Fission 3.0’s (TSX-V: FUU) Ross McElroy on the Fission Team’s Expertise in Uranium Exploration in the Athabasca Basin

November 24, 2017

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is COO and Chief Geologist for Fission 3.0 (TSX-V: FUU)(OTC: FISOF), Mr. Ross McElroy. Ross, how are you this morning?

Ross McElroy: I'm doing great, Gerardo. How are you doing?

Gerardo Del Real: I'm doing well also. Thank you so much for joining me. You and I recently had a chance to catch up at the Silver and Gold Summit, and I was joking that it was interesting to me that the two sectors that generated the most interest were the uranium sector and the cryptocurrency space. I know it's been a bit since we've been able to say that there was a lot of interest in the uranium space, but I definitely feel that was the case at the conference. I'd love your thoughts on the interest that you saw in San Francisco, Ross.

Ross McElroy: Yeah. I would echo exactly that. I thought that uranium really was catching a lot of the eyes and ears of a lot of the attendance this year. It was great to see, and I think that it's due to a great deal with the price of uranium has started to move up. We've seen it now at around $24 to $25. It's volatile, but it's moving in the right direction, and really, I think that the catalyst for that was Cameco announcing just a week or two ago that they're shutting down production for at least 10 months on their McArthur River deposit, which is the world's largest high-grade uranium deposit, in the Athabasca Basin. It's one of the best uranium mines out there. They're shutting it down because the price of uranium's so low that it's just not worthwhile for them until the price moves up, and that alone is moving the price of uranium. As we always say, the best cure for low price of uranium is low price of uranium, and that's starting to look like it's moving in the right direction.

Gerardo Del Real: Yeah. Rick Rule has one of his famous throwaway lines, says you can't make it up on volume if you're selling at a loss. Right? I think that's absolutely correct, and I know that the closure of the mine and the decision made by Cameco was a tough one. There's a real human toll there, but obviously was a necessary one. Do you think that'll be the last of the closures and cuts, Ross?

Ross McElroy: Well, that's tough to say. It's certainly the most significant, and that's taking 10 to 11% of the uranium supply off the grid right away. We've seen it last year with the announced production cuts by the Kazakhs, now this year with Cameco closing McArthur River. These are all the lowest-cost producers out there, and so they're the ones that are starting to get turned off right now, too. So I think that if we don't see a vast improvement in the price of uranium, probably somewhere north of $40, I don't think this is the end of closures coming. These are all positive impacts. They're tough on the companies' bottom line, but I think it's a very positive development for the overall uranium sector, which is something that we've all known and talked about that we need to see higher uranium prices. That's starting to materialize, and that's only going to benefit companies such as Fission 3.0.

Gerardo Del Real: Well, let's talk about Fission 3.0. You're obviously in a great space with the new interest that's being generated. You actually had some news about a week and a half or two weeks ago where you've identified some high-grade outcrops in boulders up to 11.9% U3O8. And so obviously Fission 3.0, for those that aren't familiar with the story, is a prospect generator that has just a stable of very high-quality and prospective projects in the right area. For people that are new to the story, Ross, can you explain the portfolio package and just the approach that Fission 3.0 takes?

Ross McElroy: Sure. Just stepping back, looking overall at what we have in Fission 3.0, we do focus primarily in the Athabasca Basin, but we also have an asset down in the Macusani Plateau in Peru. But really our biggest focus has been on the Athabasca Basin where we've had a great deal of success over the last 10 years in various companies, Fission Energy, Fission Uranium, and now at Fission 3 we're starting to see success. We've got a large portfolio, 17 projects in the basin. We have over 200,000 hectares of land, and basically, we started compiling, putting together a strong portfolio about three or four years ago, and they all have kind of a common theme. We're picking properties that we believe have the potential to host shallow depth high-grade uranium, so that's the difference between looking for something in the middle of the basin and looking for something near the basin margins and just outside the basin margins, or in my mind, anyways, the projects that will be able to be advanced are those that will host shallow mineralization.

If you find it too deep, it's a very difficult, long process to put those into production, even if you get to the critical size. That's what we're looking for, primarily basin hosts of shallow deposits, and that's what we had luck with this summer when we started prospecting up at our Midas Lake project up in the northwest side in the old historic Beaverlodge mining area. We saw uranium in boulders and outcrops, as you mentioned, that assayed very well, over 11.9% U3O8, so quite impressed with that. There's been a lot of historic mining in that area, and this just tells us, I think, that there's still a lot more yet to be found out there.

Gerardo Del Real: Now, the Midas property, if I understand it correctly, is near the past-producing St. Michaels mine. Is that right?

