The La Sal Project uranium-vanadium deposits in the Jurassic Salt Wash Member of the Morrison Formation are sandstone-type deposits that fit into the U.S. Department of Energy’s (“DOE”) classification as defined by Austin and D’Andrea (Mickle and Mathews, 1978) Class 240 sandstone; Subclass 244-nonchannel-controlled peneconcordant. Any future deep drilling to explore for deposits in the Triassic basal Chinle Formation (Moss Back Member) would fit the DOE classification as Class 240- sandstone; Subclass 243- channel controlled peneconcordant. These classes are very similar to those of Dahlkamp (1993) Type 4-sandstone; Subtype 4.1- tabular/peneconcordant; Class 4.1.2 (a) Vanadium-Uranium (Salt Wash type) and Class 4.1.3-basal-channel (Chinle type).

The La Sal district uranium-vanadium deposits are a similar type to those elsewhere in the Uravan Mineral Belt. The Uravan Mineral Belt was defined by Fisher and Hilpert (1952) as a curved, elongated area in southwestern Colorado where the uraniumvanadium deposits in the Salt Wash Member of the Morrison Formation generally have closer spacing, larger size, and higher grade than those in adjacent areas and the region as a whole. The location and shape of mineralized deposits are largely controlled by the permeability of the host sandstone. Most mineralization is in trends where Top Rim sandstones are thick, usually 40 feet or greater.

The La Sal Trend is a large channel of Top Rim sandstone which trends due east, possibly as a major trunk channel to distributaries that fanned-out to the east to make a portion of the Uravan Mineral Belt. The Energy Queen deposit appears to be at the location of the junction of a tributary channel that joins the main channel from the southwest. The Rattlesnake mine (U.S. Atomic Energy Commission, 1959) is located upstream in this tributary channel. The channel remains relatively straight and the uranium deposits get larger as it continues eastward through the Redd Block and Beaver mine deposits. East of the Beaver, the channel appears to widen and contain large meanders as it continues through the Mike portion of the La Sal mine, the Snowball, and Pandora mines.

Most of the La Sal and Uravan Mineral Belt areas consist of oxidized sediments of the Morrison Formation, exhibiting red, hematite rich rocks. Individual deposits are localized in areas of reduced, gray sandstone and gray or green mudstone (Thamm et al., 1981). The Morrison sediments accumulated as oxidized detritus in a fluvial environment.

The habits of the deposits in the La Sal Trend have been reported to be typical of the Uravan Mineral Belt deposits. Where the sandstone has thin, flat beds, the mineralization is usually tabular. In the more massive sections, it “rolls” across the bedding, reflecting the mixing interface of the two waters. This accounts for the fact that there are several horizons within the Top Rim that are mineralized. Very thin clay layers on cross beds appear to have retarded ground water flow, which enhanced uranium precipitation. The beds immediately above mineralized horizons sometimes contain abundant carbonized plant material and green or gray clay galls. The mudstone beds adjacent to mineralized sandstones are reduced, but can grade to oxidized within a few feet. There are no significant differences between mineral depositional habits in the Top Rim and those in lower Salt Wash sands.

The thickness, the gray color, and pyrite and carbon contents of sandstones, along with gray or green mudstone, were recognized by early workers as significant and still serve as exploration guides. The entire main La Sal Channel exhibits these favorable features. However, the bulk of the uranium deposits identified to date are aligned along the south of the Channel. This is the down-dip edge of the channel where the thick reduced sandstone grades and interfingers into pink and red oxidized sandstone and overbank mudstones (Kovschak and Nylund, 1981).

The uranium- and vanadium-bearing minerals occur as fine grained coatings on the detrital grains, they fill pore spaces between the sand grains, and they replace some carbonaceous material and detrital quartz and feldspar grains.

The primary uranium mineral is uraninite (pitchblende) (UO2) with minor amounts of coffinite (USiO4OH). Montroseite (VOOH) is the primary vanadium mineral, along with vanadium clays and hydromica. Traces of metallic sulfides occur. In outcrops and shallow oxidized areas of older mines in the surrounding areas, the minerals now exposed are the calcium and potassium uranyl vanadates, tyuyamunite, and carnotite. The remnant deposits in the ribs and pillars of the Beaver and Pandora/Snowball mines show a variety of oxidized minerals common in the Mineral Belt. These brightly-colored minerals result from the moist-air oxidation of the primary minerals. Minerals from several oxidation stages will be seen, including corvusite, rauvite, and pascoite. Undoubtedly, the excess vanadium forms other vanadium oxides depending on the availability of other cations and the pH of the oxidizing environment (Weeks et al., 1959). The Energy Queen has been standing full of water since 1993, so no direct observations have been made of that mine’s openings. Similarly, the mine on ML-49596 has been reclaimed and is not accessible at this time. Remnants of Salt Wash uraniumvanadium mineralization are exposed in the Rattlesnake pit floor. These show the habits described above and have mostly weathered to carnotite-type mineralization.

