Red Basin

Status: Available for Option

Target

The target at Red Basin is a roll front and/or unconformity-related uranium deposit of >5 million pounds U3O8 with potential for recovery by ISR (In-Situ-Recovery) methods. The project area is located near Datil in western New Mexico, the site of extensive historical uranium exploration.

Location and Setting

The Red Basin project is located in western New Mexico approximately 90 miles southwest of Albuquerque and 15 miles north of Datil. The project site occurs within the Red Basin – Pietown mining district and is road accessible from Datil via State Highway 60 and seasonal Forest Service roads.

Land Status

The Red Basin property consists of 103 unpatented federal mining claims located within the Cibola National Forest.  Seventy-one claims are wholly-owned by Millrock and 32 are subject to an option to purchase agreement.

Geology and Mineralization

Roll-front type uranium mineralization is known in the Red Basin – Pietown District.  Minor historic past production has been reported from small mines off the claim block dating back to the 1950s.  Within the district, uranium mineralization is typically concentrated within a Tertiary sandstone unit (Eocene Baca formation) and along a suspected unconformity with underlying siltstone of the Cretaceous Cravasse Canyon formation over an estimated 82 square mile area.  During the Cenozoic, redistribution of the uranium localized mineralization along roll front-like redox boundaries within sandstones of both the Cravasse Canyon and the Baca formations which underlie much of the Red Basin project area. Outcrops above the water table (200 feet) are often leached of uranium, but the gentle dipping favorable host beds can be prospected by shallow drilling down dip.  Chamberlin (New Mexico Bureau of Mines and Mineral Resources OFR-138, 1981) estimated a uranium resource potential for the greater Datil area of around 30 to 45 million pounds U3O8.

Historical Exploration

Gulf Mineral Resources explored the area in the 1970s drilling numerous shallow holes within the Red Basin project area. Millrock has documented the location of approximately 239 drill hole monuments situated in three main areas on the present Red Basin claim group.  Based on the approximate 30 m drilling pattern and from discussions with geologists familiar with the area, it is believed that significant uranium/vanadium mineralization underlie these densely drilled areas. Millrock has reviewed select drill logs from the historical drill holes but does not presently have access to them. Gulf dropped the claims in the early 1980s, the result of decreased uranium prices. Reportedly, Occidental Minerals explored the property after Gulf abandoned its efforts. The extent and results of Occidental’s program(s) are unknown at present.

Proposed Exploration Program

Millrock believes the Red Basin project has excellent potential to quickly define a uranium ± vanadium resource and expand upon it. Millrock’s initial exploration plans for the project include the following:

  1. Acquire past data –make an agreement to purchase Gulf Minerals data from the 1970s.
  2. Digitize drill logs – develop 3D models of the deposits.
  3. Confirmation drilling – drill a series of holes and re-enter some historic holes.
  4. Resource estimation – calculate the tonnage, grade and write 43-101 resource estimate report.
  5. Drill for deposit extensions – Focus on down-dip areas from known mineralization.
  6. Begin hydrology and beneficiation studies – Understand aquifer and groundwater flow.

Agreement and Terms

Of the 103 total unpatented federal mining claims that currently comprise the Red Basin property, 71 are wholly-owned by Millrock and 32 are the subject to a purchase agreement whereby Millrock can earn a 100% interest, free of any royalties, by making payments totaling US$1.3 million and expending US$1.0 million on exploration over a ten-year period.

Millrock is currently seeking potential joint venture partners for the Red Basin Project. If desired, Millrock can serve as operator on behalf of an earn-in partner.

“THE TECHNICAL INFORMATION WITHIN THIS DOCUMENT HAS BEEN REVIEWED AND APPROVED BY GREGORY A. BEISCHER, PRESIDENT & CEO OF MILLROCK RESOURCES INC. MR. BEISCHER IS A QUALIFIED PERSON AS DEFINED IN NI 43-101.”