Eclipse Metals (ASX:EPM) has added to its cash balance as exploration work on the Mary Valley (Queensland) and Liverpool (Northern Territory) uranium projects continues.
The company has raised A$497,580 via a strongly supported rights issue at A$0.003 per share.
Eclipse stock was last trading at $0.005, or 67% higher than in in late October.
The funds will be used for exploration at Mary Valley and Liverpool as well as other company tenements.
Proceeds will also be applied to the identification of new opportunities and general working capital, including the paying creditors.
Shareholders took up to 51% of the rights issue.
Whilst the Offer was not underwritten, Eclipse directors have elected to place the shortfall following strong interest from various independent third parties to subscribe for the remaining shares as shortfall shares.
Project momentum
The funds come as Eclipse improves confidence at Liverpool by extending its tenement coverage in the area ahead of a pending exploration drive.
A new licence application for 228 square kilometres has been accepted by the NT Department of Mines, completing a contiguous block of exploration tenure for Eclipse and bringing the company’s Liverpool holdings to 1,467 square kilometres.
The expansion area – known as Devil’s Elbow Central – is immediately east of Eclipse’s highly prospective Devil’s Elbow uranium-gold-palladium prospect, which has produced rock chips grading up to 7,620 ppm uranium and radioactive volcanic boulder samples reading values as high as 3,3000 ppm uranium.
Previous shallow trenching at Devil’s Elbow has yielded high-grade uranium assays including 3.2% U3O8, 3.7% U3O8, 4.40% U3O8 and 5.8% U3O8 as well as 38.1g/t gold and 28.02g/t palladium.
This site is only 41 kilometres from the worked-out Nabarlek uranium mine which produced 12,000 tonnes of uranium oxide from 568,402 tonnes of ore with a grade of 1.95% U3O8.
Analysis
The fact that the raising of new funds coincides with Eclipse's move to expand Liverpool is a strong suggestion that this project is primed for an interesting development in the near future.
Market support for these developments also reflects the growing investor appetite for uranium in the context of a macro turnaround for the nuclear fuel.
Liverpool's Devil’s Elbow area represents a particularly interesting development opportunity for Eclipse with tantalisingly strong uranium readings in preliminary exploration work.
The broader Liverpool project area lies in the sought-after Alligator Rivers Uranium field, which neighbours operations run by senior uranium explorers such as Rio Tinto and Cameco Australia, the latter of which has been instrumental in establishing Devil’s Elbow’s prospectivity.
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