Black Range Minerals offers spectacular risk/reward. Analysts...

Black Range Minerals offers spectacular risk/reward. Analysts and investors mostly point to the cheapness of the valuation with regard to its Enterprise Value divided by the number of lbs of uranium resources. Yes, I agree it's very cheap on that metric.

However, still under-appreciated by the market (in my opinion) is the real possibility that the company's JV with Ablation Technologies, LLC (Black Range's 50% stake alone) could be worth a multiple of BLR's entire Enterprise Value.

As attractive and highly prospective as the company's Colorado resource is, (and it truly is, I've done a ton of due diligence on that as well) investors should spend more time on the Ablation story. Holders and analysts seem content in considering the value of the Ablation technology with respect to the Hansen/Taylor deposit. Ablation could lower operating costs to $30 per lbs or perhaps less.

Logically though, if the Ablation technology works for Hansen/Taylor, then it will work for many uranium deposits around the world. The BLR/Ablation JV has the EXCLUSIVE global rights for ALL minerals applications.

In my opinion, the Ablation technology unquestionably works at the pilot scale. I believe that scaling up the units to 5 tons per hour and eventually 20 - 100 tons per hour, will be an engineering challenge, not a technology challenge. And, not necessarily a terribly difficult engineering challenge as the components / materials are largely off-the-shelf.

Rolling out the Ablation technology will certainly take time, but strong evidence of it being a highly promising and valuable technology COULD be evident within 3-9 months. If so, the value of Ablation to a larger company with greater financial resources than Black Range could be enormous.

Kazatomprom, Cameco, BHP, Rio Tinto, Areva, Uranium One, any of these could take out Black Range Resources for $100 million in a heartbeat. That's a pro forma, fully-diluted 7 cents per BLR share.

I envision the BLR / Ablation JV issuing site-specific licenses. The users would pay the JV a % of gross revenue royalty from the sale of Ablation processed uranium. Over time, this relatively steady, LONG TERM royalty income could grow to very substantial amounts. High quality, long lasting royalty steams are valued quite favorably in the market. For example, look at the gold streaming or gold royalty companies like U.S. based Franco-Nevada, ticker FNV.

If one calculates a Net Present Value of a long-term annuity-like income stream for 20-30 years at a discount factor of 6%-10%, the figure can reach into the hundreds of millions. The key variable is market penetration, i.e. how much global production of uranium might be mined using the Ablation technology.

If over time 5% of the world's uranium production were to use the Ablation technology, then the BLR / Ablation JV would be worth a fortune. 5% of a growing uranium market would equate to about 10 million lbs by the end of the decade. To put that figure in perspective, the proposed Hansen project alone is expected to produce 2 million lbs of uranium per year.

So, 10 million lbs x the price per lb of uranium x a % of gross revenue royalty could be a very large number. 10 million lbs x $50 per lbs uranium = $500 million of gross revenue. Apply whatever royalty % one thinks is reasonable. Clearly, the annuity-like income, (after-tax, BLR's share) could be huge. A 10 million lbs Ablation technology market penetration is less than half of what Cameco produces annually, I don't consider 10 million lbs to be a stretch.

To be clear though, it could take several years for the Ablation technology to really take off. The actual construction of the larger commercial-scale Ablation units will take time, customer acceptance, probablty on a case by case basis will take time. Permitting of the units will take time.

But once a unit is deployed, it should have a 20-30 year lifespan, i.e. the life of a mine. To be clear, I don't mean to suggest that the Ablation technology will be proven AT SCALE beyond doubt within 3-9 months. But, IF milestones are met and a just a single noteworthy industry player takes interest, BLR stock could double overnight.