Labrador Uranium (LUR) - Shares Lower, Investment Thesis As Before

Labrador Uranium Inc. is a Canadian junior exploration and development company focused on the advancement of its projects located in the region of Labrador, Canada. The company’s asset portfolio consists of its CMB project, Moran Lake deposit Mustang Lake project, and the recently acquired Anna Lake project located in the central mineral belt (CMB) region of Labrador.

Labrador Uranium Inc. at the end of 2022 concluded a marketing campaign in Europe, consisting of 7 cities in 4 countries within 5 days. The company believes that the campaign was successful, with the interest in the company generated by the campaign supported through the volume of its shares traded. The volume rose to as high as 300,000 shares a day from an average of approximately 40,000 to 50,000 shares a day.

The company announced on the 25^th of November 2022, that it had concluded the acquisition of the Anna Lake project and the Moran Lake B-Zone prospect. The acquisition consisted of the issuing of 5 million common shares of the company at CAD$ 0.32 per common share to Beaconsfield Ventures Ltd. The acquisition also included Labrador Uranium Inc. assuming a 2% net smelter royalty regarding the projects which is payable to a third party.

The newly acquired Anna Lake project is located approximately 35 km southwest of Postville, a coastal community in Labrador and approximately 15 km northwest of the Michelin deposit owned by Paladin Energy Ltd. The project has a NI 43-101 defined historical mineral resource estimate of 4.91 million pounds of U₃O₈ in the inferred category. The Moran Lake B-Zone prospect is located 3 km to the northeast of the Moran Lake deposit and has in previous exploration initiatives shown surface mineralisation through chip sampling of 0.087% U₃O₈, 0.28% copper and 13.23 g/t silver over 11.8 m.

Labrador uranium also announced on the 25^th of November 2022 that it would conduct a regional airborne gravity survey over a large section of the CMB region. The significance of the regional exploration program is the optionality it provides Labrador Uranium Inc. with the possibility of spin-out companies existing should the company discover deposits that do not fit its uranium narrative.

Labrador Uranium Inc. will incorporate the results of the airborne gravity survey into its geological modelling and machine-learning efforts to identify new discoveries and projects in 2023. The Machine learning efforts of the company have been able to yield specific drill targets. The company plans to complete the airborne gravity survey in the first half of 2023, with the period in which the survey can be done constrained due to the area’s wildlife.

 European tour and CMB region

Labrador Uranium Inc. recently concluded a marketing campaign in Europe, consisting of 7 cities in 4 countries within 5 days. Stephen Keith the CEO of Labrador Uranium Inc. explains that the rigorous tour showed good attendance from various parties and succeeded in its aim of spreading awareness of the company.

“I did 7 cities in 4 countries in 5 days, but it makes a difference because, again, our institutional holding is terrific, we have a really good base of investors, that's how we've been able to finance, but in the end, as a junior mining company or explorer, you need retail and trade. What was fascinating is that on this road show we did, we had amazing attendance and we saw a significant uptick in trading on those days.”

The company believes that the campaign was successful, with the interest in the company generated by the campaign supported through the volume of its shares traded. The volume rose to as high as 300,000 shares a day from an average of approximately 40,000 to 50,000 shares a day.

“We went from an average of 40,000 to 50,000 shares a day to a peak of 2 days of over 300,000 shares. I think one hit 500,000 shares, and that's what you need. As an explorer, you've got to find ways to put news out there, but you don't want to flood the market with useless information. The end of the year has come nicely because we've been marketing well, we closed on the acquisition of this Anna Lake target, and we were able to do a small financing…”

Keith explains that the company focuses on informing possible investors of the potential of the central mineral belt (CMB) in promotional tours. The CMB is a globally significant copper and uranium region which is approximately 260 km long and 75 km wide.

“We're a small explorer and in the end, it's about making discoveries. What's exciting and where the sale is in this region is one of the things we call Canada's next great uranium region. The reason we think that is because in the last uranium cycle, we had about half a dozen companies doing exploration in this belt and some of that yielded some very exciting results”

The significance of the region, according to Keith, is its mineralisation characteristics. The grade of the CMB belt shows an average grade of between 800 ppm and 850 ppm uranium, with the mineralisation close to the surface.

“They're near the surface so they're more likely to be an open pit, so easier to access. You also don't want to chase this stuff particularly deep because of the grade. You also have all sorts of other minerals with it. Our Moran Lake deposit is a uranium-vanadium deposit. Depending on how you work the maths, it's probably a vanadium-uranium deposit at Anna Lake, which we took on just recently. It's 5 million pounds of historical uranium, but it's also got a significant rhenium kicker.”

