Fission Uranium raising $75M to advance PLS project in Saskatchewan

Fission Uranium (TSX: FCU; US-OTC: FCUUF) is raising $75 million to advance the exploration and development of its PLS uranium project on the southwest rim of the Athabasca Basin in Saskatchewan.

A feasibility study filed last March outlined a three-year construction period and a cost of $1.1 billion to develop a mine with a 10-year life at PLS. During that time, 90.9 million lb. of uranium oxide (U₃O₈) will be produced. Production is targeted for 2029.

Fission announced in January a 6,000-metre regional exploration drill program at PLS that will test several targets along the Patterson Lake Conductive corridor that hosts the Triple R deposit.

Through the bought-deal financing, led by Canaccord Genuity and SCP Resource Finance, the company plans to sell 65.6 million common shares at $1.18 each. The financing is expected to close around Feb. 12.

The underwriters also have an option to purchase up to an additional 15% of shares sold under the offer for a period of 30 days.

PLS has robust post-tax economics, including an internal rate of return of 27.2%, a net present value at an 8% discount of $1.2 billion, and a payback period of 2.6 years. The study pegged average cash costs at US$9.77 per lb. U₃O_8.

Fission intends to file a draft environmental impact statement to the province early this year. It will reflect an updated mine plan to extract 1,000 tonnes a day at the project.

The shallow, high-grade Triple R deposit is the basis of the mine plan, beginning with the R780E and R840W zones. There is future opportunity to upgrade resources at the R1515W and R1620E zones, but they are not included in the current plan.

The indicated resource contains 114.9 million lb. U₃O₈ in 2.7 million tonnes of material that grades 1.94% U₃O₈. Within that resource is a probable reserve of 3 million tonnes grading 1.41% U₃O₈ for 93.7 million lbs. of contained metal. A cut-off grade of 0.25% U₃O₈ was used. Material in the inferred category of reserves was not considered in planning the mine.

Company shares were down 10% on Monday in Toronto to $1.17 apiece, valuing the company at $896.8 million. Its shares traded in a 52-week range of 54¢ and $1.33.