Winter conditions, as it happens, speed up the relocation of rigs, if marginally. But helpful if you’ve got seven rigs on the go.
Curyer said the junior was picking up where it left off last year.
“Between January 3 and November 10 we drilled just under 100,000m of core, which made it one of the largest programmes in Canada for any commodity,” he said. “We needed to step back and analyse, in order to optimise where to drill next. When we started drilling at Arrow, we had two [programmes] a year. Now it’s only one.”
The bulk of the C$14 million budgeted for the winter programme is aimed at Arrow. Five rigs in the new campaign are dedicated to resource expansion and closer delineation. One will be positioned 600m north-east and another 400m south-east of the deposit, both considered high-grade target zones. All the rigs will use Devico directional drilling technology. “Ground conditions can sometimes deviate the drill. This gives you more control to hit your pierce point,” said Curyer.
The 35,000m programme should be wrapped up by the end of winter. Curyer says results should start flowing mid-February, starting with radiometric numbers and then lab assays.
“We’ll have updated resources based on the drilling up to the end of 2016 either in March or April. The important takeaway here is that it’s only a point in time. The project [mineralisation] is still open in all directions.”
NexGen will also conduct engineering and metallurgical studies through this year for a pre-feasibility study expected to delivered later this year or the start of 2018.
Rook 1’s uranium discovery cost so far stands at 13c a pound.
“It’s the lowest cost for a discovery over a 100 million pounds in the Athabasca Basin by a significant margin,” Curyer said.
“We have very favourable ground conditions. Drilling a metre of core cost us less than half than what’s common in the area. Also, for a billion-dollar company, our G-and-A [general and administration cost] is less than C$2.5 million a year, and the ratio of dollars we put into exploration compared to overhead is greater than 12-to-one.
“Every new drill result improves our understanding of what Arrow is. We have never protected the asset, we have always been bold in terms of step-out drilling, with the objective of finding out what we have at the earliest possible time.”
Curyer indicated that while Arrow had drawn interest from mining majors, NexGen’s focus was on developing the project itself. The company’s share price has risen more than 42% since the start of the year, increasing its market capitalisation to C$1.08 billion (US$770 million) this week.
He saw reduced production in Kazakhstan as a key pointer to changing uranium market sentiment.
“It signifies uranium prices need to be much higher to sustain current production levels, but also to encourage new production to fill the impending supply gap,” Curyer said.
