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Drilling at Uranium Energy’s (NYSE: UEC) Roughrider project in northern Saskatchewan has hit high-grades that expand the northern end of the deposit’s core, the company reported Thursday.
Hole RR-961, drilled 840 metres northeast of the main Roughrider deposit, returned 2.4 metres grading 11.4% uranium oxide (U3O8) from 330.1 metres depth, with a high-grade sub-interval of 1 metre at 24.9% U3O8. Roughrider is located 13 kms west of Orano’s McClean Lake uranium mill, on the eastern side of the Athabasca basin, about 750 kms north of Saskatoon.
“The on-going drill campaign at Roughrider North has successfully identified additional high-grade mineralization along strike of what was reported in August,” Chris Hamel, vice-president for exploration in Canada, said in a release. “Drill hole RR-961 expands the high-grade core of this discovery and should help guide the field team to further success in the area.”
UEC’s results come as the uranium spot price, at $78.50 per lb. on Thursday, continues to trend slightly downward from a peak of $107 in February. But prices remain 30% higher than last year, giving tailwinds for producers of the nuclear metal. Analysts such as BMO Capital Markets expect the long-term trend of uranium to remain positive for years as China ramps up reactor production and the United States considers restarting idled plants.
Shares in Uranium Energy gained 1.6% to $5.27 apiece on Thursday morning in New York, valuing the company at $2.1 billion. Its shares traded in a 52-week range of $4.06 and $8.34
Hole RR-961 was a follow-up on hole RR-940 that UEC reported last month. It returned 7.2 metres at 12.7% U3O8 from 273.2 metres depth. RR-961 is 15 metres along strike, to the east of RR-940.
Another 20 holes remain in the current drill program, which is exploring along the northern trend, the company said. UEC has hit uranium mineralization at Roughrider North along about 200 metres of strike length, with the most recent hits delineating the high-grade core along around 55 metres of strike. High-grade mineralization at Roughrider North remains open to the east and west.
Roughrider North, identified along a trend that is parallel to the Roughrider project, hosts mineralization about 250 metres below the surface.
The Roughrider project, including its West, East, and Far East deposits, hosts 389,000 indicated tonnes grading 3.25% U3O8 for 27.8 million lb. of U3O8, and 359,000 inferred tonnes at 4.55% U3O8 for 36.0 million lb. of U3O8, according to a 2023 resource estimate.
UEC bought the Roughrider project for C$150 million from Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO) in 2022.
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