Marenica Energy transforms into Elevate Uranium as sector grows and money flows

In November 2020, Marenica Energy (ASX: MEY) raised $5.4 million at $0.088 per share.

On Friday, just over six months later, that same stock closed at $0.35 per share — just one more uranium company that is experiencing renewed investor enthusiasm after years of low levels of interest in what for a long time was a beaten down sector.

For those who had faith last November, that faith has been amply rewarded.

Today, the stock began trading under the new name Elevate Uranium (ASX: EL8), a change of title that reflects how the company has grown beyond its original Marenica project in Namibia — plus, using “uranium” in a company name is now a positive.

Managing director Murray Hill says the company’s name change is in recognition of the “significant” geographically diverse uranium assets it now owns.

‘Elevate’ also signals the company’s intent to grow and expand.

Three-pronged uranium strategy

Elevate now presents to the market more clearly as a stock with a three-pronged strategy — very advanced projects in Namibia, a suite of uranium deposits in Australia, plus its own patented technology.

As the company describes it, its technology U-pgrade is a “disruptive beneficiation process”.

“[The company] believes it can revolutionise surficial uranium processing by reducing processing capital and operating costs by approximately 50%, thereby improving the economics of all uranium projects which process surficial uranium and specifically making lower-grade projects much more competitive and financially viable,” it says.

In recent months, the uranium sector in Australia has been given a new lease of life.

Substantial (certainly by the standards of recent years) sums of money have been raised through placements and shareholder purchase plans, stock prices have risen as investors begin — after a long hiatus — to listen to uranium stories again, and the price of uranium appears to have firmed and is ready for a bounce.

This new spirit has been engendered by growing realisation that a supply crunch is not far away, with most US utilities needing to negotiate fresh supply contracts and the number of reactors under construction and planned worldwide continuing to grow.

Uranium offers carbon-free, base load energy

As Mr Hill says, the new name “emphasises our focus on uranium exploration, development and mining, which ultimately provides carbon-free, base load energy to power a cleaner future”.

“We have assembled significant uranium resources and large uranium tenement holdings in two of the most stable, mining friendly and reliable uranium-producing jurisdictions in the world,” he added.

In addition, Elevate believes these projects can be enhanced significantly by its U-pgrade beneficiation process.

The company has described itself as “positioned to take ‘first-mover advantage’ ahead of other greenfield developments”.

Close to becoming a Namibian uranium producer

Elevate has a large land position in the Erongo uranium province in Namibia, a country with an established and long-running uranium mining industry.

The company has the largest uranium ground position in the southern African country spanning three project areas: the Namib, Mile 72 and Marenica uranium projects.

Within those, Marenica has a large inferred uranium resource of 61 million pounds or 27,670 tonnes and U-pgrade increases the grade by more than 50 times to 5,000 parts per million of uranium oxide.

Koppies, covering 6.4sq km, has a mineralised palaeochannel system ready for resource drilling.

Hirabeb contains a palaeochannel that extends over more than 36km (wider than the English Channel), while Namib IV has a similar channel more than 19km long.

Three Australian projects in uranium-friendly Northern Territory

In 2019, the company snapped up projects in Australia and holds 48Mlb at an average grade of 859ppm of uranium oxide.

The wholly-owned projects are Angela with a resource of 31Mlb, Minerva (high-grade uranium and gold), Thatcher Soak with 11Mlb and Oobagooma, which has a historical resource and therefore cannot be reported.

The first two projects are in the Northern Territory, the last two in Western Australia.

It is significant that the NT government maintains a website promoting the territory’s uranium potential, which is in contrast to some anti-uranium mining policies in several states that have over the years bedevilled uranium exploration companies, with Victoria long maintaining a ban even on exploration.

In the case of Angela, the application of U-pgrade technology will reduce acid costs by 77%, the company says.

Oobagooma is described as under-explored but featuring extensive zones of mineralisation.

Elevate also has minority interests in three NT projects controlled by Energy Metals (ASX: EME).

It holds 21% of the Bigrlyi uranium-vanadium ground with 21Mlb, 23% of Walbiri with 16Mlb and 24% of Malawiri with a total resource of 1.2Mlb.