The project includes three highly prospective licences in the Frome Embayment area of South Australia, which is arguably the most prospective region in Australia for sandstone-hosted uranium deposits.
Frome project tenement location and major uranium deposits.
This area hosts the Beverley deposit and Four Mile in the northwest and the Honeymoon, Goulds Dam and Oban deposits in the southeast.
Importantly, the area is nearby to existing, licensed uranium production sites such as Honeymoon, Four Mile and Beverley where uranium production is by in-situ recovery (ISR).
Tenure and prospectivity
Argonaut holds a 100% interest in two large exploration licences, both greater than 950 square kilometres, and a third licence via an option, sale and milestone agreement.
This agreement provides for the acquisition by Argonaut of a 100% interest of a third similarly large exploration licence, currently in the application stage.
These licences cover sandstone-bearing palaeochannels that contain groundwater that drains from uranium-bearing granite.
Previous drilling of these palaeochannels confirms the presence of excellent sandstone aquifers at or near the base of the channels.
These sandstone aquifers are four metres to 20 metres thick (typically 10-12 metres) and contain the necessary permeable coarse sands.
Argonaut is applying the ‘two fluids’ model for uranium roll front deposits, which involves oxidised, uranium-bearing groundwater (Fluid 1) flowing along the permeable sandstone units until it encounters reducing groundwaters that have leaked upwards through faults from deeper, hydrocarbon-bearing aquifers (Fluid 2).
The interface of these fluids creates a redox front that can trap and concentrate uranium.
Numerous discovery opportunities
Argonaut has compiled and interpreted all existing data.
The company believes the data is exciting in that it points towards numerous opportunities for the discovery of sandstone-hosted uranium.
Work will proceed in several phases:
- Palaeochannel and fault interpretation via existing aeromagnetic and airborne EM data;
- Acquisition and interpretation of new, detailed airborne EM data;
- Drilling of high priority targets; and
- Drilling of regional, early-stage targets.
The company is beginning the permitting process required for drilling.
Erudina option and agreement terms
A 100%-held subsidiary of Argonaut has entered an agreement with Groundwater Science Pty Ltd in relation to the Erudina exploration licence application, ELA2021/003.
The principal terms are as follows:
- Option: $15,000 exclusivity fee plus a contingent issue of $30,000 of exclusivity shares;
- Sale: if the option is exercised then $300,000 of purchase shares become payable; and
- Milestone: if at least 10 exploration drill holes within the tenement that exhibit 500m.ppm U3O8 grade thickness accumulation with a 100ppm U3O8 grade cut-off at a minimum drill hole spacing of 100 metres are drilled, then $300,000 in cash or shares becomes payable.