NexGen Energy (TSX, NYSE: NXE; ASX: NXG) is now the full owner of its portfolio of exploration assets in the southwest Athabasca Basin after consolidating a minority interest held by Rio Tinto (ASX, LSE: RIO) on certain projects.
On Thursday, the Vancouver-headquartered uranium miner announced it has acquired Rio’s 10% production carried interest over 39 mineral claims in the region, including those hosting the PCE discovery, by exercising its right of first refusal on these assets.
Financial details of the transaction weren’t disclosed.
As set out in the parties’ initial arrangement, Rio is entitled to a 10% undivided interest in future production from the mineral claims, carried through to the commencement of commercial production. This was put in place before NexGen acquired the land package in 2012.
PCE project
The centrepiece of the claims package is PCE — or Patterson Corridor East — an uranium occurrence situated 3.5 km east of the world-class Arrow deposit that the NexGen team discovered in 2014.
Part of the larger, Rook I property, the Arrow deposit is host to one of the largest uranium resources in the world, containing 256.7 million lb. of U3O8 (uranium oxide) in the measured and indicated categories and another 80.7 million lb. in inferred.
Anchored by this resource, NexGen considers Rook I to be the largest development-stage uranium project in all of Canada. A feasibility study in 2021 estimated an after-tax net present value (at 8% discount) of $3.47 billion with a 52% internal rate of return. The proposed mine, which is now in the engineering stage, could produce nearly 29 million lb. of U3O8 per year over the first half of its approximate 10.7-year life.
Arrow similarity
The PCE discovery, according to the company, could mirror that of Arrow due to their similarities in geology. Initial drilling results at PCE have indicated an expansive footprint with remarkable continuity of mineralization, it said.
In a press release, NexGen CEO Leigh Curyer said that the two deposits could help meet the “ever-growing need for a safe, secure supply of uranium,” citing that the market is currently in a deficit and the massive spending required to build AI data centres, which would be powered by nuclear energy.
“Given the world class extent, high grade and superior technical setting of mineralization discovered to date at our two projects, consolidating our portfolio at PCE and surrounding area to match our 100% ownership in our world-class Arrow deposit, is entirely in line with our strategic objective of becoming the future leader in uranium production worldwide,” he said.
NexGen Energy fell 1.7% to $9.96 Friday afternoon in Toronto, giving the company a market capitalization of about $5.7 billion. This followed a jump of 4.9% Thursday.
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