Fission's Deposit Get Bigger, Shares Cheaper

Nick Hodge  |

Over the past month Fission Uranium shares have been pushed down in a sea of selling.

I'll recap the news first.

Results were out on September 8th for 11 new angled holes drilled as part of the summer program. All holes intersected uranium mineralization.

All 54 holes drilled to date as part of the summer campaign have hit uranium — a 100% hit rate.

The best hole of the 11 was PLS14-286, which hit 9.31 meters of off-scale mineralization inside a 97.2-meter trend at shallow depth.

Three other holes served to widen and strengthen the connection of R780E Zone to R1155E.

On September 23rd news came that the previously announced private placement of 8.35 million flow through common shares has now been closed. The over-allotment option was exercised, bringing the total to 9.602 million shares at $1.50 apiece for proceeds of $14.403 million. Those shares have a four-month hold period.

It should be noted that the dilution here is minimal. And the price at which those funds were raised is some 75% higher than the stock currently trades. The underwriters, including Dundee, BMO Nesbitt, Raymond James, Macquarie, and Cantor Fitzgerald had no problem paying that price.

Then more news on September 25th, telling us the four rogue holes have discovered radioactivity on three new conductors. This follows hole PLS14-255 (announced August 11th) that hit radioactivity 17 kilometers away from the main trend. We're talking about the Far East zone here, on the bottom-right of this map:



According to Chief Geologist Ross McElroy:

"The regional exploration program has been a great success and we have three very clear target areas prioritized for aggressive follow up: The PL Corridor, the Far East where we recently hit anomalous radioactivity in hole PLS14-255 and the Forrest Lake Areas. With over 105 separate conductors, we have felt for some time that the prospectively of PLS goes beyond the incredible discovery we have already made. These regional drill results confirm that belief."

Remember, this is in addition to the monstrous main discovery already identified at Patterson Lake South.

The last piece of news I'll discuss today came on September 29th, with the final seven angled drill holes of the summer program all hitting wide intervals of uranium mineralization. The best hole was PLS14-290, which intersected 97.5 meters of shallow uranium, 7.44 of which were greater than 10,000 cps radioactivity. Fission has hit uranium on every single one of the 61 holes put in the earth in R780E Zone as part of the summer program.

McElroy concluded:

"These results represent the final summer program holes which have been nothing less than spectacular. Zone drilling has hit with every single hole without fail, connected two zones and widened the high-grade R780E zone on multiple lines. R780E, which now has a strike length of 930m, is still open in every direction. At the same time, as per news release September 25, the exploration drilling intercepted anomalous radioactivity on three conductors elsewhere on the property."

You can see those 61 holes here, as part of newly merged and giant R780E Zone:

There were a couple dozen holes drilled on the periphery, but the bulk of summer drilling went to merging and further identifying mineralization along the main trend.

Yes, I think some people have simply sold out, taking their profits from buying in between $0.50 and $0.75 and walking away.

I've also heard of a few funds liquidating all their junior mining positions regardless of the quality of assets. To me, that's a sign of bottoming. Company-specific good news doesn't even matter anymore, the market just yawns.

And there will also be tax-loss selling over the next two months.

The company is still on track to deliver its maiden resource estimate by the end of the year, which will give the market a good idea of the initial size of the deposit.

The goal has always been to sell the asset to a major minor, though given current commodity conditions, Fission may have to drill a bit more to prove the deposit even further.

I was talking to a confidant recently who put it nicely: “Could we have sold at $1.30 and bought back at $0.90? Yes. But we're not trading it. We own an asset.”

The deposit isn't getting any smaller.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


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