Turkish envoy visits Niger to secure uranium supplies
The trip comes after Niger’s military government withdrew mining rights from Canadian and French companies to develop uranium deposits.
Fission Uranium Corp (CVE:FCU) jumped as much as 11% on Monday on massive volumes after announcing a C$82.2 million investment from China’s CGN Mining.
The cash injection is in exchange for a 20% stake in Fission, a Kelowna-based explorer advancing the Tripe-R project at its Patterson Lake South property in Saskatchewan abutting the Athabasca Basin.
In midday trade the Vancouver-based explorer retreated from its highs reached early on to change hands at $0.72, still up 5.9% on the Toronto big board. A whopping 2.5 million shares in the $278 million company had changed hands by 12:00 pm EST on Monday compared to the daily average volume of 400,000.
The deal with Hong Kong-listed CGN, the first time a Chinese company has invested directly in a Canadian uranium firm, also includes an offtake agreement for Fission’ wholly-owned PLS property. The controlling shareholder of CGN is China Uranium Development Company Limited, a fully-owned subsidiary of China General Nuclear Power Corporation.
The agreement comes after shareholders rejected a proposal for Fission to merge with Denison Energy Corp to combine the company’s adjacent properties in Saskatchewan.
Fission’s preliminary economic assessment for the Triple-R deposit released in September envisages a open pit–underground mine for an estimated capital outlay of $1.1 billion producing more than 100 million pounds of yellowcake over 14 years.
Fission estimates the hybrid approach utilizing a dyke system will result in operating expenditure of $14.02 per pound U3O8 over the life of mine, making Triple R potentially one of the lowest cost uranium producers in the world.
Spot uranium prices – usually much lower than long-term contract pricing which is the norm in the industry – were last assessed at $36.10. The commodity has been trading in tight range of $35 – $40 for the past year. Fission’s PEA assumes a long term price of $65 a pound for gross revenues over the life of the mine of $7.7 billion and net revenues of $7.1 billion after provincial royalties and transportation charges.
