by Greg Klein | October 13, 2016
ALX Uranium TSXV:AL gets 7.5 million shares of Denison Mines TSX:DML, retains a 20% stake in the Hook-Carter project and has its portion of $12 million in spending covered as Denison moves into the southwestern Athabasca Basin. Under a deal announced October 13, Denison becomes project operator, bringing its expertise to the 16,805-hectare property in the Patterson Lake South region.
“This is elephant country—a large property that has seen very little drilling on a geological trend with a precedent for large and high-grade uranium deposits,” commented Denison VP of exploration Dale Verran.
“The Hook-Carter property is uniquely situated on the Patterson Lake corridor, offering potential for both basement-hosted deposits, similar to Triple R and Arrow, and unconformity-hosted deposits which remain the largest and highest grade in the Athabasca Basin, namely McArthur River and Cigar Lake which are both operating mines. With Athabasca sandstone thicknesses similar to the Wheeler River project, the property plays to our team’s strengths and we are very excited to get started with exploration in 2017.”
So far Hook-Carter has undergone just eight historic holes, five of them on the property’s 15 kilometres of the Patterson Lake conductive corridor, which hosts Fission Uranium’s (TSX:FCU) Patterson Lake South, NexGen Energy’s (TSX:NXE) Rook 1 and Hook Lake, a joint venture of Purepoint Uranium TSXV:PTU, Cameco Corp TSX:CCO and AREVA Resources Canada. Hook-Carter also features additional potential along significant sections of the Derkson and Carter corridors.
Subject to approvals, Denison’s work requirement calls for $3 million over the first three years. Should the company fail to meet the commitment, ALX’s stake in the property increases from 20% to 25%. Additionally, Denison funds ALX’s portion of the first $12 million in spending. The companies plan a JV three years after closing the agreement.
“Denison has made a number of world class uranium discoveries within the Athabasca Basin and, given their experience, we believe that they will advance the project diligently and methodically,” said ALX president/CEO Jon Armes. “Knowing that Hook-Carter will see considerable exploration efforts over the next 36 months, the company will focus on exploration at its other high-quality exploration projects in and around the shallow margins of the Athabasca Basin, which include Gorilla Lake, Newnham Lake, Gibbon’s Creek and Lazy Edward Bay.”
by Greg Klein | September 14, 2016
Nature has inflicted many challenges on Cigar Lake, but most of them have been geological. Now local wildlife has turned against the project.
In what’s reported as strange behaviour for the species, wolves are stalking and even attacking the uranium mine’s employees. On September 14 the National Post reported one such canine wrapped its jaws around the neck of a kitchen worker. A security guard’s vehicle scared the attacker away. Considered unusual, the wolf “had apparently lain in wait for the young mining camp worker,” the NP stated.
Cigar Lake staff have cited several instances of being watched or followed by wolves, the paper added. “They are absolutely huge … they have no fear of man and come into the job sites often at night,” a former employee informed the NP.
Cameco Corp’s (TSX:CCO) majority-held operation lies roughly halfway between two 2005 wolf attacks, one of them fatal. As a result, the company fenced off Cigar Lake, cautioned employees and implemented deterrence devices such as “scare cannons,” according to the NP. Nevertheless, wolves and also bears continue to breach the barricades, Cameco acknowledges.
The newspaper characterizes the canine actions as a startling new phenomenon. But Jack London portrayed much more disturbing events in his 1906 novel White Fang.
It’s 50 below as two Yukon prospectors and their dog team find themselves tracked by an increasingly aggressive wolf pack. With gleaming eyes, the predators circle the men’s camps night after night, encroaching closer and closer and closer.
At times like that, “it’s a blame misfortune to be out of ammunition,” one guy observes.
Simply food for the predators, the dog team dwindles one by one. The two men dwindle to one.
The surviving prospector realizes his “living flesh was no more than so much meat, a quest of ravenous animals, to be torn and slashed by their hungry fangs, to be sustenance to them as the moose and the rabbit had often been sustenance to him.”
Evidently the quest for metals has always called for fortitude. And the world’s highest-grade uranium mine continues to face challenges.
by Greg Klein | August 15, 2016
A 5,000-kilometre tour offers Saskatchewan schools insight into mining’s importance to the province and the province’s importance to mining. This year’s Rock’n the Classroom GeoVenture Program began August 15 as 19 teachers took a half-day workshop in Saskatoon. The Saskatchewan Mining Association sponsors the annual event, paying all expenses except a $50 fee.
