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Tisdale Clean Energy (CSE: TCEC)(OTC: TCEFF) CEO Alex Klenman on Drilling & Positioning for Uranium Upside
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Tisdale Clean Energy, Mr. Alex Klenman. Alex, great to have you on. How are you? It's been a bit.
Alex Klenman: Yeah, good. Thank you, Gerardo. And man, I always love your intros. Thanks for that.
Gerardo Del Real: I appreciate it. Listen, let me tell you what I love and I'm loving right now, is the uranium market that has developed, that's developing and that I think, and we talked a bit off-air, is going to continue to run for the next couple of years. We're sitting at over a hundred dollars a pound. The last six months for the commodity have been absolutely incredible. I think there's a lot of runway there, and yet despite the fact that the equities have somewhat responded, there are still a lot of opportunities out there, especially as it relates to the explorers in the space that aren't getting the attention yet, hence the reason why I reached out and wanted you to come on in and chat a bit about Tisdale. So you're beginning your initial phase one drill program at the South Falcon East Project in the Athabasca Basin, so I wanted to get you on, I want your thoughts on uranium before we talk Tisdale specifically, and then let's get to the drill program afterwards.
Alex Klenman: You bet. Well, here's the interesting thing. This is a very compelling story insofar as we have a really early stage capital structure. We've got 29 million shares out. A bunch of that already is locked up in recent placements. We are different than a lot of explorers insofar as we are going directly to the development of a historical resource. There's 7 million pounds delineated at South Falcon as part of the Fraser Lakes B deposit, and the grade there is 0.03, so lower grade for the basin but shallow. We're talking surface to 200 meters, so no deep holes, no overburden, in a really good spot. And one of the reasons we really liked the project and chose to go after it was the last couple of holes that Skyharbour drilled back in 2015 started to really up the grade, so 0.03 is still above the world average, but it's lower grade.
A couple of holes, two to two and a half meter runs of 0.16 and 0.172%, U-308. So a significantly higher grade has been established to be present there within that deposit, and that's what we're going to chase. We want to expand the size of the deposit and we want to expand the grade of deposit, and we believe we can do that, but I don't think you're going to find a three or 4 million market cap out there that has the ability to go directly to development of pounds in the ground. There's a plethora of new uranium companies essentially pitching ground near someone else with no historical work and no pounds. We bypass that and at 29 million shares out, I think we've got a lot of runway in terms of our cap structure and how we can make this work to our advantage. So a really different kind of exploration story and one that I think should get the notice of retail over the next few months.
Gerardo Del Real: Let's talk about having skin in the game because one thing about this business, Alex, and you know it better than most, is it's high risk, high reward. Not everything is going to work out, but if there's one thing I actually admire about you is you put your money where your mouth is and you're not out here pitching stock with 50 shares in your account. So I check insider reports. I like knowing who owns what. Can you speak to Tisdale and your equity ownership there and your cost basis, if you don't mind?
Alex Klenman: Yeah, no, no, happy to share it. It's pretty transparent. I've been in the market consistently since November. I've almost got a million shares, about 930,000 roughly that I've purchased in the open market. My average cost is about 17 cents, so I'm right there with the people who are in the market today, but I believe in the deal. I believe honestly that - right now, we're getting 25 cents a pound credit - as we get work done, which we'll speak to with that first drill program, as the company awareness grows and people understand the opportunity here, that this market cap will escalate because that 25 cents a pound is pretty low when you talk about a hundred dollar spot.
Can we get to 50 cents a pound? Can we get to a dollar a pound? Can we get to $2 a pound? I believe we can. And to me, that's why I'm putting money in the market and buying the shares of this company, because I do believe that to me, there's a cork being trying to be held under water here, and with work and with awareness, that that 25 cent per pound credit's going to grow.
Gerardo Del Real: I couldn't agree more. Let's talk about how you're going to grow that number and how you're going to add value here, because again, your market cap is minuscule. And I know that it's exploration but you have yet to catch a bid and I think there's a heck of an opportunity because the space is going to continue to run for quite some time, if I'm correct.
