Target Exploration has been drilling its uranium project in the Shirley Basin of Wyoming since the beginning of June 2008 and has had nothing but great results. The Bootheel project continues to prove itself as one of the up and coming great uranium projects. The key factors behind Bootheel’s and, in turn, Target’s success are:
• being perfectly located in an established and growing uranium district;
• being designed for near term production with its number of pounds and its In-Situ Recovery (ISR) potential;
• having a successful 2008 drill program; and
• having knowledgeable and experienced professionals with both exploration and mining backgrounds.
Location, Location, Location
When developing a uranium mine, location obviously plays a huge role. Bootheel, Target’s flagship project, is located in uranium-mining-friendly Wyoming. Wyoming has already produced close to 200 million pounds of uranium and currently has two producing ISR mines. Several more deposits are in the permitting stage and slated for production within the next couple of years. Target couldn’t be better situated!
Near Term Production
Target is slated to be producing uranium from Bootheel in 2012. That is just four years away! This may seem like a long time, but a lot of mines need 8 to 10 years to go through the development and permitting stage to production.
Now, why can Bootheel get off the ground quicker than most? Due to the uranium at Bootheel being hosted by sandstones in roll-front settings, ISR techniques should work. ISR is an environmentally-friendly, inexpensive way to mine uranium. An ISR mine costs almost a third as much to operate as a conventional mine and can be constructed in as little as 18 months. Not only can it be constructed much more rapidly than conventional mines, but you need fewer pounds in the ground to make a mine feasible. An ISR mine can go into production with as little as 5 million pounds in the ground. This is all easily represented in a chart that I obtained from Target Management (see page 3).
Target currently has an 11 million pound historic uranium resource in an area of the world where only around 5 million pounds are needed to go into production. Once they finish drilling their 50,000 feet at Bootheel, an NI 43-101 resource will be carried out. Even if they get half of what the historic resource is, they are still on track for production.
2008 Drill Program
If you’ve been following the news from Target, you may have noticed that not only are they confirming historic grades and thicknesses with the drill, but they are also expanding the limits of the known mineralization. Holes such as 06-3008 intersected 0.055% eU3O8 over 51.0 feet within the historic resource area. Holes such as 36-3013 intersected 0.036% eU3O8 over 46.0 feet outside of the resource – this particular hole was part of a group that extended the area of mineralization 400 feet beyond the historic resource area…and this isn’t the only area that was expanded on – there are several.
All the holes drilled on the outskirts of the historic resource areas should aid in adding pounds to the anticipated NI 43-101 compliant resource and, as you can see from the following map, most of the holes (yellow dots) were drilled outside the historic resource areas (in red).
Bottom Line
Target is one of those rare companies that not only has the right type of project in the right location, but also has the team with the right exploration and mining backgrounds to get to production. The stock is trading at the .25 level, with 12 million shares outstanding, giving the company a market capitalization of a whopping $3 million. Insiders have been buying lately and at these prices, why not? Uranium is poised for a comeback in 2009 and I’m optimistic Target can benefit from it.
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