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Apr 22, 2002

Significant Uranium Mineralization Intersected on the Hidden Bay

VANCOUVER, April 22 /CNW/ - Cameco Corporation ("Cameco"), exploration manager for UEX Corporation ("UEX") on the Hidden Bay property in northern Saskatchewan, has reported to UEX the preliminary results of the winter exploration program of geophysics and diamond drilling on the property. The drilling program was conducted in the West Bear deposit area, with the following highlights:
  • a significant drill intersection of uranium mineralization in a potentially new, near surface zone located 550 m west of the West Bear deposit
  • intersection of new nickel-cobalt-arsenic and low grade uranium mineralization in a broad zone of intense clay alteration located 200 m east of the West Bear deposit
  • a single hole drilled into the West Bear deposit encountered expected uranium grades based on adjacent drill sections, but over a thickness greater than anticipated
  • the drilling results indicate that areas to the west and east of the West Bear deposit are prospective for new uranium resources at shallow depths over a minimum strike length of 1.4 kilometers
The exploration program, comprising expenditures of approximately $600,000, which included $450,000 in ground geophysical surveys and $150,000 in diamond drilling, commenced in February, 2002, and was completed in early April.

The 2002 winter program was undertaken to test high priority exploration targets through a combination of ground geophysical surveys and diamond drilling. A total of 423 line kilometers of ground fixed and moving loop EM, horizontal loop EM, and ground magnetometer surveys were undertaken on the West Bear, Raven-Horseshoe, Telephone, Rhino Lake, Wolf and Black Island target areas. Work was performed by Quantec Geoscience Inc. of Porcupine, Ontario. Conductive lithologic units were identified in basement rocks on all of the target areas, and based on their extent, intensity and structural style, will be prioritized for follow-up diamond drilling to test for associated uranium mineralization during upcoming exploration programs. Diamond drilling was conducted on the West Bear target area to test lateral and down dip extensions of mineralization and new geophysical targets. The West Bear deposit, discovered in 1978 by Gulf Minerals Canada Limited, has a historical inferred resource of 1.27 million lbs U3O8 at grades of 0.44% U3O8 (due to its historical nature, this resource was not calculated in conformity with National Instrument 43-101). During the current program, eleven diamond drill holes totaling 1284 m were completed by Major Midwest Drilling in the West Bear Area, and three holes intersected uranium mineralization with concentrations greater than 0.1% U3O8. Geochemical sample intervals in each of these were selected with guidance from radiometric probe data. Core was split, half core from each interval sealed in sample bags, and submitted to the Saskatchewan Research Council in Saskatoon. After preparation, uranium and base metal concentrations were determined using fluorimetry and ICP analysis. Results are tabulated below:

Hole Target From To Width (m) % U3O8

WBE-16 Pebble Hill 48.50 50.75 2.25 1.926

WBE-16 Pebble Hill 48.50 50.75 2.25 1.926

  including 48.50 49.00 0.50 4.490

WBE-17 West Bear 0 16.0 25.00 9.00 1.686

WBE-17 West Bear 16.00 25.00 9.00 1.686

WBE-17 West Bear 16.00 25.00 9.00 1.686

  including 16.00 22.00 6.00 1.945

  including 16.00 22.00 6.00 1.945

including 21.50 22.00 0.50 4.675

WBE-19 West Bear east 43.50 45.00 1.50 0.167

Downhole radiometric logs were also obtained for drill holes using a shielded G375A probe. Readings were collected at 10cm intervals, and equivalent U3O8 grades were estimated using a conversion factor based on correlation of radiometric data with direct chemical analysis of samples by Cameco at other deposits in the region. The radiometric data provide a verification of the geochemical data, and additional information where core loss prevented representative geochemical sampling. Radiometric results for mineralized intervals in drill holes WBE-16 and 17 are as follows:

