NUPOWER RESOURCES LIMITED
Nupower's Achievements and Strategy
Wed, 15 Oct 2008 10:00AM
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NUPOWER RESOURCES LIMITED (NUP)
ASX code: NUP
Website: http://www.NuPowerResources.com.au
Industry: Energy
Principal Activities:
Uranium exploration
Address:
, Royal Exchange, PO Box R1753,
SYDNEY
NSW
Phone: 02 9262 4235
Fax: 02 9262 6301
Executives & Directors
Mr Irvin , Mick Muir
Mr Dennis Russell O'Neill , Managing Director
Mr Ian Kowalick , Director
Mr Robert Owen , Non Exec. Director
Mr Anthony Schildkraut , Company Secretary
Company Podcasts
Company ASX Announcements
Company ASX announcements can be viewed on the ASX website.
Announcements from the preceding six months are shown below.
Please refer to the relevant stock exchange if any of the above information is incorrect
NUPOWER RESOURCES LIMITED (NUP) Events
Australia/NSW
NUPOWER RESOURCES LIMITED (NUP)
| Managing Directors Resignation | Fri, 3 Jul 2009 |
| Final Director`s Interest Notice | Fri, 3 Jul 2009 |
| Change in substantial holding from ARU | Thu, 2 Jul 2009 |
| Exploration Momentum Eva and Cobar II | Wed, 1 Jul 2009 |
| Lucy Creek Phosphate Assay Results | Tue, 30 Jun 2009 |
| Appendix 3B | Thu, 25 Jun 2009 |
| Appendix 3B | Wed, 20 May 2009 |
| Appointment of Director | Wed, 6 May 2009 |
| Initial Director`s Interest Notice | Wed, 6 May 2009 |
| Board Room Radio Interview with Mr Dennis O`Neill | Wed, 6 May 2009 |
Please note: This company appears on this website as a result of its listing on the Australian Securities Exchange. Boardroom Radio does not claim any association with any company listed on this site.
PRESENTATION BY DENNIS O’NEILL, MANAGING DIRECTOR OF NUPOWER RESOURCES LIMITED (NUP)
“NuPower’s Achievements and Strategy”
http://www.brr.com.au/event/52320
WEDNESDAY, OCTOBER 15, 2008, 11:00 AM.
BRR Good morning and welcome to Boardroom Radio’s Uranium eConference. Joining us today is Mr. Dennis O’Neill, the Managing Director at NuPower
10 Resources. Today, Dennis will be presenting on the uranium exploration activities and future prospects at NuPower. Dennis, thanks for joining our eConference today.
NUP Thank you very much indeed and good morning.
15
Apart from starting off with the usual disclaimer, I would like to move very quickly into explaining just what NuPower has achieved in the little more than eighteen months since it listed in March 2007. As investors will know, NuPower now has some 47 million shares on issue and our cash position at
20 the end of August was a little under $5 million. Like all uranium sector companies, of course, our share price has declined in the current difficulties in financial and investment markets, but I intend in today’s presentation to demonstrate to our shareholders and prospective investors the intrinsic value that is emerging in NuPower.
25
So since our listing date, we have successfully built a core team in what has been for skilled people a very constrained market. We’ve moved quickly to develop momentum in our exploration activity and indeed results are already emerging, which I will explain further detail. That momentum I mentioned has
30 certainly created a strategic advantage for NuPower because we’ve managed to put together a considerable and important holding of prospective ground immediately north of Alice Springs, and despite what’s happening in the market, this company is remaining proactive. We are talking to other companies. We are talking to a range of prospective larger investors who can
35 well understand the value that is emerging in NuPower, and also understand the requirement for patience and a steady technical application in delivering results for uranium exploration.
Our core team comprises Warwick Rafferty, a very experienced exploration
40 manager who has to his name the Gosowong gold discovery in Indonesia, and Jon Higgins, we have a senior geologist who has uranium experience courtesy of his time at the Beverley operation in South Australia, and we are using contractors and consultants to back us up. Indeed in this case, Ian Splatt, is a very experienced senior geologist who undertakes our Hard Rock
45 reconnaissance work in the Northern Territory.
