Areva's Denison Range Project is targeting possible economic sandstone-hosted uranium mineralisation that may have formed within the Mesozoic sandstones located to the east of exposed uranium-rich basement rock sequences of the Palaeo- to Mesoproterozoic Peake and Denison Inliers. The potential for occurrences of sediment-hosted uranium associated with thick sequences of gently dipping, porous, Cretaceous shallow-water marine to Jurassic fluvial-deltaic sandstones was identified in a limited way by historic exploration, when traces of such uranium mineralisation were encountered on the western side of the inliers. The target horizons for entrapping any sandstone-hosted uranium are the Jurassic Algebuckina Sandstone and the overlying Cadna-owie Formation. These pyritic and weakly carbonaceous sandstones are up to 150 m thick and disconformably overlain by Cretaceous Bulldog Shale. The region is prospective for uranium mineralisation since it contains the key criteria required for the formation of a uranium deposit (source, transport and trap). And as was discovered by Red Metals in 2007, a redox boundary exists on the western side of the Peake and Denison Inliers proximal to the source rocks. Currently, the Denison Range Project licences' ground is believed by Areva to be more prospective, because the palaeodrainage system that was in contact with the uranium-rich (65-70 ppm U), radiogenic granitic/volcanic basement source rocks is interpreted to have crossed it in a west-to-east direction. Minimal exploration has been recorded east of the Peake and Denison Inliers, with only two historical drillholes located within the Afmeco tenement boundaries. During 2011, therefore, Afmeco performed a preliminary drill programme of 11 rotary mud holes totalling 2554 m, which was designed to assess stratigraphy, oxidation state and the nature of potential sandstone uranium traps, to give better focus to future drilling programmes. The holes were vertical, with an average depth of 232 m and a maximum depth of 286 m. They were terminated once Precambrian basement was intercepted. The results of the drilling were positive, with good intersections of reduced, porous sands. Whilst the geochemical results were not significantly anomalous (<100 ppm U3O8), there is geophysical log evidence of precipitated uranium being present within the system, which appeared to be related to redox. The proposed 2012 drilling programme aimed to locate redox boundaries proximal to the radiogenic source rocks, in positions where migrating dissolved uranium should have become fixed, and to further explore along regional fault lines in the area, which have the potential for oxidising fluids and/or hydrocarbons to enter the system. To fulfil Areva's approved PACE 2020 Discovery Drilling 2012 project designated DPY7-05, which was substantially subsidised by DMITRE to promote company high-risk high-reward mineral exploration within South Australia, 4 vertical rotary mud holes totalling 862 m were drilled during October 2012 to address the above aims. However, it was found that the target sandstones are in a reduced state, indicating that no recent oxidised recharge to the Mesozoic aquifers has taken place, so the realisation of this situation has lowered the prospectivity of the project exploration model. It appears that the present day groundwater flow coming from the north-east and south-west against the faulted margins of the Peake and Denison Ranges is inhibiting recharge of surface uranium-bearing fluids, and this effect plus prolonged aridity could have limited the penetration of uranium into the basin aquifers along the range fronts. The lack of a near-surface redox front may also be due to the downfaulting that has occurred along the eastern flank of the Denison Range. Downhole geophysical wireline logging was conducted at the completion of drilling, but no significant radiometric anomalies were detected in the target formations. A maximum equivalent uranium grade of 40 ppm Ueq was recorded from 195.6 m depth in hole DR0012_2.