All eyes on Fission Energy’s upcoming winter drill program at Waterbury

Fission Energy (TSX-V: FIS) has just completed an additional placement of 8.25 million shares at 80 cents, 7.33 million flow-through shares at 90 cents and 4.125 million warrants exercisable at $1.00, raising a total of $13.2 million (gross), lifting the company`s cash balances to around $22 million.

These funds will be utilized to drill and develop the Waterbury Lake Uranium Project, a 50%-50% Limited Partnership with the KEPCO Consortium, and advance other projects. Major shareholders include Sprott Asset Management, National Bank Financial and management holding approximately 6.5%.

The Waterbury Lake Uranium Project contains 40,256 hectares and is located in the northeast corner of the Athabasca Basin, strategically located within a 200km long prolific north-east trend that hosts most of the major high grade deposits in the basin. This is a very high grade uranium province that hosts some of the richest uranium deposits in the world, and contributes approximately 20% of global uranium supply. Unconformity style deposits were first discovered here over 42 years ago, and have attracted major uranium producers such as Cameco, Areva and Denison.

The project area lies on a strike line that is 4 kilometers to the north of the Midwest Deposit, and is immediately next door to Hathor’s (TSX: HAT) extremely high grade find at Roughrider (In fact, Fission believes Roughrider extends onto their property at J-East). These deposits and some additional smaller local resources contain more than 70 million pounds of U3O8 in the vicinity of the project area. A second strike line (Discovery Bay Corridor) runs from east to west and hosts the Roughrider and Roughrider East Deposits, and continues west across the Waterbury Lake Uranium Project for approximately 2.5 kilometers. The Midwest and Discovery Bay Corridors are coincident with a major fault zone and a pelitic rock sequence that hosts most of the uranium mineralization that has been discovered around the project area.

In 2008 Fission signed a joint venture with a consortium of Korean based companies led by KEPCO, to explore the project area, and stepped up exploration as Hathor started reporting some of the highest uranium grades seen in the Basin.

The joint venture incurred $14 million in expenditures and was recently converted to a Limited Partnership between Fission and the KEPCO Consortium each retaining a 50% interest. The new partnership now has an exploration and development budget of $30 million to be deployed over the next 3 years.

KEPCO is headed by the Korea Electric Power Corporation (NYSE:KEP), which is a major Korean integrated electric utility company. KEPCO is also a producer and operator of 20 Korean nuclear power plants, and investor in uranium production by way of a 17% stake in Denison Mines (TSX:DML, NYSE AMEX:DNN). This interest makes KEPCO the largest investor in Denison and is driving the company towards an annualized production rate of 10 million pounds of uranium oxide by 2020, which equates to about 5% of world output. Denison owns a stake in the Midway and Mae West Deposits, and holds an interest in the nearby McClean Lake Mill, with an annualized production rate of 12 million pounds of uranium oxide from high grade ores, that is currently shut down due to lack of feedstock.

Fission has recently outlined three uranium mineralized bodies that commence on the eastern edge of their Waterbury Lake Project, which appear to be part of the same mineralized system which is responsible for the high grade uranium oxide that is being drilled by Hathor. The logic of the situation points to the development of these various finds as one project and KEPCO may play a major role in this development as it has interests in most of the surrounding deposits and has already indicated that Denison will grow production through both exploration and acquisition.

This mineralized trend identified so far commences at the east end with the Roughrider East deposit, which is located 300 meters east of the claim boundary line between Fission and Hathor interests, and is defined by the presence of a pelitic corridor that runs westward into Fission ground for a distance of approximately 2.5 kilometers and is the focus of the Fisson exploration effort.

The first discovery made by Fission in early 2010 was made within this corridor at the J Zone, which is located approximately 40 meters west of the Roughrider Deposit. Unlike Roughrider, which is predominately located in basement rocks below the unconformity, the J Zone discovery is at the unconformity, approximately 200m below the surface. The J Zone has been drilled down to unconformity by 31 holes, of which 28 intersected potentially mineable uranium mineralization. Drill-hole results included WAT10-098A at 12 meters of 5.95% of U3O8 and WAT10-103 at 15 meters of 5.55% U3O8. This high grade mineralization has been identified over an area measuring 120 meter x 50 meters, and is open laterally in all directions.

The J East Zone is located 15 meters west of Roughrider, and is a smaller band of mineralization that straddles the border between the two properties. Fission believes this is an extension of the Roughrider Deposit and that results to date warrant additional drilling to define the limits of the resource, along with grades and tonnage. A third zone known as Highland has been defined 80 meters to the west, where a total of 3 holes have identified an area of anomalous uranium mineralization which remains open.

This western corridor now represents a very significant target area for the discovery of additional unconformity style uranium deposits. Plans are being finalized for an $8 million winter drilling campaign, starting with ground geophysics on new targets in December, to be followed by 22,000 meters of drilling utilizing 3 rigs.

Fission has other interests that include a NI 43-101 compliant resource at Dieter Lake, Quebec, that hosts 24.4 million pounds of U3O8 at a grade of .057%, and a uranium project at Macusani, Peru. The company also holds 11 additional projects including several in or around the Athabasca Basin in Saskatchewan.

One of the more advanced projects is at Patterson Lake, located in the western Athabasca Basin on a major north-south strike line 30 kilometers south of high grade Shea Creek deposits, and 50 kilometers south of the past producing Cluff Lake Deposits. Numerous targets have been identified from scout drilling and recent airborne and ground geophysical surveys. The Minor Bay Project located on the eastern margin of the Basin is also showing potential from early work programs.

Market interest will continue to focus on the upcoming winter drilling program at Waterbury, which has the potential to become a company maker.