Skyharbour Resources Ltd.


Advancing Multiple High-Grade Uranium Exploration Projects in the 2022 Uranium Bull Market

The new uranium bull market is underway…

…and best of all, it’s still early-innings which means you haven’t missed out on the coming profit windfall.

The company featured in this report — Skyharbour Resources Ltd. — has acquired an extensive portfolio of uranium exploration projects in Canada’s prolific Athabasca Basin and is well-positioned to benefit from improving uranium market fundamentals with 14 drill-ready projects covering over 385,000 hectares. The flagship is the 100%-owned Moore Uranium Project located 15 km east of Denison’s Wheeler River uranium project and 39 km south of Cameco’s McArthur River uranium mine. Additionally, SYH has a total of 5 partner-funded uranium projects in the Athabasca Basin region.

The profound impact of COVID-19 on the global uranium market, coupled with a renewed acceptance of nuclear as “clean, emission-free, reliable energy” has kicked off events that are already seeing the uranium spot-price — and related equities — ratcheting higher.

Currently, the price of uranium is slightly above US$40 per pound. It’s likely headed north of US$75 per pound soon — and this report details precisely why.

Over the next ten years, the world will need ~200 million pounds of uranium annually. But there is only about 150 million pounds per year globally with all-in sustaining costs (AISC) below US$50 per pound — and 20% or more of that was knocked offline because of COVID-related disruptions.

At today’s spot price, only around 100 million pounds of supply per year is economic or only about HALF of what the world needs. A spot price well above US$50 per pound will be needed — and is expected — over the next few years.

That reality has kicked off a new bull market in U3O8 prices and select small-cap uranium stocks — including Skyharbour Resources Ltd. (TSX-V: SYH)(OTC: SYHBF).

A New Uranium Bull Market Emerges

Uranium’s previous bull market kicked off in 2006 when Cameco’s Cigar Lake Mine — which provides ~7% of global annual uranium supply — flooded while it was being built, prompting a run on uranium that sent the spot price to a jaw-dropping US$140 per pound.

It simultaneously sent uranium stocks significantly higher in percentage terms with some like UEX Energy, Energy Fuels, Laramide Resources, and International Enexco delivering a few thousand to +100,000% returns.

The commodities sector is known for the stocks within it offering leverage to the underlying price of the commodity.

The uranium subsector epitomizes this.

Skyharbour Resources Ltd. has been set up from the outset to capitalize on the uranium upswing the “clean-energy” world is bearing witness to now.

A Miniscule Market with Immense Leverage to Rising Prices

The uranium market is incredibly small compared to other commodities.

Kazakhstan alone produces ~40% of global supply. It does this through Kazatomprom, its national uranium company, which listed 25% of its shares on the London Stock Exchange in 2018. Those shares have a market capitalization of about US$12 billion.

The next largest public pure-play is Cameco Corporation (NYSE: CCJ), which produces ~10% of annual global supply and has a market capitalization of around US$10 billion.

In other words, roughly half of the world’s uranium production is represented by less than US$30 billion in market cap. In contrast, Amazon has a market capitalization of nearly US$2 trillion.

From there, the pure-plays get small very quickly. The “largest” uranium producer in the United States, for example, is Energy Fuels (NASDAQ: UUUU).

Largest is in quotes given it will likely only produce between 30,000 to 60,000 pounds of U3O8 this calendar year. Its market cap is around US$1.3 billion but has mostly been below that for years.

If you were to look up the top holdings of the Global X Uranium ETF (NYSE: URA), you would see that those three companies make up three of the top five holdings.

The other two are NexGen Energy, with its world-class but undeveloped Arrow project in Saskatchewan, and Denison Mines, with its large but also undeveloped Wheeler River project on the other side of the Athabasca Basin.

Those five companies make up over 50% of the sector ETF.

Hence, the uranium world is incredibly small, which is why even slight inflows into the sector can create such stark leverage reflected in the equities — especially the small-caps.

Utilities Will Drive the Next Upward Leg of the Uranium Boom

The biggest and most important buyers in the uranium space are the utilities. And here’s where it gets really interesting.

For years, the utilities have been able to lock up uranium supplies at depressed prices.

That’s about to change.

The combination of supply cuts from the highest-margin producers and utilities coming back into the market will create the greatest uranium bull market anyone has ever seen.

You see, for utilities, price is secondary to securing supply. That’s because the price they pay for uranium makes up a very small portion of the total cost of operating a nuclear reactor.

And for mine start-ups and restarts to be economic, uranium prices need to be well north of US$50 per pound. That’s the low-water-mark incentive price to build a new uranium mine in today’s economy.

The bottom line is that no developer can bring a new uranium mine from development to production at US$40 per pound uranium.

And that means we’re guaranteed to see higher contract prices.

