VANCOUVER, BC, July 29,
2024 /PRNewswire/ - Uranium Royalty Corp. (NASDAQ:
UROY, TSX: URC) ("URC" or the "Company") is
pleased to announce that it has entered into a binding royalty
purchase agreement to acquire an additional royalty on a portion of
the Churchrock uranium project ("Churchrock Project" or the
"Project") owned indirectly by Laramide Resources Ltd.
("Laramide") in New Mexico,
USA. The Churchrock Project is an advanced stage, ISR
uranium project located in the Grants Mineral Belt of New Mexico, USA, 12 miles northeast of
Gallup, New Mexico. Laramide
has disclosed that the Churchrock Project and nearby properties
represent one of the largest and highest-grade undeveloped ISR
uranium projects in the United
States.
Transaction Highlights:
- The royalty is structured as a Gross Overriding Royalty of 6%
"Mine Price", which anticipates recovery of reasonable and actual
costs to transport the mineral to the final point of sale. The
royalty covers the 10 patented mining claims in Section 8 property
(640 acres) that comprise New Mexico Mineral Survey 2220 on the
Churchrock Project.
- Total consideration payable by the Company under the
transaction is US$3.5 million, which
will be satisfied by the Company on closing by paying US$1.75 million in cash to each of the vendors,
each of whom owns an undivided one-half interest in the royalty.
The purchase price for the royalty will be funded from cash and
liquid assets on hand.
- The recently released technical report on the Churchrock
Project (the "Churchrock Technical Report") highlights a
total Inferred Mineral Resource of 50.8 million pounds
("Mlbs") U3O8 for the Project,
including an Inferred Resource of 10.22 Mlbs
U3O8 on Section 8 alone. The preliminary
economic assessment is preliminary in nature and includes inferred
mineral resources that are considered too speculative geologically
to have the economic considerations applied to them that would
enable them to be categorized as mineral reserves. There is no
certainty that such preliminary economic assessment will be
realized.
- The Churchrock Technical Report, includes a preliminary
economic assessment that estimates a Life of Mine production total
of 31.2 Mlbs U3O8, with recovered metal per
year of 975,000 pounds U3O8 from the
Crownpoint Central Processing Plant, and a mine life of 32
years.
Scott Melbye, Chief Executive
Officer of URC stated: "Laramide's Churchrock Project represents
one of the largest undeveloped ISR assets in the United States. We're very pleased to
acquire an additional royalty on this asset, as it represents an
important future source of U.S. uranium production."
Mr. Melbye continued: "Recent, successful, bipartisan
legislation in the U.S. Congress, has sought to revitalize the
American domestic nuclear fuel cycle. These bills, signed into law,
'The Prohibiting Russian Uranium Imports Act' and the 'Nuclear Fuel
Security Act', provide funding to incentivize the build-out of
uranium, conversion, and enrichment capacity in the U.S., and
completely phase out Russian imports by 2028. Our enlarging
footprints in the uranium royalty sector in the United States as evidenced by the
acquisition of the additional royalty on Churchrock fit squarely in
support of those initiatives".
Closing of the Transaction is subject to, among other things,
the satisfaction of customary closing conditions and is expected to
occur before the end of July
2024.
The Churchrock Project
The Churchrock Project is a Development stage, In-Situ Recovery
("ISR") uranium project located on the western end of the Grants
Mineral Belt of New Mexico, USA,
12 miles north-northeast of Gallup, New
Mexico. The Project is 100% owned by NuFuels, Inc., a wholly
owned subsidiary of Laramide. Laramide is a Canadian company
engaged in the exploration and development of uranium assets based
in Australia and the United States.
Church Rock has publicly
disclosed a mineral resource estimate that includes a total
inferred resource of 10.22 Mlbs U3O8 on
Section 8 of the Project. The Company notes that the purchased
royalty interest covers only a portion of such section. The
preliminary economic assessment disclosed by Laramide (the "PEA")
provides for production in Section 8 occurring in the first eight
years of production, recovering one million pounds of
U3O8 per annum upon steady state production
assuming well field recovery of 80%.
Four years of preproduction for wellfield development is
anticipated in the PEA, but all other infrastructure necessary to
resume operations is in place. Laramide also disclosed that it
holds substantially all required permits and licenses to begin
uranium production from Section 8. Life of Mine unit operating cost
is estimated at US$27.70/lb.
U3O8 the PEA. The study assumed a static
uranium price of US$75/lb.
U3O8.
For further information regarding the Churchrock Project,
including the above-referenced PEA and mineral resource estimate,
please refer to the technical report titled "Technical Report on
the Churchrock Uranium Project, McKinley
County, New Mexico, USA", with an effective date of
February 22, 2023, prepared for
Laramide Resources Ltd., available at www.sedarplus.ca (the
"Churchrock Technical Report").
