Categories: Energy
Topics: General Energy

Skyharbour Resources (TSX-V: SYH)(OTC: SYHBF) CEO Jordan Trimble on Uranium, Russell Lake, Moore and Partner Funded Exploration

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Skyharbour Resources – Mr. Jordan Trimble. Jordan, how are you today?

Jordan Trimble: I'm doing well. It's good to be back on and looking forward to catching up.

Gerardo Del Real: Well, let's get right into it. It's great having you back on. You've been traveling. You've been at conferences. I have to ask for your take on the sentiment in the uranium space. I know that you just got back in the office, as I mentioned. And so what was it like out there in person meeting with other people that are also in this space? What are they thinking? What are they feeling? What are you seeing? Anything that stood out here recently?

Jordan Trimble: Yeah, well, I was just in London at the World Nuclear Symposium. The first time it was held in person in three years, for the obvious reasons. And so it was great to be back out there. Great to catch up with people in person. Look, the sentiment around the uranium mining industry as you and I have talked about extensively has changed drastically in the last few years and at the conference, this is a nuclear conference.

So keep in mind, it's the full spectrum of companies and in government agencies from nuclear plant operators, utilities right through to junior mining companies, uranium mining companies. So it was interesting to kind of meet with people in different parts of the industry. And clearly there's some major, major developments and changes that are having an impact on the industry. Obviously, having an impact on the uranium price. A big topic of discussion at the conference was the geopolitical issues that we're seeing globally.

The conflict in Russia and Ukraine, that's created a major stress on the industry. Russia represents about 10% of primary mine supply, but really has a majority stranglehold on other parts of the fuel cycle. They control about 30 to 40% of the conversion and enrichment capacity globally. So this has created a lot of stress on the nuclear fuel cycle and various products in that nuclear fuel cycle. And we're seeing the prices of the intermediate products like the conversion and enrichment prices move much, much higher. I think that this will trickle down eventually to the U308 uranium price, the spot price and the contract price. So that was a key topic of discussion. And I think we really haven't seen that yet priced fully into the market as Russia's being carved out by the west. Secondly, the sentiment around nuclear energy has continued to improve, especially from three or four years ago.

And that was a highlight and a key takeaway is as the world continues to decarbonize as countries and economies shoot for these decarbonization objectives, nuclear energy as the only source of base load, clean, affordable, scalable, and reliable electricity generation will have to continue to play I think a growing role, not just continue, but in a much larger role will have to play an important part in meeting these decarbonization objectives that we're seeing globally. Another topic that was certainly highlighted and talked about in several presentations was the advent of small modular reactors advance nuclear technologies. We're seeing major growth in this sector. As these SMRs are brought to market. There's been a bunch of funding in particular in the last few years, that's helping to expedite the commercialization of these SMRs. The conference was in the UK and they're one of the leading countries in commercializing these SMRs. Rolls Royce has an agreement with the government to build 10 of these, but a lot of Western countries are moving in that direction.

And you and I have talked about this, I think this will be a major growth opportunity for uranium demand in the west going forward. And then just last but not least, I always like to get back to the basic fundamentals. You've over the last five or six years, you've seen major supply side responses we've talked about previously, and you're really starting to see that translate into upward pressure on the uranium prices where we now have about 190 to 200 million pounds of annual demand. And that's growing quickly and will I think grow at a quicker rate with, again, the advent of these new SMRs.

And that's in the backdrop of primary mine supply of only about 130 to 140 million pounds of primary mine supply. And so that was talked about at the conference as well... Is just this supply deficit and the dwindling secondary supplies in particular mobile, secondary supplies. And that's been further exacerbated by the Sprott Physical Uranium Trust, yellow cake, these financial entities that have come into the market in the last several years that have continued to tighten up the market. So there was a lot of positive sentiment around, especially the uranium price moving higher. I think it's still in the early days at 48, 49 dollars a pound currently, there's still a lot of runway here. I think there's still a long way to go. And I think we see that materialize over the coming months and coming years.

Gerardo Del Real: So to be clear, still early innings, if we're going to use baseball parlance right, as it relates to the uranium bull market.

Jordan Trimble: Yeah, absolutely. It is. And that's in a historical context. So you looked at where it's traded at previously before Fukushima $70 a pound and then obviously, 06, 07 in that uranium bull market in the mid 2000s, it eclipsed to $130 a pound. And so there's still a long way to move. And then if you look at it from the perspective of the price needed to incentivize new, meaningful production to come online, especially with cost inflation. And that's a key factor here now in over the last year, you're going to need to see a much higher uranium price to bring that new production online, to incentivize that new production to come online and at sub $50 a pound where we're nowhere near that.

Gerardo Del Real: Skyharbour has a 52 week low of 29 cents, a 52 week high of 84 cents. And it sits right near the middle right there at the 45 cent mark today. Clearly the stock in the uranium space is waiting for the next leg up. Clearly you've been busy behind the scenes and publicly positioning the company for that next leg up. How are things coming along on the Skyharbour front Jordan?

