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A-Cap Resources Intersects High Grade Uranium At Letlhakane

A-Cap Resources' (ASX:ACB) infill drilling program, including a peak of 3.25 metres at 2,386ppm eU3O8, has confirmed the presence and continuity of high grade uranium mineralisation at its Letlhakane Uranium Project in Botswana.

Ongoing feasibility studies are on track to be finalised in the first quarter of 2015 with a Mining Licence application to be submitted in the second quarter of 2015.

The Environmental, Social Impact Assessment is on track to be completed by March 2015.

Letlhakane has a high grade Resource of 83.7 million tonnes at 447ppm U3O8 for 82.5 million pounds of U3O8.

It is also one of the top ten global undeveloped uranium deposits with a resource of 308Mlbs at a cut off at 100ppm U3O8.

In addition, ongoing evaluations of surface miners are proving to be positive with potential for further reductions in mining costs.

Metallurgical and process design work is progressing well with final data for resources and operating costs due on time early next year.

"We are very happy with the excellent results from our last drilling programme which continues to confirm the presence and continuity of high grade mineralisation in shallow zones targeted for early production," chief executive officer Paul Thomson said.

"This is good news for project economics. Our feasibility work is progressing very well and we are on track and on budget.

"We are fortunate to be operating in Botswana, a premier mining jurisdiction with stable government, clear and simple mining laws where strong rule of law applies."

High grade uranium mineralisation

The 2,812 metre infill drilling program was carried out to further define potential early start pits.

Previous optimisation studies to determine pit areas highlighted higher grade shallow zones targeted for early production.

Best results from the drilling program at a 200ppm eU3O8 cut-off included:

- 3.25 metres at 2,386ppm eU3O8 in hole SERC0364;
- 2.20 metres at 904ppm eU3O8 in hole SERC0358;
- 2.05 metres at 2,124ppm eU3O8 in hole MOKR2582;
- 2.55 metres at 772ppm e eU3O8 in hole MOKR2584;
- 1.25 metres at 2,123ppm eU3O8 in hole SERC0362;
- 2.60 metres at 588ppm eU3O8 in hole MOKR2596;
- 2.95 metres at 1,514ppm eU3O8 in hole MOKR2571; and
- 1.90 metres at 798ppm eU3O8 in hole MOKR2603.

These will now be incorporated into a new resource model in the first quarter of 2015.

Recent trials utilising Uniform Conditioning and Localised Uniform Conditioning (LUC) resource modelling techniques have been successful and will be used across the deposit.

LUC uses the proposed mining unit which has been reduced in size due to the selectivity of the surface miners that will be utilised.

Mining Operations

Ongoing work on the mining operations is continuing and both Vermeer and Wirtgen Surface Miners are being evaluated which will allow very selective mining of the ore body.

A-Cap is planning to mine on flitches of 0.25 metres and anticipate reduced dilution, reduction in tonnes but an increase in grade by doing so.

Grade control will be undertaken using a GPS fitted vehicle mounted scintillometer to provide better than 1 metre sampling in pit to a depth of around 0.3 metres.

Two haulage scenarios are currently being investigated for delivery of ore to the ROM pad.

These include trucking of the ore or alternatively trucking of ore to strategically located belt feeders which will convey the ore to the ROM pad.

These initiatives also have the potential to further reduce the operating costs.

Environmental Social Impact Assessment

SLR South Africa has completed a high level option study to determine the most cost effective and environmentally acceptable heap leach facility.

Based on this study an expanding pad using grasshoppers to convey the agglomerated ore to the pad was chosen, and a detailed engineering study using this option is in progress.

This study will also form part of the input into the ESIA.

Metallurgy and Process Design

The testwork is based on an acid heap leach route for all the primary, oxide and lower mudstone secondary ores with a modified solvent extraction system being the principal uranium recovery method.

Solvent extraction (SX) testwork was completed successfully at the Australian Nuclear Science and Technology Organisation (ANSTO) at Lucas Heights' facility in Sydney using the pregnant liquor solutions produced from column leaches.

Process modelling work was also completed during the year indicating that a two stage leach has significant advantages over a single stage leach in terms of cost effectiveness.

The remaining calcrete and upper mudstone secondary ores will be treated using a separate alkali leach circuit once the main acid heap circuit is in operation.

The remaining metallurgical testwork to finalise feasibility studies is due for completion in the first quarter 2015.

Results will be used to finalise the process design and also provide updated uranium recoveries important to the economics of the project.

Analysis

The results - including a peak of 3.25 metres at 2,386ppm eU3O - from the infill drilling program have confirmed the presence and continuity of high grade mineralisation in shallow zones targeted for early production.

This will be incorporated into a new resource model which along with finalisation of feasibility studies could improve project economics.

Letlhakane is one of the top ten global undeveloped uranium deposits with a resource of 308 million pounds U3O8 at a cut off at 100ppm U3O8, giving it very strong long term leverage to a rising uranium price.

It includes a high grade resource of 83.7Mt at 447ppm U3O8 for a contained 82.5Mlbs of U3O8.

Share price kickers are:

- Upgraded Resource in the first quarter of 2015;
- Finalisation of feasibility studies in the first quarter of 2015; and
- Mining Licence application to be submitted in the second quarter of 2015.

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