Skyharbour Resources Ltd.


Building a High-Grade Uranium Resource in Canada’s Athabasca Basin

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

With its own flagship project and several projects being explored by partners, Skyharbour Resources Ltd. currently trading around US$0.60 per share represents an intriguing speculation in the North American uranium exploration space.

Flagship Property: Moore Uranium Project

Skyharbour owns 100% of the 137 square mile Moore Uranium Project located 9 miles east of Denison’s Wheeler River Uranium Project and 24 miles south of Cameco’s McArthur River Mine — all located in Canada’s famed Athabasca Basin.

This is some of the richest uranium ground on earth!

In July 2016, Skyharbour secured an option from Denison Mines (TSX: DML) (NYSE: DNN), a large strategic shareholder of Skyharbour, to acquire a 100% interest in the Moore Uranium Project which hosts the high-grade Maverick Zone — a key area of interest.

Skyharbour Resources is generating news from its drill program at Moore, as well as from its partner-operated projects. Rigs have been mobilized and the company has recently expanded the planned drill program from 3,500 meters to 5,000 meters.

Uranium Prices: Breaking Out!

In the resource space timing is everything!

After a near decade-long bear market in uranium, we’re finally starting to see U3O8 prices breaking to the upside primarily as a result of a constrained supply side over the last several years culminating in a wave of temporary mine closures due to the coronavirus pandemic – most notably the suspension of operations at Cameco’s massive Cigar Lake uranium mine and production curtailment at Kazakh mines.

We’ve seen U3O8 prices surge from around $25 per pound to above $45 per pound… signaling what could be the start of a long-awaited breakout for this vitally important, clean energy metal — commonly referred to as yellowcake.

The spot uranium price has now hit 9-year highs.

Some analysts believe in addition to the already compelling supply-demand fundamentals, the COVID-19 crisis could create a shock to the nuclear fuel supply chain causing a substantial rise in U3O8 prices as large producers suspend operations, draw down inventories, and/or increase market purchases to fulfill existing contractual obligations with utilities.

VIII Capital said in research note that in the United States, where 24% of the uranium used for nuclear fuel comes from Canada, it "suddenly looks like the [utilities] will be scrambling for product, as the largest source of uranium is gone."

The virus is also slowing production in Kazakhstan — which supplies over 40% of global uranium.

Developments such as these could drive uranium prices significantly higher in the weeks and months ahead, especially now with the Sprott Physical Uranium Trust entering the market and buying millions of pounds.

I’ve done my due diligence on Skyharbour Resources…

And I’m 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, and head geologist, Rick Kusmirski.

Noteworthy is that Rick Kusmirski has been a uranium-focused exploration geologist for some 4-plus decades previously serving as exploration manager at industry leader Cameco for 10-plus years.

Skyharbour boasts a highly impressive team — one I firmly believe has what it takes to get the job done for SYH / SYHBF shareholders.

Please enjoy my exclusive interview with Skyharbour’s President & CEO, Jordan Trimble.

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

Why Uranium, Why Now?

The Athabasca Basin region, which plays host to Skyharbour’s flagship Moore Uranium Project, is known as the world’s leading source of high-grade uranium.

This massive geologic formation has been responsible for about 20% of the world’s uranium supply in recent years.

The United States is by far the world’s largest user of nuclear power with one-in-five American homes relying on nuclear generated power for electricity.

A full two-thirds of America’s clean energy generation is coming from this source. In fact, nuclear is currently the world’s #1 source of clean energy… bigger than solar, wind, and all other renewable energy sources combined.

Our planet will continue to require clean nuclear energy as a means of mitigating the global warming effects of greenhouse gas emissions from coal and other carbon-based fuels.

Yet, quite alarmingly, America is almost entirely dependent on foreign imports of uranium. That lies in stark contrast to the early-1980’s when our nation’s uranium was 100% Made-in-America.

Today, with crucial trade barriers removed, less than 10% of our uranium is derived from American sources.

That’s all about to change...

America consumes a staggering 50 million pounds of uranium every year. Yet, it produces under 0.5 million pounds… less than what it brought to surface back in the early 1950’s.

The US has 95 nuclear reactors… yet only produces enough fuel for one!

It should come as little surprise then, that in order to meet its robust demand, America imports a stunning 48 million pounds every year — making it over 90% reliant on foreign uranium sources.

And just WHO are some of America’s biggest suppliers?

Russia, of course, and its satellite states of Kazakhstan and Uzbekistan. In total, these nations supply around 40% of America’s U3O8 needs.

The risk to America’s national security is clear; drastic change is long overdue. That’s why the long-awaited recommendations from the US Nuclear Fuel Working Group in relation to the Section 232 Petition were so important.

With the creation of a US national uranium reserve and rising prices, we can reasonably expect US utilities to resume large-scale uranium market purchases, particularly as current term contracts with US producers draw to a close.

Plus, the threat of cascading indefinite mine closures and tightening supply as a result of the coronavirus pandemic has already begun to push uranium prices higher to above $45 per pound today.

Scotiabank Global Banking and Markets said in a note that closing the Cigar Lake mine "has the potential to become the turning point in a ~10-year bear market."

It stresses that the site represents a "massive 13%" of global mine supply and 10% of total supply including secondary material.

Demand for uranium will keep rising…

Currently, there are 55 nuclear reactors under construction globally most notably in China, India, and the UAE.

China has 47 nuclear reactors in operation 12 being built now and many more slated to commence construction soon. Saudi Arabia has agreements to build 16 new reactors by 2040. Thus, you can see demand growth coming from all corners of the globe.

While it’s difficult to predict with any kind of certainty exactly WHEN uranium prices will catch up to global demand growth… the bottom line is that it WILL happen.

When it does, companies with world-class assets in safe mining jurisdictions like Skyharbour Resources should be among the first to capture disproportionate gains.

Keep in mind also that only 2.5 km of the total 4.7 km long Maverick corridor at Skyharbour’s flagship Moore Uranium Property has been systematically drill-tested.

That means there is robust discovery potential along strike and at-depth in the underlying basement rocks, which have seen limited drill testing historically.

Translation: There’s a lot of room for discovery and resource expansion by way of the drill.

In Closing…

Today’s uranium market is showing very compelling supply-demand fundamentals that should lead to an upward trajectory in the spot price for uranium.

We’re already seeing the beginning stages of this pending resurgence with the recent move from $25/lb to above $45/lb.

In my opinion, Skyharbour’s Moore Uranium Project is one of the top high-grade uranium exploration projects in the world. It checks every box – including size, grade, geology, and jurisdiction.

Skyharbour clearly stands out as one of the most compelling opportunities in the uranium exploration sector for speculators with the right time horizon.

I think the market will eventually wake up to the potential here… and any further upward movement in the uranium spot price could prove to be a powerful catalyst for higher share values.

For investors who are interested in the uranium market, now is an opportune time to take a close look at Skyharbour. Skyharbour Resources Ltd. trades on the TSX Venture Exchange under the symbol SYH and on the US-OTCQB market under the symbol SYHBF.

Yours In Profits,

Mike Fagan, Editor

Resource Stock Digest

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