Having completed the acquisition of Uranium Power Corp. (TSX-V: UPC), Canadian Venture and Frankfurt listed Titan Uranium Inc. (TSX-V: TUE, FSE: T4X) just announced the acquisition of 50% interest held by Uranium One (TSX: UUU) in the Sheep Mountain property, Fremont County, Wyoming.
This is a perfect conclusion to the UPC acquisition as UPC already had 50% interest in the Sheep Mountain property. Following the acquisition Titan now has 100% interest in the property which has a NI 43-101 compliant Inferred Resource of 15.6 million pounds of U3O8. In conjunction with this transaction, Titan will acquire Uranium One’s 50% interest in the Hollie claims, Emery County, UT and transfer its 50% interest in the Breccia Pipe project, AZ and the Burro Canyon project in Colorado to Uranium One.
The terms of the agreement include:
- An initial cash payment of US$850,000 for Sheep Mountain and for the Hollie claims;
- A payment of US$2,000,000 if the month-end spot uranium price reported by Ux Consulting Company exceeds US$65.00 per pound within three years of the closing date, payable within six months;
- A further payment of US$4,000,000 if the month-end spot uranium price reported by Ux Consulting Company exceeds US$85.00 per pound within three years of the closing date, payable within twelve months;
- Titan will assume the full amount of the reclamation bond for the property on closing (total bond amount is US$2.1M of which Titan has already contributed 50%);
- A credit of US$500,000 payable to Titan on closing, as payment for the transfer of Titan’s 50% interest in the Breccia Pipes project in Arizona and in the Burro canyon project in Colorado to Uranium One; and
- The termination of the existing Joint Venture between the two companies.
In addition to the 15.6 million pounds of U3O8 resource estimate, UPC has previously reported a historical Mineral Resource estimate of 6.5 million pounds contained U3O8for the North Gap Pit area of the property. The North Gap Pit area was explored in detail in the 1960s and 70s by then operator Western Nuclear. The North Gap area includes two potential open pit operations, the Congo Pit and the South Pit with historical estimates of 4.44 million pounds and 2.01 million pounds of contained U3O8 respectively (estimates made in June 1980 and are pre-NI 43 - 101).
Some of our readers have queried us about Titan’s recent acquisitions. According to company sources these acquisitions form a part of the company’s growth strategy. Relatively low uranium prices have enabled Titan to acquire companies at relatively attractive prices. Titan however continues its exploration and development activities of its other projects. Some of Titan’s key projects are however developed mostly by its joint venture partners thus leaving much of its cash resources to finance acquisitions.
About Titan Uranium Inc.
Titan is driven by advancing exploration projects to discovery in the proven Athabasca and prospective Thelon basins located in Saskatchewan and Nunavut, respectively. Titan has gained market recognition for its ability to attract strategic partners to participate in exploration on its properties by virtue of its 1.6 million acre land position and its technical expertise. The option agreement participants of Titan include: Japan Oil, Gas and Metals National Corporation (JOGMEC), Vale Exploration Canada Inc. (VEC), and Mega Uranium Ltd.