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Cosa Resources (TSX-V: COSA)(OTC: COSAF) CEO Keith Bodnarchuk on Transformational Partnership with Denison
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Cosa Resources, Mr. Keith Bodnarchuk. Keith, great to have you on. How are you today?
Keith Bodnarchuk: Yeah, I'm doing great, Gerardo. It's great to back.
Gerardo Del Real: Well, let's get right into it. Congratulations are in order, Cosa Resources for those that aren't familiar, not only as a sponsor on Resource Stock Digest, but it's also one of my premium uranium picks on the paid service that I manage and company that I co-own under Digest Publishing. And the stock, when I recommended it was up and then it pulled back a little bit, there was some softness in the uranium sector. And so anytime I have shareholders write in or subscribers write in asking about the pullback, I always pointed to the same thing, the history of success on the quality of the team, the smallish market cap, and the ability to really make transformational deals that will set the company apart, especially given the tiny market cap. And sure enough, on a December the 2nd, you've announced conditional approval for what it has to be described as a transformational deal with Denison Mines. I would love for you to provide the details there, if you don't mind.
Keith Bodnarchuk: Yeah, definitely. And you hit the nail on the head. It is truly transformational for us to do a deal with Denison Mines. We're entering into a joint venture with them for three projects, but we'll acquire 70% of those projects and in exchange for that Denison will become just under 20% shareholders of Cosa. They really become our most strategic and largest shareholder going forward. And obviously Denison is really the best development story in the uranium space right now. They have a very, very healthy treasury, and importantly, they provided us with three projects where we think that really sets us up for drilling here in 2025. There's other components of the deal. I encourage people to check the release that we put out last week. They will be appointed to members to our board, so they'll provide support on our board. We'll get a technical advisor from them.
They also put up their hand to participate in up to a minimum of $1 million in a future equity financing for Cosa. So they really want to maintain that 20% shareholding going forward. And the projects themselves are absolutely terrific. Murphy Lake North is within four kilometers of the Hurricane deposit, which obviously our management team was a part of discovery during our time at IsoEnergy. They catapulted that company into what it is today where our share price went up from 30 cents to over $6. So anytime we can get anywhere close to that deposit, we will take that opportunity. Darby project within 10 kilometers of Cigar Lake Uranium Mine, which is one of the largest uranium mines in the world, and Packrat, which is just along trend from Rabbit Lake Mill, which is owned by Cameco. So these are three projects that haven't seen that extent of exploration in the past, but are mature and discovery ready, and they're located in these tier one exploration areas in and amongst some of the best infrastructure and some of the best discoveries in the entire Athabasca Basin. So we're extremely excited to get all these projects and also extremely excited to bring in as strategic of a shareholder as Denison Mines.
Gerardo Del Real: I don't know if people fully appreciate yet the amount of due diligence that's already been done on these projects, not just by the Cosa team, but the team over at Denison, which if anyone's ever interacted with that process at that scale, the reviews are thorough and mean and lean. Can you speak to that? The advantage of having, again, not just your team, which is very successful in its own right, but having those projects having already been vetted by Denison in the past.
Keith Bodnarchuk: Yeah, definitely. And so they will be appointing a technical advisor to our team. So that's somebody that will be very familiar to projects, but also very familiar with the discoveries that Denison have had. And we didn't touch on this. I had got my career started and I spent almost 10 years working on some of their best projects, even working on some of these projects. And so Steve Blower, our chairman, is also part of Denison being the former VP of Exploration. And Andy Carmichael also worked at Denison. So we've had a lot of experience with that Denison team. This is really a deal that there's a level of trust and familiarity between the two groups. And importantly Denison is maintaining 30% of those projects. They don't want to give up on them, they just know that they can't get around to them during these next couple of years while they focus on putting their Phoenix deposit into production.
And so it was very important to them that they maintain a big ownership of us and also maintain exposure to the projects themselves. And so that's something where it can really show to the market that they weren't giving up on these assets. They still want to maintain them. They view them as high upside assets that they have developed very good targets on, but they just haven't been able to get around to exploring it. And the moment they go into production in Phoenix deposit on the River River Project, they'll be looking for that next pipeline of production opportunities. And that's where Cosa could come in if we are able to have some success on these projects or on any of the other projects that we currently have. So I think that really, it's kind of a mutually beneficial transaction in that regard.
Gerardo Del Real: Couldn't agree more. The market cap is a measly $16 million even after a good week and a good reaction from the market. I suspect and expect here in 2025, the market cap goes much, much higher. Anything to add to that?
Keith Bodnarchuk: Yeah, you know what we are sitting at, I agree, measly $15, $16 million Canadian market cap. And when you start to look in the sector, there's exploration companies that have above $50 million market caps and they don't have the track record that we do. They don't have that strong shareholding of a Denison Mine, and they don't necessarily have the projects that we built together. So I think as we continue to build this company out and kind of introduce all these catalysts and start to drill some of these great targets, I think there's huge potential for upside on us and we're really just getting started.
Gerardo Del Real: Couldn't agree more, sir. Thank you so much for your time. Looking forward to having you back on.
Keith Bodnarchuk: Thanks Gerardo.
Gerardo Del Real: All right. Cheers now.
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