New Uranium Firm Announces Incipient Maiden Drill Program

Canadian exploration company North Shore Uranium Ltd. (NSU:TSX) — formerly Clover Leaf Capital Corp. — is scouring its holdings on the eastern margin of Saskatchewan's Athabasca Basin for uranium deposits. This week, it announced that it had compiled enough data to begin a targeted drill program. 

The firm is exploring two properties about 90 kilometers from each other, Falcon (55,699 hectares) and West Bear (4,511 hectares), with drilling to commence at Falcon this month.

The Catalyst: Maiden Drill Program Announced

On February 28, North Shore Uranium announced that it had "further refined its targeting criteria, and the drill program is set to commence in mid-March."

As reported on December 19 last year, "Falcon is a highly prospective uranium exploration property with a limited exploration history in a part of the Athabasca Basin region that is seeing increased exploration activity and recent discoveries."

"Reinterpretation of electromagnetic data complemented by geophysical data acquired in 2022 has allowed the company to identify high priority uranium targets in areas where there has been no previous drilling."

The company intends to drill test up to three targets along a robust, northeast-trending electromagnetic (EM) conductor system at the southern end of the property. TerraLogic Exploration Inc. will manage the drill program, with field preparations underway. Condor Consulting is assisting with geophysical interpretation.

North Shore Uranium is in the final stages of ranking and prioritizing drill targets for the March program. Over 20 potential targets have already been identified, and drill collar locations are being refined for the three lead candidates for drilling.

Sites are being prioritized based on several factors:

• Strength and character of the EM conductor
• EM conductor plate models generated using EMIT Maxwell software
• Evaluation of airborne gravity gradient and radiometric data acquired in 2022
• The presence of potential basement-hosted structures
• Interpreted bedrock geology
• Ground conditions

North Shore Uranium President and CEO Brooke Clements proclaimed, "We are excited to be preparing to commence our first drill program where we aim to test priority targets on the Falcon Property. This is only the beginning of our exploration plans at Falcon as we have identified multiple high-quality target zones spread across the Property that require evaluation and drilling."

"Since January, the uranium spot price has consistently been around US$100/lb. for the first time since 2007, focusing more attention on the uranium exploration sector and new discoveries. Saskatchewan's Athabasca Basin is a tier-one jurisdiction for discovering new mineable high-grade uranium deposits."

Why this Sector? The Energy of Tomorrow

Uranium is essential for nuclear fuel. Natural uranium found in the Earth's crust is a mixture of two isotopes, with Uranium-235, which is ideal for use in nuclear reactors, making up only about 0.7% of the total mineral weight.

Under certain conditions, Uranium-235 can readily be split, yielding a lot of energy. It is, therefore, said to be "fissile," from which we derive the term "nuclear fission."

According to a joint report by the Nuclear Energy Agency (NEA) and the International Atomic Energy Agency (IAEA), global uranium output in 2020 met nearly 90% of world reactor demand, dropping from 95% in 2017. Government and commercial inventories covered the remaining demand.

Existing world reactor requirements up to 2040 are projected to consume about 87% of the total 2019 identified resource base of 6,147,800 tonnes, creating tight market conditions.

The outlook around the nuclear and uranium mining industries has changed significantly over the past several years. It continues to improve thanks to three primary trends: decarbonization/clean energy, electrification, and energy security/independence.

Current global geopolitical unrest has only grown demand for western-sourced uranium against a strained supply side further tightened by new financial entities sequestering material out of the market.

As the world transitions from carbon-intensive sources of electricity to carbon-free ones, many nations aim to be carbon-neutral by 2050. Countries are rethinking nuclear as the only viable energy source providing baseload, emissions-free, affordable, and scalable power.

Stockhead reported on December 4 that uranium prices reached a 15-year high and commented, "With inflation, experts think higher prices will be necessary to incentivize new producers."

"The existing uranium supply shortage will only get worse in the coming years, and anybody who makes a new discovery in uranium, especially in Saskatchewan's world-class Athabasca Basin, will be well-positioned to capitalize," explains CEO Clements. His assessment matches Katus Research's statement, "The World Nuclear Association is predicting nearly a 100% increase in uranium demand by 2040 . . .  the run on the uranium bank has begun."

Why This Company? Promising Property in the Right Place

Clements says that the Athabasca Basin is the "best jurisdiction in the world for uranium exploration and mining" and describes his company as "a new fresh face" with "ambitious plans" and "a dynamic and experienced team."

He says North Shore Uranium's drill program commencing in March offers "great potential for a new uranium discovery." The company's stock has traded off since completing its qualifying transaction and concurrent financing on October 31.

As we reported on January 2, North Shore's planned 2023-2024 exploration program at Falcon will consist of three parts, starting with the March drill program. The company will continue interpreting all geophysical and geological data, enabling it to prioritize targets for more detailed exploration. Finally, the company plans to evaluate the top targets in the field later this year by mapping and prospecting.

Clements commented at the time, "It's a great time to be exploring for uranium in the Athabasca basin, a Tier 1 jurisdiction for uranium exploration, development, and mining. The uranium spot price has recently surged past US$85 per pound, the highest we've seen in more than 15 years. We have identified a number of high-priority targets on our Falcon property and are excited to move forward." Since then, the price has been flirting with a price of US$100 per pound.

