Samples Point Way to More Exploration for Uranium Co. Partner

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Skyharbour Resources Ltd. (SYH:TSX.V; SYHBF:OTCQX; SC1P:FSE) announced that partner company Azincourt Energy Corp. (AAZ:TSX.V; AZURF:OTC) has received the sample analysis from this year's exploration program at is East Preston uranium in the Athabascan Basin of Saskatchewan.

The program consisted of 1,086 meters of drilling in four diamond drill holes completed earlier this year. Drilling was focused on the K and H Zones.

A total of 53 samples, including 20 samples from the 2021-2023 drilling programs, featured relative proportions of phyllosilicate and clay minerals including illite, chlorite, dickite, kaolinite, and dravite.

"Illite and kaolinite are both indicators of hydrothermal alteration typically found within alteration halos of unconformity associated uranium deposits," Skhyharbour noted in a release. "Dravite is a boron-rich clay which is typically found within a larger clay package in close proximity to uranium mineralization in the system. Both illite and dravite have been identified as being significant vectors for recent discoveries to the northwest of the East Preston project."

Samples of clay alteration were analyzed by Short Wavelength Infrared Reflectance (SWIR, sometimes referred to as "PIMA") to confirm the clay species.

Skyharbour has an extensive portfolio of uranium exploration projects in Canada's Athabasca Basin, with 29 projects, 10 of which are drill-ready, covering over 587,000 hectares of mineral claims. In addition to being a high-grade uranium exploration company, Skyharbour utilizes a prospect generator strategy by bringing in partner companies to advance its secondary assets.

In an updated research note on July 24, Analyst Sid Rajeev of Fundamental Research Corp. wrote that Skyharbour "owns one of the largest portfolios among uranium juniors in the Athabasca Basin."

"Given the highly vulnerable uranium supply chain, we anticipate continued consolidation within the sector," wrote Rajeev, who reiterated the firm's Buy rating and adjusted its fair value estimate from CA$1.16 to CA$1.21 per share. "Additionally, the rapidly growing demand for energy from the AI industry is likely to accelerate the adoption of nuclear power, which should in turn spotlight uranium juniors in the coming months."

Alteration 'Very Encouraging'

Analysis of Azincourt's results at East Preston showed several intervals with anomalous uranium enrichment within the clay alteration zones along the K and H target zones, Skyharbour noted.

Uranium enrichment is identified as uranium (U) values and a uranium/thorium ratio (U/Th) above what would normally be expected in the given rock type or area. The highest uranium result for 2024 was returned in hole EP0058, where 16 parts per million (ppm) U was identified over 1.91 meters, including up to 21.9 ppm U over 0.51 meters. This enriched zone sits above a zone of dravite and kaolinite clay alteration.

Azincourt considers the identification and expansion of clay alteration halos to be significant, as major uranium discoveries in the Athabasca Basin such as McArthur River, Key Lake, and Millennium were primarily the result of drill testing strong alteration zones related to conductor features. Identifying and upgrading the strong alteration zones is a significant step forward in identifying the key areas along the conductor trends where more attention is required.

"The alteration we are seeing continues to be very encouraging," said Azincourt's VP Exploration Trevor Perkins. “The identification of dravite, kaolinite and illite clays with the elevated uranium along the K and H Zones emphasizes that we are in the right environment and identifying areas for closer inspection along this trend. This trend will continue to be high priority moving forward. Based on the clay signatures in the G and A Zones, these areas will warrant a reevaluation as well.”

Partners Advancing Other Projects

Other Skyharbour partner companies include Orano Canada, Thunderbird Resources Ltd. (THB:ASX) (Previously Valor Resources Ltd.), Basin Uranium Corp. (NCLR:CSE; BURCF:OTC; 6NP0:FRA), and Medaro Mining Corp. (MEDA:CNX). More recently, two earn-in option agreements were signed with Tisdale Clean Energy Corp. (TCEC:CSE; TCEFF:OTCQB; T1KC:SE) to option the South Falcon East project, as well as North Shore Uranium Ltd. (NSU:TSX) to option the Falcon project.

The company has an additional 20 100%-owned projects that it is actively seeking to option out to potential new partners in the future to add to its growing prospect generator business.

"Option partners are actively advancing their projects through exploration and drill campaigns," Rajeev wrote for Fundamental Research. "SYH anticipates receiving (CA)$1-$2M in cash/share payments from its partners in the upcoming months."

"The demand for nuclear power is expected to grow faster than previously anticipated as data centers for AI applications experience exponential growth in energy needs," Rajeev continued.

The Catalyst: Green Economy Needs More Nuclear

Earlier this year, U.S. President Joe Biden signed into law a ban on uranium imports from Russia. According to Investing.com, the element's prices have been under pressure recently, "trading within a narrow range and slightly lower due to limited trading volume and liquidity."

But a research note published by Citi Research this week predicted the weakness in prices would subside as the demand for nuclear energy continues to rise, Investing.com wrote.

"Analysts at Citi remain tactically bullish on uranium in the near to mid-term, with projections indicating a potential price rebound to (US)$98/lb later this year," the site said. "Citi has adjusted its uranium price forecasts in response to the recent market softness. The analysts now expect uranium prices to average (US)$94/lb in 2024, with potential upside momentum during the third and fourth quarters.

Looking further ahead, the website said Citi forecasts uranium prices to average (US)$110 per pound in 2025, reflecting continued bullish sentiment driven by the increasing demand for nuclear energy.

Demand for uranium in nuclear reactors is expected to climb 28% by 2030 and nearly double by 2040 as governments ramp up nuclear power capacity to meet zero-carbon targets, the World Nuclear Association said in a report, according to Reuters.

Ownership and Share Structure

Management, insiders, and close business associates own approximately 5% of the Skyharbour.

According to Reuters, President and CEO Jordan Trimble owns 1.54%, and Director David Cates owns 0.70%.

Institutional, corporate, and strategic investors own approximately 55% of the company. Denison Mines owns 6.3%, Rio Tinto owns 2.0%, Extract Advisors LLC owns 9%, Alps Advisors Inc. owns 9.91%, Mirae Asset Global Investments (U.S.A) L.L.C. owns 6.29%, Sprott Asset Management L.P. owns 1.5%, and Incrementum AG owns 1.18%, Reuters reported.

There are 182.53 million shares outstanding with 177.73 million free float traded shares, while the company has a market cap of CA$65.71 million and trades in a 52-week range of CA$0.32 and CA$0.64.