EL 3347 Cadell Project Annual report for the period 28 July 2004 to 27 July 2005

Abstract

During the current reporting period, Cameco have been unable to access any of EL 3347 outside of the immediate vicinity of Steven's Anomaly, due to the lack of an anthropological site clearance. At the Traditional Owners request, a survey took place during the current reporting period. Prior to the expiry date, Cameco relinquished most of the tenement. This report relates only to the portion retained for an extension period of two years. This retained portion will expire on 27 July 2007. Cameco will submit a separate report for the relinquished portion of the tenement. Exploration activities carried out during the 2004-2005 reporting period were designed mainly to determine the uranium mineralisation potential of Steven's Anomaly in the northwestern corner of the tenement. This consisted of a helicopter-assisted drilling program of one diamond drill hole, CDD002, outcrop sampling and a high-resolution airborne magnetic-radiometric survey. A Hymap Hyperspectral survey was also flown over the entire tenement. Outcrop sampling (n=11) at Steven's has confirmed the geochemical anomaly >500 m long and >200 m wide, coincident with an established airborne radiometric anomaly. The best results include 1330 ppm U plus 370 ppb Au; and 711, 602, 362 & 358 ppm U. Two heli-rig diamond holes were planned 200 m to the south of previous holes, to test the surface anomaly and adjacent Steven's Fault. CDD0002 was collared on the southern edge of the airborne radiometric anomaly that defines Steven's Anomaly and inclined southward to intersect the subsurface projection of Steven's Fault. A total of 83.8 m was drilled, consisting entirely of altered Oenpelli Dolerite, with the hole abandoned before target depth in broken ground. The best analytical result obtained was 518 ppm and 71 ppb Au over 20 cm at 31.8 m. Saprolitic clay from 7.3 to 26 m assayed 31 ppb Au and 14 ppm U over 18.7 m (composite). The base of the drill hole comprises massive haematite, sericite and chlorite alteration and significant brecciation, interpreted to be associated with propagation of Steven's Fault and related hydrothermal fluid movement. Pervasive and intense chlorite, haematite, sericite (phengite) and leucoxene alteration and veining appears to be directly associated with all the radiogenic intervals. Due to poor ground conditions and lack of alternative drill sites, no further heli-drilling took place at Steven's in 2004. It was deemed that a more powerful land-based RC and /or core rig was required with the capability to penetrate the broken ground and case off the regolith, and this was proposed for 2005.