Throughout 2016, NexGen Energy Ltd. has been announcing drill results. On Dec. 20, NexGen released the results from the final 10 holes of the 2016 drill program at the Arrow deposit, part of the Rook I property in the Athabasca Basin in Saskatchewan, Canada. David Talbot, an analyst with Dundee Capital Partners, noted that positive highlights include four intercepts along A2 Shear, and another on A3 Shear. Mineralization continues to be intersected at higher than the current resource grade of 2.63% U3O8. These results, Talbot stated that NexGen has completed their 2016 73,091-meter drill program designed to expand and improve upon the existing 202 MM lbs resource at Arrow. They believe results should 1) increase confidence with closer spaced holes to upgrade to measured and indicated, 2) expand the mineralized footprint, and 3) delineate higher grade areas within areas previously believed to be lower grade.
They now estimate a resource growth of at least 50% to over 300MM lbs U308. Talbot noted that management has spent time and effort attracting a strong and experienced technical team. Plenty of geotechnical and metallurgical work is going on behind the scenes in preparation for the PEA. This should provide a strong valuation footing for investors. In the meantime the Arrow Deposit continues to grow and improve with each press release. Gwen Preston, editor of Resource Maven, concurs, writing that if uranium continues to strengthen they would expect NXE shares to offer strong leverage, given that Arrow is the best uranium discovery in the world to date. The price will also rise as they approach the anticipated resource update, which could well grow the already-impressive 202-million lb. resource by 50%. Talbot is also optimistic that they expect NXE to remain a leader in the uranium industry moving into 2017, particularly should the uranium price increase. It remains the top exploration pick of DCP.
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