Eclipse Metals has several drill-ready targets, and looks well positioned to take advantage of renewed strength in the uranium price
Which way will uranium jump in the new paradigm that the coronavirus is creating?
So far, the signs are good.
“I see a lot of light at the end of the tunnel for uranium” says Carl Popal, the chief executive of Eclipse Metals Ltd (ASX:EPM).
“The spot price has done very well. Its up around 40% in the past month. The US has budgeted for 2021 US$1.2bn towards nuclear energy research and development related programs, and they want to expand on that.”
And in the meantime, the world is waking up to clean air – in some cases for the first time in living memory.
“Take India,” says Popal. “For the first time in most peoples lives you can see a kilometre ahead of you in New Delhi. Humanitys current best and proven option at hand for decarbonisation is nuclear energy.”
With the coronavirus crisis, long-established paradigms are changing in front of our very eyes, and the world, says Popal, is waking up to the reality of what a carbon-free future could actually look like.
To fuel it, he says, nuclear will inevitably be part of the mix.
And thats where Eclipse comes in.
The company has several projects in the Northern Territory of Australia, one of the worlds premier uranium mining addresses.
“The Northern Territory produces a large chunk of the worlds uranium from the Alligator River Uranium Province,” explains Popal.
“Thats where we have our five tenements.”
The lead project, Devils Elbow, has already yielded extremely high grade results from surface assays, trenching and drilling, including 3.2% U3O8, 3.7% U3O8, 4.40% U3O8 and 5.8% U3O8. High grade gold and palladium showings have also been encountered.
Devils Elbow was first discovered in the 1980s by Uranerz (Australia), which brought with it its German technical pedigree. It was followed by the Canadian giant Cameco (TSE:CCO), but the promising showings were never converted into anything more meaningful.
That wasnt because the ground didnt have the potential though. Quite the contrary. But Cameco didnt have access to enough acreage across the whole tenement to make a go of it. Eclipse, though has access both to historical Cameco areas and to the south of the Ranger Fault.
The company is also adept at social relations, which is essential in this area.
“The Alligator River Uranium Province isnt Crown land, its Aboriginal land” explains Popal. “You need a land access agreement with the aboriginal people.”
Eclipses relations with the aboriginal communities are on a very sound footing, and have been for some time. Eclipse took the land over in 2010, and ratified consent to negotiate an agreement with the traditional owners in 2014.
The company then allowed the project to be worked in joint venture by the international major Rio Tinto (LON:RIO) from 2016. Under the terms of this agreement it was Rio Tintos responsibility to conclude negotiations on the land right agreement with the traditional owners. However, after two years the conditions precedent in the deal were not satisfied, and accordingly the agreement automatically terminated.
“We had the option to allow Rio Tinto an extension to our agreement,” says Popal, “but we decided to grab the bull by the horns and deal with it ourselves
Accordingly, a land access agreement was put in place in December 2019, and Eclipse is now cleared for exploration and drilling, allowing that some further delay will be inevitable due to the coronavirus.
The company has seventeen robust walk up drill targets that have been defined within the Devil's Elbow exploration licence based on the integration of all geophysical products generated from Cameco Australias historical geophysical surveys.
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