Jul 10
7
The company has been keeping very busy with several projects on the go. Despite having been kicked to the curb by the Labrador Uranium Mining Moratorium, which is due to expire in March 2011, the Company keeps soldiering on. Over the past four months, Crosshair has come out with some important news:
Golden Promise Property (Newfoundland)
- drill results from a 7,220 meter diamond drill program (including 69.1 g/t over 0.6 meters);
- first set of results from the metallurgical test work with an outstanding 98% gold recovery;
- signed a contract for the bulk sampling program, which is set to commence in September of this year;
Central Mineral Belt (CMB) Uranium/Vanadium Property (Labrador)
- completion of Phase 1 of the Vanadium Resource Expansion Program with continuously solid vanadium results by an objective measure;
- preliminary metallurgical test work indicated recoveries of 93% vanadium;
With all the upcoming programs planned, there should also be consistent news for the remainder of the year, including:
- further metallurgical testing on samples obtained from this year’s drill program on Golden Promise;
- bulk sample results from Golden Promise and actual gold from the mill;
- completion of Phase 2 of the vanadium sampling program on the CMB Project, which is set to commenced shortly
With the programs being carried out on the CMB and Golden Promise Properties, updated and increased resources for gold and vanadium are anticipated.
Gold – Making Headlines
7,220 meters of drilling in 36 holes have been completed on the Golden Promise Project and so far the company has apparently accomplished everything they have set out to do. Samples of the main quartz vein have been obtained for further metallurgical testing; the gold-bearing quartz vein zone has been extended 100 meters to the east and down dip of the currently defined NI 43-101 compliant resource; a new zone north of the main zone has been successfully tested; and infill holes have successfully demonstrated the quartz-vein continuity and variable nature of the gold grade between drill holes – highlighting the importance of carrying out a bulk sample. The Jaclyn Main Deposit now extends over 950m in strike length and to a depth of 425m and remains open for expansion. Highlights from the drill program include:
| Hole | Grams per tonne (g/t) of gold | Core Length (m) | From (m) | To (m) |
| GP10-114 | 11.1 | 0.9 | 28.0 | 28.9 |
| and | 69.1 | 0.6 | 52.9 | 53.5 |
| GP10-116 | 3.9 | 4.6 | 31.4 | 36.0 |
| including | 12.9 | 1.0 | 35.0 | 36.0 |
| GP10-121 | 19.9 | 1.6 | 327.3 | 328.9 |
| GP10-126 | 20.81 | 0.46 | 29.3 | 29.7 |
At the beginning of June, Crosshair released results from the metallurgical test work completed on six previously drilled holes and I have to say, the results are outstanding: 98% gold recovery using direct leaching, which proves how readily extractable the gold is. Additional metallurgical test-work is being carried out on the 12 samples obtained from the quartz vein to further define the extraction process.
The Next Step
As part of the drill program that took place earlier this year, Crosshair carried out some infill drilling with very interesting results. Two of the infill holes intersected the quartz vein within 10 meters of two, previously completed, larger diameter holes. The results? The two larger diameter drill holes actually provided evidence that a larger sample size yields a higher grade – 35% to 58% higher, in this case. This suggests that the bulk sampling program that Crosshair has planned is likely to show very promising results.
The goal of the bulk sample is to provide a more representative gold grade, test structural and grade continuity and mining/milling characteristics for the Jaclyn Main Deposit. This will better support the drill results previously completed because the assay results from diamond drilling alone are not always an effective means of determining the grade of a nuggety-gold deposit and understate the actual in-situ gold grade.
As the following image shows, the 2,000 – 3,000 tonne bulk sample will be taken from the near surface vein system. If you look at the image below and compare it to my last coverage, you will also see how far Crosshair has expanded their resource to the east, and it’s still open along strike and at depth.
The contract for the planned bulk sampling program has been awarded to Stantec Consulting Ltd. who will be preparing an Environmental Compliance Plan, a cost estimate for the bulk sample and milling program, a design for the trench as well as additional planning, design, and project management services. The bulk sample has been planned for later this year and I look forward to the results as well as an updated resource estimate.
Vanadium – Getting Bigger!
Vanadium is slowly becoming a truly up-and-coming mineral that everyone seems to want a piece of. Its primary use is in strengthening steel for aerospace, aviation, and construction purposes; however the main reason why vanadium is becoming more popular is because of its use in the advancement of battery technology and its ability to connect large-scale power grids. Crosshair has smartly kept an eye on this and has begun sampling their old core for vanadium on their CMB Project in Labrador, Canada.
The currently defined resource includes over 27 million pounds of vanadium; however, Crosshair believes that the resource could expand to as much as twice the current resource – and this can be carried out without any additional drilling! Due to the exclusive focus on uranium in the past (previous drill programs were only aimed at building up the uranium resource), the vanadium resource is composed only of the vanadium that was present with uranium. Phase I consisted of sampling 1,979 meters in 34 drill holes outside of the uranium resource and proved that there is a lot of vanadium outside the uranium envelope.
Phase 2 (sampling approximately 1,700 meters) is scheduled to begin shortly and will continue where Phase I left off. The initial vanadium recoveries have been reported at 93.4% by acid leach testing. If results continue the way they did during the first phase, I can imagine that Crosshair should have no difficulty expanding their resource to what they are aiming for.
Moratorium Expiry
The team at Crosshair is very confident that when the Labrador Uranium Mining Moratorium in eastern Labrador expires on March 31, 2011 that it will not be renewed. The Company is refurbishing its two main camps this summer, getting them ready to occupy again next year. As I have stated before, Crosshair’s current stock price is like a call option on the expiry of the moratorium. As we get closer to that date I expect interest in two main companies in Labrador with real uranium assets, Fronteer Development Group (T.FRG) and Crosshair. Fronteer is currently trading at $6.18, which makes it a little expensive to play the moratorium expiry trade.
Bottomline
The moratorium expiry, the gold project moving to the bulk sample stage and the continuing vanadium expansion program can signal the end of the dark days for this company and the beginning of a period of recovery.
