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UNO - Looking For Uranium Away From The Crowd

MPVC Inc. (UNO on the TSX Venture; there is no U.S. listing that I am aware of) is possibly the smallest and riskiest uranium exploration venture in which I have ever invested, which should be self-evident as soon as you notice the C$3.5 million market cap. It is a grass-roots exploration project that has been matured to drill-ready status over a multi-year period and the drills should be turning in the near future.

In a nutshell, UNO is about to drill at its NW Manitoba project for the first time since a multi-year, multi-million dollar, major data acquisition program by its partner, CanAlaska Uranium (MPVC has the option to earn 80% of the project from CanAlaska through a series of capital expenditures and share issuances to CanAlaska at certain milestones).

The story is fairly simple from a geological standpoint and is actually a textbook example of what you might look for if you were trying to discover a new uranium deposit in an area where few companies have looked before. The target area is within a corridor that is the interpreted extension of the Mudjatik-Wollaston Tectonic Zone, which is a major, regional-scale geological boundary that also hosts some of the largest uranium deposits in the world (Cigar Lake, McArthur River, etc). The same basement rocks which are associated with deeper deposits to the southwest are found at surface in the area where UNO is about to drill. There is high grade uranium vein mineralization in outcrop grading 9.5% U3O8 (i.e., high grade uranium in bedrock exposed at surface) within the target area and a number of uranium-mineralized pebbles and boulders have been found on the property, with one sample returning a value of >60% U3O8. That information got my attention... it's hard to ignore uranium at surface that can be sampled with a hammer and those uranium-mineralized boulders and pebbles must be coming from somewhere.

It takes about 4 pictures to tell the story, which are included below with brief descriptions of the information being portrayed...

Figure 1: A map of the Madjatik-Wollaston corridor shows the general trend of the major eastern Athabasca uranium deposits and gives a sense of the regional lineament.

(source: company reports)

Figure 2: A regional magnetic map of the eastern Athabasca Basin showing the magnetic signature of the Mudjatik-Wollaston Tectonic Zone and locations of key known deposits. The project area is outlined in yellow on the map (yellow star). Note how the low (blue) magnetic susceptibility trend becomes clearer as you move from the southwest to the northeast... that appears to be the geophysical signature of the basement rocks coming closer to surface as you move to the northeast (this interpretation has been ground-truthed by field work). So, to sum it up, the same basement rocks associated with the deposits to the southwest are at surface in the NW Manitoba project area and presumably may have similar potential for uranium mineralization. The surface sampling in the project area appears to support that theory.

(source: company reports)

Figure 3: A map focused on a smaller region of the project area outlined above. The map shows the same SW-NE trending magnetic low (blue) as well as the interpreted Maguire Conductor trend. There are some notes to the right of the image that shed a little more detail in terms of data/observations in the area. Note the scale bar... this is still a large area, but the right ingredients seem to be there.

(source: company reports)

Figure 4: This image is now zoomed to "target" resolution. Outlines of the survey areas in this image can be seen in figure 3 in black (Grid 2, Grid 2b, and Grid 2c). The Maguire conductor (marked as "VTEM anomaly") is annotated on the map and may be interpreted as a graphitic horizon that could be important for uranium deposition in the area. The map on the left is gravity data, which reflects the density of the rock in the area, while the map on the right is resistivity data, which measures the resistivity of the rock in the area. The hydrothermal alteration that is commonly associated with uranium deposits has a fairly specific geological signature... it often makes rocks both less dense and less resistive.

(source: company reports)

The 4 arrows in the image above are showing regions where gravity and resistivity are both low, which is exactly the signature you might want to see when looking for uranium. Combine that geophysical data with the regional trend, the uranium in outcrop at surface, the mineralized pebbles/boulders, all of which are adjacent to a large-scale conductor and the target becomes quite compelling, which is why I invested.

UNO is also in the process of completing a radon survey (press release linked here) which has yielded promising early results. Recall that the only way to produce radon is via the natural decay of uranium, so the presence of radon suggests a nearby uranium source.

Put it all together and these are the kind of targets that you want to see drilled. I cannot overstate how speculative a venture like this is, but the rewards are commensurate with the risks. If successful, the upside from a C$3.5 million market cap could be tremendous. The company has recently raised the money it needs to carry out an initial drill program, but it will mostly likely need to come back to market if there is to be a "phase 2" drill program. If the initial drilling yields encouraging results, the access to capital will likely be less of a factor... such is the exploration business.

I am not recommending this as an investment, because it is strictly speculative, but this brief note does outline my thoughts on the opportunity from a technical standpoint. Those who followed my writing from the early days of Patterson Lake South will know that I am not shy about taking a stab at an early stage project, which this one most definitely is...

A bet on UNO is like a bet at the roulette wheel in Vegas... once in a while you can get lucky, but at least if it doesn't work out, you know you can feel good about being at the table in the first place in light of the available data.

Additional disclaimers: This is not investment advice, nor is it a recommendation to buy or sell shares in the company/companies mentioned. The information contained herein is accurate to the best of the author's knowledge, but the presented information should be verified by any party using this information as part of any decision making process. This view represents the author's opinion only, and as such readers should come to their own conclusions if they are using the opinions contained herein as part of any larger due diligence process. Geological inferences are, by their nature, subjective and interpretation dependent.