Uranium prices are soaring, supply is constricted, demand is rising and projected to continue rising. Western nations, including the United States and Canada, are prioritizing development of new sources as a matter of national security. Here is a pretty good overview of the global situation, a report that focuses on the vast potential for Canada’s Athabasca Basin to provide a big boost to uranium production over the next few years in response to powerful market dynamics
The report, by The Oregon Group, highlights the recent discoveries of significant deposits in the western Athabasca Basin by both NexGen Uranium (TSX: NXE) (NYSE: NXE) (ASX: NXG) and Fission Uranium (TSX: FCU) (OTCQX: FCUUF) (FSE: 2FU). These projects are advancing through development stages toward potential production, and the companies have already seen significant value appreciation as a result of the discoveries.
For investors interested in opportunities closer to the beginning of the process, Stallion Uranium Corp. (TSX.V: STUD) (OTCQB: STLNF) (FSE: HM40) is a compelling option. The company is currently exploring the largest land package in the western Athabasca Basin and has seen very encouraging results from its maiden drill program conducted over the past few months.
The Potential
Stallion Uranium, through the use of extensive electromagnetic air and ground surveys, has identified seven major project areas worthy of further exploration. The company started its drill program on one, the Coffer Project, which it viewed as demonstrating the clearest signs of a potentially major discovery.
In November 2022, F3 Uranium Corp. announced a significant find in what the company now calls the JR zone, about 13km due west of Stallion’s Coffer Project. That news, combined with some follow-up exploration, pushed the company’s market capitalization from CAD$28 million at the time of the announcement to CAD$148 million in mid January 2023. Today, F3 Uranium is valued at about CAD$182 million.
There is another example from the same neighborhood of the Athabasca Basin a few kilometers south of the Coffer Project. NexGen Energy discovered the Arrow Deposit, the center of what is now considered the world’s largest uranium discovery, in February 2014 with its 21st drill hole. The company’s stock opened the month at US$0.23/share and hit a high following the discovery of US$0.51. More exploration followed, and in March 2016 NexGen released a maiden resource estimate that pushed the stock to US$1.35. The company has since expanded the resource, and the project is in the later development stages. The stock trades currently at about US$8 and the company is valued at about US$4.3 billion.
The Early Signs for Stallion
Of course there is no guarantee that the Coffer Project, or any of Stallion’s other named projects, or any further projects developed as a result of ongoing exploration over the company’s 822,223 acre land package, will produce a significant discovery similar to the ones noted above. The early signs do, however, look encouraging.
In a matter of a month or so, Stallion announced the intersection of anomalous radioactivity in its first drill hole, followed by similar results from the second hole located 700 meters to the west of the first. The last announcement of excellent results from its third drill hole, another 700 meters to the west, points toward a significant potential deposit area. These holes span 1.4km of what the company believes is a 3.5km-long conductive zone with the potential to host high grade uranium.
“Stallion’s winter 2024 drilling program at the Coffer project has yielded remarkable results, identifying a large conductive structure and 1.4 km of anomalous radioactivity at the unconformity across all three drill holes. The third hole intersected significant alteration and structure, and given the size of those intersections, indicate that the Appaloosa target possesses the characteristics capable of hosting a substantial uranium deposit. Further processing and modeling of the data collected will provide enhanced targeting capabilities, greatly increasing the probability for discovery on a future program,” commented Darren Slugoski, Vice President Exploration, Canada.
Stallion expects final assay results will be released this summer after lithogeochemical analysis is completed. Those results will define what was actually found in the three initial holes and point the way toward further exploration that could broaden the potential resource area.
The Upshot
Several definitive statements can be made about Stallion Uranium Corp. The company is certainly exploring the right general area, considering the Athabasca Basin houses the world’s largest deposits of high grade uranium. The company is also in a section of the vast Basin where major uranium resources have been discovered recently and where mining infrastructure is being added in anticipation of upcoming mines. Stallion offers investors several shots at success with its seven currently named projects and more likely on the way from further exploration. And the company’s initial exploration looks very promising.
The potential is large and the market is ripe. This summer’s drill results could go a long way toward confirming the presence of a major deposit worthy of investor attention and further exploration. Stay tuned…
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