via facsimile and U.S. mail July 26,
2005
Mr. Guy Hebert
President and Chief Executive Officer
Strateco Resources Inc.
1225 Gay-Lussac Street
Boucherville, Quebec
Canada J4B 7K1
Re: Strateco Resources Inc.
Form 10-KSB, filed March 31, 2005
File No. 000-49942
Dear Mr. Hebert:
We have reviewed the above filing and have the following
engineering comments. Our review has been limited to the areas
identified below and where indicated, we think you should revise
your
document in response to our comments. If you disagree, we will
consider your explanation as to why our comment is inapplicable or
a
revision is unnecessary. Please be as detailed as necessary in
your
explanation. In some of our comments, we may ask you to provide
us
with supplemental information so we may better understand your
disclosure. After reviewing this information, we may or may not
raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or on any other
aspect
of our review. Feel free to call us at the telephone numbers
listed
at the end of this letter.
Part II - Other Information Changes in securities and use of
Proceeds, page 88
1. The ninth paragraph of this section disclosed a resource of
275,000 ounces according to an estimate by Steffen, Robertson, and
Kirsten in October 2003. It is very important to clearly
distinguish
between "Reserves," which have a clearly defined technical, legal,
and economic meaning and "Non-reserve" mineralization that may or
may
never be mined at a profit for various reasons. In addition,
within
a "Non-Reserve" section, disclose the measured and indicated
resources separately from the inferred resources, using separate
tables and narratives. Resources should only be reported as "in
place" tonnage and grade, and should not be disclosed as units of
product, such as ounces of gold or pounds of copper. The relative
quality, reliability, and risk associated with each group of
estimates must be clearly distinguished and conveyed to the
average
non-technical reader.
In future filings, before the Measured and Indicated Resource
table,
insert the following including the indenting and bolding:
Cautionary Note to U.S. Investors concerning estimates of Measured
and Indicated Resources.
This section uses the terms "measured" and "indicated resources."
We
advise U.S. investors that while those terms are recognized and
required by Canadian regulations, the U.S. Securities and Exchange
Commission does not recognize them.
U.S. investors are cautioned not to assume that any part or all of
mineral deposits in these categories will ever be converted into
reserves.
In future filings, before the Inferred Resource table, insert the
following including the indenting and bolding:
Cautionary Note to U.S. Investors concerning estimates of Inferred
Resources.
This section uses the term "inferred resources." We advise U.S.
investors that while this term is recognized and required by
Canadian
regulations, the U.S. Securities and Exchange Commission does not
recognize it. "Inferred resources" have a great amount of
uncertainty as to their existence, and great uncertainty as to
their
economic and legal feasibility. It cannot be assumed that all or
any
part of an Inferred Mineral Resource will ever be upgraded to a
higher category. Under Canadian rules, estimates of Inferred
Mineral
Resources may not form the basis of feasibility or pre-feasibility
studies, except in rare cases.
U.S. investors are cautioned not to assume that part or all of an
inferred resource exists, or is economically or legally minable.
2. Mineral resources must have "reasonable prospects for economic
extraction." This means that any reportable "resource" estimates
must have been delimited using an economically based cutoff grade
to
segregate resources from just mineralization. Disclose in all
future
filings the cutoff grade used to delimit the tonnage estimates.
Also, disclose the analysis and relevant factors that substantiate
the cutoff grades used were based on reasonable economic
assumptions.
The relevant factors must realistically reflect the location,
deposit
scale, continuity, assumed mining method, metallurgical processes,
operational and capital costs, and reasonable metal prices based
on
the recent historic three-year average. Or if the resource
estimates
are not based on economic cutoffs, remove the estimates.
3. The following page quotes an uncategorized resource estimate of
544,000 tonnes grading 0.075% U3O8 as having been prepared prior
to
the implementation of National Instrument 43-101. With the passage
of
National Instrument 43-101 into law, your disclosure using non-
Commission reserve definitions and "resource" estimates is allowed
for Canadian incorporated companies under the exception in
Instruction 3 to Paragraph (b)(5) of Industry Guide 7. However,
you
will still be required to disclose your estimates according to
Guide
7 definitions using definitions as prescribed by N. I. 43-101. In
future filings provide a comparative table and reconciliation
narrative explaining any differences between these estimates using
Commission definitions and the N. I. 43-101 definitions.
Closing Comments
As appropriate, please respond to these comments in within
10
business days or tell us when you will provide us with a response.
Please furnish a cover letter with your amendment that keys your
responses to our comments and provides any requested supplemental
information. Detailed cover letters greatly facilitate our
review.
Please understand that we may have additional comments after
reviewing your amendment and responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to the company`s disclosure, they
are responsible for the accuracy and adequacy of the disclosures
they
have made. In connection with responding to our comments, please
provide, in writing, a statement from the company acknowledging
that:
* The company is responsible for the adequacy and accuracy of the
disclosure in the filing;
* Staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* The company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.
You may contact George (Ken) Schuler, mining engineer, at
(202)
551-3718 or, in his absence, Roger Baer, mining engineer, at (202)
551-3705, if you have questions regarding engineering comments.
Please contact me at (202) 551-3740 with any other questions.
Direct
all correspondence to the following ZIP code: 20549-7010.
Sincerely,
H. Roger Schwall
Assistant Director
??
??
??
??
Mr. Guy Hebert
Strateco Resources Inc.
July 26, 2005
Page 2
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010
DIVISION OF
CORPORATION FINANCE