The beauty of North Shore's Falcon property is its high prospectivity. It has a limited exploration history, and its location is in an area of the Athabasca basin that's home to massive uranium deposits. For investors, this makes it a safe and potentially lucrative gamble.

Technical Analyst Clive Maund wrote that "technically, this looks like an excellent point at which to pick up North Shore Uranium Ltd. stock," suggesting interested buyers "drill down swiftly and succinctly into the fundamentals to see why North Shore is such a good investment."

Both Baselode Energy Corp. and 92 Energy Ltd. made significant grassroots uranium discoveries some 40 kilometers north in 2021, demonstrating the area's potential. Fixed-wing gravity-magnetic-radiometric surveys in 2022 covered more than 80% of Falcon. Added to previously compiled information, the recently acquired geophysical data is allowing the company to prioritize targets that have yet to be drill-tested.

Clements "believe[s] that the uranium sector is poised for significant growth in the next decade and it is at the beginning of an upward trend."

He says, "The world needs to increase its efforts to address climate change," and "Replacing electricity that comes from the burning of fossil fuels with electricity from nuclear power plants is the way to do that on a big scale, and more people are starting to realize and accept that."

"Our two properties at the eastern margin of the Athabasca basin are near the only two active uranium mills in Canada and proximal to two of three significant recent discoveries."

"We see a lot of upside in the uranium exploration sector, especially in the Athabasca Basin," he concludes. "With a valuation below ten million Canadian dollars and an attractive share structure, we believe that we are an attractive option to participate in the growing uranium exploration sector, which appears to be at the beginning of a strong cycle."

Why now? Pre-Drilling Investing Can Reap Rewards

Technical Analyst Clive Maund is already interested, writing on February 5 that "Technically, this looks like an excellent point at which to pick up North Shore Uranium Ltd. stock," suggesting interested buyers "drill down swiftly and succinctly into the fundamentals to see why North Shore is such a good investment."

According to Maund, "Having now gotten over Fukushima, the nuclear power industry is in growth mode and is deemed to be of critical importance in meeting CO₂ emission reduction goals with the recent COP28 declaration to triple nuclear power by 2050."

"The uranium price has surged and surpassed US$100 per pound this year for the first time since 2007 and is in a vigorous uptrend, and this is reflected in the powerful bull markets that we are seeing in big uranium stocks like Cameco Corp. (CCO:TSX; CCJ:NYSE), and we are now seeing increased ‘trickledown' into the mid-cap and smaller stocks."

Maund explains that "North Shore's exploration properties are situated in the prolific Athabasca basin in Saskatchewan, Canada, which is home to the world's highest-grade uranium deposits that provide over 20% of the world's uranium supply."

"Whilst North Shore's Falcon claims are technically just outside the perimeter boundary of the Athabasca basin … new exploration methods and technical developments have yielded multiple significant discoveries on and near the perimeter of the basin where there is the advantage of much less overburden than exists towards the center of the basin."

"North Shore's exploration claims are close to properties where mines have already been constructed," he continues, "such as Cigar Lake, McCarther River, McClean Lake, and Key Lake, this last one being very close to the company's Falcon claims. Cigar Lake and McCarthur River are Canada’s only two uranium mines, and they are operated by  Cameco. Since they are along the east side of the Athabasca basin, the prospects for significant discoveries on North Shore's claims are clearly very good."

"Lastly," he concludes, "we have an important catalyst that is likely to get the stock moving, which is the fact that the company will be starting a drilling program this Spring. North Shore has been granted an option to the Falcon claims by prospect generator Skyharbour Resources Ltd., which has many other claims in the area and adjacent to Falcon, in return for a stake in the outcome of its exploration activity."

"North Shore Uranium is therefore rated an Immediate Strong Speculative Buy." 

Ownership and Share Structure

According to the North Shore, there are 36,830,960 shares outstanding, and 45% of the shares are held by management, directors, and founding investors.

CEO Brooke Clements owns 3.30%, with 1.22 million shares. 

The company told Streetwise, "Directors and founding investors took down 1.10 million of the 7.7 million shares in the initial financing, which closed on October 31, 2023, 14.3% of the offering. This is a sign of our commitment to building a strong company."

According to Market Watch, the company has 27.46 million shares outstanding and trades in the 52-week range between CA$0.12 and CA$0.30.

Important Disclosures:

1. North Shore Uranium Ltd. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of North Shore Uranium Ltd. and Cameco Corp.
3. Owen Ferguson wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
4.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

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Contributing Author Disclosures

1. Author Certification and Compensation: [Clive Maund of clivemaund.com] is being compensated as an independent contractor by Street Smart, an affiliate of Streetwise Reports, for writing this article. Maund received his UK Technical Analysts’ Diploma in 1989.  The recommendations and opinions expressed in this content accurately reflect the personal, independent, and objective views of the author regarding any and all of the designated securities discussed. No part of the compensation received by the author was, is, or will be directly or indirectly related to the specific recommendations or views expressed.

Clivemaund.com Disclosures

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.