Virginia Energy Announces Clarification of Technical Disclosure and Revision of Coles Hill 43-101 Technical Report
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Aug 16, 2013) - Virginia Energy Resources Inc. (TSX VENTURE:VUI)(OTCQX:VEGYF) ("Virginia Energy" or the "Company") announces that as a result of a review by the British Columbia Securities Commission, Virginia Energy is issuing the following news release to clarify the technical disclosure on its website. In addition, problems were identified in the most recent Coles Hill 43-101 Technical Report, which has been revised and will be re-posted shortly.
The Company filed a technical report dated September 6, 2012 titled "NI 43-101 Preliminary Economic Assessment Update, Coles Hill Uranium Property, Pittsylvania County, Virginia, United States of America" by Lyntek Inc. and BRS Engineering" in support of a listing application dated August 31, 2012. The technical report did not comply with the requirements of NI 43-101 and Form 43-101F1 because it incorrectly included wording that "the preliminary economic assessment…indicates that the portion of the [indicated] mineral resource…is economic under current conditions". This wording is misleading as it contradicts the definition of a PEA and the cautionary language required by NI 43-101. Furthermore, including this statement under the "Mineral Reserves" section appears to imply that the indicated resource estimate has economic viability and treats the quantities as reserves. In addition, the Technical Report uses the word "ore" in several instances, which implies technical feasibility and economic viability that should only be attributed to mineral reserves.
The report was revised by Lyntek Inc. and BRS Engineering on August 19, 2013 in accordance with NI 43-101, including the cautionary statement that mineral resources are not mineral reserves and do not have demonstrated economic viability. A revised and re-stated version will be posted to the Company's website and SEDAR profile within 5 days.
With respect to the Company's disclosure of the Coles Hill PEA on its website and corporate presentations, the economic analysis appears unbalanced because the Company discloses upside uranium price sensitivity without providing equal downside sensitivity. These references have been removed from the website and replaced with the following wording:
"a change of US$5 per pound in uranium selling prices causes the project NPV to rise or fall by US$110 M"
The Company's website, fact sheets and presentations had described the Company's Coles Hill project using terms other than applicable resource categories. Furthermore, the Company discloses a measured & indicated resource of 133 million pounds, which is misleading because the Company does not have any measured resources.
Accordingly, the Company has removed various statements and clarified its mineral resources disclosure on its website. The uranium resource estimate on its Coles Hill Property is as follows:
Total Indicated Mineral Resources
| Total North and South Coles Hill | ||||
| Category | Cutoff | Long Tons (million)* | wt %eU3O8 | lbs (million) |
| Indicated | 0.025 | 119.59 | 0.056 | 132.93 |
Total Inferred Mineral Resources (long tons)
| Total North and South Coles Hill | ||||
| Category | Cutoff | Long Tons (million)* | wt %eU3O8 | lbs (million) |
| Inferred | 0.025 | 36.28 | 0.042 | 30.41 |
Reference: NI 43-101 Preliminary Economic Assessment Update of Coles Hill Uranium Property, effective June 30, 2012, revised and re-issued on or about August 19, 2013 by Lyntek Inc. and BRS Engineering.
In each reference to the mineral resources, the Company has included the following cautionary statement required under NI 43-101: "mineral resources are not mineral reserves and do not have demonstrated economic viability."
Finally, on the Company's website, the Company discloses resources of properties adjacent to its Otish Properties, Quebec solely in the form of metal content. Those references have now been removed from the Company's website, and replaced with the following wording:
"Virginia Energy Resources Inc. has an exploration program in the emerging Proterozoic Otish Basin located in central Quebec. The Virginia properties have numerous high-grade uranium prospects similar to the nearby Matoush deposit of Strateco Resources Inc., the Seru L zone (or Lavoie) deposit of SOQUEM/AREVA, and Cameco's South Otish (Camie River) property."
All scientific or technical information in this release has been reviewed and approved by Michael Cathro, MSc, PGeo, Vice-President of Exploration for the Company, who is a "Qualified Person" as defined in NI 43-101.
About Virginia Energy Resources Inc.
Virginia Energy Resources Inc. is a uranium development and exploration company. The company holds a 100% controlling interest in the advanced stage Coles Hill uranium project located in south central Virginia, USA. Additionally, the company owns mineral exploration properties in the Otish Basin of Quebec, Canada.
On Behalf of the Board of Directors of
Virginia Energy Resources Inc.
Walter Coles, Sr., President & CEO
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release
Contact
Walter Coles, Jr.
Executive Vice President
(604) 669-4799
Tony Perri
Investor Relations, Manager
(604) 669-4799
www.virginiaenergyresources.com