Investment Banks & Hedge Funds Stepping Up Activity in Physical Uranium as Prices Spike

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May 07, 2024, 11:50 ET

PALM BEACH, Fla., May 7, 2024 /PRNewswire/ -- An article from REUTERS on the Uranium markets earlier this year painted a prosperous picture for the global Uranium. The report said: "Investment banks Goldman Sachs and Macquarie as well as some hedge funds are positioning themselves to reap the benefits of a newly buoyant uranium sector as prices of the nuclear fuel ingredient spike. While many other investment banks are still avoiding uranium, Goldman and Macquarie are boosting trading in physical uranium and in Goldman's case trading its options as well, five industry and hedge fund sources with knowledge of the deals said. The heightened activity comes as utilities seek new supplies amid shortfalls that have lifted prices to 16-year highs." It continued: "A few hedge funds are also stepping up involvement in both equities and physical uranium, a sign that the metal is starting to broaden its appeal to financial institutions after a decade in the doldrums following the Fukushima nuclear disaster. With the headlines and positive momentum in nuclear more generally, hedge funds and other commodity investors are back in the (uranium) sector. A lot of it is done via physical funds, the easiest way to get exposure to uranium prices," said Bram Vanderelst at trading firm Curzon Uranium. The metal has captured investors' attention after prices doubled over the past year to $102 a pound as top producers Kazatomprom and Cameco cut production guidance because reopened mines that had been mothballed struggled to ramp up production to meet renewed demand." Active mining companies in the markets this week include Stallion Uranium Corp. (OTCQB: STLNF) (TSX-V: STUD), Cameco (NYSE: CCJ) (TSX: CCO), Denison Mines Corp. (NYSE American: DNN), Uranium Energy Corp (NYSE American: UEC), Baselode Energy Corp. (OTCQB: BSENF) (TSX-V: FIND).

"It also comes with the revival of nuclear energy to help countries cut their carbon emissions, which was highlighted in the December 2023 Group of Seven most industrialized nations' statement that envisioned tripling nuclear energy capacity from 2020 to 2050." Goldman Sachs has started writing options on physical uranium for hedge funds, the first time it has created a derivative for the metal." It concluded: ""Goldman has been increasing their visibility, they've been increasing their book steadily," a source who dealt with the bank said, declining to give details of the transactions because they are confidential. Goldman is largely dealing with financial clients like hedge funds while Macquarie's main focus is boosting trading and marketing output from miners, another source who dealt with both banks said, also declining to elaborate because the data is confidential."

Stallion Uranium Intersects Significant Conductive Structure - Stallion Uranium Corp. (TSX-V: STUD) (OTCQB: STLNF) is proud to announce the successful completion of their inaugural winter 2024 diamond drilling program on its 100% owned Coffer Project situated in the prolific Southwestern Athabasca Basin in Saskatchewan, Canada. This milestone initiative was successful in encountering anomalous radioactivity in all three drill holes and culminated with the discovery of a large, deep-rooted conductive structure intersected on the final drill hole CF24-003 giving the target area the characteristics needed to host a large uranium deposit.

Highlights

Three diamond drill holes totaling 2,798.2m were completed at the Appaloosa target area (Figure 4).
Hole CF24-003 intersected the unconformity at 720 m and was completed at a depth of 1055 m.
CF24-003 is located 700 m west along strike from CF24-002, and 1.4km west of CF24-001.
Anomalous radioactivity was encountered at the unconformity in all three holes.
A total of 282 whole rock samples were obtained for assay, including interval and selective samples.
A deep-rooted conductive structure, spanning 94.7 meters in down-hole thickness, was encountered in hole CF24-003 highlighting the significant size of the structure.
Strong clay and chlorite alteration which is known be is associated with uranium mineralization was encountered.
Stallion holds a 100% ownership of the project.

"Stallion's winter 2024 drilling program at the Coffer project has yielded remarkable results, identifying a large conductive structure and 1.4 km of anomalous radioactivity at the unconformity across all three drill holes. The third hole intersected significant alteration and structure, and given the size of those intersections, indicate that the Appaloosa target possesses the characteristics capable of hosting a substantial uranium deposit. Further processing and modeling of the data collected will provide enhanced targeting capabilities, greatly increasing the probability for discovery on a future program," commented Darren Slugoski, Vice President Exploration, Canada.

Winter Drill Program Summary - Stallion's maiden drill program commenced on March 6, 2024, to drill test geophysical targets derived from both regional and advanced ground surveys. A total 2,798.2m of diamond drilling was completed over 3 holes, all of which were successful in encountering anomalous radioactivity at or above the unconformity. The final hole targeted and intersected the conductive structure, with an intercept of over 94m, highlighting the size and ability of the structure in transporting uranium bearing fluids. The significant size of the structure adds to Stallion's view that not only is the structure fertile for a uranium deposit but has the potential to host a large deposit.

The drill program successfully identified the key characteristics of a uranium bearing system and the promising findings validate Stallion's geological model, allowing for building confidence in the target area. The structural elements and scale encountered, along with anomalous radioactivity throughout, are strong indicators the Appaloosa target has the potential to host a significant uranium discovery. The winter drill program only tested 1.4km of the extensive 3.5-kilometre-long conductive zone, giving the target area further size and exploration potential.

The company is currently in the process of compiling and analyzing all data acquired during the drilling program. Stallion will leverage this comprehensive analysis to inform future exploration efforts and guide the development of an optimized exploration strategy for the target area moving forward.