On the itinerary are PotashCorp’s (TSX:POT) Patience Lake solution mine, Mosaic’s (NYSE:MOS) Esterhazy underground potash mine and mill, Westmoreland Coal’s Poplar River open pit operation and the world’s largest uranium operation at Cameco Corp’s (TSX:CCO) majority-owned McArthur River mine and Key Lake mill.
Other destinations will include earth science-related attractions such as the Potash Interpretive Centre in Esterhazy. Handouts include resource kits, lesson plans, posters and maps for the classroom.
The program “offers educators a front-row seat to explore Saskatchewan’s mineral industry and learn of related career opportunities for their students,” the SMA stated.
Ontario teachers also qualify for multi-day mining tours, these ones hosted by the non-profit Canadian Ecology Centre.
by Greg Klein | August 11, 2016
Described as “strong visible uranium mineralization” with “dense accumulations of massive to semi-massive pitchblende,” the Harpoon discovery adds another weapon to NexGen Energy’s (TSX:NXE) arsenal. Announced August 11, hole HP-16-08 features 17 metres of continuous mineralization, 4.5 metres of it “off-scale” or above the 9,999-counts-per-second limit of older scintillometers. At least one point surpassed 61,000 cps. To put that in perspective, 500 cps rates as anomalous. Impressive as they are, results like that keep in line with the Rook 1 project’s Arrow resource, the Athabasca Basin’s largest undeveloped deposit. But this hole’s located 4.7 kilometres northeast.
Once again demonstrating the Patterson Lake South region’s overall potential, NexGen collared HP-16-08 as a 250-metre stepout from HP-16-06, which scintillated another 1.5 metres of continuous mineralization. The company now traces 5.6 kilometres in northeasterly mineralized strike between Arrow and Harpoon. Another 300 metres northeast of Harpoon lies the Spitfire discovery of JV partners Purepoint Uranium TSXV:PTU, Cameco Corp TSX:CCO and AREVA Resources Canada.
Results for NexGen’s latest four holes, all land-based, show:
HP-16-07 returned nothing of significance. True widths weren’t available.
Calling HP-16-08 “an extremely exciting development,” CEO Leigh Curyer credited VP of exploration Garrett Ainsworth and his team for the success. The discovery has “severely elevated the prospectivity of some of the other targets we’ve got along the Patterson [conductive] corridor, and we want to be able to test those as well,” Curyer told a conference call. The seven-rig, 35,000-metre summer campaign has focused on both infill and expansion at Arrow, with about 25% of the program on regional targets. Harpoon has prompted the company to consider adding an eighth rig.
The geophysics done on [the Derkson conductive corridor] show that’s got multiple targets as well, which are identical to what we’re seeing at Arrow and what we’re learning about at Harpoon as well…. We could be there for many, many years with seven drill rigs before we truly understand the magnitude of what we’re dealing with.—Leigh Curyer,
CEO of NexGen Energy
Curyer noted the proximity of Fission Uranium’s (TSX:FCU) Patterson Lake South to the southwest, as well as Spitfire to the northeast.
Home to all the PLS discoveries so far, the Patterson corridor remains “very under-drilled and we’ve got a lot of drilling to do … until we ultimately understand the scale of the deposition,” Curyer emphasized. Rook 1 is “obviously massive and there’s not a property like it that I’m aware of on the planet.”
But he pointed out that Rook 1 hosts seven known corridors. Parallel east to Patterson is the Derkson corridor, “and the geophysics done on that show that’s got multiple targets as well, which are identical to what we’re seeing at Arrow and what we’re learning about at Harpoon as well…. We could be there for many, many years with seven drill rigs before we truly understand the magnitude of what we’re dealing with. But suffice to say at the minimum—it’s huge.”
If the company misses its H2 target for the Arrow resource update, the team will attribute that to continued drilling success, he added. A postponement to early 2017 might be necessary “to do justice” to the deposit.
NexGen’s bankroll currently holds about $91 million.
by Greg Klein | August 9, 2016
This month has ALX Uranium TSXV:AL returning to two projects at opposite ends of Saskatchewan’s prolific Athabasca Basin. On the Basin’s northern margin, the Perch property undergoes ground gravity while the Hook-Carter project in the Patterson Lake South camp gets both gravity and drilling, the company announced August 9.
