Okapi Resources Ltd (ASX:OKR) is on the verge of becoming a significant player in the US uranium market after inking a deal to acquire 51% of the high-grade Hansen uranium deposit in Colorado.
The acquisition increases the size of Okapi’s JORC resource at the Tallahassee Uranium Project by 81% to 49.8 million pounds of U3O8 and increases its grade by 10% to 540 parts per million (ppm) U3O8.
This has seen the company's shares increase as much as 30% this morning to A$0.39.
Project now a "standalone asset"
“This acquisition represents a very important transaction for Okapi and its shareholders,” Okapi’s managing director Andrew Ferrier said.
“By securing this strategic 51% interest in the Hansen Uranium Project, we now have sufficient resource inventory to advance the Tallahassee Uranium Project as a standalone asset.”
Hansen is a high-grade, shallow uranium project immediately south of, and adjacent to, Okapi’s 100%-owned Taylor and Boyer deposits, and comprises two uranium deposits – the Hansen Deposit and the Picnic Tree Deposit.
It was discovered in 1977, at which time feasibility studies were completed and it was fully permitted to start production on the cusp of the collapse of the uranium market in 1982.
Okapi continues to prosecute a strategy of consolidating its holdings within the Tallahassee uranium district.
Highly accretive acquisition
The Hansen acquisition is “highly accretive” for Okapi shareholders – it means the acquisition of 22.2 million pounds U3O8 at 610ppm at the Hansen and Picnic Tree deposits, for the modest upfront cost of US$500,000, which is fully funded by existing cash reserves.
This means Okapi’s updated JORC mineral resource for the Tallahassee Uranium Project is now 42 million tonnes at 540ppm for 49.8 million pounds of U3O8.
Geopolitics significant
“Recent geopolitical events have put increased focus on the importance of the US revitalising its domestically sourced uranium, which will undoubtedly place a significant premium on US uranium assets such as Hansen,” Ferrier said.
“The issue is significantly compounded by the fact that 46% of US uranium is currently sourced from Russia, Kazakhstan and Uzbekistan (Source: US Energy Information Administration – Sources and shares of total US purchases of uranium in 2020).”