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SOUTHERN Uranium will carry out a 3000m drilling program on the Eyre Peninsula in South Australia to investigate the resource potential and metallurgical characteristics of its Jungle Dam iron deposits.

The news was welcomed by investors with the companys share price rising by more than 10% in morning trade.

Southern Uranium recently identified substantial iron ore potential at the prospect, which is held within its wholly owned exploration licence.

In 2008-09, the company drilled the area for iron oxide-copper-gold-uranium deposits and located a number of iron-rich zones.

The initial Jungle Dam work laid the foundations for Southern Uraniums strategy in the Eyre Peninsula to target IOCGU with soil geochemistry.

A review of the iron ore potential at Jungle Dam was prompted by the company wanting to diversify its target commodities and by the increasing development of iron ore projects in the area.

Prior drilling by Southern Uranium and earlier lead and zinc explorers encountered broad intervals with grades of more than 30% iron which are compatible with nearby iron ore resources. The iron mineralogies of the intersections are variously magnetite, haematite-altered magnetite and goethite.

The intersections coincide with a magnetic trend that extends from the Hercules iron ore deposit, owned by Ironclad Mining, into Southern Uraniums ground, covering a potential 14-kilometre strike length.

Shares in Southern Uranium reached A9.1c in early afternoon trade.


Drilling at Jungle Dam