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Uranium Energy has moved its third ISR uranium project, Burke Hollow in South Texas, into the production permitting stage.
The company filed both the Mine Permit application and the Aquifer Exemption application for Burke Hollow with the Texas Commission on Environmental Quality on April 11, an important milestone in the project’s timeline. According to Cantor Fitzgerald’s Rob Chang, the latest news from UEC is positive as the Burke Hollow mine represents another important piece of the company’s mining strategy. With Burke Hollow in the permitting stage, the company now has three potential operations in the near future.
As UEC’s CEO, Amir Adnani, said in a company statement, “[t]he Burke Hollow project is an important part of our hub-and-spoke extraction strategy providing feed to our scalable Hobson Plant, which has a physical capacity of 2 million pounds per year.”
The project is one of six uranium projects held by UEC in South Texas and spans 17,510 acres of land. A NI 43-101 maiden resource of 2.9 million pounds grading 0.005-percent U3O8 was released for Burke Hollow in February 2013. Since then, a further 80 delineation holes have been completed and two mineralized trend extensions have been discovered on the property. Unexplored property at Burke Hollow still totals 60 percent.
Given the weak uranium pricing environment, UEC has opted to reduce uranium extraction from its production units at Palangana. Instead, it will focus on ensuring that when the uranium market does recover, it will be able to ramp up production. For instance, at the company’s Goliad project, long-term items are on site. The project could enter production within four to five months if the price environment becomes more encouraging
In March, UEC announced a $10-million credit facility injection from both Sprott Resource Lending Partnership and CEF Capital Markets. That, combined with the extension of the company’s credit facility to 2016 to 2017, has given UEC financial flexibility, Adnani explained, along with a strong balance sheet and working capital position.
“This strong financial position combined with our deep project pipeline will enable UEC to opportunistically scale up low-cost uranium production from multiple projects as uranium prices increase,” Adnani said.
Securities Disclosure: I, Vivien Diniz, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: UEC is an advertising client of Investing News Network. This article was not written as part of the company’s advertising campaign. This is not paid-for content.