Tubas Red Sand Project - June 2010

An initial Mineral Resource estimate, in accordance with the JORC Code, has been provided to RUN by The MSA Group of South Africa for the INCA and Tubas Red Sand (TRS) uranium deposits which together form the Omahola Project. See Figure 1 for deposit locations and Table 1 for details of the Mineral Resource estimate.

The INCA deposit consists of Indicated and Inferred Minerals Resources totalling 16,000,000 tonnes at 400 ppm eU3O8 for 6,366 tonnes (14 Mlbs) eU3O8, and the TRS deposit consists of Measured, Indicated and Inferred Resources totalling 13,846,700 tonnes at 160 ppm eU3O8 for 2,217 tonnes (4.9 Mlbs) eU3O8. The combined Mineral Resource estimate for the Omahola Project is 29,846,700 tonnes at 287 ppm eU3O8 for 8,583 tonnes (18.9 Mlbs) eU3O8.

The combined initial Mineral Resource estimate is in line with RUN’s expectations and serves to underpin its objectives of conducting a Pre-Feasibility Study (PFS) on the Omahola Project. In February 2010, SNC Lavalin was awarded a contract to conduct the PFS, which is currently scheduled to be completed in October Quarter 2010 (see Omahola Project).

Figure 1: Location Map

TRS consists of secondary uranium mineralisation (carnotite) in well-sorted aeolian (windblown) sand which occurs immediately south of the Tubas palaeochannel. A relatively small area was intensely grid drilled around a trial mining trench to acquire bulk samples for physical beneficiation testwork and it is that data that constitutes this resource estimation (see Figure 2).

Carnotite cementing red sand

Table 1: Omahola Project - JORC Code Resource Estimates

Category	Cut-Off Grade	Tonnes	Grade (eU3O8)	Mlbs (eU3O8)	Tonnes (eU3O8)
INCA ESTIMATE
Indicated	200	6,000,000	392	5,000,000	2,300
Inferred	200	10,000,000	402	9,000,000	4,066
INCA TOTAL *		16,000,000	400	14,000,000	6,366
TUBAS RED SAND ESTIMATE **
Measured/Indicated	100	3,172,500	168	1,172,668	532
Inferred	100	10,674,200	158	3,710,600	1,685
TRS TOTAL		13,846,700	160	4,883,268	2,217
OMAHOLA TOTAL		29,846,700	287	18,883,268	8,583

* Figures have been rounded

** Cut-off grade lower due to 'free digging' nature of sand from surface and positve beneficiation results

The resource estimate for the TRS deposit is considered initial as this style of mineralisation has been encountered in numerous boreholes outside the current resource area. These results suggest that mineralised red sands occur adjacent to and may potentially flank the mineralised Tubas-Oryx palaeochannel system which stretches some 30 kilometres across RUN’s EPL3496. The true extent can only be determined with future drilling.

Figure 2: Tubas Red Sand project with GTM values

The justification for the lower cut-off grade of the TRS deposit is based on unique aspects of the deposit. Firstly, the deposit is very near surface, with only minimal cover of wind-blown materials and gravel-gypcrete-calcrete of 1-2 metres. Secondly, TRS is predominately free-flowing to loosely consolidated sandy material. The combination makes the deposit amenable to simple and low cost mining techniques. Thirdly, TRS material tests positively to relatively simple beneficiation; that being attrition scrubbing with balls followed by screening.

As a consequence of the very positive beneficiation results and free-digging nature of the red sands from surface, it is highly likely much lower grades of uranium can be economically mined. For example – 150 ppm U3O8 run-of-mine material can be potentially upgraded to +500 ppm U3O8 for processing with INCA material.

Final trench profile showing upper gypsum layer 0 – 2 metre depth and mineralised red sand to the bottom of trench

As can be seen from the photograph above there is a gypsum layer varying in thickness to 2 metre overlying a mostly unconsolidated fine to medium-grained variably organic carbon rich red sand layer varying in thickness to 9.5 metre. Calcrete nodules occur within the sand and in the base of the trench. The sand has no obvious internal structure, but is most likely a buried dune or meander bank deposit. Red sand was commonly found to be the host during the Tubas drilling campaign in 2007 and the drill logs will be re-interrogated with the geological knowledge gained from the trench mapping.

Distribution of carnotite occurs as blebs and blotches or is finely distributed throughout the sand quite often as a uniform dusting causing a slight yellow discolouration of the host red sand and is quite spectacular as can be seen in the photographs below.

It is important to note that the complete section down to the basal calcrete at around 11 metre is free digging.