The 1,682-hectare Perch offers shallow targets along a four-kilometre-long conductor and coincident magnetic low running through the central area of the property. The 470-station gravity survey will consist of 24 900-metre lines at 100-metre spacing perpendicular to the conductor. Work begins in about a week with the crew heli-commuting from the community of Stony Rapids, 65 kilometres west.
At 16,458 hectares, Hook-Carter features northeastern extensions of three known conductive corridors, Carter, Derkson and Patterson Lake. The latter hosts at least seven discoveries on three properties, Fission Uranium’s (TSX:FCU) Patterson Lake South, NexGen Energy’s (TSX:NXE) Rook 1 and the Hook Lake JV of Purepoint Uranium TSXV:PTU, Cameco Corp TSX:CCO and AREVA Resources Canada. Cameco recently enlarged another property it holds bordering Hook-Carter to the northeast.
ALX now plans gravity on two areas over the Patterson corridor and one over Derkson. Weather permitting, up to two holes will follow on each of the corridors.
Previous geophysics show the Patterson corridor extending at least 12.7 kilometres along Hook-Carter, with depth to the sub-Athabasca unconformity estimated between 320 and 500 metres.
Derkson runs about 5.8 kilometres on the property, with the unconformity estimated to be 350 to 470 metres below surface. An historic hole on the corridor about 4.5 kilometres south of Hook-Carter found 0.24% uranium and 1.35% nickel over 2.5 metres in basement rocks about five metres below the unconformity.
The Carter corridor has undergone historic geophysics but remains relatively unexplored. Two separate portions of the corridor run through the property, each for about two kilometres of strike.
Plans for the Patterson and Derkson corridors follow a recent audio-magnetic transient EM survey as well as a study of the distribution of geochemical and radiochemical signatures against interpreted litho-structural features. As a result, the three priority targets were chosen.
ALX also announced an LOI to vend its Mikwam gold property to Galena International Resources NEX:GTO.H. The price tag comes to $20,000, two million shares and a 0.5% NSR, half of which Galena may buy for $1 million.
Last month ALX announced Lon Shaver’s appointment to its advisory board. His nearly 20 years of mining sector experience includes investment banking roles with Raymond James, Merrill Lynch Canada and Midland Walwyn Capital. Shaver has also held CFO positions with a publicly listed mining company and a private technology company.
In June ALX closed the second tranche of a private placement totalling $750,000, part of a strategic partnership with Holystone Energy. That month ALX also closed the final tranche of a separate private placement totalling $348,750.
With a number of active projects in its large, highly prospective portfolio, ALX reported highly anomalous radon values at its Lazy Edward Bay project on the Basin’s southeastern margin in April. The previous month preliminary geophysical results showed gravity lows on the company’s 80%-held Gorilla Lake project on the Basin’s west side.
by Greg Klein
NexGen Energy’s July 15 move to the TSX big board (TSX:NXE) marks another milestone of the almost phenomenal progress in and around Saskatchewan’s southwestern Athabasca Basin. In March the company’s Rook 1 project came from behind to surpass the deposit size of Fission Uranium’s (TSX:FCU) more advanced Patterson Lake South. Now both companies focus on regional exploration as well as resource expansion, leaving observers wondering just how much more uranium the region has to offer.
NexGen has seven rigs onsite for its largest season ever, at least 35,000 metres. Eight summer targets include the Arrow resource, due for stepouts as well as delineation, a massive pitchblende-bearing area 180 metres southwest, the Cannon discovery to the northeast and five other conductive areas running southwest to northeast across the property.
Fission’s summer calls for 52 holes and 15,200 metres, most of it outside the Triple R resource. The company hopes to fill in some of the gaps between the deposit and other zones along a trend now 2.58 kilometres long. Sixteen holes will test regional exploration targets.
Fission also plans further EM work and, with pre-feas in mind, a seismic survey, geotechnical borehole testing, hydrogeology wells and Phase II metallurgical studies.
Last spring’s resource estimate for NexGen’s Arrow zone used a 0.25% cutoff on four parallel shear structures to report an inferred total of 3.48 million tonnes averaging 2.63% for 201.9 million pounds U3O8. With the deposit open in most directions, the company hopes to release an expanded, upgraded resource this year.
Fission’s September 2015 estimate for the two-zone Triple R deposit used a 0.2% open pit cutoff and 0.25% underground cutoff for a resource totalling:
The deposit remains open in multiple directions, Fission states. Triple R reached PEA last September.
