Sometimes one hole makes all the difference.
It did today for Athabasca Basin uranium explorer NexGen Energy, which announced “a new zone of uranium mineralization” at its Rook 1 project adjacent to Fission Uranium’s Patterson Lake South deposit. The stock had been halted since yesterday morning and I suspect regulators took a keen interest in the wording of the press release, as NexGen’s project remains early-stage.
At the time of writing the stock is up about 78%, to 40 cents, after stumbling along under 30 cents since mid-December. The 52-week low is 22.5 cents, which is where it was trading when the stock was halted, and the 52-week high is 60 cents.
The hole, RK-14-21, is still being drilled as part of a 6,000-metre program. According to the press release, it contained 26 metres of “highly anomalous radioactivity” from 204 metres down-hole. NexGen has a strong land position in the Athabasca Basin, home to the world’s richest uranium grades, and its other project, Radio (which the company still describes as its “flagship” on the website), is adjacent to the Roughrider uranium deposit. Roughrider was discovered by Hathor Exploration, which was sold for $640 million to Rio Tinto in 2011 after a bidding war.
NexGen wasn’t the only Athabasca player with market-moving discovery news today: Fission released drill results that included 38.5% uranium over 10.5 metres. Fission shares are up 10% to $1.31 at the time of writing.
Update: NXE closed at 43 cents, up 91%, on volume of 6.1 million shares.
Disclosure: I own shares in NexGen Energy. Please read my disclaimer.