Some stoping areas in the Beaver/La Sal and Pandora/Snowball mines are well over 1,000 feet long and several hundred feet wide. The Mineral Resources of the Redd Block and Energy Queen mine identified through drilling are of similar size. Individual mineralized beds vary in thickness from several inches to over 6 feet. Throughout much of the La Sal District there are three horizons in the Top Rim that host the mineralization. They are 25-40 feet apart.

The mining of all resources in the La Sal Project have been by conventional underground methods. The nature of the Salt Wash uranium vanadium deposits require a random room and pillar mining configuration. The deposits have irregular shapes and occur within several closespaced, flat or slight-dipping horizons. The mineralization often rolls between horizons. The use of rubber-tired equipment allows the miners to follow the ore easily in the slight dips and to ramp up or down to the other horizons. The deposits are accessed from the surface through long declines at gradients of 8-15%, depending on depth and locations suitable for portal sites, such as the La Sal and Pandora/Snowball mines. Deposits may also be accessed through vertical shafts such as at the Beaver and Energy Queen mines. Depending on ground conditions, the shafts will be lined with concrete or with steel and timber-lagging methods. Most recently, the Beaver Shaft was used for hoisting ore, ventilation, and a secondary escape. It is connected underground to the La Sal mine which provided man and equipment access to the Beaver mine areas. The Salt Wash sandstones are usually quite competent rock and require only moderate ground support. The overlying Brushy Basin mudstones are less competent, so the declines are often supported by square set timber or steel arch and timber lagging, as is the case at the La Sal and Pandora mines. The Salt Wash uranium vanadium deposits are usually thinner than the mining height needed for personnel and equipment access. Therefore, the ore is mined by a split-shooting method.

The split-shooting mining method involves assessing each face as the stopes advance by the mine geologist, engineer, mine foreman, or experienced lead-miner. Because the grades and thickness of the typical Salt Wash uranium vanadium deposits are highly variable, they are usually unpredictable from one round to the next. (A round is a complete mining cycle of drill-blast-muck-ground support, if needed to be ready to drill again; a normal round advances a face about 6 feet.)

Typically, the thickness of the mineralized material is less than the height needed to advance the stope. As the stope face is being drilled, the blast holes are probed with a Geiger counter probe in order to estimate the U3O8 grade. The uranium-vanadium mineralization is usually dark gray to black. The mineralization sometimes rolls, pinches or swells, or follows cross-beds within the sandstone. Therefore, the miner will also use drill cutting color as a criterion to help guide blast hole direction and spacing. This irregular habit of the deposit can result in holes collared in mineralized material ending in waste, or, conversely, holes collared in waste will penetrate mineralized material much of their length.

