On October 7, 2021, Pegasus Resources (TSXV:PEGA) announced that it has acquired several uranium properties in the Athabasca Basin area of northern Saskatchewan. The news follows the firm announcing they work looking in the region in the midst of uranium squeeze in mid-September.
PEGA is acquiring a 100% interest in the Pine Channel Uranium Property from Eagle Plains Resources Ltd (TSXV: EPL), the claim from which makes up the core of the firms new property. The larger property assembled by Pegasus consists of six mineral claims covering 6,028 hectares and is located at the northern edge of the Athabasca basin, roughly 40 km west of the town of Stony Rapids.
The company has entered into a binding letter of intent with a staking syndicate to acquire an adjacent claim to the south of the Pine Channel property. Furthermore, the firm also optioned four additional claims from ALX Resources Corp (TSXV: AL), which surround the staked and acquired property..
What makes the Pine Channel property compelling is that historical exploration activity by Denison Mines (TSX: DML) from during the 1970’s shows that it is prospective for unconformity-related uranium mineralization and the depth to the basement from surface is only about 60 to 100 metres. Data from airborne and ground geophysical surveys identified two conductive trends; one is 2.5 km in length, the other is a 600 metre conductor that has not been followed up on with any additional meaningful geophysics or drill programs.
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In 1979, Denison conducted a 12 hole drill program to test a conductor from a magnetic contact identified by geophysics. Results included 0.028% U3O8 (Triuranium Octoxide) across 1.2 metres within brecciated basement rocks, 0.062% U3O8 within altered basement rocks, and 0.039% U3O8 within Athabasca Basin sandstone.
This was followed by Denison drilling four more holes in 1981. The four holes were drilled at the same location as the previous holes to test ground geophysical conductors, and these holes intersected elevated radioactivity directly above the unconformity, with one hole showing 0.15% U3O8 over 0.15 metres. Exploration activity then ceased on the property until UEX Uranium conducted an airborne geophysical survey in 2005 using magnetic, radiometric and gravity surveys, and an airborne MegaTEM survey.
The Pine Channel property has similar geological characteristics to recent Athabasca Basin uranium discoveries by NexGen Energy (TSX: NXE) and Fission Uranium (TSX: FCU), which were catalysts for other exploration programs searching for other high-grade, basement hosted uranium occurrences. The Pine Channel property has structurally complex basement lithologies, altered basement rocks commonly associated with conductive trends, and previous drilling intersected highly anomalous radioactivity. The property can be worked on year-round and is easily accessible by roads.
Uranium was initially discovered in the region in the 1940’s, with one of the first notable mines, the Rabbit Lake Mine, opening in 1968. As a testament to the quality of uranium in the region, the mine was finally put into care and maintenance in 2016 after decades of operation. The region as a whole has made Canada a leader in uranium production, falling to second place only in 2009 when Kazakhstan began producing significant amounts of the yellow metal.
In terms of size, the basin itself is roughly 100,000 square kilometres in size, stretching across a significant portion of Northern Saskatchewan, and extending into Alberta. Uranium in the region sits at the base of a sandstone sediment, where it connects to the basement.
Pegasus intends to immediately compile data, review and form a strategy to further explore the Pine Channel Property. With 83.5 million shares outstanding and a low market capitalization of $5.01 million, Pegasus appears to represent a relatively low risk, early stage exploration play.
FULL DISCLOSURE: Pegasus Resources is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Pegasus Resources on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
