Blue Sky Uranium (BSK.V) has recently released its exploration plans for its Ivana uranium-vanadium deposit for this year as it plans to expand the 22.7 million pound uranium resource (which also contains 11.5 million pounds of vanadium pentoxide which could provide a little bit of additional revenue further down the line).
An auger drill program is ongoing and after having completed in excess of 150 auger holes since the beginning of 2018, Blue Sky Uranium is planning to complete an additional 321 auger holes and this drill program has already started. Applying auger drilling is an easy and cheap way to figure out of zones with no or weak superficial radiometric results could host uranium mineralization before bringing in the big (RC) drill rigs. Auger holes are quite shallow and are drilled to a total depth of just 10 meters where after the field geologists survey the hole by dropping a radiometric probe to detect radiation.
Once radiation has been detected, Blue Sky Uranium could earmark that zone to be followed up on with a Reverse Circulation drill program. For now, Blue Sky has been budgeting for a 4,500 meter RC drill program but this, as well as an additional geophysical exploration program, are depending on Blue Sky Uranium raising more funds. It shouldn’t be too hard for Blue Sky to further increase the current resource estimate (at a similar grade) which could further boost the economics, as outlined in the PEA that was published in February. Using an uranium price of $50/pound and a vanadium price of $15/pound, the Amarillo Grande project (which includes the Ivana uranium deposit) boasts an after-tax NPV8% of US$135M and an IRR of just over 29%.
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The author has a long position in Blue Sky Uranium. Blue Sky is a sponsor of the website. Please read the disclaimer
