Wednesday 22nd November 2017

Resource Clips


Posts tagged ‘NexGen Energy Ltd (NXE)’

‘Everyone’s hiring again’

May 24th, 2017

Mining headhunter Andrew Pollard says executive recruiting presages a wave of M&A

by Greg Klein

As an executive search firm, the Mining Recruitment Group might serve as a bellwether for the industry. Founder and self-described mining headhunter Andrew Pollard says, “I put together management teams for companies, I connect people with opportunities and opportunities with people.” In that role, he experienced the upturn well before many industry players did.

To most of them, the long-awaited resurgence arrived late last year. Pollard saw it several months earlier.

Mining headhunter Andrew Pollard says executive recruiting could presage a wave of M&A

“The market came back in a huge way, at least in the hiring side, early last year when my phone started ringing a hell of a lot more,” he explains. “There was a huge volume. And what I’ve found is that the available talent pool for executives shrank in a period of about six months. In January 2016, for example, I was working on a search and there was almost a lineup out the door of some really big-name people. What I’m finding now, a year and a half later, is that the available talent has almost evaporated. It’s much harder to recruit for senior positions.”

Lately his work suggests another industry development. “The major upturn I’m seeing in the market now is a huge demand for corporate development people who can do technical due diligence on projects. Over the last few years large mining companies and investment banks cut staff almost to the bone in that regard because no one was interested in doing deals or looking at acquisitions.”

Just completed, his most recent placement was for Sprott. “They had me looking for someone with a technical background who can do due diligence for their investments. In doing so I spoke with everyone on the street, from investment banks to some big name corporate development people and they all said the same thing: Everyone’s hiring again. These are people who couldn’t get job offers a year ago, now every single candidate on the short list for this last search has multiple offers from companies looking to get them. I haven’t seen that in five years.

“So that leads me to believe companies have been staffing up their corporate development teams. I see that as a major sign that you’re going to see M&A pick up in a huge, huge way, probably over the next three to six months.”

An early example would be last week’s Eldorado Gold TSX:ELD buyout of Integra Gold TSXV:ICG—“one of my best clients over the years”—in a deal valued at $590 million.

Mining headhunter Andrew Pollard says executive recruiting could presage a wave of M&A

Andrew Pollard: Executive recruiting “leads me to believe companies have been staffing up their corporate development teams.”

“I think there’s leverage for other companies to start pulling the trigger faster because they’re adding the expertise to get these things done.”

Having founded the Mining Recruitment Group over a decade ago at the age of 20, “a snotty kid” with only a single year of related experience, he’s placed people in companies with market caps ranging from $5 million to well over $200 million. Now in a position to pick and choose his assignments, Pollard’s business concentrates on “the roles that will have the most impact on a company’s future.” That tends to be CEO, president, COO and board appointments.

Last year he placed five CEOs, as well as other positions. Among those assignments, Pollard worked with Frank Giustra on a CEO search for Fiore Exploration TSXV:F and filled another vacancy for Treasury Metals TSX:TML as it advances Goliath toward production.

But the hiring surge coincides with an industry-wide recruitment challenge. Pollard attributes that to a demographic predicament complicated by mining’s notorious cyclicality.

During the 1990s, he points out, fewer people chose mining careers, resulting in a shortage of staffers who’d now be in their 40s and 50s. Greater numbers joined up during the more promising mid-2000s, only to “get spat out” when markets went south. Now Pollard gets a lot of calls to replace baby boomers who want to retire. Too many of those retirements are coming around the same time, he says, because stock losses during the downturn had forced executives to postpone their exit.

Now, with a wave of retirements coinciding with a demographic gap, Pollard sees a “perfect storm to identify the next batch of young leaders.”

But he also sees promise in a new generation. That inspired him to assemble Young Leaders, one of two panel discussions he’ll present at the International Metal Writers Conference in Vancouver on May 28 and 29.

“By talking with some very successful executives age 35 and under, I want to show that we need to look at people one generation younger, and foster and develop this talent.”

By talking with some very successful executives age 35 and under, I want to show that we need to look at people one generation younger, and foster and develop this talent.

