Uranium Co. With Large Project Portfolio Upsizes Private Placement

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2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Skyharbour Resources Ltd.
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Skyharbour Resources Ltd. (SYH:TSX.V; SYHBF:OTCQX; SC1P:FSE) announced it was upsizing a previously announced private placement for proceeds up to CA$9.5 million.

The placement will include the sale of up to 5 million hard-dollar units of the company at a price of 40 cents per unit for gross proceeds of up to CA$2 million plus any combination of the following for total gross proceeds of up to CA$7.5 million: charity flow-through (FT) shares at a price per charity FT share of 59 cents and traditional flow-through shares at a price per traditional FT share of 46 cents.

Red Cloud Analyst David Talbot recently called the company one of the "good stories from the Athabasca Basin."

According to a Kitco report on Wednesday, uranium prices have fluctuated widely this year, from above US$100 per pound in February to below US$80 at the start of November. The price was US$77.50 on Wednesday.

Geopolitical news and the aftermath of Donald Trump's election victory in the U.S., "while stressful on the nuclear industry, is positive for the uranium industry," Talbot wrote in a uranium sector update note on November 21.

"The market is telling us, at least right now, as geopolitical issues are driving the equity markets, it doesn't much matter if you are looking at uranium producers, developers (who might have the current advantage right now) or explorers," he wrote. "But if you are going downstream, investors should best be on the lookout for companies with better stories (like Skyharbour). We believe that buying a basket of junior exploration companies is a sound way to reduce risk for investors."

In the Kitco report, Scott Melbye, executive vice president of Uranium Energy Corp., cited a growing acceptance of nuclear power and the need for new uranium mines to meet increasing demand in his prediction that uranium prices will reach three-digit figures again in 2025.

"Expect uranium prices to remain high and probably increase much more from where they are today," Melbye told Kitco. "I won't predict how high the uranium price goes next year, but it has one in front of it. So, it is a three-digit [price tag]."

Details of Placement

In Skyharbour's private placement, each unit will consist of one common share of the company plus one-half of one common share purchase warrant. Each warrant will entitle the holder to purchase one share at an exercise price of 55 cents for 30 months following the completion of the offering.

The gross proceeds from the sale of the charity FT shares and the traditional FT shares will be used by the company to incur "eligible Canadian exploration expenses that qualify as flow-through critical mineral mining expenditures … and will also be used to incur eligible flow-through mining expenditures related to the company's projects in Saskatchewan.

The net proceeds from the sale of units will be used for the 2025 exploration and drilling programs at the company's uranium projects in Saskatchewan, as well as for general working capital purposes. The offering is scheduled to close on or about December 20, 2024.

Skyharbour has a large portfolio of uranium exploration projects in the Athabasca Basin, with 29 projects, 10 of which are drill-ready, covering over 1.4 million acres of mineral claims. In addition to being a high-grade uranium exploration company, it also utilizes a prospect generator strategy by bringing in partner companies to advance its secondary assets.

The company now has 10 partner companies advancing 11 projects in their portfolio, with project considerations totaling over $90 million, assuming that these partner companies complete their full earn-ins at their respective projects.

Analyst Sid Rajeev of Fundamental Research Corp. wrote recently that Skyharbour "owns one of the largest portfolios among uranium juniors in the Athabasca Basin."

"Given the highly vulnerable uranium supply chain, we anticipate continued consolidation within the sector," he wrote, confirming the firm's Buy rating and adjusting its fair value estimate from CA$1.16 to CA$1.21 per share. "Additionally, the rapidly growing demand for energy from the AI industry is likely to accelerate the adoption of nuclear power, which should, in turn, spotlight uranium juniors in the coming months."

AI Needs 'Bucket Loads of Power'

The growth of artificial intelligence (AI) and electric vehicles (EVs) during the energy transition is contributing to new attitudes toward nuclear energy and uranium.

Microsoft Corp. (MSFT:NASDAQ) announced a deal with Constellation Energy Group (CEG:NYSE) to restart and buy all of the power from one of the shut-down reactors at its infamous Three Mile Island plant in Pennsylvania and the Biden administration also announced a plan to restart the Palisades plant in Michigan.

Chris Temple, publisher of The National Investor, recently noted that with the Three Mile Island deal, "uranium/nuclear power is BACK!"

"I've watched as the news has continued to point to uranium being in the early innings of this new bull market," Temple wrote. "Yet the markets have been yawning . . . until now."

AI requires "bucket loads of power," wrote Dominic Frisby for his newsletter, The Flying Frisby, in October. "That's why Microsoft recently agreed to pay Constellation Energy, the new owner of America's infamous nuclear power station, Three Mile Island, a sizeable premium for its energy. There is cheaper wind and solar power to be had in Pennsylvania, but it isn't as reliable as nuclear 24 hours a day. It's not just AI. The widespread political desire to rid ourselves of fossil fuels means the world needs electricity, and fast."

Ownership and Share Structure

Management, insiders, and close business associates own approximately 5% of Skyharbour.

According to Reuters, President and CEO Trimble owns 1.6%, and Director David Cates owns 0.70%.

Institutional, corporate, and strategic investors own approximately 55% of the company. Denison Mines owns 6.3%, Rio Tinto owns 2%, Extract Advisors LLC owns 9%, Alps Advisors Inc. owns 9.91%, Mirae Asset Global Investments (U.S.A) L.L.C. owns 6.29%, Sprott Asset Management L.P. owns 1.5%, and Incrementum AG owns 1.18%, Reuters reported.

There are 182.53 million shares outstanding with 178 million free float traded shares, while the company has a market cap of CA$74.05 million and trades in a 52-week range of CA$0.31 and CA$0.60.