quakes99 wrote: And with all the attention that NexGen is getting, it might be Fission that gets to "ride the gravy train." ;-)
I heard on Sunday, and again yesterday, that Dev and Leigh have already been in discussions on how to best move forward on a new Patterson Lake U District in the SW Basin. We already know with some certainty that only 1 Mill will be built in the PLS region to serve all of the regional U3O8 processing requirements. That means you can kiss the old NI 43-101 PEA initial CAPEX cost estimates goodbye and begin to think in terms of a shared-cost or Toll Milling arrangement being made.
Not only would a cost-shared mill significantly reduce Fission's CAPEX requirements, it could also reduce the costs over the next few years as the development process heads into high gear to get a new Mill built. Site choosing (and all the related geotechnical/groundwater studies, etc.), Environmental Impact Studies, government and community engagement, permitting, planning, engineering, infrastructure additions to support mill construction... all of those costs could be shared by the players in the region, which so far include Fission, NexGen, UEX/Areva, Purepoint/Cameco.
That situation provides a double bonus to Fission - it reduces our Pre-Feasibility Study costs so that more of that CGN $82M investment goes directly to exploring and expanding the U3O8 discovery zones at PLS - and it reduces the RISK by sharing the costs for planning and constructing the mill amongst multiple partners. As a long term investor, that is precisely the scenario that can make your investment in any of the SW Basin discoveries a winner!
If you look at Fission's PEA and the CAPEX breakdown, you will see that of the $1.1B of pre-production Capital Costs, only about $400M relates directly to the construction of an Open-Pit mine at PLS. The other $700M is primarily CAPEX for building a Mill and all the Infrastructure (plus contingency) that supports both the Mill and Mine. If that $700M was cost-shared on a 50-50 basis then that drops Fission's initial CAPEX down to $400M + $350M = $750M which is a
32% reduction in Capital needed by the PLS mine developer!
Perhaps even better, giving Fission the opportunity to ride the NexGen gravy train, if NexGen takes centrestage and its buyer/backers decide to build a Mill for NexGen that could process PLS ore on a Toll Milling basis, then
Fission's CAPEX could drop by over 50%! That could lead to some amazing returns for the developer/producer taking PLS into production.
Today's drill results sweeten that situation even further... confirming that
the new zone at R840W was not a one-off but is indeed another land-based high-grade zone that increases the amount of PLS U3O8 ore that can be first to production at the lowest initial capital cost! In my opinion, the story just got a whole lot better and appears to have even more growth potential both in heading further west toward the high-grade boulder field and connecting R840W with R600W and perhaps all the way back to R00E on the shore of Patterson Lake. The Corebox 3D model already shows the potential for that in the way the structures at R600W and R00E line up.
Whether you want to believe it or not, the great results out of both Fission and NexGen are providing the catalyst to greatly increase the profitability of taking them both into production. Right now, in my opinion, it is Fission investors that could have the most to gain when the market finally realizes how undervalued we are, and how much our Asset Value will jump when U prices do begin to rise. Overall, every play in the SW Basin has gained far more upside potential. This certainly is not lost on Dev and Leigh as they look to find the most profitable way forward for both sets of shareholders.
Just my opinion...
Do your own due diligence and invest according to your own unique goals and investment strategy.
Good luck with your investments in the new Patterson Lake Uranium District!
CEO Corner
West Side Story
March 8, 2016
We’re only a few months into 2016 but they’ve been big months for the west side of the Athabasca Basin. Fission Uranium has brought the Chinese into play with an $82M financing and an off-take agreement and just days ago our neighbours, NexGen Energy, released a maiden resource estimate in the inferred category of 201.9M lbs @ 2.63% U3O8. As Christian Polak of Areva mentioned to me at this year’s PDAC in Toronto, with Areva’s Shea Creek and Maybelle River deposits, Fission’s PLS Triple R deposit, NexGen’s Arrow deposit and the Cameco-Areva-Purepoint JV’s Spitfire discovery, we have the makings of a true west side story.
This is fantastic news for all of us involved or invested in the west side of the Basin and I want to offer a big congratulations to Leigh Curyer and his team for their accomplishment.
People have been asking me what I think about the NexGen news and here it is:
It proves that, just as we’ve been saying: the western side of the Basin region is prolific and is a new emerging important uranium camp.
There’s already a provincially-maintained highway in the west (which runs through the middle of PLS and Fission 3.0’s PLN and Clearwater West properties). However, the continued success in the west means that building the additional infrastructure necessary to establish the Western Athabasca Basin region as a uranium camp is now pretty much a given. I’ve often heard some commentators say “oh it’s the west, there’s no infrastructure there”. Well with hundreds of millions of lbs of uranium sitting in the ground, my opinion is that the case for needed infrastructure just got a whole lot stronger. After all, Cluff Lake (which only had 58M lbs) ended up with a mill and a government-funded highway.
If the West Side Story continues to develop at this rate, the best really could end up being in the west.
Dev Randhawa, CEO of Fission