Based on the results of the assessment of the blast holes drilled in the face, the round will be loaded and shot in two or more stages. Depending on the location and thickness of the mineralized material in the face (there may be multiple mineralized layers); the miner will attempt to blast either only mineralized material or only waste rock. The miner will muck it out as clean as possible, then shoot the remaining rock and muck it cleanly. In resource estimates, one foot of waste is added to the mineralized material for dilution because of this method. The amount of waste rock shot before or after the mineralized material results in typical stope heights of eight-to-nine feet. The minimum height needed to advance the stope is about seven feet, so any mineralized drill-intercept greater than seven feet does not receive dilution in resource estimate calculations. As with the split-shooting method of mining, resuing mining involves very selective separation of the waste rock from the ore. Ore grade material is determined by probing drill holes in the face of the stope. In resuing, waste is blasted or otherwise removed from one side of the ore zone. The ore in that zone is then extracted, thereby leaving any waste on the other side of the ore zone in place. If additional stope space is needed or a second ore zone occurs behind the remaining waste, that waste is removed without dilution to the ore zones. The lower limit of waste volume that can be extracted without disturbing ore is a function of the precision with which waste areas of the drill pattern can be selectively blasted without unduly increasing mining costs. Mining assumptions were used in determining a cutoff grade for the resource estimates. Mining dilution is 1 foot of waste for mineralized thicknesses less than 6.0 feet or an appropriate fraction of a foot (if the intercept is greater than 6 feet) up to 7.0 feet. Mineralized intercepts greater than 7.0 feet are not diluted for resource calculations. A resuing or split-shooting mining approach will be followed to minimize dilution when extracting thin zones. The eventual stope height will be seven feet or greater, but at the time of mining the waste above or below the mineralized horizon is blasted. This waste layer may be one or more feet thick. After the waste is blasted and removed, the mineral zone is blasted and removed, thus reducing the amount of dilution to the mineralized rock. At times, the mineralized zone is blasted before the waste. For the La Sal Project Mineral Resources, 7.0 feet is the assumed minimum stope height. It is conservative to use waste at zero grade for the dilution, because there is often lower-grade material adjacent to the target mineralized zones. Vanadium assays are available for some of the drill holes. Where no data exist on vanadium content, the intercept is assigned a value based on the district average estimate for the property which averages a V2O5:U3O8 ratio of 5.25:1 based on historic assays of core. This ratio cannot be guaranteed and must be used only as a historical estimator for vanadium mineralization potential.

The cutoff of a mineralized intercept in individual holes is 0.10% U3O8, with a select few holes as low as 0.05% U3O8, used in the Mineral Resource estimates for the La Sal Project in order to achieve the average grade of the total resource of 0.18% U3O8.

The La Sal Trend has a long history of uranium and vanadium production. Deposits from this district have been successfully milled at several historic mills in the region. The White Mesa Mill uses sulfuric acid leaching and a solvent extraction recovery process to extract and recover uranium and vanadium. The Mill has been operated on a campaign basis since its initial start-up due to variable uranium market conditions.

Between November 2012 and April 2013, the Mill processed uranium/vanadium ores from stockpiles of the several previous months’ mining at Beaver /La Sal and Pandora/Snowball mines attaining greater than 96% uranium recovery and greater than 70% vanadium recovery. Future production will be processed at White Mesa Mill.

The White Mesa Mill is located six miles south of Blanding in southeastern Utah. Its construction by EFNI was based on the anticipated reopening of many small low-grade mines on the Colorado Plateau, and the mill was designed to treat 2,000 tons of ore per day. The mill has operated at rates in excess of the 2,000 tons per day design rate. The mill has been modified to treat higher grade ores from the Arizona Strip, as well as the common Colorado Plateau ores. Processing of Arizona Strip ores is typically at a lower rate of throughput than for the Colorado Plateau ores. The basic mill process is a sulphuric acid leach with solvent extraction recovery of uranium and vanadium.

Run-of-mine ore is reduced to minus 28 mesh in a six-foot by 18-ft. diameter semiautogenous grinding (SAG) mill. Leaching of the ore is accomplished in two stages: a pre-leach and a hot acid leach. The first, or pre-leach, circuit, consisting of two mechanically agitated tanks, utilizes pregnant (high-grade) strong acid solution from the countercurrent decantation (CCD) circuit which serves both to initiate the leaching process and to neutralize excess acid. The pre-leach circuit discharges to a 125-ft. thickener where the underflow solids are pumped to the second stage leach and the overflow solution is pumped to clarification, filtration, and solvent extraction circuits.

A hot strong acid leach is used in the second stage leach unit, which consists of seven mechanically agitated tanks having a retention time of 24 hours. Free acid is controlled at 70 grams per litre and the temperature is maintained at 75o C. Leached pulp is washed and thickened in the CCD circuit, which consists of eight highcapacity thickeners. Underflow from the final thickener at 50% solids is discharged to the tailings area. Overflow from the first thickener (pregnant solution) is returned to the pre-leach tanks.

The solvent extraction (SX) circuit consists of four extraction stages in which uranium in pregnant solution is transferred to the organic phase, a mixture consisting of 2.5% amine, 2.5% isodeconal, and 95% kerosene. Loaded organic is pumped to six stages of stripping by a 1.5 molar sodium chloride solution, and thence to a continuous ammonia precipitation circuit. Precipitated uranium is settled, thickened, centrifuged, and dried at 1,200o F. The final product at about 95% U3O8 is packed into 55 gallon drums for shipment.