Prompt Fission Neutron (PFN) Borehole Logging Technology, Comparison with

Gamma Logging Techniques

AusIMM International Uranium Conference

Adelaide June 2010

www.uxa.com.au

ASX: UXA

Russell Penney and Dennis Stevens

AcknowledgementsAcknowledgementsAcknowledgementsAcknowledgements

Uranium Exploration Australia Limited (UXA) thanks UraniumSA Limited for permission to present data from their Mullaquana uranium discovery in South Australia.

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This presentation does not comprise a disclosure document. It does not constitute provision of financial product advice. None of the directors of UXA, its related bodies corporate, officers, employees or advisors makes or gives any representation, warranty or guarantee in relation to this presentation (whether orally, in document form or in any form whatsoever) or in relation to any information (“Information”) contained in it to the recipient of this presentation or any of its related bodies corporate, officers, employees and advisors (“Recipient(s)”). Information sourced from third parties and reported in this presentation has not been verified or updated; it is important that Recipient(s) take care to verify and update before taking in to account in any process of evaluation. The presentation is provided expressly on the basis that the Recipient(s) will carry out its own independent inquiries into the Information and make its own independent decisions about the affairs, financial position or prospects of UXA. UXA reserves the right to update, amend or supplement the Information at any time in its absolute discretion (without incurring any obligation to do so).

� Unique borehole logging tool provides immediate and fool-proof uranium analysis within the borehole by using neutron activation to measure 235U

� PFN used in discovering Australia's most recent uranium mine – Beverley – and the Four Mile mine development in South Australia and is in daily use at many uranium mines in the USA

� UXA recently purchased the PFN business and intellectual property from its owner in the USA

� PFN technology is owned 100% by UXA and is available from GAA, an independently managed borehole logging company, a 100% owned subsidiary of UXA

238U decay chain

gamma

gamma

Spectral gamma energy windows typical of airborne surveys, hand-held spectrometers and downhole gamma tools

� Total Gamma includes gamma radiation derived from the decay of Potassium, Thorium, Lead and Bismuth

� Spectral Gamma uses energy windows to differentiate the origin of each gamma particle.: e.g. most airborne radiometric surveys

� Spectral Gamma tools measure the daughter products of 238U to determine Uranium grade

� Both Total Gamma and Spectral Gamma tools suffer from disequilibrium issues

Many uranium deposits too

young for uranium and gamma

emitting daughter elements to

be in equilibrium (7 half lives of

the longest living daughter

element = 560,000 years)

Uranium may also have

migrated away from its

daughter elements by chemical

action

Gamma, in this example,

“misses” a significant zone of

uranium

PFN

Source: Natural Decay Series: Uranium, Radium, and Thorium;

Human Health Fact Sheet, August 2005, Argonne National Laboratories, EVS

UUUU238238238238

ThThThTh234234234234

β

α

PaPaPaPa234234234234

UUUU234234234234

βα

ThThThTh230230230230

α α αRaRaRaRa

226226226226RnRnRnRn

222222222222α

PoPoPoPo218218218218

PbPbPbPb214214214214

β

γ

Bi214

β

Po214

γ

αPb

210

β

Bi210

β

Po210

αPb

206

α

β

γ

= alpha decay radiation

= beta decay radiation

= gamma radiation

Gamma can be used to calculate

uranium concentration as eU3O8

[ Indirect determination]

Valid only if daughters inequilibrium with parent!

4.5x109 Yrs

24.5 days

1.14 mins

2.33x105 Yrs 8.3x104 Yrs 1590 Yrs 3.825 days3.05 mins

26.8 mins

19.7 mins

1.5x10-4 secs 22 Yrs

5 days

140 days Stable

� PFN tool creates very fast neutrons (14MeV) and fires 108

neutrons per second

� Neutrons are slowed (Thermal) by collisions with the rock

� The generated neutrons collide with 235U and splits the atom (Fission)

� Fast (Epithermal – 2MeV) neutrons are produced

� PFN measures the ratio of epithermal(fast) and thermal(slow) neutrons

�235U is the only fissile material in the natural environment

� The Ratio of Epithermal to Thermal Neutrons is proportional to 235U

� Uranium is in Isotopic Equilibrium ◦ 0.72% 235U

◦ 99.27% 238U

� Therefore % U3O8 may be deduced from PFN results directly.

