The Uranium Sector excitement highlights the opportunity for the SKRR / F3 Clearwater West Uranium Project
On Monday, Goldman Sachs (NYSE:GS) initiated coverage on Cameco (TSX:CCO) Corporation (NYSE:CCJ) stock, a major nuclear fuel supplier, with a Buy rating and a price target of $55.00. The firm sees approximately 30% upside from the stock's current levels, citing Cameco’s significant role in the uranium/nuclear fuel value chain and the potential for increased demand and higher prices to drive substantial estimate revisions.
Cameco, with a market capitalization of $18 billion, operates in Canada, the United States, Kazakhstan, and Australia. Goldman Sachs anticipates that the uranium spot price will average around $95 per pound and Cameco's realized price will be approximately $68 per pound over the coming years.
These projections represent a significant increase over historical averages from 2013 to 2023, which the firm attributes to a combination of a meaningful supply deficit and a potential underestimation of demand due to miscalibrated enrichment requirement assumptions.
The firm suggests that a 0.30% tails requirement is more realistic for long-term demand forecasts, as opposed to the 0.25% assumption by the International Atomic Energy Agency (IAEA). This adjustment could lead to an approximate 14% increase in demand compared to current industry estimates.
Goldman Sachs also points to the potential for the United States and France, which together account for about 35% of global demand, to shift uranium sourcing to Canada and Cameco due to geopolitical challenges and the need for secure supply chains.
Goldman Sachs' estimates for Cameco's EBITDA and EPS are around 15% higher than the consensus for the period of 2024-2027, indicating strong potential for positive revisions to the company's financial projections. The firm's positive outlook is based on the expectation of a robust demand increase and the strategic positioning of Cameco within the industry.
PALM BEACH, Fla., April 02, 2024 (GLOBE NEWSWIRE) -- FN Media Group News Commentary - Production of Uranium globally is projected to increase and also to reach all time highs. A recent report from Mining.com said that Global uranium production is expected to grow by 11.7% to more than 60.3 kilotonnes (kt) in 2024, according to estimates by UK-based analytics firm GlobalData, with the production rise predominantly coming from key producers such as Kazakhstan and Canada. It added: "Kazakhstan is expected to deliver the highest uranium production growth in 2024, GlobalData says, driven by the planned higher output from the country’s largest uranium producer Kazatomprom. The continuous ramp-up of Canada’s McArthur River uranium mine will also contribute to the global increase, it adds. Kazakhstan accounted for 37.3% (20.1kt) of total global uranium supply in 2023. Despite a 5.1% dip in output in 2023 due to planned lower production from Kazatomprom, its output is expected to recover in 2024, with forecast production of 23.2kt. This will be supported by the company’s plan to produce between 21.2-21.6kt on a 100% basis, while production is expected to increase to between 25.9-26.7kt with no restrictions in 2025." It continued: “Meanwhile, global uranium production in 2024 will be further bolstered by continuous ramp-up of Canada’s McArthur River, which is aiming to produce 6.9kt of uranium (8.2kt of U3O8) for 2024. In October 2023, the Canadian Nuclear Safety Commission renewed the licences for McArthur River for a further 20 years, allowing the mine to continue operations until October 2043. Global uranium production is expected to grow with a compound annual growth rate of 4.1% from 2024 to 2030, as output reaches 76.8kt in 2030.” Active mining companies in the markets this week include Stallion Uranium Corp. (OTCQB: STLNF) (TSX-V: STUD), NexGen Energy Ltd. (NYSE: NXE), F3 Uranium Corp (OTCQB: FUUFF) (TSX-V: FUU), FISSION URANIUM CORP. (OTCQX: FCUUF) (TSX: FCU), Cameco (NYSE: CCJ).
Given the low market cap, and that the drill permits are in hand - this makes this a very attractive Uranium exploration investment for investors looking for exposure to the Canadian Uranium Athabasca Basin excitement. The West side - PLN/PLS area continues to grow.
The F3 Uranium team is the operator and SKRR will benefit from the synergies of being so close to the PLN Discovery.
About Patterson Lake North:
Clearwater West is located on the edge of the Athabasca Basin in proximity to Fission Uranium's Triple R and NexGen Energy's Arrow high-grade world class uranium deposits which is poised to become the next major area of development for new uranium operations in northern Saskatchewan. PLN/PLS is accessed by Provincial Highway 955, which transects the area, and the new F3 Uranium - JR Zone uranium discovery is located 23km northwest of Fission Uranium's Triple R deposit.
SKRR - CLEAWATER URANIUM FINANCING
Drill Permits Granted Fieldwork to Begin This Summer Drilling to Commence on Completion of Financing Clearwater West - Drill Ready - F3 as the Operator Very Tight Share Structure 17 Million Shares F/D
News Release – Vancouver, British Columbia – March 4, 2024 – SKRR Exploration Inc. (TSXV: SKRR) (OTC: SKKRF) (FSE: B04Q) (“SKRR” or the “Company”), is pleased to announce that it intends to complete a non-brokered private placement (the “Private Placement”) for aggregate gross proceeds of up to $1,500,000 consisting of any combination of units of the Company at a price of $0.10 per Unit (the “Unit”) and ‘flow-through’ units of the Company (each, a “FT Unit”) at a price of $0.12 per FT Unit.
Sherman Dahl, CEO of SKRR comments:
“We look forward to closing this private placement financing and beginning the exploration work with F3 Uranium Corp. on the Clearwater West uranium property in the Athabasca basin.”
Each Unit will consist of one common share of the Company and one common share purchase warrant (each, a “Warrant”). Each FT Unit will consist of one common share of the Company to be issued as a Critical Mineral Exploration Tax Credit “flow-through share” within the meaning of the Income Tax Act (Canada) (each, a “FT Share”) and one Warrant. Each Warrant will entitle the holder thereof to purchase one common share of the Company at a price of $0.15 for a period of three (3) following the closing of the Private Placement.
The Company intends to use the proceeds from the sale of the FT Shares towards exploration work (including drilling) on the Clearwater West uranium property located in Saskatchewan and intends that such expenses incurred will be eligible for the Critical Mineral Exploration Tax Credit (the “CMETC”). The Company intends to use the net proceeds from the non-FT Shares for general corporate and working capital purposes.
SKRR has the option to acquire up to a 70% interest in the Clearwater West uranium property from F3 Uranium Corp. (TSXV: FUU), which is comprised of 3 contiguous mineral claims totaling 11,786 hectares, located ~20km outside the edge and in the south-west area of the Athabasca Basin. Subject to the completion of the Private Placement, F3 will serve as the operator for this exploration program on the Clearwater West uranium property.
Raymond Ashley, President & Director of F3 Uranium comments:
“We are excited to head back to Clearwater West in the near term to resume exploration. Work permits are already in hand for the initial ground geophysical work as well as drilling. The initial ground geophysical work is looking to define additional drill targets on untested conductor trends to add to the prospective drill ready targets that have been defined from previous work on the property.”
