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Fission 3.0 and Aldrin Resource announced Thursday that they have signed an option agreement under which Aldrin can earn up to a 50-percent interest in Fission 3.0’s Key Lake property package. Both companies saw share price increases as a result.
The big news in the uranium space on Thursday was Fission 3.0 (TSXV:FUU) and Aldrin Resource‘s (TSXV:ALN) joint announcement that they have signed an option agreement under which Aldrin can earn up to a 50-percent interest in Fission 3.0′s Key Lake property package.
Located in the southeastern area of Saskatchewan’s Athabasca Basin, Key Lake is made up of five separate, but contiguous, properties containing a total of 61 mineral claims that cover about 18,392.7 hectares. The five properties are called River Lake, Costigan Lake, Karpinka Lake, Millson Lake and Hobo Lake, and according to the companies, they come with a variety of benefits. Those include proximity to infrastructure and the Key Lake mill, which handles slurry ore from the MacArthur River mine, as well as geological prospectivity.
To earn its 50-percent interest, Aldrin has to spend $6.9 million on staged exploration on or before May 1, 2019. Payment deadlines are as follows:
- $1 million by May 1, 2016
- $1.7 million by May 1, 2017 (20-percent interest gained)
- $2 million by May 1, 2018 (10-percent interest gained)
- $2.2 million by May 1, 2019 (20-percent interest gained)
Prior to making those payments, Aldrin must pay Fission 3.0 $100,000 in cash and issue it a total of 1.9 million shares within 10 business days of the TSX Venture Exchange approving the transaction. The company also has to make semi-annual $100,000 payments to Fission 3.0 during the earn-in period.
In terms of what attracted Aldrin to Key Lake, CEO Johnathan More told Uranium Investing News (UIN) that Fission’s past successes were a key part of what drew his company in. Specifically, he pointed to the fact that Fission’s technical team has made two big discoveries in the last four years — the Triple R and J Zone deposits — and noted that Key Lake holds similar promise and is prospective for hosting rich, high-grade and shallow mineralization.
The team at Fission 3.0 seems similarly pleased with the arrangement. As Ross McElroy, the company’s COO and chief geologist, said in Thursday’s release, “[w]e’re looking forward to utilizing the in-house skills and techniques we’ve developed in recent years when we begin exploration this year.” Similarly, Dev Randhawa, the company’s chairman and COO, noted, “[t]his latest agreement gives Aldrin and its shareholders the opportunity to partner with the top technical teams in the uranium exploration sector and enables Fission to explore a highly prospective part of its project portfolio.”
Though some historic data for Key Lake exists, McElroy told UIN that initial work there will be aimed at getting a better understanding of the area. Airplane surveys looking at radiometrics and conductors will be first on the docket, with Fission 3.0’s patent-pending airborne radiometric survey equipment being used. “It gives us a real advantage over everyone else,” McElroy said. That will be followed by ground geophysics and — in about a year’s time — drilling on the most prospective areas.
As of 3:35 p.m. EST on Thursday, Aldrin’s share price was up 14.29 percent, at $0.20. Meanwhile, Fission 3.0′s was up 6.25 percent, at $0.085.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Aldrin Resource is a client of the Investing News Network. This article is not paid-for content.