Fission has the shallower deposit, about 55 to 200 metres below surface. NexGen’s resource extends to about 800 metres but it’s land-based while most of Fission’s resource and its other zones lie under a lake. Both deposits are basement-hosted, avoiding the leaking sandstone problems that plagued Cigar Lake.
Fission’s summer budget comes to $13.3 million, slightly less than NexGen’s $14 million. Fission’s well-funded following last January’s $82.2-million private placement that gave Hong Kong-based uranium trader CGN Mining a nearly 20% stake in the company. NexGen took a different approach, issuing US$60 million in convertible debentures to CEF Holdings, shared 50/50 by CK Hutchinson Holdings and CIBC. That leaves NexGen with about $100 million on hand and the possibility of paying off the debt.
Does that suggest the company contemplates production revenue in its future? CEO Leigh Curyer can give that impression. The former CFO of a Uranium One predecessor takes credit for managing South Australia’s Honeymoon project through feasibility. Late last month he announced three new staffers holding “combined experience with permitting, development and operating mines.”
By contrast Fission chairperson/CEO Dev Randhawa has openly courted suitors, as in the failed merger with Denison Mines TSX:DML that preceded the CGN deal. The question of who ends up owning how much uranium in the region inspires wide-ranging speculation. Meanwhile expansion and development of the two projects can only enhance their attractiveness.
The region’s northeasterly reach of mineralization hardly stops at Rook 1’s border, as Purepoint Uranium TSXV:PTU demonstrates at Hook Lake. Last winter’s drilling reaffirmed interest in the project’s Spitfire zone, a few kilometres beyond NexGen’s Bow discovery. The season’s last hole revealed Spitfire’s best assay yet—10.3% U3O8 over 10 metres, starting at 237.6 metres in downhole depth and including 53.5% over 1.3 metres.
Backed by money from JV partners Cameco Corp TSX:CCO and AREVA Resources Canada (39.5% each), operator Purepoint has another round of drilling in the planning stages.
by Greg Klein | May 16, 2016
Projected to grow 2.4% annually, nuclear power will remain one of the most important means of generating electricity, says a new report. With last week’s release of International Energy Outlook 2016, the U.S. Energy Information Administration looked at energy markets from 2012 to 2040. Electricity continues to be “the world’s fastest-growing form of end-use energy consumption.”
The report foresees world net electricity generation increasing 69% by 2040, from 21.6 trillion kilowatt-hours in 2012 to 25.8 trillion kWh in 2020 and 36.5 trillion kWh in 2040.
Renewables will be the fastest-growing source of electricity, with annual increases averaging 2.9%. Natural gas follows with 2.7% a year, then nuclear with 2.4% a year. That increase would almost double nuclear generation from 2.3 trillion kWh in 2012 to 4.5 trillion kWh in 2040.
The EIA sees most of nuclear’s increase coming from emerging countries outside the Organization for Economic Co-operation and Development. The only OECD nation planning a significant increase is South Korea, with an additional 15 GW. Despite that, reductions in Canada, OECD Europe and Japan would cut total OECD nuclear capacity by six GW.
The trend changes radically with non-OECD countries, especially China, India, other Asian economies and the Middle East. The report sees 9.6% average growth in China, adding 139 GW from 2012 to 2040. India would expand by 7.9% for 36 GW. Other non-OECD Asian economies would average 2.9% to add eight GW. Even the oil-rich Middle East would increase nuclear capacity from less than one GW in 2012 to 22 GW in 2030, according to the report.
Uranium prices, however, seem oblivious to such robust projections. At a shareholders meeting last week, Cameco Corp TSX:CCO president/CEO Tim Gitzel bemoaned “levels not seen since 2005.” Having put Rabbit Lake on care and maintenance the previous month, the miner cut its 2016 guidance from 30 million pounds to 25.7 million pounds U3O8.
But noting that the world has more than 60 reactors under construction, Gitzel predicted demand rising about 3% annually, from 170 million pounds this year to 220 million in 2025. “That equates to about three to four more Cigar Lakes being required over those same 10 years—not an easy task, as we know by experience.”
The EIA concedes its projections “are not statements of what will happen, but what might happen given the specific assumptions and methodologies used for any particular scenario.”
by Greg Klein | April 22, 2016
ALX Uranium TSXV:AL has signed agreements to pick up extra turf proximal to the Hook-Carter project in Saskatchewan’s Patterson Lake South camp, the company announced April 22.