That’s why uranium bull markets are so powerful. It’s also why the profits can be so life-changing.

Whether the utilities pay US$50 per pound or US$150 per pound… THEY HAVE TO BUY!

With nuclear power providing some 15% of global baseload clean electricity… either the utilities buy uranium at higher prices… or the lights go out!

The utilities' last major contracting cycle was in 2010. And when you look at the levels of uncovered reactor requirements starting next year and the year after that... every year, it gets larger and larger and larger.

Not only is the biggest buyer about to rush back into the market… but governments that just years ago vowed to move away from nuclear energy are now realizing that there isn’t a cleaner, safer, more economic option in the world.

China, Japan, India, South Korea, and even the US are now fully onboard with a cleaner energy future that will require vast amounts of uranium.

In fact, China just confirmed its intent to build 150 new nuclear reactors over the next 15 years as part of their newly-enhanced decarbonization mandate. That's more reactors than have been built in the last 35 years!

France also just announced they’re going to be building a new generation of nuclear reactors for the first time in decades.

And there’s also the advent of Small Modular Reactors — or SMRs — right here in America.

SMRs offer key advantages over traditional reactors such as relatively small physical footprints, reduced capital investment, ability to be sited in locations not possible for larger nuclear plants, and provisions for incremental power additions.

In other words, strong tailwinds are forming for the uranium sector at large.

And then there’s the retail speculator who, until now, hasn’t had a viable vehicle to buy physical uranium with the press of a button or by placing a phone call.

That’s all changing now…

Sprott Inc. just launched what amounts to a new uranium ETF by taking over Uranium Participation Corp (TSX: U)(OTC: URPTF).

The formation of the Sprott Physical Uranium Trust is a big deal. In fact, we believe Sprott's 200,000-plus investors will look at this as a way to directly purchase physical pounds without having to take delivery, which Sprott will do for them.

They’ve done it with gold. They’ve done it with silver. And now they’re doing it with uranium!

Sprott has already announced an initial investment of over US$1.3 billion. That will likely grow over the coming quarters.

The Kazakhs quickly followed suit with their own US$500 million physical uranium fund.

Those two funds are combining to tighten an already strained uranium supply market… resulting in the first upward leg of the new uranium bull market with U3O8 prices surging from US$30 per pound to currently around US$42 per pound.

We talked about the utilities. They’ll be next to come in.

Historically, it is the utilities that have been the main driver for higher uranium prices.

And there are signs the utilities are about to enter the market to secure their next long-term U3O8 contracts.

Once that happens, we could see uranium prices surge first to US$75 per pound… and eventually to record highs above US$140 per pound.

Could we see US$200 uranium in the not too distant future? We believe so!

And while that high a price would likely be unsustainable over the longer-term — it won’t matter!

That’s because any surge above US$75 per pound would send the share prices of select small-cap uranium firms many multiples higher… resulting in life-changing gains for well-positioned investors.

So yes, the gains in the uranium spot price will be incredible... but the top junior uranium exploration firms will make those gains look paltry in comparison.

Enter Skyharbour Resources Ltd. (TSX-V: SYH)(OTC: SYHBF).

Skyharbour Resources: A Brilliant Growth Model

Skyharbour Resources Ltd. (TSX-V: SYH | OTC: SYHBF) is a preeminent uranium exploration company with 14 drill-ready projects located in the prolific Athabasca Basin of Saskatchewan, Canada.

It’s where the big boys come to play! Industry leaders like Cameco have their largest uranium mines in the Athabasca. And these are some of the biggest and richest uranium mines in the world… including behemoths like McArthur River and Cigar Lake.

Saskatchewan is also consistently ranked among the very best mining jurisdictions on the planet — a benefit that simply cannot be overstated in today’s world where the nationalization of mining assets from foreign operators is commonplace.

With its own flagship project plus several additional high-potential properties being advanced by partners in the Athabasca Basin region, Skyharbour Resources Ltd. — currently trading around C$0.50 per share — represents an intriguing speculation in the North American uranium exploration space.

Flagship Property: Moore Uranium Project

Skyharbour owns 100% of the 137 sq mi Moore Uranium Project located 9 miles east of Denison’s Wheeler River uranium project and 24 miles south of Cameco’s McArthur River uranium mine — all situated in Canada’s famed Athabasca Basin.

This is some of the richest uranium ground on Earth… and it’s where high-grade uranium discoveries are consistently made.

Moore is an advanced stage uranium exploration property with high-grade uranium mineralization at the Maverick Zone that returned drill results of up to 6.0% U3O8 over 5.9 metres, including 20.8% U3O8 over 1.5 metres at a vertical depth of 265 metres.