The Churchrock Royalty
Each of the vendors owns an undivided one-half interest in a
uranium royalty of six percent (6%) mine price on part of the
S2NE4; part of the E2SW4: part of the SE4NW4 and SE4, Section 8,
T16N, R16W, N.M.P.M., McKinley County,
New Mexico. The royalty covers the 10 patented mining claims
in Section 8 that comprise New Mexico Mineral Survey 2220 on the
Churchrock Project.
The royalty is structured as a Gross Overriding Royalty of 6%
"mine price", which anticipates revenues based on contract sales
and recovery of certain reasonable and actual costs to transport
the mineral to the final point of sale.
About Uranium Royalty Corp.
Uranium Royalty Corp. is the world's only uranium-focused
royalty and streaming company and the only pure-play uranium listed
company on the NASDAQ. URC provides investors with uranium
commodity price exposure through strategic acquisitions in uranium
interests, including royalties, streams, debt and equity in uranium
companies, as well as through holdings of physical uranium. The
Company is well positioned as a capital provider to an industry
needing massive investments in global productive capacity to meet
the growing need for uranium as fuel for carbon-free nuclear
energy. URC has deep industry knowledge and expertise to identify
and evaluate investment opportunities in the uranium industry. The
Company's management and the Board include individuals with decades
of combined experience in the uranium and nuclear energy sectors,
including specific expertise in mine finance, project
identification and evaluation, mine development and uranium sales
and trading.
Note on Technical Disclosure
Darcy Hirsekorn, the Company's
Chief Technical Officer, has supervised the preparation of and
reviewed the technical information contained in this news release.
He holds a B.Sc. in Geology from the University of Saskatchewan, is a qualified person
as defined in National Instrument 43-101 Standards of Disclosure
for Mineral Projects ("NI 43-101") and is registered as a
professional geoscientist in Saskatchewan.
Unless otherwise indicated, the scientific and technical
information herein regarding the Churchrock Project has been
derived from the Churchrock Technical Report, and Laramide's other
public disclosures, copies of which are available under its profile
on SEDAR+ at www.sedarplus.ca.
As a royalty holder, the Company has limited, if any, access to
the properties subject to its interests. The Company generally
relies on publicly available information regarding these properties
and related operations and generally has no ability to
independently verify such information. In addition, such publicly
available information may relate to a larger property area than
that covered by the Company's interests.
Unless otherwise indicated, the technical and scientific
disclosure contained or referenced herein has been prepared in
accordance with NI 43-101, which differs significantly from the
requirements of the U.S. Securities and Exchange Commission
applicable to U.S. domestic issuers Accordingly, the scientific and
technical information contained or referenced in this press release
may not be comparable to similar information made public by U.S.
companies subject to the reporting and disclosure requirements of
the SEC. "Inferred mineral resources" have a great amount of
uncertainty as to their existence and great uncertainty as to
their economic and legal feasibility. It cannot be assumed that
all or any part of an inferred mineral resource will ever be
upgraded to a higher category.
Forward Looking Statements
Certain statements in this news release may constitute
"forward-looking information" and "forward looking statements", as
defined under applicable securities laws, including those regarding
the disclosed expectations of the operator of the Project,
including expectations regarding the Project, including estimates
included in Laramide's disclosed PEA. Forward-looking
information includes statements that address or discuss activities,
events, or developments that the Company expects or anticipates may
occur in the future. When used in this news release, words such as
"estimates", "expects", "plans", "anticipates", "will", "believes",
"intends" "should", "could", "may" and other similar terminology
are intended to identify such forward-looking information.
Statements constituting forward-looking information reflect the
current expectations and beliefs of the Company's management. These
statements involve significant uncertainties, known and unknown
risks, uncertainties, and other factors and, therefore, actual
results, performance or achievements of the Company and its
industry may be materially different from those implied by such
forward-looking statements. They should not be read as a guarantee
of future performance or results and will not necessarily be an
accurate indication of whether or not such results will be
achieved. A number of factors could cause actual results to differ
materially from such forward-looking information, including,
without limitation, any inability to satisfy the conditions to the
transaction announced herein, risks inherent to royalty companies,
uranium price volatility, risks related to the operators of the
projects underlying the Company's existing and proposed interests
and those other risks described in filings with Canadian securities
regulators and the U.S. Securities and Exchange Commission. These
risks, as well as others, could cause actual results and events to
vary significantly. Accordingly, readers should exercise caution in
relying upon forward-looking information and the Company undertakes
no obligation to publicly revise them to reflect subsequent events
or circumstances, except as required by law.
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SOURCE Uranium Royalty Corp.
