Uranium's Strategic Alliance: Skyharbour, Athabasca Nuclear, Lucky Strike, Noka to team up on PLS-area's largest land package
If only for the especially high grades found near surface, Patterson Lake South’s uranium discovery was bound to provoke excitement. It didn’t hurt that joint venture partners Alpha Minerals (V.AMW) and Fission Uranium (V.FCU) continually release impressive news during a time of optimistic supply, demand and price forecasts. But finding such a discovery in such an underexplored area naturally pulled other companies into the region in and around the Athabasca Basin’s southwestern rim. Now four of them propose to join forces to explore what would be by far the area’s largest land package.
That was the news announced June 24 by Skyharbour Resources (V.SYH), Athabasca Nuclear (V.ASC), Noka Resources (V.NX) and Lucky Strike Resources (V.LKY). Under a memorandum of understanding, Skyharbour and Athabasca Nuclear plan to combine their properties into one package, with all four companies funding exploration.
The package would comprise Skyharbour’s six PLS-area properties totalling just under 150,000 hectares and Athabasca Nuclear’s 125,375-hectare Preston Lake property. Also included would be a seventh Skyharbour property on the Basin’s eastside, the 11,769-hectare Wheeler project.
“It’s a creative deal for all the companies for a number of different reasons,” Skyharbour president/CEO Jordan Trimble tells ResourceClips.com. “We’ll have four technical teams working in unison to improve our chances of making a discovery and four groups marketing. The biggest benefit in my opinion is the ability to raise funds and finance the program with four companies as opposed to one. This is the lowest-risk way of going about this large, aggressive exploration program with a minimal amount of future equity dilution for Skyharbour. Skyharbour’s only responsible for $1 million out of $6 million in funding over two years.”
The deal would expand on an existing arrangement in which Noka and Lucky Strike each hold 25% earn-ins on Skyharbour’s current package. Under the MOU, Athabasca Nuclear would also get a 25% option on the same package while the other three companies would each get 25% options on Athabasca Nuclear’s Preston Lake. A $6-million two-year work program would be funded by $1 million each per year by Lucky Strike and Noka, and $500,00 each per year by Skyharbour and Athabasca Nuclear. The companies would then form a four-way JV.
An exchange of cash and shares further intertwines the companies. Noka and Lucky Strike would each pay $100,000 and issue $100,000 in shares to each of Skyharbour and Athabasca Nuclear. Skyharbour and Athabasca Nuclear would issue each other $100,000 in shares.
The four parties hope to sign a definitive agreement by June 30.
“From a logistic and tenure management standpoint, it makes a lot of sense,” says Trimble. Preston Lake, 26 kilometres southeast of the PLS discovery, would link Skyharbour’s adjacent South Patterson, Draco and West Patterson properties into “one big land mass.” Three other Skyharbour properties, South Basin, RY and North Patterson, lie east and north of PLS.
The strategic alliance would be Athabasca Nuclear’s focus too. “One thing we like about the deal is it gives us exposure to the alliance but we have six other projects that we control 100%,” Athabasca Nuclear president/CEO Chuck Downie tells ResourceClips.com. “So we can still work on those or look for partners on them. But the majority of the funding for the foreseeable future will go into the alliance.”
He adds, “I’ve been going through the Alpha Minerals tech report and it’s pretty obvious that the way you find uranium deposits is through methodical exploration that tends to cost a lot of money.” Having closed a $600,000 private placement earlier this month, Downie says the alliance’s benefits might allow his company to put off further financing as long as two years.
Also referring to the 43-101 technical report Alpha filed in April, Trimble says, “They’ve really written the book on how to discover deposits in this specific area. Their report outlines specifically how they came to the discovery, what techniques, surveys and groundwork they used. We won’t have to reinvent the wheel and that’s a big benefit for the syndicate moving forward.”
The entire package is already being flown by a VTEM-plus time domain system, the same type of survey that found basement conductors on PLS. A radiometric survey to track down uranium boulder trains and in-situ mineralization will follow later this summer. Skyharbour and Athabasca Nuclear pooled funds with Aldrin Resource (V.ALN) and Forum Uranium (V.FDC) to conduct the geophysics over their contiguous PLS-area properties. So far the study has found two conductive anomalies on Aldrin’s Triple M property that the company interprets as “parallel basement conductive trends analogous to conductors” at PLS.
Acting as operator of the combined package would be Athabasca Nuclear. “We will be working in concert with the other groups to come up with a plan, a budget and everything,” Downie says.
Having moved into the area early and cheaply, Skyharbour considered a number of options before putting together the proposal. “We decided this approach made the most sense from both an exploration standpoint and a financial standpoint,” says Trimble. “This will also create value-added synergies that will further improve our chances of raising money and making a new discovery.”
The four-company announcement came the same day Alpha and Fission reported significant gold on all three PLS zones, including one intercept of 1.58 grams per tonne over 63.5 metres, starting at 82 metres in downhole depth.
The JV partners stated that the high-grade gold “occurs frequently, but not always, in areas of higher-grade uranium mineralization.” But not all the high-grade uranium intersections showed high-grade gold.
Uranium-gold correlations certainly aren’t unknown. Fission and Alpha noted that Cluff Lake produced over 16,000 gold ounces in 1987. UEX Corp (T.UEX) has reported high gold grades at its Shea Creek uranium deposit, a JV with AREVA Resources Canada that’s 58 kilometres north of PLS.
As Trimble points out, “You don’t often hear about high-grade gold around the Athabasca because it gets overshadowed by the higher-grade nature of the uranium.”
Disclaimer: Skyharbour Resources is a client of OnPage Media Corp, the publisher of ResourceClips.com. Neither OnPage Media nor its owner hold a stock position or options in Skyharbour Resources.