CanAlaska Uranium (CVV) - $3M to Focus on Green Energy!

April 27 2021, 13:19 GMT+01:00

CanAlaska Uranium

  • TSX-V: CVV
  • Shares Outstanding: 78.9M
  • Share price C$0.68 (13.04.2021)
  • Market Cap: C$54M

CanAlaska Uranium is an exploration stage company primarily engaged in the acquisition and exploration of mineral properties in Canada. The Company focuses on the exploration of uranium deposits in the Athabasca Basin area of Saskatchewan. The Company operates approximately 20 projects within the Athabasca basin area.

Recently we had the opportunity to speak with Cory Belyk, Principal Geologist and COO at CanAlaska Uranium, a company with quite a bit of activity in the uraniferous Athabasca Basin of northern Saskatchewan as well as in other parts of central and western Canada. He relayed to us what’s going on with the company and where it is headed in the near future.

Company Overview

CanAlaska is a Vancouver-based junior explorer and developer of uranium, nickel, copper, and diamond projects in western and central Canada. The company views itself as a “Prospect Generator”, has extensive land holdings, and has had success in the identification of rich uranium targets in the Athabasca Basin. The company is in a strong financial position, having recently closed a private placement of $3M.CanAlaska Uranium (CVV) - $3M Raise to Focus on Green Energy

Management and Direction                  

In addition to our guest, Cory Belyk, the company is managed by Peter Dasler, President and CEO, and Karl Schimann, VP Exploration.

CanAlaska Projects

The company’s flagship project is the West McArthur project in the Athabasca Basin, where they have discovered a series of high-quality uranium deposits and have an extensive land position near infrastructure. Drill results indicate a large halo of mineralization extending to the surface. Recent exploratory drilling has intercepted excellent lengths of high-grade uranium oxide (triuranium octoxide) containing 5% and 8% of uranium, indicating the strong potential of a large-scale mineralization feeder zone.

CanAlaska has successfully mapped these occurrences and have developed a geologic understanding of mineralization at West McArthur, which the company believes can be developed into a Tier 1 uranium asset. The project is operated as a joint venture with Cameco Corp.CanAlaska Uranium (CVV) - $3M Raise to Focus on Green Energy

Other projects in the company fold are the Cree East, Waterbury, and NE Wollaston uranium projects, also in the Athabasca Basin; the Hunter, Strong, and Manibridge nickel projects in Manitoba; the North Ruttan copper-zinc-gold project in Manitoba; the Mouse Mountain copper-gold project in British Columbia; the Athabasca kimberlite diamond project in Saskatchewan; and several other Athabascan holdings.CanAlaska Uranium (CVV) - $3M Raise to Focus on Green Energy

Belyk’s Perspective on The Last 12 Months for CanAlaska

We didn't let the COVID period go to waste, Belyk said, telling us that the company has been busy generating new projects focusing on extensions of areas in their Athabascan portfolio, especially where they have potential to make Tier 1 discoveries. Furthermore, they have been involved with a bit of deal making. In addition, they are currently drilling in the Athabasca now, so they expect that positive news flow will come out over the next couple of months.

Commodities on a Tear

Commodities like uranium, nickel, and copper have been on quite a tear lately. CanAlaska share price is up as well. Therefore, we posed the question of whether they have simply benefitted from market tailwinds or if something organic was going on.

Belyk answered by connecting Can Alaska’s business model with the 'green energy' revolution that is going on. The company has been continuing to do numerous deals with partners to consolidate their control over uranium and nickel assets, all necessary for the move away from carbon that is taking place across the globe.

For example, they have inked several deals recently. These include a partnership with the company D Block at their Manibridge project, and another with Fiorland Exploration at the Strong and Hunter projects.

The deal with Fiorland is instructive on how they like to approach their nickel assets. It a US $9M option deal to earn up to 80% over 3 stages based on spend over time.CanAlaska Uranium (CVV) - $3M Raise to Focus on Green Energy

How is the “Project Generator” Model Working?

The project generator business model is at the core of Can Alaska’s activities. In this model, the company concentrates its efforts on the strategic acquisition of early-stage property assets, followed by focused exploration programs designed to advance projects along the value curve. 