Hole Target From To Width (m) Equivalent
% U3O8

WBE-16 Pebble Hill 48.60 51.40 2.80 1.25

  Including 48.60 49.20 0.60 1.82

  And 49.80 51.40 1.60 1.27

WBE-17 West Bear 13.90 24.90 11.00 1.79

  Including 14.50 21.80 7.30 2.34

Hole WBE-16 was drilled to test the down dip projection of southeast dipping uranium mineralization intersected historically at the Pebble Hill prospect (0.8% U3O8 over 1.5 m in two holes). Although the historic Pebble Hill mineralization was not intersected, a Fe-oxide-clay altered zone in pegmatite was intersected 7.1 m below (true depth) the Athabasca unconformity, which contains 1.926% U3O8 over a 2.2 m interval. This is the most significant intersection ever obtained in the Pebble Hill area. While the field location of the historical drill holes has not been precisely established, historical plans and sections suggest that the mineralization occurs 10-15 m structurally above, and south of, the Pebble Hill prospect, and consequently may represent a previously unknown zone which is open to the south.

Hole WBE-17 was drilled within the West Bear deposit. Historical diamond and reverse circulation drilling in the deposit suffered from poor recoveries due to the altered host rocks, and wet drilling conditions. The current hole was completed to test the potential for upgrading the resource using larger diameter (HQ wireline) diamond drilling techniques to increase core recovery, and modern downhole radiometric probe technology to determine the width and grade of mineralization. The hole, sited between two 30.5 m spaced historic drill sections, intersected significant uranium mineralization in intense clay alteration above and straddling the unconformity over a 9 m interval grading 1.686% U3O8. Although no core was recovered above 16 m, the radiometric logs indicates that mineralization is present as high as 13.9 m in the hole, and is continuous over an 11 m interval (13.9-24.9 m grading 1.79% U3O8 equivalent). This represents the thickest intersection of greater than 1% U3O8 obtained in the deposit to date, and supports the hypothesis that thickness and tonnage of the deposit may be understated. Additional confirmatory drilling on the deposit will have to be completed before this possibility can be confirmed and quantified.

Hole WB-19 was completed to test potential eastern extensions of the West Bear deposit, based on a new interpretation of the strike of host lithologies indicated by the new EM surveys. The hole intersected an intense zone of clay alteration in basement rocks between 30.3 and 50.1 m which contains anomalous uranium mineralization, including an interval grading 0.167% U3O8 over 1.5 m between 43.5 and 45.0 m. Representative spot and continuous geochemical samples collected throughout the alteration zone have returned consistently highly anomalous concentrations of Ni, Co, As, Cu and Zn, including samples containing up to 9.21% Co, 2.86% Ni and 10.8% As in a 20 cm representative spot sample at 33.8 m. Continuously sampled intervals in this alteration zone include 0.38% Co, 0.68% Ni and 0.99% As over 8.5 m between 37.0 and 45.5 m, and 0.35% Co, 1.09% Ni and 1.18% As between 43.5 and 45.0 m. Similar concentrations of these elements, indicative of nickel-cobalt arsenide minerals, are spatially associated with uranium mineralization at deposits such as West Bear and Key Lake. Since this mineralization occurs in a wide gap in historic drilling, it is a high priority follow-up target that could either represent an extension of the West Bear deposit, or a new zone.

Diamond drill holes WBE-12 to 15 and 18, drilled to test potential down dip and western extensions of the West Bear deposit, did not intersect uranium mineralization indicating that historical diamond drilling has effectively bounded the mineralization in these areas. Holes WBE-20 and 21 were drilled to test northeast extensions of the deposit, but may have been targeted too far north since footwall host rocks to the deposit were intersected beneath the unconformity. While no uranium mineralization was intersected in hole WBE-22, a zone of clay alteration was intersected in pegmatite between 47.6 and 90.1 m which may represent the southwestern, down dip extent of the metaliferous alteration zone intersected approximately 150 m to the northeast in hole WBE-19.

UEX management is very encouraged by the results of the 2002 exploration program, which underscores the company's belief that the property contains the potential for the rapid discovery and delineation of new uranium deposits, and the upgrading of the historical resources previously identified at the West Bear and Raven-Horseshoe deposits. The company is in the process of evaluating the numerous exploration targets identified on the Hidden Bay property during historical exploration, and will use the geophysical results and drilling data obtained during the current program to aid in the planning of further drilling programs that will commence this summer.

The information in this document has been compiled by D. Rhys, P. Geo., an independent qualified person as defined by National Instrument 43-101.



Stephen H. Sorensen
President & C.E.O.