Aurora Energy Metals primed to drill for both lithium and uranium

Aurora Energy Metals (ASX: 1AE) has come to market at a time of a global focus on energy security and an accelerated green transition.

The company's 100% owned Aurora Energy Metals Project in southeast Oregon, United States hosts a growing uranium resource and recently defined lithium mineralisation.

The story so far

Aurora successfully raised $8m at 20 cents per share in its IPO and listed on 18 May 2022 at a market cap of around $28m.

In its prospectus, the company's near-term goals included the conversion of its existing uranium resource to Measured status, advance key feasibility studies and define a maiden lithium resource.

In September, the company purchased a 'transformational' 410-acre private property, approximately 12km down the road from the Aurora uranium deposit. The location was viewed as ideal for future plant and tailings facilities.

Aurora is setting itself up to 'fast-track the development' of the uranium component of its project and placing the building blocks to enhance the prospects of future lithium development. Being a dual commodity project, Aurora said it plans to progress both prospects depending on the drilling results.

“Over the next few months, we expect the level of newsflow to increase significantly, with drilling results expected to flow regularly once we commence the program," said Managing Director, Greg Cochran.

Uranium: Drilling on the horizon

Aurora has a well-defined 37.9mlb uranium resource. Ongoing exploration efforts will seek to grow this resource whilst it is in the final stages of converting the current resource to a higher confidence level.

Site preparation for the first hole of the Company’s Phase 1, 17-hole RC drilling program of approximately 3,400m is complete, following on from its announcement on Wednesday 19 October when it said it expects the permit to be issued 'next week'.

The program will target both uranium and lithium mineralisation, and is expected to be completed by December 2022.

Assays from the campaign will be submitted progressively, and results are expected to begin coming through from late December.

Uranium fundamentals at a glance

Uranium spot prices are close to a five month high, currently fetching US$53.5/lb.

Buoyant prices have been supported multiple by factors including:

• Japan announcing the restart of 17 shut-down nuclear reactors and extending the lifespan of existing plants

• China accelerating the development of nuclear power plants

• The Biden administration saying that the US will redouble its efforts to break free from its reliance on Russian nuclear fuel

Uranium spot price (Source: TradingEconomics)

Lithium: Promising early days

In mid June, assay results from a previous drilling campaign confirmed "widespread lithium intersections in sediments overlying the Aurora Uranium Deposit". The results showed that lithium mineralisation exists directly above the well-defined Aurora uranium deposit.

Aurora noted that the grades "are at least comparable to those encountered at Jindalee Resources' (ASX: JRL) nearby McDermitt Lithium Project, one of the USA's largest lithium deposits."

Lithium defies economic gloom

"The race to source supply of critical materials such as lithium from US/FTA partner countries is expected to intensify as auto and battery manufacturers seek to leverage the significant incentives on offer as part of the Inflation Reduction Act," Allkem (ASX: AKE) said in its September quarter report.

The lithium major said that despite a rise in Australian shipping volumes, up 89% year-on-year in August 2022, a significant shortage remains, highlighted by record high prices and an increase in demand for lower grade products.

Source: Benchmark Minerals Intelligence

Insights from Aurora CEO

We sat down with Aurora CEO Greg Cochran who gave us a run down of the current developments. Watch the full interview below which includes:

• Uniqueness of lithium mineralisation sitting above uranium

• Implications of Aurora's early stage lithium mineralisation

• The importance of US-based uranium supply

• Company outlook for the next 2-3 months