Skyharbour CEO, Jordan Trimble — whom you’ll be hearing more from in a moment via our exclusive interview — commented via press release:

“We are very pleased with the results thus far from this most recent drill program at our flagship Moore Uranium Project as we continue to outline new high grade zones of uranium mineralization at the Maverick Corridor and make notable progress at earlier-stage regional targets. Final assays are pending for six holes from the program and we plan to commence a fully funded winter drill program early in the new year to follow up on these results. Skyharbour is very well positioned to benefit from the accelerating uranium market recovery with strong discovery potential and upcoming news flow from its continued drilling at Moore as well as at partner funded projects. Worth highlighting is that we now have five partner companies with Azincourt Energy, Valor Resources, Basin Uranium Corp. and Medaro Mining each planning upcoming exploration and drill programs at the East Preston, Hook Lake, Mann Lake and Yurchison projects, respectively.”

Drill results are continuing to be released from Skyharbour’s recently completed 19-hole drill program with plans to resume drilling in early-2022. The focus will continue to be on the Maverick and East Maverick zones as well as a new target referred to as Grid 19.

The main Maverick corridor is approximately 4.7 km long with just over half having been systematically drill tested to-date, which means there’s plenty of expansion potential along strike and at-depth.

In Q4 2021, the Skyharbour team further strengthened its already robust position in the Athabasca with the staking of 6 new prospective uranium exploration properties.

Highlights of the newly-acquired properties include:

  • Riou River Project: 18,227 hectares along the Riou River within the Athabasca basin; contains over 40 km of discrete undrilled EM conductors along a magnetic low and anomalous boulder geochemistry.

  • Pluto Bay Project: 28,840 hectares situated northeast of Black Lake hosting numerous uranium showings and several EM conductors east of the regional Black Lake fault.

  • Wallee Project: 20,765 hectares located ~35 km northwest of Cameco’s Eagle Point Mine; contains numerous untested EM conductors coinciding with significant magnetic and/or gravity lows in the Wollaston Domain.

  • Usam Island Project: 42,186 hectares situated ~21 km northeast of Cameco’s Eagle Point Mine; contains numerous EM conductors alongside significant magnetic lows of the Wollaston Domain

  • Foster River Project: 37,529 hectares located southwest and adjoining Skyharbour’s South Falcon Point project; contains numerous uranium showings including up to 1.25% U3O8 in grab samples.

  • South Dufferin Project: 922 hectares along the trend of the Virgin River Shear, which hosts Cameco’s Centennial high-grade uranium deposit 32 km to the north.

Partner Projects: Multiple Drill Programs Commencing in 2022

In addition to the flagship Moore Uranium Project and the newly-acquired claims, Skyharbour boasts a total of 5 partner projects in Saskatchewan’s Athabasca Basin region:

  • Preston: JV with industry-leader Orano Canada Inc.

  • East Preston: JV with Azincourt Energy.

  • Mann Lake: Option partnership with CSE-listed Basin Uranium Corp.

  • Hook Lake: Option partnership with ASX-listed Valor Resources.

  • Yurchison: Option partnership with CSE-listed Medaro Mining Corp.

For speculators, having a suite of active partner projects means Skyharbour will be delivering news flow not just from the flagship but also by way of its regional partner-funded projects as developments arise and as milestones are checked off.

Preston Uranium Project

Skyharbour is joint-ventured with industry-leader Orano Canada Inc. at the Preston Uranium Project whereby Orano France's largest uranium mining and nuclear fuel cycle company has earned a 51% interest by way of exploration expenditures and cash payments. Skyharbour currently holds a 24.5% interest in the project.

The Preston project spans 49,635 hectares and is strategically located proximal to NexGen’s (TSX-V: NXE) high-grade Arrow uranium deposit and Fission Uranium’s (TSX: FCU) Patterson Lake South project, host to the high-grade Triple R deposit.

East Preston Uranium Project

Skyharbour is joint-ventured with Azincourt Energy on the neighboring East Preston Uranium Project (see below) whereby Azincourt has earned a 70% interest through exploration expenditures, cash payments, and share issuance. Skyharbour maintains a 15% interest in the project.

Azincourt has announced a minimum 6,000 meter, 30-35 hole drill program for East Preston starting in Q1 2022.

Mann Lake Uranium Project

The Mann Lake project has seen more than $3 million in previous exploration expenditures and is situated just 25 km southwest of Cameco’s McArthur River mine — the largest high-grade uranium deposit in the world — and 15 km to the northeast of Cameco’s Millennium uranium deposit.

To complete the previously announced 75% earn-in, Basin Uranium Corp. must pay Skyharbour C$850,000 in cash plus C$1.75 million in securities and spend C$4 million on exploration over the next three years.

