Energy Fuels Inc. (NYSEMKT:UUUU TSE:EFR) shares jumped nearly 8% on Wall Street on Thursday after the company said it has discovered an extensive system of high-grade copper mineralisation at its 100%-owned Canyon mine in northern Arizona.
The company is currently evaluating the Canyon deposit to expand and upgrade the uranium resources. The Canyon Mine is the highest-grade uranium mine in the US, and based on uranium recovery alone, the company expects production costs from the Canyon Mine to be competitive with the best underground uranium mines globally, including mines in Canada, based on industry-published cost estimates.
However, now that extensive high-grade copper mineralisation has been discovered within the deposit with exploration results to date averaging 8.75% Cu and one intercept hitting 5-feet of 31.69% Cu, the company is now expanding the scope of the evaluation of the Canyon deposit to analyse recovering copper as a by-product of uranium recovery, which has the potential to make the economics of the Canyon Mine even better.
As a part of the current evaluation, the company is completing the production shaft to a planned depth of 1,470-feet and conducting an underground drilling programme. At the current time, the shaft is at a depth of approximately 1,250-feet, and underground drilling is currently occurring on the second of the three planned levels.
The company completed a fifteen hole subsurface angled core drilling program from the first level that intercepted several large and high-grade areas of uranium mineralization, including 8.5-feet with an average grade of 6.88% eU3O8, 48.0-feet with an average grade of 1.02% eU3O8, and 35-feet with an average grade of 1.39% eU3O8.
"The preliminary drilling results showing an extensive system of high-grade copper mineralisation at the Canyon Mine are very exciting for Energy Fuels. We have long known that similar deposits in northern Arizona contain copper. However, the average grades in the five holes sampled thus far, with a total grade of nearly 9% copper and one intercept hitting copper grades over 31%, has far exceeded expectations based on past historical results at other mines in the region,” said Stephen P. Antony, President and CEO of Energy Fuels.
“These are remarkable copper grades that one may only encounter a couple of times in a mining career. Even though the Canyon deposit is relatively small compared to other global mines, these grades are world-class. These results also have the potential to significantly improve the economics of the Canyon Mine, which is vitally important in today's weak uranium market. As a result, we intend to continue to evaluate the Canyon deposit, complete the shaft, perform additional core drilling, and optimize the potential of this exciting high-grade deposit,” he added.
Energy Fuels shares were up 7.1% at $1.51 on Thursday.