Jordan Trimble: Look, we've been very, very busy over the last several months. The last 12 months for the company needless to say has been pivotal. And I really believe that the next 12 to 18 months is going to be transformational for the company. So we'll start off with the core projects and update at our Moore Lake project, our newly acquired Russell Lake project and South Falcon Point at Moore Lake. We completed a drill program earlier in the year, assays still pending for that. So that's a near term catalyst expecting those results shortly, continuing to have success at that project at the Maverick quarter, in particular, in the underlying basement rocks and at various other regional targets. We are planning for some follow up work and drilling at the project to continue proving up and delineating high grade pounds of uranium going forward. But that'll be tied in with the programs, the drilling that we'll be carrying out at our newly acquired Russell Lake project.

And as you know, this, it was a major transaction for Skyharbour that we completed in the summer with Rio Tinto. Took us a while to negotiate with Rio. Finally, got the terms that we were comfortable with and a great deal all around. It's allows us to earn an initial 51% in the project. And there's a pathway to a hundred percent as we've discussed in previous interviews. This is a very, very strategic acquisition for the company. Major land package strategically located on the Eastern side of the Athabasca basin, basically all the ground between the MacArthur River Mine project there, the Key Lake mill to the south, MacArthur River to the north, Denison's Wheeler project to the west, and our Moore Lake project to the east. That's over 73,000 hectares of ground. The project is host to several high grade zones of uranium mineralization that haven't been fully drill tested.

We've done a lot of data compilation and interpretation and geological modeling over the last several months. I was out in Saskatoon with our team about a month ago, going through all this. And they're doing some incredible work to refine and select the highest priority drill targets. But bottom line is the project is I think right for a new high grade discovery. There's been fair bit of historical drilling and exploration, but a lot of that carried out many, many years ago. And so we're going in there with some new thinking, some new modeling and some new techniques, and it's got all the right ingredients for a new major, high grade discovery.

And so we're very excited to get to work there. We just raised three and a half million dollars in flow through. So that'll cover the first 12 to 18 months of drilling at the project. That should get us between eight to 10,000 meters of drilling. We'll have details on the next several phases of work that we’ll be completing at Russell Lake. The details on that will be forthcoming. So keep an eye out for news on that, but yeah, very much thrilled to get to work there it is road accessible, the road that connects McArthur River Mine with the Key Lake Mill runs up through the western claims of the project. There's power there, and there's a 40 person exploration camp, which will bring our drill cost down. So it's accessible and workable all year round.

Gerardo Del Real: Given its strategic location, if there is a discovery of significance to be had, I could see that region being ripe for consolidation, Jordan.

Jordan Trimble: Yeah. I mean, look, it's right in the heart of the eastern part of the basin. You've got Cameco there, you've got Denison there, you've got Orano there. You've got several other companies that are actively exploring, developing, and producing. And so it's, like I said earlier, it was a very, very strategic and important acquisition for the company.

Gerardo Del Real: Good stuff. Good work. Anything else to add Jordan?

Jordan Trimble: Yeah. Well, just to cover off the partner companies, we've had a lot of news flow out from these various partner companies over the last several weeks and expect some more to come out here in the next few weeks. As you know, we've got five partner companies, two joint ventures and three earn in option partners as a part of our prospect generator business. We've had a number of those partner companies announce drill results. Azincourt announced the results from their 5,000 meter program that they carried out earlier in the year, some significant and notable mineralization in some of the holes. So they're doing a great job of vectoring in on potential new high grade discovery. I think they're on the right track there and excited for them to get back to work. They've just recently announced plans for a 6,000 meter drill program, that'll commence later this year. Following that, Basin Uranium Corp. just recently announced their initial results from their first pass drilling at the Mann Lake project and notably they had some significantly anomalous uranium mineralization in a couple of the holes.

And what's interesting there is the project's only had about 10 to 12 drill holes put into it. So the fact that they've already honed in on a zone of mineralization is quite exciting. So they've just now announced a 4,000 meter phase two drill program, that'll be starting shortly again. They're funding the entirety of that. Medaro Mining is just completing some more geophysical work and groundwork at our Yurchison project.

They do have plans to be drilling there at some point in the new year. And last, but certainly not at least Valour Resources completed a small drill program just under 2000 meters earlier in the year. And they're planning some follow up work on that from that program at our Hook Lake project here and will be planning additional drilling in the new year. So we've got lots on the go, I think collectively between the various partner companies and our planned drilling later this year and early in the new year, we're looking at over the next 12 months between 25 to 30,000 meters of combined drilling. So that'll be our largest combined drill campaign ever. So lots of news flow and lots of catalysts coming up.

Gerardo Del Real: Good stuff. Sounds like we'll be chatting often, Jordan.

Jordan Trimble: Absolutely looking forward to providing updates as we make progress.

Gerardo Del Real: Appreciate the time today. Thanks again.

Jordan Trimble: Thanks Gerardo.

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