Fission Uranium Corp T.FCU

Alternate Symbol(s): FCUUF

Energy

Fission Uranium Corp. is a Canada-based resource company. The Company’s principal business activity is the acquisition and development of exploration and evaluation assets. The Company is a resource issuer specializing in uranium exploration and development in Saskatchewan’s Athabasca Basin in Western Canada. The Company’s primary asset is the Patterson Lake South (PLS) project, which hosts the Triple R deposit, high-grade and near-surface uranium deposit that occurs within 3.18 kilometers (km) mineralized trend along the Patterson Lake Conductive Corridor. The property comprises approximately 17 contiguous claims totaling approximately 31,039 hectares and is located geographically in the south-west margin of Saskatchewan’s Athabasca Basin, notable for hosting the highest-grade uranium deposits and operating mines in the world. The Company also has the West Cluff property comprising three claims totaling 11,148-hectares in the western Athabasca Basin region of northern Saskatchewan.

TSX:FCU - Post by User

Fission Uranium Corp

Bullboard Posts

Comment by Aelfricon Dec 31, 2014 11:58am

286 Views

Post# 23275740

RE:RE:RE:RE:Expectations 43-101

PamplonaTrader wrote: Mr. Market currently values UEX at less than $1/lbs in the ground whereas DML is being valued at less than $6/lbs in the ground.

I think it's fair to assume that whatever figure the 43-101 discloses, the market will apply a multiple between $1 on the extreme low end to $6 on the high end. To be clear, I am not talking about takeout values... just the multiples that the market is currently applying to in-situ pounds in the Basin.

I also think it's fair to apply a sliding scale multiple. e.g. $4/lbs for total inventory of 40mm lbs; $5/lbs for 50mm lbs; $6/lbs for 60mm lbs; etc. The reason being that there is not a mill and that a critical mass is required for the deposit to support building one.

My guesstimate is that the resource estimate will show roughly 50mm lbs indicated with 60-65mm lbs across all categories. Using a high multiple of $6/lbs on an aggressive estimate of 65mm lbs of total inventory, we arrive at a value of $390mm. $390mm/406mm fully diluted = $0.96/sh. Any wonder why the market continues to sell off FCU in this range? I'm of the mind that the current share price offers little in the way of margin of safety for this initial estimate.

With a longer term view, I expect another 40-50mm shs of dilution to prove up another 15-20mm lbs. As others have pointed out, capital spending on the main deposit is being reduced while spending on new exploration will increase...I think the reason being that delineation of the main zone has done little to move the stock price. Since August, I said that FCU will need to hit a distal new zone of high grade to improve the technical picture. As well, the company will need to spend on various scoping studies such as Preliminary Economics and Environmental Assessments. They will also need to update their resource estimate.... translation... more dilution, less growth.

Ultimately, I think FCU proves up roughly 80mm lbs across all categories. Assuming a multiple of $8/lbs and fully diluted share count of about 460mm = $640mm/460mm fully diluted = takeout value of $1.39.