Well, it’s either talent or a precocious Midas touch that distinguishes these panel members. Maverix Metals TSXV:MMX CEO Dan O’Flaherty co-founded the royalty/streaming company just last year, already accumulating assets in 10 countries and a $200-million market cap.

As president/CEO of Skyharbour Resources TSXV:SYH, Jordan Trimble proved adept at fundraising and deal-making while building a 250,000-hectare uranium-thorium exploration portfolio in Saskatchewan’s Athabasca Basin. Integra president/CEO Steve de Jong raised the company from a $10-million market cap in 2012 to last week’s $590-million takeout.

And, demographic gap notwithstanding, Pollard’s second panel features three other success stories, just a bit older but with lots of potential left after guiding three of last year’s biggest M&A deals. They’ll take part in the Vision to Exit discussion, which closes the conference on May 29.

Eira Thomas burst into prominence at the Lac de Gras diamond fields where she discovered Diavik at age 24. Her most recent major coup took place last year on the Klondike gold fields with Goldcorp’s (TSX:G) $520-million buyout of Kaminak Gold.

Featherstone Capital president/CEO Doug Forster founded and led Newmarket Gold, producing over 225,000 ounces a year from three Australian mines and enticing Kirkland Lake Gold’s (TSX:KL) billion-dollar offer.

Now chairperson of Liberty Gold TSX:LGD and a director of NexGen Energy TSX:NXE, Mark O’Dea co-founded and chaired True Gold Mining, acquired in April 2016 by Endeavour Mining TSX:EDV. Three other companies that O’Dea co-founded, led and sold were Fronteer Gold, picked up by Newmont Mining NYSE:NEM in 2011; Aurora Energy, sold to Paladin Energy TSX:PDN in 2011; and True North Nickel, in which Royal Nickel TSX:RNX bought a majority interest in 2014.

“We’ll be looking at how they go into deals, what their philosophy is, what’s their current reading of the market and what they’re going to do next. They each have a big future ahead of them.”

Pollard’s two panel discussions take place at the International Metal Writers Conference on May 28 and 29 at the Vancouver Convention Centre East. Pre-register for free or pay $20 at the door.

In all, the conference brings generations of talent, expertise and insight to an audience of industry insiders and investors alike.

Read more about the International Metal Writers Conference.

ALX Uranium welcomes Denison Mines to southwestern Athabasca Basin’s “elephant country”

October 13th, 2016

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.

ALX Uranium welcomes Denison Mines to southwestern Athabasca Basin’s elephant country

“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.”

NexGen Energy CEO Leigh Curyer marvels at the continuing success of the PLS uranium camp’s Rook 1 project

September 9th, 2016

…Read more

NexGen Energy’s latest discovery emphasizes PLS camp’s regional potential

August 11th, 2016

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.

NexGen Energy’s latest discovery emphasizes PLS camp’s regional potential

A regional discovery 4.7 kilometres northeast of NexGen’s
Arrow deposit delivered a boxful of pitchblende treasures.

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-16-05

  • <500 to 890 cps over 1.5 metres, starting at 292 metres in downhole depth

HP-16-06

  • <500 to 2,200 cps over 1.5 metres, starting at 303 metres

HP-16-08

  • <500 to >61,000 cps over 17 metres, starting at 220 metres

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.

ALX Uranium readies geophysics for northern Basin, drilling for PLS vicinity

August 9th, 2016

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.

ALX Uranium readies geophysics for northern Basin, drilling for PLS vicinity

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.

Read Chris Berry’s report: A Closer Look at Uranium.

Battle in the Basin

July 15th, 2016

Backed by big money, Fission and NexGen compete for uranium prominence

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.

Backed by big money, Fission and NexGen compete for uranium prominence

NexGen has an H2 resource update scheduled for Rook 1’s Arrow zone.

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:

  • indicated: 2.01 million tonnes averaging 1.83% for 81.11 million pounds U3O8

  • inferred: 785,000 tonnes averaging 1.57% for 27.16 million pounds

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.

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