Azarga Uranium Corp. (AZZ:TSX; AZZUF:OTCQB) announced in a news release it agreed to sell its subsidiary UrAsia in Kyrgyzstan, which owns the noncore Kyzyl Ompul uranium project in the Kyrgyz Republic, to Central Asian Uranium Co.
Per the agreement terms, Central Asian Uranium will pay $250,000 for UrAsia. UrAsia granted former shareholders a 2% net smelter return royalty up to $5 million on future uranium production from Kyzyl Ompul. Azarga has the right to a pro rata 93.1% share of the cash consideration and royalty.
Blake Steele, Azarga's president and CEO, commented, "With the continued political uncertainty surrounding uranium mining activities in the Kyrgyz Republic, we have monetized our non-core Kyzyl Ompul Uranium Project and exited the Kyrgyz Republic. Our strategic focus remains on advancing the company's initial development priority, the internationally competitive Dewey Burdock In-situ Recovery Uranium Project in South Dakota, U.S. and developing our portfolio of high quality uranium assets in the U.S."
The company stated the monetization of UrAsia lowered its current liabilities by about $335,000.
Now, Azarga states it will focus solely on developing both its Dewey Burdock in situ recovery uranium project in South Dakota and its portfolio of U.S. uranium assets. Next for Dewey Burdock are publication of an updated preliminary economic assessment and, expected on Dec. 6, 2019, the decision regarding the final remaining Nuclear Regulatory Commission license contention for the project.
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