Bayswater Uranium Corporation - Anna Lake

Anna Lake

Highlights

Drilling in 2007 identified a major uranium discovery including 40 meters grading 0.07% U3O8.
Located in the Central Mineral Belt of Labrador, a region with IOCG-Olympic Dam and Rossing-style uranium deposits.
Major dill program is underway to expand resources and bring them into NI 43-101 compliance; initial results from 2008 program continue to expand the deposit with best intersections including 19.0 metres grading 0.04% U3O8 and 5.9 metres grading 0.10% U3O8.

Overview

Bayswater began drilling at Anna Lake and several other targets located at its Central Mineral Belt (CMB) property in July 2007. The 2007 exploration program produced very encouraging results and the Company is currently carrying out a 20,000 metre drill program to continue to expand the deposit and test other targets along a favourable 10 km corridor. Preparation of a NI 43-101 compliant resource calculation is planned upon completion of this phase of drilling.

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Location & History

Anna Lake is situated in the Central Mineral Belt which runs for more than 250 km through south-central Labrador, on the eastern edge of Canada. With numerous uranium, copper, and rare earth element showings and prospects, the CMB is a major uranium exploration region in Canada. Bayswater has a large land position in the district with 50% to 100% interest in 2,376 square kilometres.

The Company's claims and interests are largely within Labrador Inuit Land Settlement Agreement (LILSA) areas that are administered by the Government of Newfoundland and Labrador. This region welcomes exploration and development of resources.

The project area is located near Postville, a town of approximately 250 people. The vast property is flat-lying and sits at approximately 300m above mean sea level.

Access to the project is by fixed wing aircraft or helicopter from Postville. Supplies and heavy equipment are brought to the community by barge from St. John's, Newfoundland. The community provides the project with housing, supplies, fuel and internet access. In addition, there is a small but able work force whose members have experience in exploration through the various junior companies active in the area, as well as through the Voisey's Bay Nickel Mine.

Exploration for uranium and base metals in the CMB started in 1955 and continued on and off until the late 1970's. In 1993 the Geological Survey of Canada completed a detailed lake sediment and water sampling survey program that revealed significant uranium, silver, copper and iron anomalies.

Exploration reactivated in earnest in the early 2000's with the surge in uranium prices and several companies are now active in the area. The most advanced project is Aurora Energy's Michelin iron-oxide/copper/gold (IOCG) "Olympic Dam-style" deposit with a Measured and Indicated Resource of 22.2 million pounds with an additional Inferred Resource of 13.4 million pounds U3O8 (ref: www.aurora-energy.ca). This deposit sits approximately five km from Bayswater's Southeast Claim block and Aurora's airborne radiometric surveys have shown anomalies which may extend onto Bayswater ground. Further to the south, the Moran Lake deposit being explored by Crosshair contains an Inferred Resource of 124,000 tonnes at a grade of 0.25% U3O8 or approximately 688,000 pounds of U3O8 (ref: www.crosshairexploration.com ). There is a magnetically and radiometrically favourable belt of rocks found on the Moran Lake property which is believed to extend on Bayswater ground for as much as 30 km. This postulated extension is supported by the existence on Bayswater property of favourable major fault structures, rock units, widespread base and precious metal occurrences, uranium occurrences and common anomalous scintillometer counts.

Geology & Mineralization

The Anna Lake prospect of the CMB is underlain by rocks that are around 2.5 billion years old as well as an extensive terrain of slightly older granite-like intrusives. In particular, the "Aillik Group" consists of an approximately 5,000 m tick assemblage of metamorphosed sedimentary and volcanic rocks, subvolcanic intrusive and dikes. This group of rocks hosts most of the uranium, copper, zinc, lead, and molybdenum occurrences in the region. Uranium bearing horizons and veins are genetically related to the east-northeast trending units, and faults with similar orientation, implying that the faults have acted as conduits for mineralizing solutions along structures.

Anna Lake is an IOCG target consisting of a 1.2 km long boulder train containing over 2000 radioactive granite and gneissic boulders with values of up to 3.05% U3O8.

Exploration

In July 2007, the Company began drilling at its Anna Lake prospect. In total, 41 holes were drilled by November 2007 which led to a major uranium discovery that included 40 meters grading 0.07% U3O8. The property was also shown to contain Molybdenum credits. Hole to hole correlation established a main uranium mineralization zone over a 600 meter strike length, 230 meter vertical depth and approximate true widths of up to 25 meters. The deposit is open in all directions and is entirely blind.

A major drill program commenced in May 2008 that will consist of up to 20,000 metres of drilling to evaluate the depth potential of the Anna Lake deposit, and to test numerous step out targets along an 11 km favourable structural corridor northeast of the deposit. In August 2008, Bayswater released initial results from 24 holes drilled to date at Anna Lake and other targets. Results continue to expand the size of the deposit as drilling traced mineralized zones to 430 metres depth with best drill intersections including 19.0 metres grading 0.04% and 5.9 metres grading 0.10% U3O8. The results also continue to return significant molybdenum credits. Results from the remaining holes are pending and exploration will continue on through summer.

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