In February 2015, Kivalliq made a strategic addition to the Company’s project portfolio through a transaction with Rio Tinto Exploration Canada Inc. and Rio Tinto Canada Uranium Corporation (Rio Tinto) to acquire a highly prospective uranium property, adjacent to the Athabasca Basin of Saskatchewan, Canada.
Kivalliq has acquired 100% the Hatchet Lake Uranium Property, subject to a 2% NSR:
- 13,711 hectares (33,880 acres) in six claims adjacent to the north-eastern margin of the Athabasca Basin in Saskatchewan and three and a half (3.5) kilometres to the north west of Kivalliq’s Genesis Property
- Hatchet Lake is located 39 km along trend from the Roughrider uranium deposit and within 29 kilometres of Cameco’s Eagle Point uranium mine
- Multiple unconformity related basement targets of interest based on results from recent work by Hathor Exploration Ltd and Rio Tinto, including geophysics, boulder, soil, lake sediment and bio-geochemical sampling
- At least five priority target areas selected for follow-up exploration in 2015
- Low net acquisition cost
There is no record of mineral exploration over the Hatchet Lake property prior to the discovery of uranium at Rabbit Lake in 1968. Early exploration between 1968 and 1980 by groups including Gulf Minerals Canada Ltd, Canadian Superior Exploration Ltd and SMDC comprised airborne and ground geophysical surveys, surface sampling and drilling based on boulder, geochemical and radon anomalies. No further work was conducted until the property area was staked by Roughrider Uranium Corporation in 2005.
In 2007, following a takeover of Roughrider, Hathor Exploration Ltd (Hathor) collected 420 lake sediment samples and flew magnetic and Versatile Time Domain (VTEM) surveys over the claims. The VTEM survey defined 30 individual conductive trends with a combined strike length of 53 line kilometers. In 2008, Hathor collected an additional 837 soil and 215 rock samples. 19 of these rock samples returned assays greater than 0.2% U3O8 with a high of 1.17% U308 in a pegmatitic boulder. Exploration in 2012 by Rio Tinto included the collection of 306 soil samples, 1153 bio-geochemical samples and 31 rock samples. The Rio Tinto work identified uranium in soil anomalies coincident with known mineralization in boulders and outcrops and geochemical signatures known to be associated with uranium mineralization.
Kivalliq Exploration Priorities
Exploration priorities included compiling and confirming all available data in order to refine Kivalliq's five priority targets for future drilling. Kivalliq's first program was conducted on the Hatchet Lake Property in June 2015 and included ground geophysical and geochemical surveying, prospecting and mapping. Results from this program enhanced basement hosted uranium targets identified by previous operators and confirmed further work in 2016 is warranted.
Terms for the acquisition of the Hatchet Lake Uranium Property
Kivalliq acquired 100% interest in the Hatchet Lake Property on the following terms:
- Kivalliq made a cash payment upon execution of the agreement of C$220,000, subject to all claims being in good standing as of the closing date;
- Rio Tinto transferred a 100% interest in the Hatchet Lake Project to Kivalliq;
- Kivalliq granted Rio Tinto a 2% NSR royalty on the Hatchet Lake Project, with Kivalliq holding a buy-down right of 0.5% for C$750,000 (in the event Kivalliq exercises its buy-down right RTX’s remaining royalty will be a 1.5% NSR royalty).