We asked Belyk how they are working this model these days. Lately they’ve been telling the story to potential partners and financial backers. They believe that at West McArthur and Cree East, where they have drill intercepts with 5% to 8% uranium, that they have 2 potentially viable Tier 1 projects. Big uranium systems like these like this don’t occur everywhere, Belyk said, and CanAlaska has 2 of them.

He also spoke about “opening up space”. By this he was referring to the fact that they feel that they have to drill additional step-out holes to determine if the high-quality uranium that they been drilling into extends several km or so from the original strikes. That is key to proving up and presenting a large Tier-1 system to potential partners.

West McArthur and Cree East take up large areas, the size of a metro Toronto or a metro London, for example. As they work these huge tracts and develop a sound geologic model, they can pinpoint parcels of land, should they become open, that they can capture for big-upside, add-on value.

Another part of the story is that these occurrences are near infrastructure. He believes that “The value is right there” because of the infrastructure, the quality of the minerals, and the size of the deposits.CanAlaska Uranium (CVV) - $3M Raise to Focus on Green Energy

Will CanAlaska Move Past the Project Generation Stage?

We continued along the same vein with Belyk, suggesting that now, with the uranium price having moved up, that perhaps it’s time to move past the project generation mindset. He reiterated that the company is out there structuring deals. Indeed, the joint venture with Cameco at West McArthur is an example of that.

Currently, they are attempting to “open up space” at other locations in order to attract right mix of partnerships that can bring money to the table and move the projects forward. For example, they own 100% of Cree East. They’d love to bring in the right partner there to move that project ahead, he said. That’s what is right for our shareholders, he continued.

Not Interested In Diluting Shareholder Value

We spoke then about capital available, recognizing that they have recently taken in $3M in a private placement. We asked if the company might need to raise more money soon.

Belyk answered that they can methodically move forward with the additional appraisal work they envision at West McArthur with the money they’ve already raised. He indicated that they don’t really need to take in any more capital at this juncture. As he said “We're just being very cautious for our shareholders. We don't need to dilute. We can move our stuff forward that we plan on moving forward with what we have in place”.

The Non-Uranium Projects: How Do They Fit In?

We then turned to CanAlaska’s non-uranium projects. We queried him on how the nickel, copper and diamond projects fit into the company’s broader business picture.

Belyk quickly responded by saying that CanAlaska is first and foremost a uranium company. In his own words: “That's our love. That's our passion. That's our experience. This is where we want to be, so that is our forte”. He feels that, at the moment at least, nearly 100% of the value of the company is in its uranium business.

That being said, he had these comments about nickel. Nickel has some value to it, but they are trying to bring in other people’s money to develop that value further. He again cited the partnership at Manibridge as an example of that.

Criteria for Potential Deals

Belyk stressed that they are not rushing into anything. Not all deals are the same, he said. They are very particular about the type of companies they want to partner with. He said that they can afford to do that because of the asset quality and cash position that they possess.

Typically, they favour Canadian-style deals with an option to earn in. But, he said, they are also interested in doing sovereign-type deals like that already have done with Japan and Korea earlier at WestMcArthur and East Cree.

The Next 12 Months: An Overview

We asked the COO to sharp-shoot the next 12 months of company activity for us. Here is his overview:

  • Waterbury: Continued drilling to identify and understand a possible large unconformity-type uranium deposit.
  • West McArthur: Step-out drilling to delineate recently discovered 8%-grade uranium.
  • Diamond Project: Some reconnaissance mineral-indicator work to advance the understanding of the potential prize.
  • Nickel Projects: Permit completion with the Canadian government and First Nations in advance of drilling operations using other people’s money.
  • Cree East: Pushing forward. Everything looks like it can be another West McArthur.

CanAlaska Uranium (CVV) - $3M Raise to Focus on Green EnergyHow does CanAlaska Fit into the “Green Revolution” Space?

Even though the company brands itself as a uranium business, its other mineral assets – nickel and copper especially – help broaden the company’s appeal, especially in light of the green energy megatrend. We asked Belyk if they are considering cashing in on the non-uranium assets.

He replied that all of the strategic minerals in their assets fit into the evolving green eco-system. As he told us: “Uranium generates electricity. Copper moves that electricity, and the nickel space is a natural tag on”. And keep in mind, he said, were moving forward on the nickel with other people’s money. 

To find out more, go to CanAlaska's Uranium Website.

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