Alex Klenman: Yeah, no, I don't disagree with you at all. I think we've got a lot of runway ahead and how we grow is very simple. We earn 75% of this project. For every drill program we do, for every bit of awareness and marketing put into it, our footprint grows and our value grows. One of the things that I think is important here, and people have to understand, I would love to be drilling 5,000 meters right now, but our market cap is so small, it's really hard to attract institutional support to raise three, four, $5 million for a drill program. It's got to come from institutional players, and our market cap just isn't there. It's below the threshold they typically like. So the first drill program or two, this is the tough money. This is the hard money to raise.
So the goal here, although a small drill program, it's milestone insofar as it meets the requirements, the first obligations of the earn in with Skyharbour. A great partner. I know Jordan Trimble well. We've done a lot of business together over the years and I'm happy to be working with them. They're throwing their weight behind this and their support and that's really important. So 1.25 million into this program gets us the first leg of the earn in obligations, so that's the first thing that you have to cross over, you have to complete, you have to achieve. Then if the market cap grows and the valuation gets better, I might be able to attract some institutional money and we can do more drilling here in '24. That's the goal, and the drilling has a twofold purpose. First, we want to confirm and show people that mineralization is present and that the holes that Skyharbour drills in 2015 is sort of the beginning of the iceberg and the tip of the iceberg.
And we also want to expand, so we're going to do infill and step out. We're going to try to start to expand that footprint, but there's also tons of exploration upside elsewhere on the property. There's anomalies and there's structural positives that we want to get into as well, so it's not just this Fraser Lakes B deposit that's almost 7 million pounds. That's not really... I mean, that's the anchor here that's going to help us all along, but there's also exploration upside on the ground as well so we could run into some luck there as well. And the geologists we have, I've got Trevor Perkins from Azincourt, who's an amazing geologist and knows the basin like the back of his hand. He's made big discoveries. And we also have the Skyharbour geologists who are working with us all the way through this, so a good setup.
Gerardo Del Real: I like it. What comes next?
Alex Klenman: Well, we are going to be on the ground here in the next four to six weeks, so we'll have that program and then we will have the results of the drilling out in probably May, June. And then we're going to continue to do what we do, which is bang the pavement, let everybody know that this company exists. I need to attract more capital later in the year to get more drilling done. And people say, "Well, you're real tight. Why do you want to expand the cap structure? You've got to be careful." If you're trading by appointment, your valuation isn't necessarily accurate. You need a decent amount of shares out there circulating to really get a handle on an accurate valuation, and then you also have the funds. The funds like distribution. They don't really like tight deals. You need an exit, so if you put a million dollars in, you got to know that you have an exit and that it doesn't trade 50,000 shares a day for eternity.
So we are liquid. That's an important part of it, so I'm not afraid of expanding the share structure at this point. It's not going to go hog wild and we're not going to have 300 million shares out by the end of '24, but certainly that 50 to 60 million share range in the next 24 months is not a bad place to be. You're going to be liquid, but if the demand is greater than the supply on the share side, then that bodes well for share price.
Gerardo Del Real: Looking forward to the rest of 2024. Tons of catalysts. Looking forward to seeing what the project delivers in the first go around. Anything to add to that, Alex?
Alex Klenman: No, just I urge people to do due diligence. Go look out there. Go look for four or 5 million market caps that have a deposit on their ground, an actual deposit, and I don't think there's many opportunities like this. So if you're one of those investors who likes to see an asset back a company rather than pure speculation or pure what may happen, then look at us because we're going to develop this deposit, we're going to get credit for it, and spot's 150 or 200 a pound. Having credit in a 7 million pound deposit or more is going to bode well for the company's valuation. I think it's just a matter of math.
Gerardo Del Real: Well said, Alex. Thank you for your time.
Alex Klenman: Appreciate it. Thanks Gerardo.
Gerardo Del Real: All right, chat soon. Cheers.
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