"Our maiden drill program was a game-changing moment for Stallion, as we not only uncovered radioactivity in every hole, but also struck a massive conductor that unveiled the size of the structure at Appaloosa. Our confidence in the Appaloosa target's potential continues to grow given the results of the drill program, providing us with the information needed to vector towards a discovery," declared Drew Zimmerman, CEO. "Our drill program proved to be a resounding success, showcasing our ability to swiftly navigate from greenfield to drill testing in just 14 months. This achievement highlights our strategic approach to uncovering the next major uranium discovery. By systematically uncovering high-potential targets within our extensive portfolio of conductive corridors, we are maximizing the probability of success in all future exploration endeavors." #stallionuranium #uranium - CONTINUED… Read these full press releases and more news for Stallion Uranium at: https://stallionuranium.com/news/press-releases/

Other recent developments in the mining industry of note include:

Cameco (NYSE: CCJ) (TSX: CCO) recently reported its consolidated financial and operating results for the first quarter ended March 31, 2024, in accordance with International Financial Reporting Standards (IFRS).

"In the first quarter operational performance was strong across our uranium, fuel services and Westinghouse segments. Financial results are in line with the 2024 outlook we provided, which has not changed, and are as expected, reflecting normal quarterly variability and the required purchase accounting and other non-operational acquisition-related costs for Westinghouse," said Tim Gitzel, Cameco's president and CEO.

"Our strategy continues to demonstrate the benefits of aligning our operational, marketing, and financially focused decisions in a market where we are seeing sustained, positive momentum for nuclear energy like never before. We remain in the enviable position of having what we believe are the world's premier, tier-one assets operating in stable geopolitical regions, along with our investments across the fuel cycle and reactor life cycle. That includes our investment in Westinghouse, where we are seeing its long-term business prospects continue to improve. With our position as a proven, reliable supplier operating across the nuclear fuel cycle, our customers recognize our deep understanding of how nuclear fuel markets work, and global policymakers are turning to us as thought leaders in the industry.

Denison Mines Corp. (NYSE American: DNN) recently announced that it has filed its 2023 Annual Report on Form 40-F with the U.S. Securities and Exchange Commission ('SEC'). Denison's Form 40-F includes its management discussion and analysis and audited financial statements for the year ended December 31, 2023. The Form 40-F will be available on Denison's website at www.denisonmines.com and on the SEC's website at www.sec.gov/edgar.shtml. View PDF version

Denison's Annual Information Form has also been filed with Canadian regulatory authorities and will be available on Denison's website at www.denisonmines.com and under the Company's profile on SEDAR+ at www.sedarplus.ca.

Holders of Denison's securities may receive a free printed copy of the Company's most recent Form 40-F and Annual Report, including the audited financial statements, by sending an email request to [email protected] or by writing to Denison Mines Corp., 1100 - 40 University Avenue, Toronto, Ontario, Canada M5J 1T1.

Uranium Energy Corp (NYSE American: UEC) recently announced that it applauds a recent vote by the United States Senate for passing H.R. 1042, a bill to ban Russian uranium imports into the United States, by unanimous consent. The House of Representatives passed the bill in December of 2023.

Senator Barrasso of Wyoming stated: "I have fought for years to end America's reliance on Russian nuclear fuel. Our efforts have finally paid off with passage of our bill to ban these imports once and for all. Wyoming has the uranium to replace Russian imports, and we're ready to use it. Our bipartisan legislation will help defund Russia's war machine, revive American uranium production, and jumpstart investments in America's nuclear fuel supply chain. This is a tremendous victory. I'm grateful to members of both parties for helping get this over the finish line."

Senator Manchin of West Virginia stated: "It is unconscionable for the United States of America, as the superpower of the world, to contribute to Vladimir Putin's ability to finance his unlawful war against Ukrainethrough our reliance on Russia for the uranium we need to power our nuclear reactors. I am proud to have worked on this legislation with Ranking Member Barrassoto put an end to Russian uranium imports, which simultaneously unlocks $2.72 billionto ramp up domestic uranium fuel production. Building on initiatives I worked to include in the Energy Act of 2020, the Bipartisan Infrastructure Law, and the Inflation Reduction Act, this legislation is one more critical step toward reshoring our nuclear supply chains."

Baselode Energy Corp. (OTCQB: BSENF) (TSX-V: FIND) recently announced the starts of an inaugural drill program and ANT geophysical survey on its Bear ("Bear") and Hook ("Hook") uranium projects, respectively, in the Athabasca Basin area, northern Saskatchewan

"We're excited to start this drill campaign on Bear. Our target generation has identified areas of potential structural disruption and hydrothermal fluid alteration along the uranium-fertile Wollaston-Mudjatik transition zone that hosts numerous high-grade uranium deposits. We've identified 3 main targets areas we'll be drilling at the intersection points of NE-SW-trending layers and cross-cutting NW-SE-oriented structures. We believe the latter structures may have controlled anomalous uranium intersected in historic drill holes.

We're also happy to announce we've started laying out and acquiring data from Fleet Space Technologies' ANT survey deployed over ACKIO. We hope to map out the extent of ACKIO's Athabasca sandstone outlier and the deep structural roots of the uranium mineralization system. We believe ACKIO continues at depth, including mineralization along the sandstone-basement fault zone. We look forward to testing these targets when we begin our next ACKIO drill program in June," stated James Sykes, CEO, President, and Director of Baselode.

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