In other areas, the consultants we are using cover geology, radiometrics, and water chemistry, as well as geophysics. We’ve also dipped into geobotany, and we’ve looked up various types of spectral imagery and indeed we’ve also looked at some technical magic associated with understanding the details of radiochemistry. The same time, we’ve found that we’ve had to be very flexible to accommodate fly-in fly-out arrangements. It’s been difficult to get deeper on the spot in the various locations where we’ve worked in the Northern
5 Territory, and again this is reflective of the way in which the resources sector has developed over the last 5 to 10 years.
NuPower in being flexible recognises that we’re dealing with changed circumstances and indeed to develop that momentum, I mentioned earlier
10 and to maintain it, we have to go with that change, the set of circumstances and accommodate the lifestyle preferences of the people which is to employ.
In terms of our core strategy, NuPower has elected to focus on the Northern Territory with South Australia a secondary focus, largely because of the
15 earlier perception that the political risks associated with uranium exploration and ultimately mining in those jurisdictions were significantly lower than elsewhere in the country. Of course, with the political changes in Western Australia, that risk has reduced in Western Australia and it’s a matter now of remaining somewhat opportunistic to see what positions, what projects
20 become available as the current market circumstances create opportunities for shedding of ground or for new joint ventures. Part of the risk mitigation strategy by NuPower, we’ve also diversified our projects to cover different geological targets but predominantly we have retained in situ recovery capable projects and those are based on looking for paleochannels as our
25 key target, as our main priority. Reason for that is simply that in situ recovery is generally a less costly, less intensive way of recovering uranium. It certainly is environmentally more satisfactory because there is not the requirement to physically dig up ore and to leave an open pit at the end of the mining phase.
30
We’ve also placed very high on our strategic list the need to take on board people who have technical excellence very much as part of their way of operating. Having done so it’s about the company putting in place processes and acquiring staff and consultants who can maintain that technical
35 excellence. Exploration for uranium is technically more challenging than for many other commodities and a wider array of tools needs to be applied to this task. We’ve had twenty five to thirty years of reduced exploration activity for uranium and this brought along with it reduced activity of the research and development area. Consequently, there’s a need to think outside the square
40 to be prepared to try new techniques, new equipment, new technologies, and to see if we can bridge that 25-year gap and bring uranium exploration well and truly into the 21st century. That is certainly one of the strategic goals of NuPower.
45 In these challenged market times, we’re also proactively seeking corporate targets for possibility of a friendly merger as part of sector consolidation. It would also assist us to further refine our selection of projects and indeed through creating more robust critical mass giving NuPower the capacity to go forward and lock-in on the results that we’re getting to date and build on that process in the expectation that we can achieve commercial success more readily.
The layout of our projects in the Northern Territory such that the
5 concentration around the Alice Springs area and just some 300 km north of Alice Springs is very much focused on identifying those palaeochannel systems with the in situ recovery capacity.
To demonstrate what I mean by technical excellence, I’ve thrown up this
10 particular diagram to demonstrate why we believe the Aileron Project, some 100 km or so north and northwest of Alice Springs, is very much in our minds an analog of the Beverley area in South Australia which, as investors will know, hosts the Beverley and Beverley 4-mile uranium deposits. The point of the diagram is to demonstrate the process by which a relatively rich uranium
15 source rock, in this case the granites and gneisses in the Reynolds range, over time erode and shed that uranium into waters that flow into nearby catchments or from the catchments into nearby basins. The diagram therefore shows the creation of alluvial fan which then further erode into alluvial plains, and over time sandstone bedding and gravel and sand beds
20 emerge in the basin. The uranium in the waters flowing through these gravels, sands, and indeed sandstone rock itself can encounter changed chemical conditions which would result in the uranium depositing out of the water. It would no longer be soluble, it would become insoluble, and would precipitate into the gravels and between the sand grains. Our target in
25 exploring the basins is indeed to find these areas where the uranium has deposited out of the waters that have been carrying the dissolved uranium from the source rocks.
