TORONTO (Reuters) - One of the most closely watched uranium deposits not owned by a major miner, Fission Uranium Corp's (>> Fission Uranium Corp) Patterson Lake South project, is attracting attention from potential buyers, but Fission's CEO hopes to buy time.

Drilling results displaying the ore's rich grade and shallow depth have caught the eye of investors and analysts over the past two years, even before Patterson Lake South, in the Athabasca Basin, has an established resource recognized by Canadian regulators.

Now with uranium's three-year slump showing signs of ending, three groups have signed non-disclosure agreements to take a closer look at Fission, Chief Executive Dev Randhawa said in an interview at the Prospectors & Developers Association of Canada (PDAC) convention in Toronto on Sunday.

The interest from two Asian groups and one North American group is welcome, but the timing isn't ideal for a sale, Randhawa said.

"We're not going to let this go very easily. It's the first time in 40 years someone's made a high-grade discovery that is so shallow. I'm not in a hurry to sell."

For starters, the uranium spot price is hovering around $35.50 per pound, just above an eight-year low and limiting the sector's outlook.

The 2011 Fukushima meltdown led to most of Japan's nuclear reactors being shut down, depressing the radioactive metal's price and weighing down uranium equities. But uranium stocks got a bump last week when Japan's draft energy plan included a place for nuclear power.

Fission also does not yet have an established resource, meaning that drilling results to date may have only scratched the surface of Patterson's potential, Randhawa said.

Fission shares touched a six-month high in Toronto on Wednesday of C$1.46.

Randhawa expects Fission to complete by the end of the year its 43-101, a set of rules in Canada for reporting on mineral properties, including the size of resources.

A Japanese utility has inquired about an off-take agreement for the uranium PLS may one day produce, and a couple of financial groups are considering stakes in Fission, Randhawa said.

The Athabasca Basin is home to the world's largest high-grade uranium mine, McArthur River, owned by Cameco Corp (>> Cameco Corporation) and Areva SA (>> AREVA). Those companies are also starting production this year at the Cigar Lake mine in the basin.

Patterson Lake South is situated on the west side of the basin, where no one has mined uranium since Areva's Cluff Lake mine ceased production more than a decade ago. As a result, the area lacks a mill to process uranium - the main factor working against Fission.

After potential buyers delayed many of their own mining projects in recent years, they also may be hesitant to buy another one, Randhawa acknowledged.

Cameco Chief Executive Tim Gitzel suggested on a February 10 conference call that the company is more interested in developing its existing projects than buying new ones.

"We're just focused on our existing operations, trying to make them as lean and productive as we can."

But Patterson has high-grade ore, the resource appears to be large, and it is shallow at about 50 meters (164 feet) below the surface, reducing the potential cost of production, said Rob Chang, analyst at Cantor Fitzgerald.

Based on Fission's results, Chang estimates that Patterson Lake South has a resource of about 45.7 million pounds at an average grade of 1.01 percent U3O8, a form of uranium yellowcake, but said the resource could be as large as 76.6 million pounds. The global median grade is 0.08 percent.

Grades from assay results at PLS are similar to other high-grade deposits in the basin, but at far shallower depth starting at less than 100 meters, Chang said.

Cameco's McArthur River produces ore from 500-600 meters underground, while other promising deposits, Denison Mines Corp's (>> Denison Mines Corp.) Phoenix and the Areva/UEX Corp (>> UEX Corporation) Shea Creek project, range from around 400 to more than 600 meters deep.

($1=$1.11 Canadian)

(Reporting by Rod Nickel in Toronto; Editing by Phil Berlowitz)

By Rod Nickel