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Peninsula Energy Discovers New Mineralised System During Drilling At Lance

Peninsula Energy (ASX: PEN) continues to discover new zones of mineralisation at the Lance projects, with an additional 105 of the 150 hole program encountering mineralisation above 100ppm uranium.

The drilling program for 135,000 feet was targeting a confidence category upgrade at the planned Kendrick Production Unit located to the west of the Ross Production Unit to Indicated Resources - but also delivered a new mineralised roll front.

Highlights from the latest drilling roll include:

- 27.5 ft at 300ppm eU3O8 (GT 0.83) including 3.5 ft at 700ppm eU3O8;
- 23.0 ft at 330ppm eU3O8 (GT 0.76) including 15.0 ft at 420ppm eU3O8;
- 45.0 ft at 167ppm eU3O8 (GT 0.75) including 6.0 ft at 300ppm eU3O8; and
- 8.5 ft at 598ppm eU3O8 (GT 0.51) including 2.0 ft at 1,640ppm eU3O8.

Another highlight from the campaign is that 19 holes reported GT (Grade-Thickness) values exceeding 0.2ppm uranium, with five holes delivering multiple zones of stacked uranium.

Looking further down the track, Peninsula's technical team has identified and priority ranked over 500 follow-up drill targets within the Lance Projects and estimated that these drill targets will form the basis for ongoing exploration for a staggering 5-10 years.

The Lance ISR Projects currently host a JORC Resource of 51.5 million pounds uranium and is targeted for production in the second half of 2013.

A Feasibility Study, which excludes the vanadium credits, has estimated a project cash flow of $905 million on revenue of $2.2 billion.

Peninsula remains well funded with $13.8 million cash in the bank at the end of the March quarter.

New mineralised roll front

The new mineralised roll front discovered from the drilling campaign covers a strike length of 500 metres and a 400 metre northern extension to the existing K4 roll front system.

In the southern part of the Kendrick area (historically known as Chatterton) 10 GT intersections exceeding 0.20 were reported in 3 new roll fronts.

Peninsula is continuing exploration at speed with two rigs active, with one dedicated to the along strike exploration and one to intersecting the high grade nose of the roll fronts.

22 kilometre strike

Highlighting the sheer size of the mineralised areas at Lance, drilling in Kendrick area has previously identified the K3, K4, K5, K5A and K6 roll fronts, which merge in places to produce wide areas of continuous mineralisation.

This continuous mineralisation has been identified over a combined strike length of 22 kilometres with horizontal widths of up to 60 metres in the northern K5 area.

Current interpretations suggests that there is a total of 312 line kilometres of mineralised roll fronts in the greater Lance Projects and that the delineated mineralisation to date in the Kendrick roll fronts represent only 7% of the estimated mineralised roll front systems within this.

Analysis

Drilling continues to show the vast and scale of mineralisation at the Lance projects that looks likely to result in further increases to resource inventory. With the pull-back in equities prices, PEN continues to provide value for the long term investor. With recent news of China developing more reactors and China offering to invest over STL35 billion pounds to build reactors in the UK, current valuations of PEN are attractive.

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