In 2007, the airborne electromagnetic survey which we ran over the Aileron
30 Project area discovered paleochannels. These were subsequently drilled in 2008 and anomalous radioactivity was found in a number of holes with measured mineralisation above 0.01% uranium. Not a large number obviously but one that certainly technically is consistent with our hypothesis, but the area does replicate what has happened to lead to the Beverley
35 uranium deposits. Iindeed, we also were able to identify that this anomalous radioactivity due to the deposition of the uranium is consistently in one stratum of gravel and sand in the Aileron Basins area.
So in terms of our key projects, NuPower has therefore elevated the Aileron
40 region to its so called jewel in the crown. We’ve established already, based on the work in ’07 and followed up with the drilling so far in ’08, that we have a mineralised palaeochannel system hosting low grade uranium which certainly in our view demonstrates the analogue with Beverly.
45 Lagoon Creek in the north-eastern sector of the Northern Territory just by the Queensland border and geologically a long strike from the Westmoreland uranium deposit in Queensland, remains a very important project for us because indeed all grade intersections of uranium have already been drilled in the Lagoon Creek area. The mineralisation is however in small pods, it’s at depth, and we would need to uncover considerably more intersections of the type seen so far to elevate Lagoon Creek to a stronger economic position for us. Indeed that will be very much the focus of exploration activity into ’09 at Lagoon Creek.
5
Of our other projects, the Warrabri project is also one focus on seeing whether that area replicates what we are seeing to date at Aileron, and we are looking more closely now at Lucy Creek and Arganara as areas which are on the fringes of the Georgina Basin to see whether they are prospective for
10 phosphate, hopefully phosphate containing uranium, as key new targets.
Victoria River Joint Venture is a series of scattered exploration licenses to the south and southwest of Darwin in the Victoria River area and then these are based on examining more closely airborne radiometric anomalies and
15 identifying whether these anomalies continue at depth and indeed host sufficient uranium to be of interest.
Lastly, two projects inherited from Arafura at the time of the merger of NuPower in the Johanssen Range area and Hammer Hill, we are doing a
20 reassessment there for hard rock uranium targets, but that is currently a low priority project for us.
I commence this presentation with reference to the momentum that NuPower has successfully generated since its listing and I think it would be appropriate
25 just to reflect for a moment on the elements of our program which indeed are driving this momentum. The quality outcomes that we’ve seen in the short space of time since that listing eighteen months ago, have been not only the interpreted electromagnetic work from the airborne survey but the reinforcement of that work by emerging water chemistry results and the
30 geological mapping which is helping us to refine which palaeochannels should be targeted as a priority. The raw data from the extended airborne survey undertaken this year and just finished a week or so ago, together with the drilling that has just finished in the last week, certainly confirms the extensiveness not only of the palaeochannel system but of the uranium
35 mineralisation within it. Albeit so far at low grades but the strata we’re seeing, the sands and the gravels, with thicknesses in excess of 15 m, certainly our most encouraging outcome because it indicates that we have available to us in these basins, not only thickness but mineralisation and it is also now a question of seeing whether that mineralisation has been further concentrated
40 in parts of the basins such that economic orebodies are the result.
We will now process the data that has come from the ’08 airborne survey largely targeted at identifying, and filling in the gaps that existed in our tenement holdings from ’07 and this will lead us to the identification of where
45 to place our follow-up drilling into the thicker parts of the key stratum in ’09.
Conclusion of all of these is the key strategic advantage which NuPower has now generated by moving quickly; employing key people with sound, technical, and exploration experience and applying leading-edge geophysical technology to get a better understanding of the layout of the channelling systems in these basins.
