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Uranium Co. Preparing for a Follow-up Drill Program

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Planning is underway at both properties showing established uranium potential. The Buy-rated company is well-positioned given uranium's current bull market.

North Shore Uranium Ltd. (NSU:TSX) is preparing for a follow-up drill program at Falcon and, later, a maiden drill campaign at West Bear, both are uranium projects in Saskatchewan's Athabasca Basin, President and Chief Executive Officer Brooke Clements said in an interview.

"We think we've just scratched the surface at Falcon," Clements told RCTV. "More work is clearly warranted on the discoveries we made this winter. We have a lot of untested, high-priority targets that we want to evaluate." As for West Bear, "We have some targets we want to test in an area where there has been no drilling."

Both projects, about 90 kilometers (90 km) apart, are at the basin's eastern margin, an area with much less past exploration than the expanse to the west. Both projects have historical exploration data, now in the hands of North Shore, which complemented it with airborne gravity surveys over each property in 2022. Both projects boast established uranium potential.

Clements provided an update on both assets. As for the 55,000-hectare Falcon project, North Shore completed its maiden drill program earlier this year. It selected the drill targets after analyzing various historical data sets and the results of airborne geophysical surveys done in 2006, 2007, and 2022, said Clements.

Red Cloud Securities Analyst David Talbot described the drill results in a March research report. "In our view, the structures and alteration typical of basement-hosted uranium mineralization [were] identified by this initial drill program," he wrote. "We see the results as a positive first step."

Specifically, the new data indicated near-surface mineralization at two targets, PO3 and PO8, 1.3 km apart from one another and each associated with near vertical electromagnetic conductor systems, said Clements.

At PO3, the company encountered a subvertical graphitic brittle fault zone about 10 meters (10m) wide, between 196 and 206m downhole. Five intervals showed 100+ parts per million (100+ ppm) U3O8, and three samples, 300+ ppm U3O8. Also, the structure and mineralization were associated with a chlorite and silica alteration.

At PO8, the company hit near-surface uranium mineralization between 42m and 47m. A 4.7m interval averaged 316 ppm U308; the highest value was 572 ppm. Between 67 and 71m two intervals had 100+ ppm U308. Between 102 and 105m, the company hit the targeted electromagnetic conductor system and encountered a brittle graphitic fault zone that had elevated, but not anomalous, uranium, bleaching clay alteration, hematite alteration, chloride alteration, and patchy silica alteration.

Before the next drill program, said Clements, North Shore is analyzing its extensive geophysical and geological database along with data from the drill program and plans to go into the field to investigate some of the priority targets.

Regarding West Bear, limited historical drilling has been done on the property, the last four holes drilled by Denison Mines Corp. (DML:TSX; DNN:NYSE.MKT) in 2015. About 1.5 km to the north of West Bear, Uranium Energy Corp. (UEC:NYSE AMERICAN) has the only cobalt-nickel resource in the basin as well as a uranium reserve. 

North Shore intends to drill the West Bear property in the future.

Stock Has Rerating Potential

Overall, about this British Columbia-based uranium explorer-developer, Clements said, "I think we offer good value for exposure to grassroots uranium exploration. It looks like we're at the beginning of a major bull cycle in uranium, and excitement is building in the exploration sector." The CEO added that it is a good time to invest in it.

Technical Analyst Clive Maund is bullish on North Shore Uranium, too. He recommended it as an immediate Strong Speculative Buy in May when it was CA$0.17 per share. Now the price is even lower.*

According to Talbot, "As the company continues to execute on its exploration strategy at Falcon and West Bear, we believe that the stock has the potential to rerate."

The Catalyst: Further Exploration Work

North Shore has catalysts ahead this year related to both Falcon and West Bear, wrote Talbot, as it continues executing its exploration plans at each. Specifically, at Falcon, the team is in the process of desktop and field evaluation, which will be followed by further drilling.

At West Bear, desktop and field evaluation of targets is the next step.

Uranium Bull Market Underway

Interest in uranium is growing as major economies around the globe continue their decarbonization efforts and transition to green energy, Georgina McKay reported for Bloomberg on June 24.

"China is rapidly deploying atomic power, Japan is looking to boost its economy by giving nuclear another chance, and across the U.S. and allied countries, owners of left-for-dead uranium mines are restarting operations," she wrote.

The return to nuclear is evidenced, McKay added, by the upswing in the uranium price. It has gained 233% over the past five years, more than three times the gains in gold and copper. Last year, the price climbed 88.54%, Jacob White with Sprott wrote on June 20.

"This phase indicates a healthy correction within a bullish market cycle," White commented. "We believe that uranium's recent pause may be an attractive entry point in the overall uranium bull market."

Global demand for uranium is robust. As for supply, very little investment has been made in production post-Fukushima.

"With no meaningful new supply on the horizon for three to five years, we believe this bull market has further room to run," White added. " Over the long term, increased demand in the face of an uncertain uranium supply may likely continue supporting a sustained bull market."

Mine restarts, and new mines to come online are critical, White purported, given the lack of adequate supply for the world's nuclear reactors, the expected supply deficit over the next 10 years, and the long lead times and capex requirements hampering near-term supply.

streetwise book logoStreetwise Ownership Overview*

North Shore Uranium Ltd. (NSU:TSX)

*Share Structure as of 5/16/2024

Ownership and Share Structure

Among the reasons investors should consider North Shore, Clements said, are its ownership by insiders and founding investors, tight share structure, and attractive valuation.

Insiders and founding investors who are not insiders own approximately 45% of the issued and outstanding shares. Clements himself owns 3.43% or 1.26M shares, Director Doris Meyer has 2.11% or 0.78M shares, and Director James Arthur holds 1.45% or 0.53M shares.

Most of the rest is with retail, as the institutional holdings are minor.

North Shore has 36.84M outstanding shares.

The company has a market cap of CA$3.69 million at the recent price of CA$0.10 per share. It has traded in the past 52 weeks between CA$0.075 and CA$0.30 per share.

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Important Disclosures:

  1. North Shore Uranium Ltd. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of North Shore Uranium Ltd. and Uranium Energy Corp.
  3. Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
  4.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

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* Disclosure for the quote from the Clive Maund article published on May 1, 2024

  1. For the quoted article (published on May 1, 2024), the Company has paid Street Smart, an affiliate of Streetwise Reports, US$1,500 in addition to the monthly consulting fee. 
  2. Author Certification and Compensation: [Clive Maund of] is being compensated as an independent contractor by Street Smart, an affiliate of Streetwise Reports, for writing the article quoted. Maund received his UK Technical Analysts’ Diploma in 1989.  The recommendations and opinions expressed in the article accurately reflect the personal, independent, and objective views of the author regarding any and all of the designated securities discussed. No part of the compensation received by the author was, is, or will be directly or indirectly related to the specific recommendations or views expressed Disclosures

The quoted article represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be  only be construed as a recommendation or solicitation to buy and sell securities.

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