Uranium deposits in the Dewey-Burdock Project are sandstone, roll front type. This type of depositis usually “C” shaped in cross-section, with the down gradient center of the “C” having the greatest thickness and highest tenor. The “tails” of the “C” are usually much thinner and essentially trail the “roll front” being within the top and bottom of the sand stone unit that is slight lyless permeable.

These “roll fronts” are typically a few tens of feet wide and often can be thousands of feet long. Uranium minerals are deposited at the interface of oxidizing solutions and reducing solutions. As the uranium minerals precipitate, they coat sand grains and partially fill the interstices between grains. As long as oxidizing groundwater movement is constant, minerals will be solubilized at the interior portion of the “C” shape and precipitated in the exterior portion of the “C” shape, increasing the tenor of the orebody by multiple migration and accretion. Thickness of the orebody is generally a factor of the thickness of the sandstone host unit. Mineralization may be 10 to 15ft thick within the roll front while being inches to feet thick in the trailing tail portions. Deposit configuration determines the location of well field drillholes and is a major economic factor in ISR mining.

The uranium deposits in the southern Black Hills region are characteristic of the Rocky Mountain and Intermontane Basin uranium province, United States (ref., Finch, 1996). The uranium province is essentially defined by the extent of the Laramide uplifts and basins.

Roll-front sandstone uranium deposits formed in the continental fluvial basins developed between uplifts. These uranium deposits were formed by oxidizing uranium-bearing groundwater that entered the host sandstone from the edges of the basins. Two possible sources of the uranium were uraniferous Precambrian granite that provided sediment for the host sandstone and overlying Tertiary age (Oligocene) volcanic ash sediments. Major uranium deposits occur as sandstone deposits in Cretaceous and Tertiary age basin sediments. Cluster size and grades for the sandstone deposits range from 500 to 20,000t U3O8, at typical grades of 0.04 to 0.23 percent U3O8.

Ore mineralogy consists of uraninite, pitchblende and coffinite with associated vanadium in some deposits. Typical alteration in the roll-front sandstone deposit includes oxidation of iron minerals up- dip from the front and reduction of iron minerals down-dip along advancing redox interface boundaries.

Size and shape of individual deposits can vary from small pod-like replacement bodies to elongate lobes of mineralization along the regional redox boundary.

Historical drillhole data (electric and lithology logs), along with Azarga’s confirmatory drilling results confirm that the mineralization at Dewey-Burdock is a roll front type uranium deposit. This is determined by the position of the uranium mineralization within sandstone units in the subsurface, the configuration of the mineralization and the spatial relationship between the mineralization and the oxidation/reduction boundary within the host sandstone units.

The Dewey-Burdock uranium mineralization is comprised of “roll-front” type uranium mineralization hosted in several sandstone stratigraphic horizons that are hydrogeologically isolated and therefore amenable to ISR technology. Uranium deposits in the Dewey-Burdock Project are sandstone, roll-front type. This type of deposit is usually “C”-shaped in cross section, with the down gradient center of the “C” having the greatest thickness and highest tenor. These “roll fronts” are typically a few tens of feet wide and often can be thousands of feet long. Uranium minerals are deposited at the interface of oxidizing solutions and reducing solutions. As the uranium minerals precipitate, they coat sand grains and partially fill the interstices between grains. Thickness of the deposits is generally a factor of the thickness of the sandstone host unit. Mineralization may be 5 to 12 ft thick within the roll front while being 1 to 2 ft thick in the trailing tail portions. Deposit configuration determines the geometry of the well field and is a major economic factor in ISR mining.

The Dewey-Burdock mineralization is located at depths of 184 to 927 ft below surface at Dewey and surface to 782 ft below surface at Burdock, as several stacked horizons, which are sinuous and narrow but extend over several miles along trend of mineralization. The deposits are planned for ISR mining by development of individual well fields for each mineralized horizon. A well field will be developed as a series of injection and recovery wells, with a pattern to fit the mineralized horizon, typically a five spot well pattern on 50 to 150 ft drillhole spacing.

The Burdock Resource Area consists of 19 well fields where mineral extraction will occur. The central processing plant (CPP) facility for the Project will be located at the Burdock Resource Area along with five ponds. A satellite facility will be constructed in the Dewey Resource Area. The Dewey Resource Area consists of 32 well fields
where mineral extraction will occur.

The Burdock CPP Facility will be constructed to initially accept a flow rate of up to 1,000 gallons per minute (gpm) lixiviant. Capacity will be gradually expanded to accept a flow rate of 4,000 gpm of lixiviant. Resin will be transferred from IX vessels to resin trailers to be transported and processed at an off-site processing facility for the first few years. Once the flow rate capacity reaches 4,000 gpm, the Burdock CPP Facility will be expanded to include processing capabilities for up to 1.0-mlbs-pa of U3O8. Once the Burdock Resource Area has been economically depleted, the IX vessels will be removed from the CPP Facility and transported to Dewey, where a satellite facility will be constructed to mine the Dewey Resource Area. The proposed phases are as follows:

- Phase I – Construction of two header houses and the Burdock CPP Facility with one IX train (estimated 1,000 gpm average flow rate, 1,100 gpm maximum flow capacity) and capability to transfer resin to a transpo ........