head available for each mineralized horizon plus an airborne geophysical survey.

This article was developed in collaboration with GTI Energy, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.