Ross McElroy: Yeah. In fact, the past-producing St. Michaels mine is right in the middle of the property, so this is one that was scheduled for production, I think it was in the 1950s, early 1960s, back when the Beaverlodge area was the place to be. There was upwards of 20 some plus mines that were in production, a lot of deposits, and this is just before the high-grade uranium was found over on the east side in the Key Lake, Rabbit Lake area. It's an area that did enjoy a lot of exploration and development and mining in the '50s and 1960s, but it hasn't seen a lot of attention since then.

I think that it's time that we put our modern way of looking for deposits, and the models, and just the methods that we have to use back in the area. And I think that there's going to be more significant deposits found in that region using similar techniques that we've basically got a lot of expertise in. That's what's happening up at Midas. We have other properties in that region as well, and we did do some work this summer on them, and so we're seeing very positive results out of that.

Gerardo Del Real: Excellent. Now, Fission 3.0 has a tiny market cap right now, even after the recent news with the closures by Cameco. I think the market cap, as of this morning, sub-$14 million Canadian.

Can you talk a bit about the team? You mentioned the success that you've had in the basin. Can you talk a bit about the team at Fission 3.0? Because I think it's a key point, and I think it's going to help generate interest for the other projects that you have in the portfolio, Ross. You've seen these cycles in the past. You know the order of things. I think with uranium ticking up, it would not surprise me if your phone starts ringing very, very soon. But can we talk a bit about the team in place?

Ross McElroy: Yeah, we sure can. And this is a team that we've been very successful with the same core group of people. This has been the group that made the discovery on the Waterbury Lake project back in the Fission Energy days, which was a discovery right on trend of the Roughrider Deposit. That was something that we sold to Denison Mines. We made the discovery after that at the PLS project with the Triple R deposit. I mean, it's got a great track record. These are guys that, the team is geologists, geophysicists, geochemists, a lot of core people that have been looking for uranium for a very long time, and they know what it takes to make a discovery in the Athabasca Basin, and that is something that does set us apart from pretty much everybody else. We've been able to hold the group together, and that's because we've been able to be serially successful over the years.

I think that Fission 3, it's much earlier stages, obviously, than other projects that we've had, and I'd say with the tide turning in the uranium market, there's going to be more attention, a little bit more love for the uranium explorers, and we're the, in my opinion anyways, the cream of the crop of the explorers. Hopefully we'll be able to continue to generate good results on these properties.

Gerardo Del Real: It's interesting to me that earlier in the year you were able to close a private placement for up to $3 million dollar. I know initially, if I recall, it was initially a $2 million dollar financing, and even in that bearish market before the recent news and the recent uptick, there was interest for Fission 3.0. What's the treasury look like right now, Ross?

Ross McElroy: We were very careful with it. We obviously will have to raise some more money if we want to get out and do some drilling, and we do have good properties with excellent drill targets, and that's partly what we were on a mission to accomplish this summer, was to develop drill targets on some of these properties, such as Midas and Thompson Lake. We've already got great drill targets out on the PLN property, which is just immediately north of Fission Uranium's PLS Triple R deposits, so we've got the targets. We'll have to raise some more money if we do want to pursue growth programs. And I'd say that, as I say, I think the theme this year coming into it is, stronger uranium prices are going to move the sector forward. There's more interest, and hopefully we'll be able to build the treasury to be able to get out there and drill these targets. That's certainly the vision that we're going to carry forward in 2018.

Gerardo Del Real: I'm sure with the stable of projects you have, and the team behind it, and the track record that you've had in the basin, I can't imagine it's going to be terribly difficult for you to do that. Ross, what can we expect here in the next few months? I want to thank you ahead of time here for your time this morning, but what can we expect in the next few months from Fission 3.0?

Ross McElroy: Well, I think that we look at this as a perfect storm opportunity, the ongoing low uranium prices that we've seen in the last few years have allowed us to continue to pick up key properties, great prospective targets in the Athabasca Basin. We've been able to do that while others have basically been pushed out of the game. We've been able to build a really nice portfolio. We have been able to advance it through some of the work, such as we announced from this summer and fall, building drill targets, so I would say that we start seeing some continued improvement in this market. We'll be out there looking to be very active in 2018 with drilling on our priority targets, that being the PLN, and likely up at Midas, and probably over in the Key Lake area as well, where we've assembled a great portfolio. Look to us to be pretty active.

We'll take advantage of the good uranium markets, and I'd say that I think this is just the beginning. I think we're starting to see a new renaissance in the uranium sector, and if the conference that we just attended in San Francisco is any indication, certainly the investors out there are paying attention.

Gerardo Del Real: I couldn't agree more, Ross. It's a great time for people newer to the story to go to the website. The website is Get familiar with the projects. Get familiar with the team. Again, the market cap is sub-$14 million Canadian today, so a lot of upside, especially if we're really entering what I think is a better uranium market. Ross, thank you again for your time. I look forward to having you back on here.

Ross McElroy: Great. Great talking to you, Gerardo, and thank you again, as always.

Gerardo Del Real: Thank you.

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