Projects

Close Lake

The Close Lake Uranium Project ("Close Lake", or the "Project") is held 74.40% by Orano Canada Inc. (“Orano Canada”), 14.99% by Cameco Corporation (“Cameco”) and 10.61% by JCU (Canada) Company Ltd. (“JCU”). ALX has the opportunity to earn up to a 51% participating interest from Orano as per the terms of a definitive earn-in agreement signed in April 2019. Close Lake hosts two significant uranium discoveries and is adjacent to the Cigar Lake and McArthur River uranium mine properties, along with a number of other uranium deposits and discoveries. Close Lake has the potential to host high-grade uranium mineralization in the eastern Athabasca Basin, the richest uranium district in the world.

Highlights

  • Drill hole CL-11 (1985) intersected 1.52% U3O8 over 23.0 metres including 3.71% Ni and 0.52% Co.
  • Drill hole CL-90 (1997) intersected 0.34% U3O8 over 107.3 metres including 2.86% U3O8 over 8.5 metres, and 2.00% U3O8 over 1.5 metres
  • Close Lake is located in an area of the Wollaston Belt which has produced over 900 million pounds of U3O8 over the past four decades.

Location

  • Approximately 3.5 km northeast of the McArthur River uranium mine
  • Approximately 8.5 km west of the Cigar Lake uranium mine
  • Approximately 40 km southwest of Points North Landing, Saskatchewan
  • Adjacent and parallel to Christie Lake uranium deposit

Property Description and Ownership

  • Close Lake consists of 21 claims over 38,679 hectares.
  • The Project is held 74.40% by Orano Canada Inc., 14.99% by Cameco Corporation and 10.61% by JCU (Canada) Company Ltd. where ALX can earn up to 51% from Orano Canada.

Option Agreement

For ALX to earn an option to acquire a 51% interest in Close Lake, ALX would be required to issue to Orano Canada a total of 10,000,000 common shares of ALX and fund a total of $12.0 million towards exploration expenditures for the Project for a period of five (5) years. Subject to prior written approval by Orano Canada, ALX would be able to accelerate any of the expenditure payments in order to earn interests in the Project sooner than as set out below.

In order to earn a participating interest in the Project, ALX would be obligated to:

(a) during the period commencing on the date of the LOI and expiring 12 months following the Effective Date (the “Initial Period”) pay to Orano $1,250,000 towards exploration expenditures, and issue to Orano 4,000,000 common shares of ALX; and

(b) following satisfaction by ALX of its obligation during the Initial Period, during the period commencing immediately following expiry of the Initial Period and expiring 24 months following the Effective Data (the "First Option Period") pay to Orano Canada an additional $2,250,000 towards exploration expenditures, and issue to Orano Canada an additional 3,000,000 common shares of ALX.

If ALX satisfies these obligations during the First Option Period, it will have earned an option to acquire a 20% interest in the Project (the "First Option").

(c) following satisfaction by ALX of its obligations during the First Option Period during the period commencing immediately following expiry of the First Option Period and expiring 42 months following the Effective Data (the "Second Option Period") pay to Orano Canada an additional $3,500,000 towards exploration expenditures, and issue to Orano Canada an additional 2,000,000 common shares of ALX.

If ALX satisfies these obligations during the Second Option Period, it will have earned an option to acquire a 35% interest in the Project (the "Second Option").

(d) following satisfaction by ALX of its obligations during the Second Option Period, during the period commencing immediately following expiry of the Second Option Period and expiring 60 months following the Effective Date (the "Third Option Period") pay to Orano Canada an additional $5,000,000 towards exploration expenditures, and issue to Orano Canada an additional 1,000,000 common shares of ALX.

If ALX satisfies these obligations during the Third Option Period, it will have earned an option to acquire a total 51% interest in the Project (the "Third Option").

Exploration Plans for 2019

In its initial evaluation of the Project, ALX has determined that certain target areas at Close Lake that have only been explored with widely-spaced drill holes still exhibit high potential to host significant high-grade uranium deposits.

Orano Canada, as operator of exploration, has received approval from the Close Lake joint venture partners for a helicopter-supported diamond drilling program in the northern part of the project of approximately 3,000 metres in up to four holes at an estimated cost of $1.1-million. The proximity of the Cigar Lake mine property infrastructure (approximately 10 kilometres from the northern boundary of the project) as a staging area for personnel and equipment is expected to provide improved cost efficiency for a helicopter-supported drilling program.

Significant gaps in historical drilling remain along many of the defined conductor trends at Close Lake. The exploration strategy for the Project remains to test for unconformity-style uranium mineralization by ground-truthing conductor locations by geophysical means, fence drilling of geological targets, and drilling unexplored and underexplored conductors that demonstrate favourable characteristics for uranium mineralization.

On November 14, 2019, ALX announced the results received from Orano Canada for the fall 2019 diamond drilling program at Close Lake.

2019 Drilling Program

Orano Canada completed three holes totalling 2,394.0 metres in the northern part of the Project during the helicopter-supported diamond drilling program, as follows:

  • CL-174 was designed to test the down-dip extensions of faulting intersected within the sandstone of historical drill hole CL-144 along the C-14 North conductor. Strong to moderate bleaching was encountered to 169.1 metres and three fault zones were intersected in the upper and lower sandstone. The unconformity was intersected at 686.3 metres and the hole was completed to a final depth of 827.0 metres. A radioactive peak of 400 counts per second (“cps”) measured in the sandstone was associated with the basal conglomerate. Although elevated pathfinder elements were detected in the geochemical analysis, no significant uranium was encountered in the drill hole.
  • CL-175 tested the southwestern portion of the C-12 North conductor, near a large flexure detected in previous geophysical work by Orano Canada. The upper sandstone showed moderate to strong bleaching and the unconformity was intersected at 645.0 metres. Analysis of the basal sandstone returned values of 40.5 parts per million (“ppm”) uranium and 126 ppm copper. Moderate to strong disseminated pyrite mineralization with trace amounts of graphite and chalcopyrite characterized the basement intersection. The hole was completed within pelitic gneiss to a final depth of 800.0 metres.
  • CL-176 was designed to test the C-12 North conductor at a significant flexure detected in previous geophysical work by Orano Canada. The drill hole encountered moderate to strong bleaching in the upper sandstone and the unconformity was intersected at 645.5 metres. Geochemical analysis returned elevated uranium values in the lower sandstone over a 45 metre interval above the unconformity. Moderate to strong pyrite was present throughout the basement rocks. A radioactive peak of 993 cps was measured in the basement rocks within the upper pelitic gneiss. A basement sample returned 43.2 ppm uranium over one metre. The drill hole was completed to a depth of 767.0 metres.
Orano Canada has proposed a budget of $2.375 million to the Close Lake joint venture partners for winter 2020 geophysical and drilling programs in the southern part of the Project, with ground geophysical work to begin in December 2019. A moving loop electromagnetic survey is planned to better define targets on several target areas, including along the C-9 South conductor, which is located on trend with the conductive system that hosts Cameco’s McArthur River uranium mine southwest of the Project. The 2020 drilling program is proposed to consist of up to ten drill holes totaling approximately 5,200 metres.
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