Power Metal nets $17.8M for uranium drilling JV in Saskatchewan

Power Metal Resources’ (LSE: POW; US-OTC: POWMF) gained 3.3% on Monday after it announced a £10 million ($17.8 million) investment from London-based UCAM for a joint venture to drill for uranium in northern Saskatchewan and Newfoundland.

The company holds 16 early-stage properties on a combined total of 924 km² that sit in and around the Athabasca basin, as well as one in Newfoundland, which it acquired in September.

“It’s the biggest thing we’ve ever done,” CEO Sean Wade told The Northern Miner in a Zoom interview. “You don’t get many deals like this with a £20-million market cap and below (company). It’s a great validation of our model.”

Power Metal shares traded for 16 pence apiece on Monday after markets closed in London, valuing the company at £18.3 million ($32.6 million). Its shares traded in a 52-week range of 10 pence to 25.68 pence.

The tie-up follows the spot price for uranium oxide rising to US$82 per lb. this week from US$78.50 per lb. at the end of August. It’s among various tailwinds for the uranium market, including a deal last month between Microsoft and Constellation on a 20-year power purchase from the restarted Three Mile island nuclear plant in Pennsylvania.