Our next slide shows the raw data from ’07 and ’08 so that we have an
5 apples-and-apples comparison between the two. Nevertheless, even without further processing showing in red the detailed deeper structures which we believe to be the drainage systems that are buried well and truly under the surface of these basins. With further computer-driven processing, these structures will be refined and we will find as a result a color inversion will be
10 undertaken by the geophysical consultant to shuffle up the view that we can have of these channels. Then together with the results from our drilling this year, the complete set of water data, which we will get from having sampled all the past drilled bores in the region together with some geobotany where we use uranium sampling from the leaves and bark of various plant species in
15 the area as a surrogate for taking water samples where we have no bores. Collectively, that information will be analysed and interpreted in such a way as to identify a narrow dam where we should undertake our second phase drilling in 2009.
20 Through the use of joint ventures, we have successfully filled in the holes in the so called Swiss cheese that we had when we first identified our tenements in the area such that we now have a contiguous block of ground at Aileron, covering some 17,000 sq km. To give you an idea of just how much this is, it’s about 30% of the area of Tasmania.
25
Once the ’08 data has been processed fully, I expect that we will more than double the length of the channels that we’ve interpreted in the area and this will indeed present a significant target for activity going ahead quite a few years. The example I can give of the deposit of results today are shown in
30 this slide which shows the cuttings that have emerged from one of our drillholes and the dark material at the bottom of the photo, labelled as T4, is indicative of having moved toward the bottom of the drillhole. We are actually targeting the gray material which is the reduced sands that contain the right chemical conditions for depositing uranium. The T3 unit, just before the T4
35 unit, is the unit that we are actually seeking when we drill and this is the one where we test for anomalous radioactivity. As mentioned earlier, in some holes we have had that T3 unit as thick as in excess of 15 m.
So where does NuPower head from here? Well, as I mentioned a moment
40 ago, we’ve remained proactive despite what’s happening in the market. Overall, in the Northern Territory we have over 20,000 sq km of tenements. We’ve used joint ventures strategically to fill in the gaps, and we’ve maintained a Darwin base to give us logistical efficiency and thereby secure a competitive advantage in being able to efficiently explore our areas in the
45 Northern Territory. We intend to be an active player in the coming consolidation of the junior uranium sector and we are therefore talking to strategic investors with a view to ensuring that we have the capacity to move forward, continue our programs, and to be an active and successful company. Part of this approach also requires that we maintain a pipeline of projects covering not only different geological targets but also ensuring that we drop off the projects which are more basic, more grassroots, and focus the available financial resources on the best chances for success. In this regard we very much place the palaeochannel systems which have the potential to
5 host in situ recovery operations such as Beverley or in the same style as Beverley, as highest on our list of priorities.
To be successful in executing this approach, we need ongoing smart use of technology. I mentioned earlier the 20-year hiatus and we are certainly
10 prepared to think and act outside the square to try new techniques. There is a considerable work ahead also to understand the hydrogeology within palaeochannels, that is the flow and direction of flow of water, and we also are looking to achieve some success in the use of water geochemistry to try and separate our palaeochannels into those that are less or more likely to
15 contain uranium. There’s also a requirement to understand new and emerging drilling technologies and to apply the most cost-effective technology for the ground that we have, and similarly to look at cost-effective methods of analysing down the hole the type of radiation and the extent to which we can directly measure uranium concentrations from those down-hole
20 measurements.
In consolidating the company in the current market, NuPower is determined to retain its best people and to ensure that it has available to it the best consultants. We will maintain the diversification of geological risk and where
25 possible, where it’s cost effective increase the smart use of new technology. It’s critical that we maintain that exploration momentum that has been put in place since our listing in March 2007, and by 2009, our objective will be to achieve exploration success within the Aileron project as well as demonstrate that a junior uranium exploration company running on the basis of quality
30 results with low overheads and continuous value adding can within a few years be commercially successful. Thank you very much.
BRR That was the Managing Director of NuPower Resources, Mr. Dennis O’Neill, presenting to you today as part of the Boardroom Radio’s Uranium
35 eConference. Dennis, thanks very much for your time.
NUP Thank you, James.
PRESENTATION CONCLUDED
Contact brr@brr.com.au for more information
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