Consolidated Uranium (TSXV: CUR) (OTCQX: CURUF) announced its plans on Thursday to spin out its Premier American Uranium subsidiary (PUR), creating a pure play United States uranium company.
The new company would retain its focus on the acquisition, exploration and development of uranium projects in Wyoming and Colorado.
Spinning out refers to when a company creates a separate entity by dividing a portion of its business or assets and distributing shares of the new entity to its existing shareholders.
Part of the company’s May 24 arrangement agreement with PUR includes ownership transfer of subsidiaries with eight U.S. Department of Energy (DOE) leases and patented claims in Colorado in exchange for 7.7 million Class A common shares. PUR intends on listing the PUR shares on the TSX Venture Exchange.
Furthermore, CUR and PUR have signed a purchase agreement with several parties, including privately held Premier Uranium Inc. Located in the Great Divide Basin of Wyoming and various mining claims in the Uravan Mineral Belt of Colorado. Additionally, PUR has independently staked 368 unpatented mining claims, covering approximately 6,940 acres in significant areas of the Uravan Mineral Belt.
Deposits found within horizontally positioned sandstones
The Cyclone Project is situated around 45 miles northwest of Rawlins, Wyoming, and approximately 15 miles away from the Sweetwater Uranium Mill. The project encompasses a total of 25,500 acres, and consists of 1,061 claims covering 21,220 acres and seven state leases spanning 4,280 acres.
Uranium deposits within the basin are found within horizontally positioned sandstones of the Battle Spring Formation. These host sandstones exhibit widespread alteration, and numerous roll-front uranium deposits are associated with the altered rock formations. The project still holds significant exploration potential, requiring further drilling to build upon historical work and delineate mineralized zones.
Previous exploration includes 80 holes drilled between 2007-2008 with mineralization and grades similar to uranium deposits found elsewhere in the Great Divide Basin.
Exploration intersections on the Rim Target include:
- UT-8 which intersected 8.0 feet averaging 0.092 per cent eU308 (0.02 per cent cut-off) or 5.5 ft. At 0.121 per cent eU308 at 200 feet from the surface
- UT-44 which intersected 7.5 feet averaging 0.081 per cent eU3O8 (0.02 per cent cut-off grade) or 5.5 feet averaging 0.104 per cent eU308 at a 0.05 per cent cut-off grade.
The Uravan Mineral Belt in Colorado has a notable history of uranium exploration and production, having yielded nearly 80 million lbs of U3O8 and over 400 million pounds of V2O5 since 1945. In the Fraser Institute Annual Survey of Mining Companies 2022, Colorado ranked 5th out of 62 jurisdictions in terms of investment attractiveness.
The Monogram Mesa project covers approximately 7,431 acres and includes 361 mining claims. Within the property, there are several historic mines located on the northeast and west sides. The property boasts a strategic location, being just a few miles away from a paved highway, with mine roads and power lines crossing through it. Historical drilling data indicates the presence of numerous exploration targets.
The Atkinson Mesa project encompasses 5,863 acres, which consist of 128 unpatented lode mining claims and 4 DOE leases. Additionally, the project includes approximately 2,702 acres, incorporating 18 patented mining claims spanning 360 acres. The property boasts several past producing mines, notably the King Solomon mine, an underground operation that was one of the significant uranium producers in the Uravan Mineral Belt.
The Outlaw Mesa and Slick Rock projects are positioned at the northern and southern ends of the Uravan Mineral Belt, respectively. The Outlaw Mesa project covers 5,759 acres and includes 2 DOE leases, while the Slick Rock project covers 1,226 acres and also holds 2 DOE leases.
New board brings experience to the table
The leadership team of the new company includes Tim Rotolo as the CEO. He brings over 15 years of experience as an investment professional, with a strong background in fund management. He is the co-founder of Sachem Cove Partners and the founder of Lloyd Harbor Capital Management, LLC, an SEC registered investment advisor. Rotolo also founded North Shore Indices, Inc., which successfully launched URNM, a uranium mining ETF in 2019. The ETF raised over $1 billion before being sold to Sprott Asset Management (NYSE: SII).
Consolidated Uranium shares dipped 1.6 per cent to $1.20 on Friday on the TSX Venture Exchange.