American Uranium (ASX:AMU,OTCQB:AMUIF) is advancing its major Lo Harma in-situ recovery (ISR) uranium project in Wyoming, current work focuses on increasing scale and improving resource confidence ahead of a planned scoping study.
Recent drilling has increased the total resource 9.45 million poundsWith 43 percent now in the indicated category. In priority areas for scoping studies, the company has earmarked approximately £7 million, with indicated resources increased by 46 per cent.
“This is a very good result, considering we are only halfway through the planned drilling program,” CEO Bruce Lane told Investing News Network.
Lo Harma is also becoming the equivalent of advanced ISR projects in the area, all of which are located in close proximity. Lane mentioned Ur-Energy’s (TSX:URE,NYSEAMERICAN:URG) Shirley Basin project, which is currently under commissioning, for £8.8 million. This also includes Uranium Energy’s (NYSEAMERICAN:UEC) £11 million Ludeman project and Encore Energy’s (TSXV:EU,NASDAQ:EU) Gas Hills project worth approximately £8 million.
From a valuation perspective, there appears to be room for upside in US uranium as the project progresses. “We think there’s an opportunity to move our valuation upward and meet the intrinsic value of the project we have,” Lane said.
On the macro front, U.S. uranium demand is currently about 50 million pounds annually, while domestic production is much lower. With global supply also lagging behind demand, the supply gap is expected to widen. The US is targeting potential production in the 2029 to 2030 time frame, in line with forecasts of tightening uranium market conditions.
Upcoming catalysts at Lo Herma include the next phase of drilling, additional technical studies and scoping studies expected in Q3, as well as a resource update.
Watch the full interview with American Uranium Executive Director Bruce Lane above.