Subject to approvals, ALX gets the new land for 250,000 shares at a deemed value of $0.115 each on the closing date. A 2.5% NSR applies.
Geophysical results released last month verified multiple basement conductors at Hook-Carter, which covers extensions of three known conductive trends, the Carter, Derkson and Patterson corridors. Drill targets have already been established on the latter two.
The Patterson corridor hosts Fission Uranium’s (TSX:FCU) Triple R deposit and three additional zones on the company’s Patterson Lake South project. NexGen Energy’s (TSXV:NXE) adjacent Rook 1 project includes the Arrow deposit, the Athabasca Basin’s largest undeveloped resource, as well as the Bow zone. Neighbouring NexGen is the Hook Lake JV of Purepoint Uranium TSXV:PTU, Cameco Corp TSX:CCO and AREVA Resources Canada, which hosts the Spitfire discovery. ALX’s Hook-Carter borders Hook Lake to the south and a Cameco property to the north.
In February Cameco signed an agreement to buy ALX claims peripheral to Hook-Carter.
Earlier this month the company reported highly anomalous radon values at its Lazy Edward Bay project on the Basin’s southeastern rim. A week earlier preliminary geophysical results showing gravity lows brought encouraging news for ALX’s 80%-held Gorilla Lake property in the western Basin. The ALX portfolio includes five active projects in the Basin region.
ALX closed a private placement first tranche of $318,000 from Holystone Energy last month, part of a strategic partnership in which Holystone would invest up to $750,000, retain the right to maintain its ownership level for three years and nominate a director.
by Greg Klein | April 7, 2016
Successful financings and a prospective portfolio distinguish ALX Uranium TSXV:AL with a steady news flow from five active Athabasca Basin projects this year. The company’s most recent announcement arrived April 7 from Lazy Edward Bay, where strong radon-in-water results near an historic hole will help ALX narrow down drill targets. This follow-up survey took 143 samples over an area of 1,400 by 450 metres on the 18,916-hectare property. Work was conducted by RadonEx Ltd, whose technology helped select drill targets for Fission Uranium’s (TSX:FCU) Triple R deposit.
Straddling the Athabasca Basin’s southeastern rim, the highway-accessible Lazy Ed lies about 55 kilometres from the Key Lake mill.
Results show eight one-point samples with highly anomalous readings of 100 picocuries per litre. Four of the samples surpassed 200 pCi/L. The results showed up approximately 200 metres northeast of historic hole LE-50, which returned basement uranium grading 908 ppm U3O8 over 0.3 metres, along with boron, nickel and other pathfinders.
“Many of the anomalous samples appear to lie along a northeast-striking linear trend in the central portion of the grid which overlies historic conductors,” ALX noted.
Electromagnetic surveys in 2005 and 2007 confirmed the conductors, while further support came from geochem and radon work in 2014 and 2015, all of which helps pinpoint high-priority drill targets.
“Given the proximity of the highly anomalous radon samples to historic drill hole LE-50, which was never followed up with drilling along strike, the results of this radon survey demonstrate the significant exploration potential at Lazy Edward Bay,” commented president Jon Armes.
With one of Saskatchewan’s largest and most highly prospective uranium portfolios, ALX has five projects scheduled for exploration this year. Last week the company announced gravity anomalies pointing to prime drill targets at the western Basin’s Gorilla Lake project, where ALX holds an 80% option.
One week earlier came geophysical confirmation of multiple basement conductors at ALX’s Hook-Carter, a 16,461-hecatre property that covers extensions of three known conductive trends. Hook-Carter sits in the southwestern Basin region that hosts Fission’s Patterson Lake South, NexGen Energy’s (TSXV:NXE) Arrow deposit and Bow zone, and the Purepoint Uranium TSXV:PTU/Cameco Corp TSX:CCO/AREVA Resources Canada Spitfire discovery.
Cameco signed an agreement in February to buy ALX claims peripheral to Hook-Carter.
In mid-March ALX closed a $318,000 first tranche of a private placement from Holystone Energy, part of a strategic partnership in which Holystone would invest up to $750,000 on TSXV approval. Howard Haugom, Holystone’s nominee to the ALX board, has been appointed an adviser until the company’s AGM. The former Simon Fraser University economics professor co-owns a national retail chain and is a partner in the private equity firm Burkehill Capital.