December 21, 2010 – Purepoint Uranium Group Inc. (“Purepoint”) (TSX:PTU.V) is pleased to announce that they have entered into a definitive option agreement with Rio Tinto Exploration Canada Inc. allowing Rio to earn a controlling interest in Purepoint’s Red Willow Project by spending up to $22.5 million in exploration and development expenses. Rio Tinto Exploration Canada Inc. is a wholly owned subsidiary of Rio Tinto, the world’s third largest producer of uranium.
“Recent increases in nuclear power projections have put significant pressure on major uranium producers to explore for large, high value mineral deposits” said Chris Frostad, Purepoint’s President and CEO. “We are excited that Rio has confirmed that level of potential in Purepoint’s Red Willow project and chosen it as their entry point to the Athabasca Basin”.
- Rio is currently finalizing plans for a drill program on the property during the first quarter of 2011
- Rio may earn a 51% undivided interest in the project by incurring $5 million in expenditures by December 31, 2015;
- Rio may earn an additional 19% undivided interest by incurring an additional $7.5 million by December 31, 2018;
- Rio may earn an additional 10% undivided interest by incurring an additional $10 million by December 31, 2021;
The Red Willow property consists of nine claims on the eastern edge of the Athabasca Basin. The Athabasca sandstone is shallow and the depth to unconformity varies from 0 to 80 metres. The basement rocks are composed of intensely deformed and metamorphosed sedimentary, volcanic and plutonic rocks trending NE to SW. Five major uranium deposits are located along a NE to SW mine trend that extends through the Red Willow Project. To date only five of Red Willow’s 21 delineated target zones have been subject to first pass drilling.
The Red Willow property adjoins AREVA Resource Canada Inc.’s claim group that contains the JEB, Sue, McClean and Caribou deposits to the west and, to the south adjoins UEX’s Hidden Bay property that surrounds Cameco Corporation’s Rabbit Lake, Collins Bay and Eagle Point deposits.
About Rio Tinto
Rio Tinto is a leading international mining group whose business is finding, mining and processing the Earth’s mineral resources. The Group’s interests are diverse both in geography and product. Rio Tinto’s activities span the world but are strongly represented in Australia and North America and have significant businesses in South America, Asia, Europe and southern Africa. Businesses include open pit and underground mines, mills, refineries and smelters as well as a number of research and service facilities.
The Group combines Rio Tinto plc, which is listed on the London Stock Exchange, and headquartered in London, and Rio Tinto Limited, which is listed on the Australian Securities Exchange and has executive offices in Melbourne. The Group consists of wholly and partly owned subsidiaries, jointly controlled assets, jointly controlled entities and associated companies.
Purepoint Uranium Group Inc. is focused on the precision exploration on its eleven projects in the Canadian Athabasca Basin. The company proudly maintains project partnerships with the three largest uranium producers in the world, Cameco Corporation, AREVA and Rio Tinto. Established in the Basin well before the resurgence in uranium, Purepoint is actively advancing this large portfolio of multiple drill targets in the world’s richest uranium region.
Scott Frostad BSc, MASc, PGeo, Purepoint’s Vice President, Exploration, is the Qualified Person responsible for technical content of this release.
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
For further information please contact:
Purepoint Uranium Group Inc.
Chris Frostad, President and CEO