Labrador Uranium Inc. will continue to spread the potential of and advance the CMB region, through its various exploration initiatives, with the hope of finding large mineralisation deposits or as Keith puts it “Elephant Hunting”.

“One of the reasons why we just completed a small flow-through financing in Canada was to start an airborne geophysics program over the entire belt. We want to tie this thing together and see what's really happening because, again, one of the questions you asked about geology and why we are there is that we believe, and we actually need to, we believe there are giant projects here. We'll do the arm waving for a second but we're elephant hunting…”

Anna Lake acquisition and Regional airborne gravity survey

The company announced on the 25^th of November 2022, that it had concluded the acquisition of the Anna Lake project and the Moran Lake B-Zone prospect. The acquisition consisted of the issuing of 5 million common shares of the company at CAD$ 0.32 per common share to Beaconsfield Ventures Ltd. The acquisition also included Labrador Uranium Inc. assuming a 2% net smelter royalty regarding the projects which is payable to a third party.

The newly acquired Anna Lake project is located approximately 35 km southwest of Postville, a coastal community in Labrador and approximately 15 km northwest of the Michelin deposit owned by Paladin Energy Ltd. The project has a NI 43-101 defined historical mineral resource estimate of 4.91 million pounds of U₃O₈ in the inferred category. The Moran Lake B-Zone prospect is located 3 km to the northeast of the Moran Lake deposit and has in previous exploration initiatives shown surface mineralisation through chip sampling of 0.087% U₃O₈, 0.28% copper and 13.23 g/t silver over 11.8 m.

Labrador uranium also announced on the 25^th of November 2022 that it would conduct a regional airborne gravity survey over a large section of the CMB region. Keith explains that the company’s airborne gravity survey will assist it in identifying new mineralisation deposits and projects.

“We started this year with two projects, we've got Moran Lake with a historical resource, and Mustang Lake which we bought off Mega Uranium, which has a historical drill intercept of over 9 m of uranium. It's a great start. We now have Anna Lake with the historical uranium deposit, and we believe with the machine learning program, we plan to exit that program with multiple projects...”

The significance of the regional exploration program is the optionality it provides Labrador Uranium Inc. The possibility of spin-out companies is according to Keith likely, should the company discover deposits that do not fit its uranium narrative.

“All the while, we have known resources that we try to expand, and that creates options, optionality and value for our shareholders. Let's say we do find a copper target that's only copper or copper-gold; maybe we don't spend our time on that as we are a uranium company, but now you have an asset that could create a new company, you spin it out, you joint-venture it, you sell it, so all of a sudden, now your shareholders have more than one way to win.”

2023 initiatives

Labrador Uranium Inc. will incorporate the results of the airborne gravity survey into its geological modelling and machine-learning efforts to identify new discoveries and projects in 2023. The Machine learning efforts of the company, also referred to as AI (artificial intelligence), have been able to yield specific drill targets through its initial stages. 

“There are two sets of information that we hope to be generating. One on the higher level is the results of the preliminary and first rounds of the AI, which should generate real projects and targets. Some of that will come from what we've done now and some of that will be enhanced by a geophysics program that we just funded. We will probably spend USD$ 2 million to USD$ 3 million in airborne geophysics this winter”

The company plans to complete the airborne gravity survey of the CMB region in the first half of 2023, with the survey’s duration being constrained due to the area’s wildlife.

“The plan is to do it over this winter and, frankly, where we are, you can't fly or do the geophysics in the summer due to environmental and indigenous issues, the animals…”

The company will further continue its exploration initiatives at its Moran Lake project according to Keith. Labrador Uranium Inc. was able to intercept mineralisation at the project with the company aiming to define if the intercepted mineralisation is an extent of the project’s known mineralisation or a new mineral body. 

“At Moran Lake, we did some confirmatory work on the existing resource but we stepped it out 1 km as well. We found mineralization, we now have to determine whether that is an extension or whether it is another body. We think there could be multiple bodies, so we need to figure that out.”

Keith explains that the company’s 2023 initiatives will be influenced by the results of its airborne gravity survey and machine learning program results. The company, however, plans to conduct exploration initiatives at its newly acquired Anna Lake project in 2023 and further show the potential of the CMB region to the world.

“Now that we have Anna Lake, that's a very exciting target and is very early days, so we'll probably do a lot more work around that. That'll be the hard drilling, detailed exploration of the targets that emerge out of the geophysics and AI that we have yet to see. Of course, we need to see the results before we make a decision on what we're going to spend.”

To find out more, go to the Labrador Uranium website