Uranium prices could push higher. For one, there’s a good deal of global demand, with some countries planning to build even more reactors. In fact, Demand for uranium in nuclear reactors is expected to increase by 28% by 2030, and nearly double by 2040, says the World Nuclear Association (WNA), as noted by Reuters. All as global governments ramp up their nuclear capacity to meet zero-carbon targets. Two, we have global leaders attempting to cut back on harmful emissions, which could increase dependency on uranium. All of which could make Lexston Mining Corporation (CSE: LEXT) (OTC: LEXTF), Uranium Energy Corp. (NYSE: UEC), Energy Fuels Inc. (NYSE: UUUU) (TSX: EFR), Cameco Corp. (NYSE: CCJ) (TSX: CCO), and Denison Mines Corp. (NYSE: DNN) (TSX: DML) even more attractive.
We should also note, “Uranium prices have reached their highest level in more than a decade as a global supply shortage persists, with the bull market for uranium investments still in its ‘earliest days.’ The market is ‘definitely in a structural deficit as demand is growing at a 5% annual rate and the current (2023) gap between global production and consumption remains at over 50 million pounds, said Scott Melbye, executive vice president at mining company Uranium Energy Corp.,” as quoted by MarketWatch.com
Look at Lexston Mining Corporation (CSE: LEXT) (OTC: LEXTF), For Example
Lexston Mining Corporation entered into the Project 176 and Project Itza Option Agreement dated November 27, 2023 with three optionors to acquire 100% interest in the uranium mineral property, generally known as "Project 176" (claim 103470) and “Project Itza” (claim numbers 103463, 103478 and 103465) located in the Thelon Basin in Nunavut and occupying a total area of 5661.93 hectares.
To exercise the option and earn the 100% interest in the Property, the Company has over a period of two years to pay a total of $400,000 and issue a total of 6,000,000 shares to the Optionors as follows:
- upon the execution of the Agreement to pay $10,000;
- sixty days from the date of the Agreement to pay $90,000 and issue 1,000,000 shares;
- within one year from the date of the Agreement to pay $100,000 and issue 2,000,000 shares; and
- within two years from the date of the Agreement to pay $200,000 and issue 3,000,000 shares.
The Option is subject to a net smelter return royalty payable by the Company to the Optionors equal to one percent on the proceeds from production for all minerals derived from the Property. The Company may elect to purchase from the Optionors at any time one-half of the net smelter return royalty, upon the payment to the Optionors of $1,000,000.
The Optionors are arm’s length parties to the Company.
The Agreement provides for an investigative period of 60 days. The investigative period locks the Property for the Company for sixty days in exchange for a payment of $10,000. During the investigative period the Company plans to perform further investigations regarding the Property and can terminate the Agreement by providing a one day’s written notice to the Optionors without making any additional payments or issuing any shares. If the Company is satisfied with its investigation, the Company plans to explore the Property for uranium and to make further payments and issue shares to the Optionors.
Jag Bal, President and CEO of Lexston states, “We remain steadfast in our commitment to exploration, drilling, and value creation through advancing our portfolio of properties. This option agreement provides an opportunity to get a foothold in a data-rich part of the Thelon Basin. High-resolution, modern geophysics has not been deployed to the project before, providing an advantage for Lexston to leverage the $2,000,000 in previous uranium exploration in the area.”
Both projects sit at the mapped unconformity between the Thelon Formation and the underlying Amer Lake Metasediments. Containing reactivated Faults identified in 2013 - not identified when the properties were last explored (2012). The intersection of reactivated faults and unconformities is highly prospective for uranium deposits. e.g. Cigar Lake, key Lake.
The two projects are within the most prospective region of the Thelon Basin and contain the highest-grade uranium oxide samples.
- STRONG land position in the up-and-coming Thelon Basin
- Extensive historical data available to guide exploration planning
- Historical high-grade Uranium occurrences
- Previous exploration programs terminated without extensive drill testing
- Thelon Basin is experiencing a staking rush, and these projects cover the historically most attractive areas
- Multiple projects that cover the spectrum from conceptual exploration targets to near-drill ready targets
Other related developments from around the markets include:
Uranium Energy Corp.’s. Amir Adnani, CEO and President stated : "Fiscal 2023 proved to be a year of significant achievements in executing on our strategy and building the premier North American focused uranium company. We continued to make accretive acquisitions and advance our projects with resource expansions and extraction/production restart programs. Our strategy is aimed at a robust uranium supply from the stable and secure jurisdictions of the U.S. and Canada, with near term U.S. ISR production and a pipeline of high-grade Canadian projects with exceptional growth potential. UEC remains 100% un-hedged, at a time when the need for new production is becoming acute in the global market and particularly for Western utilities seeking supply assurance. Our balance sheet is debt free with $192.3 million in cash and liquid assets, providing the financial strength to advance projects towards production and support further accretive acquisitions."
Energy Fuels Inc. ’s Mark S. Chalmers, President and CEO , recently stated, "Energy Fuels continued to make excellent progress on all aspects of our core uranium and rare earth businesses during Q2-2023. We completed the sale of 80,000 pounds of uranium to one of our utility customers under one of our long-term contracts. We expect to make another sale of 180,000 pounds of uranium under another long-term contract later this year. Depending on inflation and spot price activity, we expect that sale to be at a price of $54 - $58 per pound. We also continued preparing four (4) of our conventional uranium mines for production, and we expect at least one to be ready to commercially produce uranium ore later this year.
Cameco Corp. provided a market update regarding challenges at the Cigar Lake mine and Key Lake mill that are expected to impact its 2023 production forecast. At the Cigar Lake mine, it now expects to produce up to 16.3 million pounds of uranium concentrate (U 3 O 8 ) (100% basis) this year, a reduction from the previous forecast of 18 million pounds U 3 O 8 (100% basis). Production from the McArthur River/Key Lake operations for 2023 is anticipated to be 14 million pounds U 3 O 8 (100% basis), down from the previous forecast of 15 million pounds U 3 O 8 (100% basis). As previously reported, mining activities at the Cigar Lake operation were initiated from a new zone in the orebody (west pod) in the second quarter of this year, which impacted productivity. As mining activities continued in the west pod during the third quarter, equipment reliability issues emerged which further affected performance. The mine is scheduled to enter its planned annual maintenance shutdown that will run through most of September. At the Key Lake mill, ramp up activities remain ongoing. However, as noted in our second quarter MD&A, there is continued uncertainty regarding planned production in 2023 at Key Lake due to the length of time the facility was in care and maintenance, the operational changes that were implemented, availability of personnel with the necessary skills and experience, and the impact of supply chain challenges on the availability of materials and reagents.
Denison Mines Corp. entered into a binding agreement with F3 Uranium Corp . to make a $15 million strategic investment in F3 in the form of unsecured convertible debentures David Cates, President and CEO of Denison commented, "F3's technical team has an incredible track record of exploration success including the discovery of the JR Zone on the Patterson Lake North property, which represents one of the top new uranium discoveries globally. We are pleased to be investing in F3, supporting the further assessment of the PLN property, and providing Denison shareholders with exposure to this exciting new discovery in the Athabasca Basin."
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