Tim Goyder-chaired DevEx Resources has just kicked off its 2024 drilling campaign at the Nabarlek uranium project in the Northern Territory.
While the number of uranium explorers is on the rise since the price started to make some serious moves, DevEx is not new to the space.
The company floated in 2000 and was previously known as Uranium Equities but changed its name in 2017 – which was around the same time the uranium spot price slumped to below US$20 per pound.
It retained its uranium projects, waiting for the right time to resume its goal of making Australia’s next big uranium discovery.
With uranium trading at around 16-year highs and demand for nuclear energy growing as the energy transition gathers pace, now is looking to be the best time in years.
Nabarlek
What makes DevEx stand out from the pack is that it has known high-grade uranium mineralisation in Australia.
DevEx’s Nabarlek project sits in the NT’s world-class Alligator Rivers uranium province, which also hosts the historical Jabiluka and Ranger uranium mines.
Nabarlek was also a former mine, producing 24 million pounds of uranium at 1.84% uranium oxide, making it Australia’s highest-grade uranium mine.
DevEx’s ground, spanning 4700 square kilometres, covers the historical mine and its surrounds.
The company is aiming to make a large-scale, fault-hosted unconformity uranium discovery, similar to the other deposits in the province and those in Canada’s famous Athabasca Basin.
DevEx has already had strong sniffs in previous field campaigns.
To the north of the mine, previous drilling returned 13m at 0.28% U3O8 from 41m, including 1m at 0.73% U308 – or 16.09 pounds per tonne.
The U40 fault corridor, where mineralisation has already been intersected over 500m of strike, is to the northeast of the historical mine.
Previous drilling at U40 returned a standout hit of 6m at 7.6% U308, or 167.55lb/t, from 75m.
The 25,000m reverse circulation and diamond drilling campaign, which started a week ago, will focus on those two areas as well as the Coopers and U42 prospects.
Managing director Brendan Bradley says the program will offer multiple opportunities to make a major discovery.
The program, which will comprise more than 200 holes, is expected to generate plenty of news flow in the coming months.
“With its high-quality exposure to Australia’s most prospective uranium address, complemented by significant exploration drilling results that are broadening the mineralised position, DEV is extremely well placed to maintain strong market momentum,” MineLife analyst Gavin Wendt said recently.
Goyder buying on-market
Aside from being DevEx’s founder and chairman, well-known resources entrepreneur Tim Goyder is also the company’s major shareholder.
In a clear sign of Goyder’s enthusiasm for the 2024 field season, over March and April, he acquired a further 4 million DevEx shares on-market.
The almost A$1.2 million spent takes his stake in DevEx to 17.1%.
Goyder was buying when the stock was trading at below A30c per share.
In the past two weeks, DevEx has rallied to over A40c and even after a few down days this week, is still trading at above A35c.
This week Goyder tweeted that the start of drilling at Nabarlek was “fantastic news”.
Uranium market
The uranium spot price rose to over US$100/lb in the first few days of 2024, putting a rocket up explorers, including DevEx.
The price has since cooled and stabilised at just under US$90/lb.
According to Bell Potter Securities, term prices increased by US$1 over May to US$78.50/lb.
“We continue to see support for higher prices over the medium term, driven by ongoing tightness in short-term supply, exacerbated by issues at major producers Cameco and Kazatomprom,” analyst Regan Burrows said this week.
“Long-term pricing is heading in the right direction, however we do not view US$78.50/lb for a base-escalated contract (fixed price with annual CPI adjustments) as being an incentive price for the next wave of development.
“With this view in mind, we see both spot and term prices increasing through to CY26 before additional supply begins to enter the market.”
Burrows said commodity price volatility was particularly sensitive when the market was in a deficit.
“Our internal modelling estimates a circa 23Mlb deficit for CY24 (down from a 31Mlb deficit in CY23) with the addition of restart operations, increasing the likelihood of volatile price action in response to developments impacting supply (e.g. Kazakhstan flooding, Kazatomprom production issues etc),” he said.
As of May, 60 new nuclear reactors were under construction globally.
“We continue to see reactor installation growth across the globe, with China and India boasting both a comparatively young fleet and ambitious growth outlooks for nuclear capacity (China propose construction of a further 154 reactors and India a further 28),” Burrows said.
