VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 12, 2012) - Formation Metals Inc. (the "Company") (News - Market indicators) has been advised by the Virgin River Uranium Project operator, Cameco Corporation, that the 2011 drill program has successfully concluded and that plans and budget for the 2012 drill program have been approved. The Virgin River Project is located within the south-central portion of the Athabasca Basin in northern Saskatchewan, approximately 130 km northwest of Cameco's Key Lake mill. The project is a joint venture between the Company's wholly owned Canadian subsidiary, Coronation Mines Ltd., Cameco Corporation and AREVA Resources Canada Inc.
The 2011 diamond drill program on the Virgin River project was completed on October 15th, with a total of 7,746.2 metres drilled in 6 pilot holes and 7 off-cuts. All final uranium ICP assay results from the program are pending. The program concentrated on testing for the presence of cross structures and strike extensions to both the north and south of the Centennial Deposit. The Centennial Deposit has previously been traced over 650 metres of strike length with a minimum across strike width ranging from 10.0 metres to 52.5 metres. To date, approximately $29.9 million has been spent on the Virgin River project.
The program has provided data and additional drill targets for further follow-up in 2012. A budget of $2.15 million for the 2012 diamond drilling and geophysical exploration program on the Virgin River Project has been approved by the joint venture. The 2012 program is expected to consist of 5 - 6 diamond drill holes and 2 - 3 wedge off-cut diamond drill holes.
Drilling along section L3+74N in DDH VR-047 assessed the potential for mineralization along strike to the south by locating and following the faulted quartzite. Although only elevated radioactivity was encountered in the lower sandstone, the alteration and structure is comparable to the Centennial Deposit located approximately 225 m to the north.
Evaluation for the presence of potential cross structures completed on L8+00N and L10+50N was successful in confirming the presence of east - west striking cross structures. The mineralization intersected 250 m east of the deposit, in the DDH VR-042 and -049 series drill holes, appears to be controlled by an east - west striking cross structure which intersects the Centennial deposit. The mineralization present on L10+50N, DDH VR-046, VR-046W1 and VR-046W2, continues to suggest that potential remains immediately to the west of the deposit for additional mineralization both parallel to and cross-cutting the deposit.
The final pilot hole of the 2011 program, DDH VR-051, located approximately 1.4 km from the current northern extension of the Centennial Deposit, intersected a broad zone of elevated radioactivity and weak mineralization within the lower sandstone, with the most significant present associated with a faulted quartzite unit immediately below the unconformity. The preliminary results of DDH VR-051 are extremely encouraging considering mineralization is associated in a similar off-conductor geological setting to that encountered on the Centennial Deposit 1.4 km to the south. The model suggests that this target demonstrates the potential for increased grades existing both to the east and west across strike as well as both north and south along strike of this intercept.
The 2012 drill program will concentrate on the evaluation of the off-conductor mineralization intersected in drill hole DDH VR-051 mentioned above. In addition, a number of tests will also evaluate the conductor responses from a proposed geophysical survey between L21N and L33N located to the north of the deposit. Several tests will also be dedicated to upgrading mineralization on the Centennial Deposit by assessing the cross structural influence on uranium mineralization within the deposit.
High grade U3O8 intersections of up to 298 GT have been intersected within the Centennial Deposit (33.9 metres grading 8.78% U3O8 - see Company News release dated May 30, 2011). GT is defined as % grade U3O8 multiplied by thickness in metres. Assay results returned from diamond drill programs from 2004 to 2010 on the Centennial Zone have resulted in 35 significant primary uranium intersections returning results greater than 10.0 GT.
The Company is pleased with the continued success of the program and is looking forward to the results of the ongoing program.
The Virgin River project joint venture was formed in 1998 between the Company's subsidiary, Coronation Mines Ltd. (2%), Cameco Corporation (49%) and AREVA Resources Canada Inc. (49%). Coronation Mines Ltd. has the right of first offer to increase its ownership of the project up to 10%.
All uranium geochemical assays are being carried out utilizing Inductively Coupled Plasma - Optical Emission Spectroscopy analysis by the Saskatchewan Research Council of Saskatoon, Saskatchewan. Mr. Eric (Rick) Honsinger, P.Geo., of Formation Metals Inc., is the Qualified Person who has reviewed and approved the content of this news release based on an examination of the data submitted to the Company by the project operator Cameco Corporation.
Formation Metals Inc.
Mari-Ann Green, C.E.O.
This press release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation. Generally, forward-looking statements can be identified by the use of forward-looking terminology. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws. Further information on the Company is available at www.sedar.com.
The statements contained in this news release in regard to Formation Metals Inc. that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including Formation Metals Inc.'s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to the parties as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.
