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Fission Uranium (TSX: FCU) President Ross McElroy Provides an Update on PLS Property: More High-Grade Drill Results, Summer Drill Program Planning, PFS in Late 2018

June 15, 2017

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is Fission Uranium (TSX: FCU)(OTC: FCUUF) President, COO, and Chief Geologist, Mr. Ross McElroy. Ross, thank you for joining me this evening.

Ross McElroy: Great to be with you here again, Gerardo. Thank you.

Gerardo Del Real: Well, I know you've been busy. We were recently in New York in Manhattan at the 121 Mining Investment Conference, which I found very well-organized. It was well-attended. We had a chance to catch up a bit there, and I'm really curious as to your take there and the feedback that you got, because I know you were busy with meetings both days.

Ross McElroy: Yeah. First of all, for a plug on the 121, it is a very good conference, well-attended, well-organized. There was a lot of interest in the uranium sector. Our couple of days there were really filled with a lot of good quality meetings by investors. I'd say overall the biggest question that most investors had is really trying to get an understanding of the macro story and see if we have any insight in it. I think almost to a person, everybody believes that the uranium sector has a great future. It looks good, but nobody's sure when the price is going to change, the price of the commodity. It is at some relatively low positions now, almost historic lows. We saw earlier in the year that the volatility is there. It can rise very quickly. It rose almost 45% earlier this year, it fell off a bit. But people are looking for a sustained uptick, and they're trying to get our take on where we think the sector is going, and timing.

To be honest, I don't know if anybody has the timelines predicted all that well. Although, you have to think that within two to three years, certainly there has to be a significant turnaround in the price of the commodity, because the lowest cost producers are starting to cut back. The Kazakhs are certainly dialing back. They've announced production cuts of 10%. We'll see, there could even be more coming there. They're the lowest cost producers anywhere. Another low cost producer, Cameco, has already shut in some operations, delayed others. They have staged cutbacks, even on their big high-grade deposits.

So the message I try to get to investors out there, "Yes, it's a very positive sector, because the growth is still happening as we speak. More reactors are operating now than at any time in history. There's more coming online. There's several under construction. There's a number in the near-term horizon. All we're looking for is an improvement in the price of uranium. That's got to be at some point. It could happen tomorrow. It could be six months. It could be a year or two. Nobody knows the timing, but we're all sure that it will happen."

Gerardo Del Real: Excellent. Now, I know with Fission you obviously have a world-class asset. In the precious metal space late last year, I noticed that the companies that had big, scalable, high-margin anchor assets were the first companies to be rewarded when the market kind of turned around. Do you see a similar scenario developing there with the uranium space?

Ross McElroy: I absolutely do. You know, this is the time in the sector where the strongest are the survivors. The best projects will be the ones that are recognized quickly, and probably with the most leverage when the turnaround in the sector does happen. It's always the best projects that really do the moving at the beginning of a cycle. Of course, as anybody that's followed Fission Uranium and the PLS story recognizes, this is considered one of the best, if not the best, uranium development stories of any project in the world. It's blessed with having, first of all, a large size. It's high-grade. And, of course, being near surface makes all the difference. So it's close to surface, open-pittable, and it's in the world's best jurisdiction for uranium mining, that being Saskatchewan. It's got a lot going for it. I think when the sector turns you'll see an improvement in the share price in a significant way at Fission Uranium.

Gerardo Del Real: Agreed. Now you mentioned what's already there. There's also a lot of exploration potential. I think the last news release really speaks to that. Can we talk a bit about those results and what you're seeing? I know when we spoke in New York you were excited about some of the near-surface, high-grade stuff that you're finding. Can we talk about that a bit, Ross?

Ross McElroy: We sure can. This last winter program was quite successful for us. We made a new discovery further on trend to the west. It's an on-land target. That's called the R1515 West Zone. Now that one, we finally were able to put out some assays on that with the news release a couple of weeks ago, and it really showed that, you know, there's six holes that we've drilled in that area that are looking quite promising. Some of the better ones are multi-percent over some significant thicknesses. Again, similar style of mineralization with a high-grade core in the middle of the zones, quite wide intersections that are similar in a lot of respects to what we see out on the main 780 East Zone.

It's early days still on the 1515 West Zone, and it's got a handful of holes in there. Right now it's just an area that looks like it's got a great deal of potential. That's something that we're going to focus on in future programs including this summer. We'll be targeting for growth on the new zone that's on land. It's on trend with the R840 West Zone, which is about another 500 meters to the east of the 1515. They're all occurring like pearls on a necklace on this very prolific structural trend that hosts a number of high-grade zones, including the very significant Triple R deposit.

Gerardo Del Real: Excellent. Now let's talk about that summer drill program. Have you finalized details on that? Are you putting that together as we speak? What does that look like, Ross?

Ross McElroy: It's still a work in progress, Gerardo. We haven't finalized yet, but I can tell you what we do want to focus on. As I've already mentioned, I think we'll be drilling a number of holes on the 1515 West Zone to see what it's all about. We also have a number of exploration targets. I mean, this is a very large project that is very underexplored. There hasn't been a long history of exploration on the west side of the basin, and it's something that we really opened up with the discovery of mineralization just a few years ago.

There's a lot of ground yet to test, a lot of conductors that look very perspective to us that we want to test. Hopefully they'll lead to more uranium. Also, in the main core of the project, the Triple R deposit, we want to continue to move that towards a pre-feasibility study, which we hope to be able to get to by the end of 2018, somewhere in that timeframe, so we'll be advancing some parts of the project this summer on that as well. So metallurgical testing, we'll be doing some technical testing. Just things that really are aimed towards us being able to produce a PFS by late 2018. So an exciting year ahead for us with exploration targets. We have a new zone discovery, and we're able to move the core part of the project forward with the eye towards a PFS study in 2018.

Gerardo Del Real: It sounds like a busy next six to twelve months, Ross. Are you fully financed and cashed up to be able to not dilute moving forward?

Ross McElroy: We certainly are. We have $50 million dollars in the bank. This is something that we're very mindful of when we do our planning and when we talk to investors and people. They want to know that we're very careful with the spend that we do. We have cut back on our spending on the program between, I would say, what we've done a couple of years ago. That's really respecting the fact that the sector, you know, that the prices in the sector are low. We're careful. We don't want to go through the money too quickly. But we're looking at being able to carry us over another two and a half, three years out before the need for extra capital in there. We're very well financed for now. We can continue to be reasonably aggressive on the project, continue to do that exploration, continue to do that zone development, and continue on towards PFS. So we're well cashed up for that.

Gerardo Del Real: Wonderful. Well, Ross, I want to thank you for your time. I hope to have you back on once you announce the details of the summer program so we can go over that. Is there anything else that you'd like to add?

Ross McElroy: Well, I think that should provide a pretty good update and let shareholders know where Fission Uranium's sitting right now. We are getting prepared for a summer program. It's probably a month away yet before we are on the ground actively doing the program. So yeah, stay tuned and we'll be able to provide the details once we have an approved program in hand.

Gerardo Del Real: Fantastic. Ross, thanks again. Ross McElroy from Fission Uranium. Thank you.

Ross McElroy: Thank you very much, Gerardo.

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