THE BOURSE WHISPERER: Anatolia Energy (ASX: AEK) informed the market its proposed merger partner, NASDAQ listed Uranium Resources Inc (URI) has agreed to secure a database of geological information pertaining to its Butler Ranch Project in South Texas.
Anatolia said the deal increases the historical drilling information available to URI, including information in respect of historical resource estimates.
“We commend the team at URI on the innovative non-cash land swap transaction they completed in November 2014, which has effectively provided URI with five highly prospective projects considered amendable to ISR development, and now this follow-on transaction to deliver a significant volume of drilling information for an upfront cash outlay of only US$150,000,” Anatolia Energy managing director Paul Cronin said in the company’s announcement to the Australian Securities Exchange.
“These transactions are smart deals that preserve cash, whilst greatly improving the prospects of URI returning to uranium production in South Texas.
“All five projects acquired by URI are within only 75 miles of the company’s licensed Rosita and Kingsville Dome processing facilities, and although the Rosita plant is earmarked for relocation to Turkey for use at our Temrezli project, any resources discovered on the South Texas properties are expected to be capable of being cost effectively developed by making use of URI’s fully licensed Kingsville Dome processing facility.”
Anatolia explained that validation of the historical resource estimates at the Butler Ranch Project by URI is expected to move it closer to returning to uranium production in the medium term in South Texas.
According to Anatolia URI already has existing In-Place Reserves which are considered recoverable with a stronger uranium price.
Anatolia considers this deal will provide it exposure to a second low-cost uranium production centre, and other benefits that come from having multiple production assets including diversification of cashflow, and increased production scale.