Recharge Metals (ASX:REC) has signed a binding agreement with DG Resource Management and Kalt Industries to acquire 100% of the Newnham Lake Uranium Project in Canada.
Newnham Lake is near the northeast margin of the Athabasca Basin and 56km northwest of IsoEnergy’s (TSX.V:ISO) Hurricane deposit, which has an indicated resource of 48.6 million pounds of triuranium octoxide (U3O8) based on a 63,800 tonnes grading 34.5% U3O8.
The acquisition is expected to be completed on or about 15 March 2024. Conditions must be satisfied no later than 28 March 2024.
The $7.9 million market capitalisation company says the project provides an ‘outstanding’ opportunity for it to make a new uranium discovery against the backdrop of a ‘strong’ uranium price.
Recharge’s established Canadian footprint, in-country relationships, and focus on green energy makes this a logical acquisition, as well as a highly accretive addition to its portfolio.
The company has also received firm commitments for a $1.44 million share placement of over 24 million fully paid ordinary shares at $0.06 per share to fund the acquisition, as well as accelerate exploration activities at Newnham Lake.
Pamplona Capital was retained as lead manager of the placement and will be paid 6% of the proceeds of the placement.
An additional $50,000 will be placed to directors, subject to shareholder approval.
Managing Director Felicity Repacholi says the company’s bid for the project is testament to its “strong working relationship” DGRM.
“This acquisition is a complementary and highly value-accretive addition to Recharge’s portfolio.
The Athabasca Basin has some of the world’s largest and highest-grade uranium deposits and is the source of around 20% of global uranium production annually.
Historical drilling at Newnham Lake has confirmed the presence of uranium in the system. However, drilling has only focused on the shallow Athabasca Basin unconformity, with minimal drilling done in the underlying basement rocks.
Advancements in the understanding of basement-hosted mineralisation has helped uncover some spectacular deposits, such as NexGen’s Arrow Deposit. This basement-hosted geological model adds weight to the prospectivity of Newnham Lake, as does the scale of the coincident low resistivity anomaly which is analogous to Arrow, and will be Recharge’s primary target.”
The Newnham Lake Project covers an area of 15.84km-square and was flagged for uranium mineralisation in the 1970s and 1980s in the vicinity of the unconformity at shallow depths.
Recharge Metals is an explorer with a portfolio of projects scattered around Canada which provide exposure to uranium and lithium.
The company is also progressing the copper-focused Brandy Hill South Project in Western Australia.
As of December 2023, Recharge Metals had $1.263 million cash and cash equivalents at hand, according to its latest quarterly report.
Write to Adam Drought at Mining.com.au
Images: Recharge Metals
