In a February 2021 research note, Globe Small Cap Research stated that Blue Sky Uranium Corp. (BSK:TSX.V; BKUCF:OTCQB) "is worthy of active consideration and ongoing following for developments."
Globe described the company and presented its compelling factors, noting, "There is a lot to like about the Blue Sky Uranium story."
Blue Sky Uranium is a Canada-headquartered junior uranium and vanadium exploration company that owns 5,000-plus square kilometers of property in Argentina's Rio Negro and Chubut provinces. It has exclusive mining rights to more than 400,000 hectares, divided into two primary areas: Amarillo Grande, the project on which it is currently focused, and Sierra Colonia.
At Amarillo Grande, Blue Sky's main target area today is the Ivana deposit, containing 23 million pounds (23 Mlb) of uranium and up to 12 Mlb of vanadium, as estimated by the company. On Feb. 1, 2021, it restarted its 4,500-meter Ivana drill program, previously suspended due to COVID-19 restrictions. The campaign will test Ivana Central and Ivana North, two of the three current targets there. The third is Ivana West.
The firm noted that an attractive feature of the Amarillo Grande property is that the uranium mineralization there is shallow, at about only 25 meters below surface. Given that and the fact the entire deposit sits in a 5 kilometer (5 km) long strip of land, ore extraction can be done at a low cost, "on par with industry leaders in Central Asia," Globe highlighted. Ore processing should be low cost, too, as it will only require a simple, two-stage process.
"The combination of low priced extraction and simple initial processing could result in an ultra-low-cost operational position for Blue Sky," according to Globe.
The company also offers potential blue sky with its numerous other exploration sites. They include Cateo Cuatro and Ivana East, 10 km to the northeast and 32 km to the southwest, respectively, of the main Ivana deposit. In addition, the 15-km long Anit site could contain a significant vanadium deposit, and the Santa Barbara District site is prospective for deeper mineralization.
Management is a key component of Blue Sky, Globe indicated. The company is part of the Grosso Group Management, a set of highly experienced, successful executives and companies specializing in mineral exploration in South America. Joseph Grosso, Grosso Group's president and CEO, is one of Argentina's mining pioneers and is the chairman of Blue Sky's board of directors. Further, Blue Sky's management team, helmed by Nikolaos Cacos, comprises industry professionals with extensive experience in exploration, mining, international business and finance.
Globe pointed out that the status of Argentina's nuclear industry enhances the investment outlook for Blue Sky. The country is home to three operating nuclear power plants that generate 10% of its electricity, and the construction of two more is being planned. Argentina also has a uranium enrichment plant for manufacturing fuel for the country's nuclear plants.
Argentina needs 225 tons of uranium annually, all of which it currently has to import. Similarly, the country imports all of the vanadium it needs, and demand for that metal by the steel industry is rising. Consequently, in 2006, Argentina initiated a uranium exploration program with the goal of developing domestic suppliers. All of these factors bode well for Blue Sky Uranium in the South American country.
In a broader context, demand for uranium from the global nuclear industry is expected to increase, also creating opportunities for Blue Sky, Globe indicated. Signs of this are Asia quickly growing its nuclear capacity, the U.S. enacting policy about domestic uranium supply and the emergence of new, safer nuclear technologies. Further, to deal with climate change, the world needs to use nuclear power and, thus, will need uranium.
"[Blue Sky Uranium] is operating in a hot space where growth opportunities are stellar," Globe added.
The company is trading today at about CA$0.28 per share.
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1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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Disclosures for Globe Small Cap Research LLC, Blue Sky Uranium, February 2021
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