Hook Lake Uranium Project

At Hook Lake, Valor Resources can earn-in 80% through C$3,500,000 in exploration expenditures, C$475,000 in cash payments over three years, plus an initial share issuance to Skyharbour.

Valor has announced a maiden drill program at Hook Lake starting in Q1 2022. The program is slated for 2,500 to 3,000 meters across 10 to 15 diamond drill holes in an area of the property that has returned highlight surface samples up to 59.2% U3O8.

Yurchison Uranium Project:

At Yurchison, Medaro Mining Corp. can earn-in an initial 70% of the project through C$5,000,000 in exploration expenditures, C$800,000 in cash payments as well as share issuances over three years followed by the option to acquire the remaining 30% of the project from Skyharbour through a cash payment of C$7,500,000 plus C$7,500,000 in shares.

Medaro has announced plans for a winter 2022 exploration program at Yurchison with the aim of refining existing historical targets plus the identification of new high-priority drill targets.

Tallying up the numbers on these option and joint venture partnerships, Skyharbour is now looking at total exploration expenditures of approximately C$19.8 million, cash payments of just over C$10 million, and significant share positions in some of these partner companies.

These projects will no doubt provide a steady stream of news flow throughout 2022 and beyond while complementing Skyharbour’s upcoming drill program at the flagship, 100%-owned Moore Uranium Project.

Exclusive Interview: Jordan Trimble, CEO, Skyharbour Resources Ltd.

We’ve done our due diligence on Skyharbour Resources… and we’re impressed with the company’s vast uranium property portfolio in the Athabasca, its partnerships with global uranium development companies, and its highly-adept management team starting with CEO, Jordan Trimble.

Skyharbour boasts a highly impressive amalgamation of talent — one we firmly believe has what it takes to get the job done for early SYH / SYHBF shareholders.

It’s a team that includes none other than professional geologist and strategic advisor, Paul Matysek, who founded and led Energy Metals as president and CEO prior to its eventual buyout by Uranium One for US$1.5 billion in 2007.

These are the types of industry professionals you can have confidence in… that you want to bet on… in this highly competitive industry!

Please enjoy our exclusive interview with Skyharbour president & CEO, Jordan Trimble.

The Skyharbour Resources Opportunity

The new uranium bull market has arrived… and it’s only just getting started.

Uranium prices are poised to resume their upward trend following what many in the industry are describing as a healthy bull market pullback. And select small-cap uranium stocks — including Skyharbour Resources — appear poised to follow suit.

Led by president & CEO, Jordan Trimble, Skyharbour Resources has amassed an impressive portfolio of 14 drill-ready projects covering over 385,000 hectares in the famed Athabasca Basin region — oftentimes referred to as The Saudi Arabia of Uranium.

The combination of 100%-owned and partner-funded projects makes Skyharbour one-to-watch in the new uranium bull market.

You heard directly from CEO Jordan Trimble. He says,

“I think 2022 is setting up to be an amazing year. I think we'll see the uranium price, obviously, have a major move higher. But I think the equities… you're going to see new highs being set. Everything is lining up.”

As we discussed in detail, the next major leg up in the uranium price will be driven by utilities coming into the market to secure long-term U3O8 contracts.

That means we could be setting up for a much higher uranium price environment — potentially well above US$75 per pound — for years to come.

You also heard from our own Gerardo Del Real. He recently said,

“I think we're going to see the uranium price overshoot to the US$200 level before it does a 50% retracement to a more sustainable US$100 level.”

The Skyharbour team is currently focused on advancing the flagship Moore Uranium Project located in the southeastern portion of the Athabasca Basin in close proximity to Denison's Wheeler River uranium project and Cameco’s McArthur River uranium mine.

Drilling is set to resume at Moore in Q1 2022.

Additionally, Skyharbour has no less than 5 partner projects in the Athabasca Basin region. Drill programs have been announced for East Preston and Hook Lake, and exploration programs have been announced for Mann Lake and Yurchison.

It’s a brilliant model of developing certain projects on their own — such as the flagship Moore project — while joint venturing or optioning out other properties with the vast majority of exploration expenditures on those projects being on other companies’ dimes with Skyharbour maintaining an interest.

With a robust portfolio of 14 drill-ready, Athabasca-based uranium exploration projects in a rising uranium market — Skyharbour’s sub-C$70 million market cap is considered minuscule compared to many of its peers.

The company is also well-funded with approximately C$9 million in the treasury.

Now is an excellent time to begin conducting your own due diligence on Skyharbour Resources Ltd. — symbol SYH on the Toronto Venture Exchange and symbol SYHBF on the US-OTC Bulletin Board Exchange.

A great place to start is Skyharbour’s corporate website. Sign up for updates directly from the company here.

And be sure to follow our exclusive interviews with upper management and much more.

— Resource Stock Digest Research