Event 1AE has released assay results from its maiden exploration program at the Aurora Energy Metals Project (AEMP) targeting lithium mineralisation and extensions of the existing uranium resource. Impact Encouraging initial results. Assay results have been released for 6 RC holes from the Phase I drill program (totalling 17 holes for ~3,414m) subsequent to the release of downhole gamma log results in late Dec'22. Drill testing to the northwest of the uranium resource has demonstrated continuity of lithium mineralisation in deeper lakebed sediments, with RC holes 1-4 averaging 20m at 1,220ppm Li from an average depth of 52m using a 1,000ppm Li cut-off grade (Fig. 1). Noting lakebed sediments are expected to thicken toward the centre of the McDermitt Caldera, we highlight pending lithium assays for drilling completed to the southwest of the uranium resource as a potential catalyst. Multiple uranium intersections grading above >350ppm eU3O8 have also been recorded outside of the existing MRE envelope, headlined by an intercept of 34m @ 610ppm eU3O8 from 151m. US DOE commits to unconventional lithium... ASX-listed peer Ioneer Ltd (ASX: INR, mkt cap: A$1.1bn) yesterday announced that it has secured a US$700m loan from the US Department of Energy (DOE) to fund the construction of on-site processing infrastructure at the Nevada-based Rhyolite Ridge Lithium-Boron Project. This is the first instance of US DOE loan funding for the processing component of a lithium mining project. Noting both the quantum of funding and terms of the proposed US DOE loan (10-year tenure with interest fixed at the 10-year US Treasury rate), we view this as a material development for potential lithium extraction at the AEMP, which also presents as an unconventional source of lithium with processing to be undertaken in Nevada (Fig. 2). ...shortly after executing contracts for domestically-produced U3O8 at material premiums to the spot uranium price in Dec'22. Subsequent to our last published note,the US DOE has announced five contracts to purchase a cumulative total of 1mlb of uranium concentrates directly from domestic uranium miners in support of establishing a strategic uranium reserve, with contracts executed at prices ranging up to US$70.50/lb (spot: US$50/lb). Despite being sourced from inventory already held in storage in the US, the first US DOE uranium concentrate purchases in 40 years at healthy premiums to the spot uranium price bodes well for US-domiciled uranium developers amidst depleted domestic production levels, in our view. (Fig. 5) Action Speculative Buy rating maintained, Price Target unchanged at $0.55/sh. Our Price Target reflects the application of an unchanged target EV/Resource multiple of A$1.80/lb to the AEMP resource containing 50.6mlb U3O8, risk-weighted by 85% in recognition of potential future dilution. The stock continues to trade materially behind its ASX-listed peers on an EV/Resource basis (Fig. 3). Catalysts Assay results for the balance of holes drilled under the Phase I drill program are expected shortly ahead of a 1H CY23 PFS release on the AEMP uranium deposit. | 
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