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GTI Energy Ltd (OTC:GTRIF) (ASX:GTR) is a mineral exploration company now focused on acquiring and advancing U.S.-based uranium assets. Not only are uranium prices anticipated to rise due to a projected supply/demand imbalance in the upcoming years, but also there are pressures to develop U.S. uranium mines in order to secure domestic supply for U.S. nuclear reactors, which as a group are the world's largest consumer of uranium fuel.
The company has acquired highly prospective uranium properties in Wyoming (Great Divide Basin aka GDB) and Utah (the part of the Colorado Plateau in southeastern Utah). Both areas have had historical uranium production with extant processing facilities: the Lost Creek ISR facility (UR Energy) and the Sweetwater/Kennecott mill (Rio Tinto) in Wyoming and the White Mesa Mill (Energy Fuels Resources) in southeast Utah.
Management is keen to advance its Great Divide Basin and Green Mountain Projects where roll-front uranium deposits are amenable to low-cost ISR (In Situ Recovery) mining methods. The imminent 100,000ft drilling program of the Great Divide Basin Project is designed to support a maiden Mineral Resource Estimate, which is expected during 2023.
Wyoming Uranium Properties (Great Divide Basin Project and the Green Mountain Project)
In Wyoming's Great Divide Basin, GTI Energy acquired Branka Minerals Pty Ltd (958 mineral lode claims and two state leases) in November 2021 and Logray Minerals Pty Ltd (672 mineral lode claims) in June 2022. The two acquisitions, which are in close proximity to each other, have been renamed the Great Divide Basin Project and the Green Mountain Project, respectively. The redox (aka reduction-oxidation) boundaries formed in the Great Divide Basin are conducive to the formation of roll-front uranium deposits, which are usually amenable to ISR (In Situ Recovery), the lowest-cost mining method for uranium. The redox boundaries of the Great Divide Basin (gold-colored lines in the map below) cross through the company's properties and are highly prospective for front roll uranium deposits.
Proximate deposits with MREs (mineral resource estimates) are Lost Creek (18.52 Mlbs eU308), Lost Soldier (17.25 Mlbs eU308) and JAB (4.14 Mlbs eU308).
Wyoming Uranium Properties – Planned Exploration
Management is planning for a 100,000ft (30,480m) drilling program at the Great Divide Basin projects, including up to 70 holes (approximately 40,000ft) of follow-up drilling at the Thor Project. The company is pursuing the necessary permits and the required bond(s).
The drilling program also will include exploration drilling at certain lode claim blocks approximately 10km north of the Thor lode claims (namely Loki, Odin, Teebo and Wicket East). These blocks are in the vicinity of Ur-Energy's Lost Soldier deposit and Uranium Energy's Antelope and Twin Buttes projects with the mapped redux boundary crossing through Loki and Wicket East.
Up to 20 holes (circa 20,000ft or 6,100m) of drilling are planned for Wicket East, which very near to the southern boundary of Ur-Energy's Lost Soldier deposit. The program seeks to explore a distance of three miles for a projected mineralized trend that may extend from the Lost Soldier property.
The drilling program is slated to commence soon and is expected be completed before Christmas. This drilling is designed to support a maiden Mineral Resource Estimate during 2023.
Utah Uranium Properties (Henry Mountains Project)
Situated in the northern portion of the Colorado Plateau (in southeastern Utah), the Henry Mountains Project was assembled by GTI Energy in October 2020 through the acquisition of Voyager Energy Pty Ltd (161 mineral lode claims) and also the purchase of two mining leases from Anfield Energy (TSX.V:AEC). The area has a plethora of past-producing uranium-vanadium mines (well over 140 mines) and occurrences.
The uranium deposits bodies in the vicinity of the Henry Mountains tend to be tabular-or lens-shaped uranium-enriched ore bodies, most commonly hosted in sandstone of the lowermost sequence of the Salt Wash Member of the Jurassic Morrison Formation and accompanied by vanadium. Extraction methods and processing of uranium ore from tabular sandstone deposits requires hard rock techniques, namely conventional open-pit/underground mining, crushing, grinding and a leach process.
The Shootaring-Delmonte and Cottonwood Wash-Trachyte mining sub-districts in the South Henry Mountains Mining District historically have produced about 650,000 pounds of U3O8 plus an additional 2,480,000 pounds of V2O5. GTI Energy's exploration programs (mapping, sampling and drill programs) have focused on a 5km mineralized trend extending between the company's Rat Nest and Jeffrey claim groups, along with mapping and X-ray fluorescence spectroscopy of the walls in two underground mines on mineral lease ML 52627.
Spin-Off of Niagara Gold Project (near Kookynie, Western Australia
GTI Energy recently divested its Niagara Gold Project in Western Australia through a spin-off to Regener8 (ASX:R8R), which issued 5,000,000 shares of R8R to GTI Energy, along with issuing 1,500,000 performance rights and paying AUD$150,000 in cash for a total value of AUD$1,450.000.
Valuation
The P/B valuation range of ISR companies with U.S. uranium projects is between 1.8 and 3.5. With the expectation that GTI Energy's stock (OTC:GTRIF) will attain a third quartile P/B ratio of 2.33, our comparable analysis valuation price target is US$0.023. The more comparable companies to GTI Energy fall into exploration category, which tend to trade in the third and fourth valuation quartiles.
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