� Calibration at AMDEL facility run by DWLDC in Adelaide

� Three pits of various grades of U3O8

� Barren zone also recorded

� Hole Correction Pit –calibration for three different hole diameters

� Both Gamma and PFN components of the tool are calibrated in these pits

Mine sites have their own calibration pits

� Multiple runs are used to check repeatability and ascertain a ratio of epithermal/thermal for a particular known grade of U3O8 gamma PFN

y = 1.9378x - 0.0148

R² = 0.9999

0

0.5

1

1.5

2

0 0.1 0.2 0.3 0.4 0.5 0.6

%pU3O8

Ratio Epi/Thermal

PFN

Linear (PFN)

Gra

de in p

it

� Corrections for wet/dry hole situations◦ Dry holes decrease correction factor. Difficult to provide quantitative results due to hole rugosity

� Aquifer fluid correction factor◦ Higher salinity – higher correction factor

� Porosity◦ Higher porosity = higher aquifer fluid

� Drill hole size correction

y = 0.8933ln(x) - 3.1862

R² = 0.9992

0.50

0.70

0.90

1.10

1.30

1.50

1.70

1.90

2.10

2.30

2.50

50 100 150 200 250

Correction factor

Hole size (mm)

Hole Size

Log. (Hole Size)

HQ

PQ

In this example, Uranium and its

daughter products are in

Equilibrium

U Grade from gamma logging is

denoted as “% eU3O8”

U Grade from PFN logging is

denoted as “% pU3O8”

PFN = Blue LineGamma = Red Line

0.15%

An absence of Uranium occurs at a

gamma peak at 35.8m

This log demonstrates the necessity

of PFN in defining uranium, and in

quantifying the amount of uranium.

Note the “Negative” or “Positive”

Disequilibrium in the right hand

column

PFN = Blue LineGamma = Red Line

PFN = Blue LineGamma = Red Line

1.10%

0.65%

Low grade Uranium in a hard rock environment

Uranium from a Tertiary Basin deposit

PFN = Blue LineGamma = Red Line

0.15%

0.03%

0.01%

Low grade Uranium in a hard rock environment - equilibrium

Uranium from a calcrete hosted depositFluctuating groundwater causes disequilibrium

PFN = Blue LineGamma = Red Line

0.03%

Gamma log alone does not reveal a true picture of U distribution

PFN (red) shows the strong disequilibrium with little uranium in the “wings” of the deposit

The PFN tool can be used

to guide exploration by

following disequilibrium

vectors to find the

displaced uranium

PFN = Blue LineGamma = Red Line

PFN Currently

being used at a

number of

uranium mines in

the US

Sandstone-hosted

U deposits with

roll-fronts

� Gain certain knowledge of the presence and amount of Uranium downhole as opposed to measuring 214Bi and 214Pb with gamma

� Provides instant results to aid drill program adjustments instead of waiting for geochemical analysis

� Analyses a larger mass of host rock than core or cuttings

� Reduces analytical costs – (reduce labour cost from collecting, handling and transporting radioactive substances and in geochemical assay costs and storage)

� Reduces drilling costs (no need to core)

PFN TECHNOLOGY (WORLDWIDE) IS PFN TECHNOLOGY (WORLDWIDE) IS

AVAILABLE FROM GAAAVAILABLE FROM GAA

GAA also provides a wide range of geophysical borehole logging technologies, including Gamma

Logging

Contact details:

Dr Russell Penney

info@uxa.com.au+61 8 8363 7970www.uxa.com.au

ASX: UXA

Uranium Exploration Australia LimitedRegistered Office in Adelaide, South Australia

43a Fullarton RoadKent Town, SA 5067